STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement ("Agreement") is made as of the 10th day
of May, 2001, by INMEDICA DEVELOPMENT CORPORATION, a Utah corporation (the
"Company"), MicroCor, Inc., a Utah Corporation, a wholly owned subsidiary of the
Company, (the "Subsidiary") and XXX XXX TECHNOLOGY CO., LTD., a corporation duly
organized and existing under the laws of the Republic of China ("Buyer").
RECITALS
The Company and the Subsidiary desires to issue, and Buyer desires to
purchase, 5,328,204 shares (the "Shares") of the authorized but unissued shares
of its common stock of the Company, $0.001 per share par value, as well as
29,420 shares of the authorized but unissued shares of the common stock of the
Subsidiary, for the consideration and on the terms set forth in this Agreement.
Upon the issuance of the Shares, Buyer shall own one-third (33.3333%) of the
issued and outstanding common stock of the Company as well as one-fifth (20%) of
the common stock of the Subsidiary.
An integral part of this Agreement is the execution by the parties of a
Development, Licensing and Manufacturing Agreement in the form set forth as
Exhibit 7.5 (the "Development Agreement") for products based on the Company's
noninvasive hematocrit technology (the "Hematocrit Technology"). The parties
intend to execute such an agreement in connection with the Closing described in
this Agreement.
AGREEMENT
The parties, intending to be legally bound, agree as follows:
1. DEFINITIONS
For purposes of this Agreement, the following terms have the meanings specified
or referred to in this Section 1:
"Anti-Dilution Right"-as defined in Section 2.1.
"Best Efforts"-the efforts that a prudent Person desirous of achieving a result
would use in similar circumstances to ensure that such result is achieved as
expeditiously as possible; provided, however, that an obligation to use Best
Efforts under this Agreement does not require the Person subject to that
obligation to take actions that would result in a materially adverse change in
the benefits to such Person of this Agreement and the Contemplated Transactions.
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"Board Resolution"-as defined in Section 2.1(c).
"Breach"-a "Breach" of a representation, warranty, covenant, obligation, or
other provision of this Agreement or any instrument delivered pursuant to this
Agreement will be deemed to have occurred if there is or has been (a) any
material inaccuracy in or breach of, or any material failure to perform or
comply with, such representation, warranty, covenant, obligation, or other
provision, or (b) any claim (by any Person) or other occurrence or circumstance
that is or was inconsistent with such representation, warranty, covenant,
obligation, or other provision, and the term "Breach" means any such inaccuracy,
breach, failure, claim, occurrence, or circumstance.
"Buyer"-as defined in the preamble of this Agreement.
"Closing"-as defined in Section 2.3.
"Closing Date"-the date and time as of which the Closing actually takes place.
"COBRA"-means the requirements of Part 6 of Subtitle B of Title I of ERISA and
Code Section 4980B.
"Code"-means the Internal Revenue Code of 1986, as amended.
"Company"-as defined in the preamble of this Agreement.
"Consent"-any approval, consent, ratification, waiver, or other authorization
(including any Governmental Authorization).
"Contemplated Transactions"-all of the transactions contemplated by this
Agreement, including:
(a) the issuance of the Shares by the Company to Buyer;
(b) Buyer's payment of the Purchase Price;
(c) the execution, delivery, and performance of the Development,
Manufacturing and Distribution Agreement; and
(d) the performance by Buyer and the Company of their respective covenants
and obligations under this Agreement.
"Contract"-any agreement, contract, obligation, promise, or undertaking (whether
written or oral and whether express or implied) that is legally binding.
"Damages"-any loss, liability, claim, damage (including incidental and
consequential damages), expense (including costs of investigation and defense
and reasonable attorney fees) or diminution of value, whether or not involving a
third-party claim.
"Development Agreement"-as defined in the Recitals of this Agreement.
"Disclosure Schedule"-has the meaning set forth in Article 6 below.
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"Employee Benefit Plan"-means any (a) nonqualified deferred compensation or
retirement plan or arrangement, (b) qualified defined contribution retirement
plan or arrangement which is an Employee Pension Benefit Plan, (c) qualified
defined benefit retirement plan or arrangement which is an Employee Pension
Benefit Plan (including any Multiemployer Plan), or (d) Employee Welfare Benefit
Plan or material fringe benefit or other retirement, bonus, or incentive plan or
program.
"Employee Pension Benefit Plan"-has the meaning set forth in ERISA Section 3(2).
"Employee Welfare Benefit Plan"-has the meaning set forth in ERISA Section 3(2).
"Encumbrance"-any charge, claim, community property interest, condition,
equitable interest, lien, option, pledge, security interest, right of first
refusal, or restriction of any kind, including any restriction on use, voting,
transfer, receipt of income, or exercise of any other attribute of ownership.
