CAPITAL CONTRIBUTION AGREEMENT
EXHIBIT
10.2
THIS
CAPITAL CONTRIBUTION AGREEMENT (the
“Agreement”) is made and entered into on June 9, 2005 by and among IQ
MEDICAL CORP.,
a
Colorado corporation (“IQMC”), and OSMOTEX
USA, INC., a
Florida
corporation (“Osmotex”). IQMC and Osmotex are collectively referred to herein as
the “Parties”.
WHEREAS,
Osmotex
owns certain rights to the licensing of certain technology (the “Licensing
Rights”); and
WHEREAS,
Osmotex
wishes to contribute the Licensing Rights to IQMC as a capital contribution
in
exchange for the issuance of common stock by IQMC as contemplated in this
Agreement; and
WHEREAS,
the
Parties wish to document their agreement regarding this transaction in this
Agreement.
NOW,
THEREFORE,
in
consideration of the mutual terms, conditions and other agreements set forth
herein, and for other valuable consideration, the receipt and adequacy of which
are hereby conclusively acknowledged, the Parties hereto, intending to be
legally bound, hereby agree as follows:
ARTICLE
1
CAPITAL
CONTRIBUTION; ISSUANCE OF SHARES
1.1 CAPITAL
CONTRIBUTION.
Upon
the
terms and subject to the conditions set forth in this Agreement, Osmotex hereby
contributes (the “Capital Contribution”) the Licensing Rights to IQMC as a
contribution to the capital of IQMC. IQMC hereby accepts this Capital
Contribution. In exchange for this Capital Contribution, IQMC hereby issues
42,670,000 shares (the “Shares”) of its $0.0001 par value per share common stock
to Osmotex.
1.2 TIME
AND PLACE OF CLOSING.
The
closing of the transactions contemplated hereby (the “Closing”) will take place
on the date hereof, or at such other time as the Parties, acting through their
authorized officers, may mutually agree. The Closing shall be held at such
location as may be mutually agreed upon by the Parties or may be conducted
by
mail, email or facsimile as may be mutually agreed upon by the
Parties.
ARTICLE
2
REPRESENTATIONS
AND WARRANTIES OF IQMC
IQMC
hereby represents and warrants to Osmotex as follows:
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2.1 ORGANIZATION,
STANDING, AND POWER.
IQMC is
a corporation duly organized, validly existing, and in good standing under
the
Laws of the State of Colorado, and has the corporate power and authority to
carry on its business as now conducted.
2.2 AUTHORITY
OF IQMC; NO BREACH BY AGREEMENT.
(a) IQMC
has the corporate power and authority necessary to execute, deliver, and perform
its obligations under this Agreement and to consummate the transactions
contemplated hereby. The execution, delivery, and performance of this Agreement
and the consummation of the transactions contemplated herein have been duly
and
validly authorized by all necessary corporate and shareholder action in respect
thereof on the part of IQMC. This Agreement represents a legal, valid, and
binding obligation of IQMC, enforceable against IQMC in accordance with its
terms (except in all cases as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, receivership, conservatorship,
moratorium, or similar Laws affecting the enforcement of creditors’ rights
generally and except that the availability of the equitable remedy of specific
performance or injunctive relief is subject to the discretion of the court
before which any proceeding may be brought).
(b) Neither
the execution and delivery of this Agreement by IQMC, nor the consummation
by
IQMC of the transactions contemplated hereby, nor compliance by IQMC with any
of
the provisions hereof, will (i) conflict with or result in a breach of any
provision of IQMC’s Articles of Incorporation or Bylaws, or (ii) constitute or
result in a default under, or require any consent pursuant to, any Contract
or
Permit of IQMC.
(c) No
notice to, filing with, or Consent of, any public body or authority is necessary
for the consummation by IQMC of transactions contemplated in this
Agreement.
2.3 CAPITAL
STOCK.
(a) The
authorized capital stock of IQMC (the “IQMC Capital Stock”) consists of
(i) 300,000,000 shares of IQMC Common Stock, of which 38,860,877 shares
are issued and outstanding as of the date of this Agreement and (ii) 25,000,000
shares of preferred stock, of which no shares are issued or outstanding. All
of
the issued and outstanding shares of IQMC Common Stock are duly and validly
issued and outstanding and are fully paid and nonassessable. None of the
outstanding shares of IQMC Capital Stock has been issued in violation of any
preemptive rights of the current or past shareholders of IQMC. When all of
the
transactions contemplated by this Agreement and Section 1.3 of the Financing
Agreement (as defined herein) have been consummated, Osmotex will own a total
of
85.0% of the outstanding IQMC Capital Stock on a fully diluted basis (including,
without limitation, all options, warrants and other rights to purchase IQMC
Capital Stock).