"Environmental, Health, and Safety Requirements"-shall mean all federal, state,
local and foreign statutes, regulations, ordinances and other provisions having
the force or effect of law, all judicial and administrative orders and
determinations, all contractual obligations and all common law concerning public
health and safety, worker health and safety, and pollution or protection of the
environment, including without limitation all those relating to the presence,
use, production, marketing, generation, handling, transportation, treatment,
storage, disposal, distribution, labeling, testing, processing, discharge,
release, threatened release, control, or cleanup of any hazardous materials,
substances or wastes, chemical substances or mixtures, pesticides, pollutants,
contaminants, toxic chemicals, petroleum products or byproducts, asbestos,
polychlorinated biphenyls, noise or radiation, each as amended and as now or
hereafter in effect.
"ERISA"-means the Employee Retirement Income Security Act of 1974, as amended.
"Escrow Agent" -Xxxxx Xxxxxxx, 00 Xxxxx Xxxx Xx.,Xxxxx 000, Xxxx Xxxx Xxxx, Xxxx
00000
"Financial Statements"-has the meaning set forth in Paragraph 7 of Exhibit 3
attached hereto.
"GAAP"-generally accepted United States accounting principles, applied on a
basis consistent with the basis on which the financial statements referred to in
Section 3.4 were prepared.
"Governmental Authorization"-any approval, consent, license, permit, waiver, or
other authorization issued, granted, given, or otherwise made available by or
under the authority of any Governmental Body or pursuant to any Legal
Requirement.
"Governmental Body"-any:
(a) nation, state, county, city, town, village, district, or other
jurisdiction of any nature;
(b) federal, state, local, municipal, foreign, or other government;
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(c) governmental or quasi-governmental authority of any nature
(including any governmental agency, branch, department, official, or
entity and any court or other tribunal);
(d) multi-national organization or body; or
(e) body exercising, or entitled to exercise, any administrative,
executive, judicial, legislative, police, regulatory, or taxing
authority or power of any nature.
"Hematocrit Technology"- a method developed by the Company for measuring
hematocrit non-invasively (without drawing blood), and the Company has applied
for and/or received four (4) patents from the U.S. Patent and Trademark Office.
As of December 12, 1995, the Company's application for a patent entitled "Method
and Apparatus for Non-Invasively Determining Hematocrit" was allowed by the U.S.
Patent and Trademark Office, and such patent issued on June 18, 1996, as Patent
No. 5526808 with a term of 17 years. The Company filed an application for an
additional patent which claims priority from October 4, 1990, the date of the
first patent's filing. The second patent was issued on July 1 1997 as patent No.
5,642,734, Method and Apparatus for Noninvasively Determining Hematocrit. As of
December 21, 1999, the Company received a first office action notice of
allowance on a third patent, "System and Method for Invivo Hematocrit
Measurement Using Impedence and Pressure Plethysmography." On October 3, 2000
this patent was issued as patent No. 6,128,518. On May 16, 2000 InMedica filled
for a fourth patent System and Method for In-Vivo Hematocrit Measurement Using
Impedance and Pressure Plethysmography. This patent application is currently
pending. The methods and procedures to measure hematocrit non-invasively,
including without limitation, the patents and technologies incorporated in the
three patents and patent applications described above, are collectively referred
to herein as the "Hematocrit Technology."
"Intellectual Property"-means (a) all inventions (whether patentable or
unpatentable and whether or not reduced to practice), all improvements thereto,
and all patents, patent applications, and patent disclosures, together with all
reissuances, continuations, continuations-in-part, revisions, extensions, and
reexaminations thereof, (b) all trademarks, service marks, trade dress, logos,
trade names, and corporate names, together with all translations, adaptations,
derivations, and combinations thereof and including all goodwill associated
therewith, and all applications, registrations, and renewals in connection
therewith, (c) all copyrightable works, all copyrights, and all applications,
registrations, and renewals in connection therewith, (d) all mask works and all
applications, registrations, and renewals in connection therewith, (e) all trade
secrets and confidential business information (including ideas, research and
development, know-how, formulas, compositions, manufacturing and production
processes and techniques, technical data, designs, drawings, specifications,
customer and supplier lists, pricing and cost information, and business and
marketing plans and proposals), (f) all computer software (including data and
related documentation), (g) all other proprietary rights, and (h) all copies and
tangible embodiments thereof (in whatever form or medium), relating to the
"Hematocrit Technology".
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"Knowledge"-an individual will be deemed to have "Knowledge" of a particular
fact or other matter if:
(a) such individual is actually aware of such fact or other matter; or
(b) a prudent individual could be expected to discover or otherwise
become aware of such fact or other matter in the course of conducting a
reasonably comprehensive investigation concerning the existence of such
fact or other matter.
A Person (other than an individual) will be deemed to have "Knowledge" of a
particular fact or other matter if any individual who is serving, or who has at
any time served, as a director, officer, partner, executor, or trustee of such
Person (or in any similar capacity) has, or at any time had, Knowledge of such
fact or other matter.
"Legal Requirement"-any federal, state, local, municipal, foreign,
international, multinational, or other administrative order, constitution, law,
ordinance, principle of common law, regulation, statute, or treaty.
"Liability"-means any liability, whether known or unknown, asserted or not
asserted, absolute or contingent, accrued or unaccrued, liquidated or
unliquidated, and whether due or to become due, including any liability for
Taxes.
"Order"-any award, decision, injunction, judgment, order, ruling, subpoena, or
verdict entered, issued, made, or rendered by any court, administrative agency,
or other Governmental Body or by any arbitrator.