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(b) No
agreements or undertakings of any kind exist which grant or would grant any
party the right to obtain ownership of any IQMC Capital Stock.
(c) Schedule
2.3(c)
contains
a true and complete list of all of the current holders of IQMC Capital Stock
along with the amounts owned by each such party.
2.4 INVESTMENTS;
SUBSIDIARIES.
IQMC
currently has and has never owned any subsidiary corporation, partnership or
other business entity and has never made any investments in any other
corporation, partnership or other business entities.
2.5 FINANCIAL
STATEMENTS.
The IQMC
Financial Statements attached hereto as Schedule
2.5
(the
“IQMC Financial Statements”) were prepared in accordance with United States
generally accepted accounting principles applied on a consistent basis
throughout the periods involved, and fairly presents in all Material respects
the consolidated financial position of IQMC as of the respective dates and
the
consolidated results of operations and cash flows for the periods indicated,
except that the unaudited interim financial statements were or are subject
to
normal and recurring year-end adjustments which were not or are not expected
to
be Material in amount or effect.
2.6 ABSENCE
OF UNDISCLOSED LIABILITIES.
IQMC has
no liabilities that are reasonably likely to have, individually or in the
aggregate, a material adverse effect.
2.7 ABSENCE
OF CERTAIN CHANGES OR EVENTS.
Since
December 31, 2004, except as disclosed in the IQMC Financial Statements
delivered prior to the date of this Agreement there have been no events,
changes, or occurrences which have had, or are reasonably likely to have,
individually or in the aggregate, material adverse effect.
2.8 TAX
MATTERS. IQMC
has
never filed any tax returns.
2.9 INTELLECTUAL
PROPERTY.
IQMC
does not own or use any intellectual property and has never owned or used any
intellectual property.
2.10 REAL
PROPERTY.
IQMC
does not currently own or lease any real property and has never owned or leased
any real property.
2.11 COMPLIANCE
WITH LAWS.
IQMC
requires no permits that are not already in existence. IQMC
is
not in default under any of the provisions of its Articles of Incorporation
or
Bylaws (or other governing instruments).
2.12 LABOR
RELATIONS.
IQMC has
no employees and has never had any employees.
2.13 EMPLOYEE
BENEFIT PLANS. IQMC
has
no employee benefit plans of any kind and has never had any employee benefit
plans of any kind.
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2.14 MATERIAL
CONTRACTS.
IQMC is
not a party to any material contract or agreement (oral or written).
2.15 LEGAL
PROCEEDINGS.
There is
no litigation or any other legal or administrative action instituted, pending
or
threatened against IQMC or to which IQMC is a party.
2.16 PINK
SHEET LISTING.
The
IQMC
Common Stock is currently listed in the “pink sheets”, and IQMC is not aware of
any reason why the IQMC Common Stock would not qualify for listing on the OTC
Bulletin Board.
2.17 STATEMENTS
TRUE AND CORRECT.
No
statement, certificate, instrument, or other writing furnished or to be
furnished by IQMC to OSMOTEX pursuant to this Agreement, contains or will
contain any untrue statement of material fact or will omit to state a material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading.
ARTICLE
3
CERTAIN
CHANGES AND CONDUCT OF BUSINESS.
3.1 CONSENTS
AND APPROVALS.
The
Parties (i) shall use their best efforts to obtain all necessary consents,
waivers, authorizations and approvals of all governmental and regulatory
authorities, domestic and foreign, and of all other Persons, firms or
corporations required in connection with the execution, delivery and performance
by them of this Agreement, and (ii) shall diligently assist and cooperate with
each Party in preparing and filing all documents required to be submitted by
a
Party to any governmental or regulatory authority, domestic or foreign, in
connection with such transactions and in obtaining any governmental consents,
waivers, authorizations or approvals which may be required to be obtained
connection with such transactions.
3.2 PUBLIC
ANNOUNCEMENT.