"Organizational Documents"-(a) the articles or certificate of incorporation and
the bylaws of a corporation; (b) the partnership agreement and any statement of
partnership of a general partnership; (c) the limited partnership agreement and
the certificate of limited partnership of a limited partnership; (d) the
articles of organization and the operating agreement of a limited liability
company; (e) any charter or similar document adopted or filed in connection with
the creation, formation, or organization of a Person; and (f) any amendment to
any of the foregoing.
"Person"-any individual, corporation (including any non-profit corporation),
general or limited partnership, limited liability company, joint venture,
estate, trust, association, organization, labor union, or other entity or
Governmental Body.
"Proceeding"-any action, arbitration, audit, hearing, investigation, litigation,
or suit (whether civil, criminal, administrative, investigative, or informal)
commenced, brought, conducted, or heard by or before, or otherwise involving,
any Governmental Body or arbitrator.
"Representative"-with respect to a particular Person, any director, officer,
employee, agent, consultant, advisor, or other representative of such Person,
including legal counsel, accountants, and financial advisors.
"Securities Act"-the Securities Act of 1933 or any successor law, and
regulations and rules issued pursuant to that Act or any successor law.
"Shares"-as defined in the Recitals of this Agreement.
"Subsidiary"-as defined in the preamble of this Agreement.
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"Tax"-means any federal, state, local, or foreign income, gross receipts,
license, payroll, employment, excise, severance, stamp, occupation, premium,
windfall profits, environmental (including taxes under Code Section 59A),
customs duties, capital stock, franchise, profits, withholding, social security
(or similar), unemployment, disability, real property, personal property, sales,
use, transfer, registration, value added, alternative or add-on minimum,
estimated, or other tax of any kind whatsoever, including any interest, penalty,
or addition thereto, whether disputed or not.
"Tax Return"-means any return, declaration, report, claim for refund, or
information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.
"Threatened"-a claim, Proceeding, dispute, action, or other matter will be
deemed to have been "Threatened" if any demand or statement has been made
(orally or in writing) or any notice has been given (orally or in writing), or
if any other event has occurred or any other circumstances exist, that would
lead a prudent Person to conclude that such a claim, Proceeding, dispute,
action, or other matter is likely to be asserted, commenced, taken, or otherwise
pursued in the future.
"Triggering Person"-as defined in Section 2.1.
2. ISSUANCE AND TRANSFER OF SHARES; CLOSING
2.1 SHARES; OPTIONS; BOARD OF DIRECTORS
Subject to the terms and conditions of this Agreement, at the Closing, the
Company shall:
(a) issue and transfer the Shares to Buyer.
(b) grant to Buyer the right (the "Anti-Dilution Right") to receive
that number of additional shares of the Company's common stock
necessary to maintain Buyer's percentage ownership of the common stock
(as a percentage of the total number of outstanding shares of common
stock) equal to the lesser of (A) the percentage ownership held by
Buyer immediately prior to any issuance described in clauses (i) and
(ii) below, or (B) the percentage ownership held by Buyer immediately
following the Closing Date. The Anti-Dilution Right shall be triggered
by the Company issuing shares of its common stock to any Person other
than Buyer, or Buyer's successors or permitted assignees (a "Triggering
Person"), during the period beginning on the Closing Date and ending
five (5) years thereafter. After such period the Anti-Dilution Right
shall expire.
(i) If the Company issues shares of its common stock to a
Triggering Person pursuant to any option, warrant or other right held
by such Triggering Person existing on or before the date of this
Agreement, then Buyer shall have the right to exercise the
Anti-Dilution Right at no cost or other obligation to Buyer.
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(ii) If the Company issues shares of its common stock to a
Triggering Person by any means other than that described in clause (i)
above, then Buyer shall have the right to exercise the Anti-Dilution
Right by payment of the same price and pursuant to the same terms upon
which the shares are being issued to such Triggering Person.
and
(c) appoint two (2) individuals, as designated in writing to the
Company by Buyer prior to the Closing, to fill the two vacancies on the
Company's Board of Directors. The Buyer shall submit the names and
credentials of four persons from which the selection of the two board
members shall be made by the InMedica board of directors which shall
also act as a nominating committee. InMedica shall not increase the
size of its board to more than 5 persons without the prior consent of
Buyer.
2.2 PURCHASE PRICE
The purchase price (the "Purchase Price") for the Shares shall be Five hundred
thousand and No/100s Dollars ($500,000.00) for the shares in the Company plus an
additional Five hundred thousand and No/100s Dollars ($500,000.00) for the
shares of MicroCor, Inc. The Purchase Price shall be paid in U.S. currency
pursuant to the payment schedule, Schedule 3.7 attached hereto.
2.3 CLOSING
The purchase and issuance (the "Closing") provided for in this Agreement shall
take place on a date to be agreed to in writing by the parties, but in any event
such date shall be on or before May 31, 2001. The parties may agree in writing
to change the Closing Date. Subject to the provisions of Section 9, failure to
consummate the purchase and issuance provided for in this Agreement on the date
and time and at the place determined pursuant to this Section 2.3 will not
result in the termination of this Agreement and will not relieve any party of
any obligation under this Agreement.
2.4 CLOSING OBLIGATIONS
(a) Prior to or at the Closing, (i) the Company shall deliver to Escrow
Agent certificates representing the Shares, duly executed by the Company's
appropriate and authorized officers and issued in the name of Buyer; and (ii)
Buyer shall deliver to Escrow Agent the Full Purchase Price in the form of a
Note payable to the Company for the shares in the Company and a Note payable to
the Subsidiary for the shares in the Subsidiary according to the attached
schedule. . Upon receiving both the certificates and the Purchase Price, Escrow
Agent shall promptly deliver the certificates to Buyer and the Purchase Price to
the Company and Subsidiary. If Escrow Agent has not received both the
certificates and the Purchase Price by two (2) business days following the
Closing Date, Escrow Agent shall return any certificates it has received to the
Company and Subsidiary and shall return any Purchase Price it has received to
the Buyer. Escrow Agent's responsibilities shall be expressly limited to those
described in this Section 2.4(a) and the parties hereby agree to indemnify
Escrow Agent against any costs or expenses it incurs, including without
limitation, attorney fees and court costs, in the event of any dispute
concerning the matters described herein.
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(b) At the Closing, (i) Buyer shall deliver to the Company a certificate
executed by Buyer representing and warranting to the Company that each of
Buyer's representations and warranties in this Agreement was accurate in all
respects as of the date of this Agreement and is accurate in all respects as of
the Closing Date as if made on the Closing Date; (ii) the Company and Subsidiary
shall deliver to Buyer a copy of the fully executed Board Resolution, and a
certificate executed by the Company and Subsidiary representing and warranting
to Buyer that each of the Company's and Subsidiaries representations and
warranties in this Agreement was accurate in all respects as of the date of this
Agreement and is accurate in all respects as of the Closing Date as if made on
the Closing Date; and (iii) the parties shall execute the Development Agreement.
2.5 POST-CLOSING COVENANTS
In the event the Closing takes place:
(a) Buyer covenants that for a period of five (5) years beginning on
the Closing Date it shall not take any action either directly or
indirectly to increase its representation on the Company's Board of
Directors such that the number of members thereof appointed or elected
by Buyer exceed (as a percentage of the total number of members of the
Board of Directors) forty percent (40%).
(b) The Company covenants that it shall take no action either directly
of indirectly to hold a shareholders meeting for the election of
directors until at least twelve (12) months following the Closing Date.
3. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY
The Company represents and warrants that the statements contained in Exhibit 3
are correct and complete as of the date of this Agreement and will be correct
and complete as though made then, except set forth in the Disclosure Schedule.
Nothing in the Disclosure Schedule shall be deemed adequate to disclose an
exception to a representation or warranty made herein, unless the Disclosure
Schedule identifies the exception with reasonable particularity and describes
the relevant facts in reasonable detail.
4. REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to the Company and Subsidiary as follows:
4.1 ORGANIZATION AND GOOD STANDING
Buyer is a corporation duly organized, validly existing, and in good standing
under the laws of the Republic of China (Taiwan).
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4.2 AUTHORITY; NO CONFLICT
(a) This Agreement constitutes the legal, valid, and binding obligation
of Buyer, enforceable against Buyer in accordance with its terms. The
Development Agreement, when executed, will constitute the legal, valid,
and binding obligation of Buyer, enforceable against Buyer in
accordance with its terms. Buyer has the absolute and unrestricted
right, power, authority, and authority to execute and deliver this
Agreement and to perform its obligations hereunder. All required
authorizations, resolutions, consents and other actions of the Buyer's
board of directors and shareholders have been given, made or performed.
(b) The execution and delivery of this Agreement and the Development
Agreement, and the consummation and performance of the Contemplated
Transactions will not, directly or indirectly (with or without notice
or lapse of time):
(i) contravene, conflict with, or result in a violation of (A) any
provision of the Organizational Documents of Buyer, or (B) any
resolution adopted by the board of directors or the stockholders of
Buyer; or
(ii) contravene, conflict with, or result in a violation of, or
give any Governmental Body or other Person the right to challenge any
of the Contemplated Transactions or to exercise any remedy or obtain
any relief under, any Legal Requirement or any Order to which Buyer, or
any of the assets owned or used by Buyer, may be subject.
Buyer is not and will not be required to give any notice to or obtain any
Consent from any Person in connection with the execution and delivery of this
Agreement or the consummation or performance of any of the Contemplated
Transactions.
4.3 INVESTMENT INTENT
Buyer is acquiring the Shares for its own account and not with a view to their
distribution within the meaning of Section 2(11) of the Securities Act. Buyer
acknowledges the restrictions placed upon the resale of the Shares by Rule 144
of the Securities Act, including a restrictive legend, which will affect Buyer's
ability to liquidate its investment
4.4 CERTAIN PROCEEDINGS
There is no pending Proceeding that has been commenced against Buyer and that
challenges, or may have the effect of preventing, delaying, making illegal, or
otherwise interfering with, any of the Contemplated Transactions. To Buyer's
Knowledge, no such Proceeding has been Threatened.