Unless
otherwise required by applicable law, the Parties hereto shall consult with
each
other before issuing any press release or otherwise making any public statements
with respect to this Agreement and shall not issue any such press release or
make any such public statement prior to such consultation.
ARTICLE
4
TERMINATION
AND ABANDONMENT
4.1 METHODS
OF TERMINATION.
This
Agreement may be terminated and the transactions contemplated hereby may be
abandoned at any time before the Closing:
(a) By
the mutual written consent of both Parties; or
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(b) By
either Party if a court of competent jurisdiction or governmental, regulatory
or
administrative agency or commission shall have issued an order, decree or ruling
or taken any other action (which order, decree or ruling the Parties hereto
shall use its best efforts to lift), which permanently restrains, enjoins or
otherwise prohibits the transactions contemplated by this
Agreement.
4.2 SURVIVAL
OF REPRESENTATIONS AND COVENANTS.
The
respective representations, warranties, obligations, covenants, and agreements
of IQMC shall survive the
execution of this Agreement for a period of eighteen months.
4.3 ADJUSTMENT
OF SHARES.
The
parties to this Agreement are also parties to a Financing and Listing Agreement
(the “Financing Agreement”) dated the date hereof. If the share adjustment
transactions contained in Section 1.3 of the Financing Agreement are not fully
consummated and completed by the close of business on June 17, 2005, Osmotex
may, in its sole discretion, terminate and unwind this Agreement in all respects
without penalties or costs of any kind upon written notice to IQMC. If such
termination occurs, all of the Shares will revert back to IQMC and IQMC will
have no rights of any kind relative to Osmotex, including, without limitation,
any right related to the Licensing Rights.
ARTICLE
5
POST-CLOSING
AGREEMENTS
5.1 INDEMNITY.
Each
Party shall indemnify and hold the other Party harmless for acts or omissions
pertaining to this agreement that are not detailed herein and that may occur
in
the future without knowledge at the execution of this agreement.
ARTICLE
6
MISCELLANEOUS
PROVISIONS
6.1 EXPENSES.
Each
Party shall bear and pay all direct costs and expenses incurred by it or on
its
behalf in connection with the transactions contemplated hereunder.
6.1 BROKERS
AND FINDERS.
Each
Party represents and warrants that neither it nor any of its officers,
directors, employees, or Affiliates has employed any broker or finder or
incurred any Liability for any financial advisory fees, investment bankers’
fees, brokerage fees, commissions, or finders’ fees in connection with this
Agreement or the transactions contemplated hereby.
6.2 ENTIRE
AGREEMENT.
This
Agreement (including the documents and instruments referred to herein, all
of
the Recitals stated above, and all schedules and exhibits to this Agreement,
all
of which are hereby incorporated by reference into and made a part of this
Agreement) constitutes the entire agreement between the Parties with respect
to
the transactions contemplated hereunder and supersedes all prior arrangements
or
understandings with respect thereto, written or oral.
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6.3 AMENDMENTS. This
Agreement may only be amended by a subsequent writing signed by all
Parties.
6.4 WAIVERS. The
failure of any Party at any time or times to require performance of any
provision hereof shall in no manner affect the right of such Party at a later
time to enforce the same or any other provision of this Agreement. No waiver
of
any condition or of the breach of any term contained in this Agreement in one
or
more instances shall be deemed to be or construed as a further or continuing
waiver of such condition or breach or a waiver of any other condition or of
the
breach of any other term of this Agreement.
6.5 ASSIGNMENT.
Neither
this Agreement nor any of the rights, interests or obligations hereunder shall
be assigned by any Party hereto (whether by operation of Law or otherwise)
without the prior written consent of the other Parties. Subject to the preceding
sentence, this Agreement will be binding upon, inure to the benefit of and
be
enforceable by the Parties and their respective successors and
assigns.
6.6 NOTICES.
All
notices, requests, consents and other communications required or permitted
under
this Agreement shall be in writing and shall be (as elected by the Person giving
such notice) hand delivered by messenger or courier service or mailed by
registered or certified mail (postage prepaid), return receipt requested,
addressed to:
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IQMC:
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IQ
MEDICAL CORP.
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Copy
to Counsel:
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OSMOTEX:
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Osmotex
A/S
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Copy
to Counsel:
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Gunster,
Yoakley & ▇▇▇▇▇▇▇, P.A.
▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., Esq.
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or
to
such other address as any Party may designate by notice complying with the
terms
of this Section. Each such notice shall be deemed delivered (a) on the date
delivered, if by messenger or courier service; and (b) either upon the date
of receipt or refusal of delivery, if mailed.
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6.7 GOVERNING
LAW.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of Florida, without regard to any applicable conflicts of
laws.
6.8 JURISDICTION
AND VENUE.
The
Parties acknowledge that a substantial portion of the negotiations and
anticipated performance of this Agreement occurred or shall occur in Palm Beach
County, Florida. Any civil action or legal proceeding arising out of or relating
to this Agreement shall be brought in the courts of record of the State of
Florida in Palm Beach County or the United States District Court, Southern
District of Florida. Each Party consents to the jurisdiction of such Florida
court in any such civil action or legal proceeding and waives any objection
to
the laying of venue of any such civil action or legal proceeding in such Florida
court. Service of any court paper may be effected on such Party by mail, as
provided in this Agreement, or in such other manner as may be provided under
applicable laws, rules of procedure or local rules.
6.9 COUNTERPARTS.
This
Agreement may be executed in counterparts, which shall be deemed to be an
original, but all of which together shall constitute one and the same
instrument.
6.10 CAPTIONS;
ARTICLES AND SECTIONS.
The
captions contained in this Agreement are for reference purposes only and are
not
part of this Agreement. Unless otherwise indicated, all references to particular
Articles or Sections shall mean and refer to the referenced Articles and
Sections of this Agreement.
6.11 INTERPRETATIONS.
Neither
this Agreement nor any uncertainty or ambiguity herein shall be construed or
resolved against any Party, whether under any rule of construction or otherwise.
No Party to this Agreement shall be considered the draftsman. The Parties
acknowledge and agree that this Agreement has been reviewed, negotiated, and
accepted by all Parties and their attorneys and shall be construed and
interpreted according to the ordinary meaning of the words used so as fairly
to
accomplish the purposes and intentions of all Parties hereto.
6.12 ENFORCEMENT
OF AGREEMENT.
The
Parties hereto agree that irreparable damage would occur in the event that
any
of the provisions of this Agreement were not performed in accordance with its
specific terms or were otherwise breached. It is accordingly agreed that the
Parties shall be entitled to an injunction or injunctions to prevent breaches
of
this Agreement and to enforce specifically the terms and provisions hereof
in
any court of the United States or any state having jurisdiction, this being
in
addition to any other remedy to which they are entitled at law or in
equity.
6.13 ENFORCEMENT
COSTS.
If any
civil action, arbitration or other legal proceeding is brought for the
enforcement of this Agreement, or because of an alleged dispute, breach, default
or misrepresentation in connection with any provision of this Agreement, the
successful or prevailing Party or Parties shall be entitled to recover from
the
non-prevailing party or parties reasonable attorneys' fees, court costs, sales
and use taxes and all expenses even if not taxable as court costs (including,
without limitation, all such fees, taxes, costs and expenses incident to
arbitration, appellate, bankruptcy and post-judgment proceedings), incurred
in
that proceeding, in addition to any other relief to which such Party or Parties
may be entitled. Attorneys' fees shall include, without limitation, paralegal
fees, investigative fees, administrative costs, sales and use taxes and all
other charges billed by the attorney to the prevailing Party (including any
fees
and costs associated with collecting such amounts).
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6.14 SEVERABILITY.
Any term
or provision of this Agreement which is invalid or unenforceable in any
jurisdiction shall, as to that jurisdiction, be ineffective to the extent of
such invalidity or unenforceability without rendering invalid or unenforceable
the remaining terms and provisions of this Agreement or affecting the validity
or enforceability of any of the terms or provisions of this Agreement in any
other jurisdiction. If any provision of this Agreement is so broad as to be
unenforceable, the provision shall be interpreted to be only so broad as is
enforceable.
IN
WITNESS WHEREOF,
the
Parties hereto have executed this Capital Contribution Agreement as of the
date
first above written.
| IQ MEDICAL CORP. | ||
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| By: | /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ | |
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ |
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| Its: President | ||
| OSMOTEX USA, INC. | ||
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| By: | /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇ | |
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇ |
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| Its: President | ||
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