5. COVENANTS OF THE COMPANY PRIOR TO CLOSING DATE
5.1 ACCESS AND DUE DILIGENCE
Between the date of this Agreement and the Closing Date, the Company will, and
will cause its Representatives to, (a) permit Buyer and its Representatives and
prospective lenders and their Representatives (collectively, "Buyer's Advisors")
full and free access at all reasonable times to all premises, properties,
personnel, books and records (including Tax record), and other documents and
data of or pertaining to the Company, (b) furnish Buyer and Buyer's Advisors
with copies of all such books and records, and other existing documents and data
as Buyer may reasonably request, and (c) furnish Buyer and Buyer's Advisors with
such additional financial, operating, and other data and information as Buyer
may reasonably request.
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5.2 NOTIFICATION
Between the date of this Agreement and the Closing Date, the Company will
promptly notify Buyer in writing if the Company becomes aware of any fact or
condition that causes or constitutes a Breach of any of the Company's
representations and warranties as of the date of this Agreement, or if the
Company becomes aware of the occurrence after the date of this Agreement of any
fact or condition that would (except as expressly contemplated by this
Agreement) cause or constitute a Breach of any such representation or warranty
had such representation or warranty been made as of the time of occurrence or
discovery of such fact or condition. During the same period, the Company will
promptly notify Buyer of the occurrence of any Breach of any covenant of the
Company in this Section 5 or of the occurrence of any event that may make the
satisfaction of the conditions in Section 7 impossible or unlikely.
5.3 BEST EFFORTS
Between the date of this Agreement and the Closing Date, the Company will use
its Best Efforts to cause the conditions in Section 7 to be satisfied.
5.4 PRESERVATION OF BUSINESS
Between the date of this Agreement and the Closing Date, the Company will keep
its business and properties substantially intact, including its present
operations, physical facilities, working conditions, and relationships with
lessors, licensors, suppliers, customers, and employees.
5.5 EXCLUSIVITY
Between the date of this Agreement and the Closing Date, the Company will not
(i) solicit, initiate, or encourage the submission of any proposal or offer from
any Person relating to the acquisition of any capital stock or other voting
securities, or any substantial portion of the assets, of the Company (including
any acquisition structured as a merger, consolidation, or share exchange) or
(ii) participate in any discussions or negotiations regarding, furnish any
information with respect to, assist or participate in, or facilitate in any
other manner any effort or attempt by any Person to do or seek any of the
foregoing. The Company will notify the Buyer immediately if any Person makes any
proposal, offer, inquiry, or contact with respect to any of the foregoing.
5.6 FURTHER ASSURANCES
In case at any time after the Closing any further action is necessary or
desirable to carry out the purposes of this Agreement, each of the Parties will
take such further action (including the execution and delivery of such further
instruments and documents) as any other Party reasonably may request, all at the
sole cost and expense of the requesting Party (unless the requesting Party is
entitled to indemnification therefore under Article 10 below). The Company
acknowledges and agrees that from and after the Closing the Buyer will be
entitled to possession of all documents, books, records (including Tax records),
agreements, and financial data of any sort relating to the Company.
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6. COVENANTS OF BUYER PRIOR TO CLOSING DATE
Between the date of this Agreement and the Closing Date, Buyer will use its Best
Efforts to cause the conditions in Section 8 to be satisfied.
7. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE
Buyer's obligation to purchase the Shares and to take the other actions required
to be taken by Buyer at the Closing is subject to the satisfaction, at or prior
to the Closing, of each of the following conditions (any of which may be waived
by Buyer, in whole or in part):
7.1 ACCURACY OF REPRESENTATIONS
All of the Company's representations and warranties in this Agreement must have
been accurate in all material respects as of the date of this Agreement, and
must be accurate in all material respects as of the Closing Date as if made on
the Closing Date.
7.2 THE COMPANY'S PERFORMANCE
(a) All of the covenants and obligations that the Company is required
to perform or to comply with pursuant to this Agreement at or prior to
the Closing must have been duly performed and complied with in all
material respects.
(b) Each document required to be delivered pursuant to Section 2.4 must
have been delivered, and each of the other covenants and obligations in
Section 5.3 must have been performed and complied with in all respects.
7.3 NO PROCEEDINGS
Since the date of this Agreement, there must not have been commenced or
Threatened against Buyer, or against any Person affiliated with Buyer, any
Proceeding (a) involving any challenge to, or seeking damages or other relief in
connection with, any of the Contemplated Transactions, or (b) that may have the
effect of preventing, delaying, making illegal, or otherwise interfering with
any of the Contemplated Transactions.
7.4 BOARD RESOLUTION
The Company's and Subsidiary's Boards of Directors shall have executed the Board
Resolution in a form reasonably acceptable to Buyer, and the Company and
Subsidiary shall have delivered a copy thereof to Buyer.
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7.5 DEVELOPMENT AGREEMENT
Buyer and the Company shall be in a position to execute and perform the
Development Agreement in the form attached hereto as Exhibit 7.5 simultaneous
with the execution of this Agreement.
7.7 ACTIONS AND DOCUMENTS
All corporate actions necessary to consummate the transactions contemplated
hereby and all documents and instruments incident to such transactions shall be
satisfactory in substance and form to the Buyer, and the Buyer shall have
received all such counterpart originals or certified or other copies of such
documents as it may reasonably request.
7.8 OWNERSHIP OF TECHNOLOGY
The Buyer shall have received from the Company all documents and other materials
requested by Buyer for the purpose of examining and determining the Company's
rights in and to Intellectual Property relating to Hematocrit Technology
developed and to be developed, and the status of the Company's ownership rights
in and to all such Intellectual Property shall be reasonably satisfactory to
Buyer under this Agreement.
7.9 DUE DILIGENCE APPROVED BY THE BUYER
The transactions contemplated under this Agreement shall have been approved by
the Buyer. Buyer shall provide a copy of the Xxx Xxx Board resolution approving
this transaction certified by an officer of Xxx Xxx.
8. CONDITIONS PRECEDENT TO THE COMPANY'S OBLIGATION TO CLOSE
The Company's obligation to issue the Shares and to take the other actions
required to be taken by the Company at the Closing is subject to the
satisfaction, at or prior to the Closing, of each of the following conditions
(any of which may be waived by the Company, in whole or in part):
8.1 ACCURACY OF REPRESENTATIONS
All of Buyer's representations and warranties in this Agreement must have been
accurate in all material respects as of the date of this Agreement and must be
accurate in all material respects as of the Closing Date as if made on the
Closing Date.
8.2 BUYER'S PERFORMANCE
(a) All of the covenants and obligations that Buyer is required to
perform or to comply with pursuant to this Agreement at or prior to the
Closing must have been performed and complied with in all material
respects.
(b) Buyer must have delivered each of the documents required to be
delivered by Buyer pursuant to Section 2.4 and must have made the cash
payment required to be made by Buyer pursuant to Section 2.4(a).
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8.3 NO INJUNCTION
There must not be in effect any Legal Requirement or any injunction or other
Order that (a) prohibits the issuance of the Shares by the Company to Buyer, and
(b) has been adopted or issued, or has otherwise become effective, since the
date of this Agreement.
8.5 DEVELOPMENT AGREEMENT
Buyer and the Company shall be in a position to execute and perform the
Development Agreement in the form attached hereto as Exhibit 7.5 simultaneous
with the execution of this Agreement.
9. TERMINATION
9.1 TERMINATION EVENTS
This Agreement may, by notice given prior to or at the Closing, be terminated:
(a) by either Buyer or the Company and Subsidiary if a material Breach
of any provision of this Agreement has been committed by the other
party and such Breach has not been waived or cured within a period of
30 days after the notice of breach.
(b) (i) by Buyer if any of the conditions in Section 7 has not been
satisfied as of the Closing Date or if satisfaction of such a condition
is or becomes impossible (other than through the failure of Buyer to
comply with its obligations under this Agreement) and Buyer has not
waived such condition on or before the Closing Date; or (ii) by the
Company and Subsidiary, if any of the conditions in Section 8 has not
been satisfied as of the Closing Date or if satisfaction of such a
condition is or becomes impossible (other than through the failure of
the Company to comply with their obligations under this Agreement) and
the Company and Subsidiary has not waived such condition on or before
the Closing Date;
(c) by mutual consent of Buyer and the Company and Subsidiary; or
(d) by either Buyer or the Company and Subsidiary if the Closing has
not occurred (other than through the failure of any party seeking to
terminate this Agreement to comply fully with its obligations under
this Agreement) on or before the date set forth in Section 2.3, or such
later date as the parties may agree upon in writing.
9.2 EFFECT OF TERMINATION
Each party's right of termination under Section 9.1 is in addition to any other
rights it may have under this Agreement or otherwise, and the exercise of a
right of termination will not be an election of remedies. If this Agreement is
terminated pursuant to Section 9.1, all further obligations of the parties under
this Agreement will terminate, except that the obligations in Sections 11.1 and
13
11.3 will survive; provided, however, that if this Agreement is terminated by a
party because of the Breach of the Agreement by the other party or because one
or more of the conditions to the terminating party's obligations under this
Agreement is not satisfied as a result of the other party's failure to comply
with its obligations under this Agreement, the terminating party's right to
pursue all legal remedies will survive such termination unimpaired.
10. INDEMNIFICATION; REMEDIES
10.1 SURVIVAL; RIGHT TO INDEMNIFICATION NOT AFFECTED BY WAIVER
All representations, warranties, covenants, and obligations in this Agreement,
the certificates delivered pursuant to Section 2.4(b), and any other certificate
or document delivered pursuant to this Agreement will survive the Closing. The
waiver of any condition based on the accuracy of any representation or warranty,
or on the performance of or compliance with any covenant or obligation, will not
affect the right to indemnification, payment of Damages, or other remedy based
on such representations, warranties, covenants, and obligations.
10.2 INDEMNIFICATION AND PAYMENT OF DAMAGES BY THE COMPANY
The Company will indemnify and hold Buyer harmless, and will pay to Buyer the
amount of any Damages arising, directly or indirectly, from or in connection
with (a) any Breach of any representation or warranty made by the Company in
this Agreement or in any certificate delivered by the Company pursuant to this
Agreement, (b) any Breach by the Company of any covenant or obligation of the
Company in this Agreement, or (c) any claim by any Person for brokerage or
finder's fees or commissions or similar payments based upon any agreement or
understanding alleged to have been made by such Person with the Company (or any
Person acting on its behalf) in connection with any of the Contemplated
Transactions.
10.3 INDEMNIFICATION AND PAYMENT OF DAMAGES BY BUYER
Buyer will indemnify and hold the Company harmless, and will pay to the Company
the amount of any Damages arising, directly or indirectly, from or in connection
with (a) any Breach of any representation or warranty made by Buyer in this
Agreement or in any certificate delivered by Buyer pursuant to this Agreement,
(b) any Breach by Buyer of any covenant or obligation of Buyer in this
Agreement, or (c) any claim by any Person for brokerage or finder's fees or
commissions or similar payments based upon any agreement or understanding
alleged to have been made by such Person with Buyer (or any Person acting on its
behalf) in connection with any of the Contemplated Transactions.
11. GENERAL PROVISIONS
11.1 EXPENSES
Except as otherwise expressly provided in this Agreement, each party to this
Agreement will bear its respective expenses incurred in connection with the
preparation, execution, and performance of this Agreement and the Contemplated
Transactions, including all fees and expenses of agents, representatives,
counsel, and accountants.
14
11.2 PUBLIC ANNOUNCEMENTS
No notices to third parties or other publicity concerning this Agreement or the
Contemplated Transactions shall be issued or released by either party hereto
without the prior written consent of the other party, which consent shall not be
unreasonably withheld. This provision shall not be interpreted to bar a party
from making any disclosure required of it by law, but if such disclosure
mentions the other party, then the disclosing party shall give the mentioned
party the opportunity to review the disclosure prior to its release.
11.3 CONFIDENTIALITY
Between the date of this Agreement and the Closing Date, Buyer and the Company
will maintain in confidence, and will cause the directors, officers, employees,
agents, and advisors of Buyer and the Company to maintain in confidence any
written information stamped "confidential" when originally furnished by another
party in connection with this Agreement or the Contemplated Transactions, unless
(a) such information is already known to such party or to others not bound by a
duty of confidentiality or such information becomes publicly available through
no fault of such party, (b) the use of such information is necessary or
appropriate in making any filing or obtaining any consent or approval required
for the consummation of the Contemplated Transactions, or (c) the furnishing or
use of such information is required by legal proceedings.
If the Contemplated Transactions are not consummated, each party will return or
destroy as much of such written information as the other party may reasonably
request.
11.4 NOTICES
All notices, consents, waivers, and other communications under this Agreement
must be in writing and will be deemed to have been duly given when (a) delivered
by hand, (b) sent by telecopier, provided that a copy is mailed by registered
mail, return receipt requested, or (c) when received by the addressee, if sent
by a nationally recognized overnight delivery service, in each case to the
appropriate addresses and telecopier numbers set forth below (or to such other
addresses and telecopier numbers as a party may designate by notice to the other
parties):
The Company:
Xx. Xxxxx Xxxxxx, President
InMedica Development Corporation
000 Xxxxx 000 Xxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxx Xxxxxxx
00 Xxxxx Xxxx Xx., Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
Facsimile No. (000) 000-0000
15
Buyer:
Xxxxxxx Xxxxx
Xxx Xxx Technology Co. Ltd.
717 Xx. 00 Xx Xxx Xxxx
Xxx Xx Xxxxx,
Xxxxxx Xxxxxx Xxxxxx, R.O.C
Facsimile No.: (00) 000-0000
with a copy to:
Xxxxxx X. Xxxxxx
Xxx Xxx Technology Co. Ltd.
717 Xx. 00 Xx Xxx Xxxx
Xxx Xx Xxxxx,
Xxxxxx Xxxxxx Xxxxxx, R.O.C
Facsimile No.: (00) 000-0000
11.5 JURISDICTION; SERVICE OF PROCESS
Any action or proceeding seeking to enforce any provision of, or based on any
right arising out of, this Agreement may be brought against any of the parties
in the courts of the State of Utah, County of Salt Lake, or, if it has or can
acquire jurisdiction, in the United States District Court for the Central
District of Utah, and each of the parties consents to the jurisdiction of such
courts (and of the appropriate appellate courts) in any such action or
proceeding and waives any objection to venue laid therein. Process in any action
or proceeding referred to in the preceding sentence may be served on any party
anywhere in the world.
11.6 FURTHER ASSURANCES
The parties agree (a) to furnish upon request to each other such further
information, (b) to execute and deliver to each other such other documents, and
(c) to do such other acts and things, all as the other party may reasonably
request for the purpose of carrying out the intent of this Agreement and the
documents referred to in this Agreement.
11.7 WAIVER
The rights and remedies of the parties to this Agreement are cumulative and not
alternative. Neither the failure nor any delay by any party in exercising any
right, power, or privilege under this Agreement or the documents referred to in
this Agreement will operate as a waiver of such right, power, or privilege, and
no single or partial exercise of any such right, power, or privilege will
16
preclude any other or further exercise of such right, power, or privilege or the
exercise of any other right, power, or privilege. To the maximum extent
permitted by applicable law, (a) no claim or right arising out of this Agreement
or the documents referred to in this Agreement can be discharged by one party,
in whole or in part, by a waiver or renunciation of the claim or right unless in
writing signed by the other party; (b) no waiver that may be given by a party
will be applicable except in the specific instance for which it is given; and
(c) no notice to or demand on one party will be deemed to be a waiver of any
obligation of such party or of the right of the party giving such notice or
demand to take further action without notice or demand as provided in this
Agreement or the documents referred to in this Agreement.
11.8 ENTIRE AGREEMENT AND MODIFICATION
This Agreement supersedes all prior agreements between the parties with respect
to its subject matter (including the Proposal of Joint Venture between Buyer and
the Company dated April 27, 2000) and constitutes (along with the documents
referred to in this Agreement) a complete and exclusive statement of the terms
of the agreement between the parties with respect to its subject matter. This
Agreement may not be amended except by a written agreement executed by the party
to be charged with the amendment.
11.9 ASSIGNMENTS, SUCCESSORS, AND NO THIRD-PARTY RIGHTS
Neither party may assign any of its rights under this Agreement without the
prior written consent of the other party. Subject to the preceding sentence,
this Agreement will apply to, be binding in all respects upon, and inure to the
benefit of the successors and permitted assigns of the parties. Nothing
expressed or referred to in this Agreement will be construed to give any Person
other than the parties to this Agreement any legal or equitable right, remedy,
or claim under or with respect to this Agreement or any provision of this
Agreement. This Agreement and all of its provisions and conditions are for the
sole and exclusive benefit of the parties to this Agreement and their successors
and assigns.
11.10 SEVERABILITY
If any provision of this Agreement is held invalid or unenforceable by any court
of competent jurisdiction, the other provisions of this Agreement will remain in
full force and effect. Any provision of this Agreement held invalid or
unenforceable only in part or degree will remain in full force and effect to the
extent not held invalid or unenforceable.
11.11 SECTION HEADINGS, CONSTRUCTION
The headings of Sections in this Agreement are provided for convenience only and
will not affect its construction or interpretation. All references to "Section"
or "Sections" refer to the corresponding Section or Sections of this Agreement.
All words used in this Agreement will be construed to be of such gender or
number as the circumstances require. Unless otherwise expressly provided, the
word "including" does not limit the preceding words or terms.
17
11.12 TIME OF ESSENCE
With regard to all dates and time periods set forth or referred to in this
Agreement, time is of the essence.
11.13 GOVERNING LAW
This Agreement will be governed by the laws of the State of Utah without regard
to conflicts of laws principles.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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11.14 COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of which will
be deemed to be an original copy of this Agreement and all of which, when taken
together, will be deemed to constitute one and the same agreement. Execution and
delivery of this Agreement by facsimile machine shall be deemed as effective as
delivery of an original, signed document.
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date first written above.
THE COMPANY:
INMEDICA DEVELOPMENT CORPORATION, a Utah corporation
By: /s/ Xxxxx Xxxxxx
--------------------
Name: Xxxxx Xxxxxx
Title: President
BUYER:
XXX XXX TECHNOLOGY CO., LTD., a corporation organized
and existing under the laws of the Republic of China
By:
--------------------------------------------------
Name:
------------------------------------------------
Title:
-----------------------------------------------
By:
--------------------------------------------------
Name:
------------------------------------------------
Title:
-----------------------------------------------
19
LIST OF EXHIBITS AND SCHEDULES
SCHEDULE 2 of Exhibit 3 Description of Contracts relating to the
issuance, sale, or transfer of any equity
securities or other securities of the Company
SCHEDULE 7 of Exhibit 3 Financial Statements
SCHEDULE 13 of Exhibit 3 List of all licensing agreements or other
Contracts with respect to patents,
trademarks, copyrights, or other intellectual
property relating to the Hematocrit
Technology, including agreements with current
or former employees, consultants, or
contractors regarding the appropriation or
the non-disclosure of any of the Company's
intellectual property assets relating to the
Hematocrit Technology
Exhibit 3 Representations, Warranties and Covenants of
the Company
EXHIBIT 7.5 Development, Licensing and Manufacturing
Agreement
20
SCHEDULE 3.3
Description of Contracts relating to the issuance, sale, or transfer of
any equity securities or other securities of the Company
See Section 3, Due Diligence Request List
21
SCHEDULE 3.4
Financial Statements
See Section 5., Due Diligence Request List
22
SCHEDULE 3.6
List of all licensing agreements or other Contracts with
respect to patents, trademarks, copyrights, or other intellectual
property relating to the Hematocrit Technology, including agreements
with current or former employees, consultants, or contractors
regarding the appropriation or the non-disclosure of
any of the Company's intellectual property assets
relating to the Hematocrit Technology
See Section 8., 10, Due Diligence Request List
23
EXHIBIT 7.5
Development, Licensing and Manufacturing Agreement
24
