Exhibit 10.8
JOINTVENTURE AGREEMENT
This Agreement is entered into on this 16th day of November 2000
BY AND BETWEEN
(1) Medi-Hut Co., Inc., a corporation organized and existing under the laws of
the United States of Amercia with its registered office at 1935 Swarthmore
Avenue, Lakewood, NJ 08701, U.S.A.(hereinafter referred to as "Medi-Hut")
AND
(2) Coa International Ind., Inc.,. a corporation organized and existing under
the laws of the Republic of Korea with its registered office at 6th Floor Sam
Won Bldg., 210-1 Nonhyun-Dong Kangnam-Ku, Seoul, Korea (hereinafter referred
to as "Coa"
WITNESSETH
Whereas, Coa is engaged in the business of Exporting and Manufacturing of
Medical Disposable Products including Disposable Syringes by a subcontract in
Korea.
Whereas, Medi-Hut is engaged in the business of Development and Sale of Safety
Syringes in U.S.A; and
Whereas the Parties agree to set up a Joint Venture Company ("the Company") in
Korea on the terms and conditions set out hereunder.
Now therefore, in consideration of the mutual promises contained herein, the
parties agree as follows:
Article 1. ORGANIZATION OF JOINT VENTURE COMPANY
1.1 Subject to the terms and conditions set forth in this Agreement,
Medi-Hut and Coa shall cause the Joint Venture Company (hereinafter referred
to as the "Company") to be established as a business corporation under the
laws of Korea by the target date of 30 November 2000.
1-2 The Company shall
(a) be called "Medi-Hut International (Mfg.) Co., Ltd."
(b) have its principal office and factory in Korea.
1-3 The business purposes of the Company shall be to engage in
manufacture and sale of and any and all business activities incidental to the
foregoing objectives.
1-4 The fiscal year of the Company shall first day of January and end on
December of each year; provided, however, that the first fiscal year of the
Company shall be from the date of its incorporation until December 31 of the
same year.
Article 2. CAPITAL CONTRIBUTION AND SHARES
2-1 The total amount of capital contribution which shall be made to the
Company by the parties shall be as follows;
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MEDI-HUT: U$1,000,000.00
COA : U$400,000.00
The Company shall grant 10% of share of stock of the Company to Inben Brothers
Company, a corporation organized and existing under the laws of the United
States of America (hereinafter referred to as the "INBEN") who has been and
will act as coordinator-negotiator and agent for both parties.
The number of share of stock of the Company to be issued to each party, and
the ratio of the equity interest in the Company of each party shall be as
follows:
MEDI-HUT : 44,000 shares 44%
COA : 46,000 shares 46%
INBEN : 10,000 shares 10%
At the time of incorporation the parties shall contribute the initial capital
of U$1,400,000.00, according to the ratio as prescribed in this provision.
At the time of incorporation each party has the right to nominate their
representative(s) who has and hold the share of stock of the Company in
proportion to their respective shareholding ration in the Company.
2-2 At the time of incorporation, the total number of shares set forth in
article 2-1 shall be fully subscribed for by Medi-Hut and Coa, respectively
and the total investment amount under Article 2.1 shall be paid by the parties
hereto in Korean Won or U.S. Dollars and in cash to Korean Bank which will be
appointed for the account of the Company.
2-3 Medi-Hut and Coa, as shareholders of the Company, shall have
preemptive rights to subscribe to any additional shares, options, warrants or
debentures convertible into such shares as the Company may issue after its
incorporation, in proportion to their then current respective shareholding
ration in the Company.
2-4 The Company shall lend the necessary funds of approximately
U.S.$1,461,100 or more or less to cover the lack of amount between initial
capital and total investment amount of the new manufacturing facility.
Article 3. TRANSFER OF SHARES
3-1 Except as otherwise provided in this Agreement, neither Medi-Hut nor
Coa shall at any time sell, transfer, mortgage, pledge, or otherwise encumber
or dispose of any of the shares of the Company held by it, without prior
written consent of the other party hereto.
3-2 If any party desires to sell, transfer or otherwise dispose of any of
its shares in the Company (the "Offeror"), the Offeror shall first offer in
writing to sell such shares to the other party (the "Offeree"). Such offer
shall state the suggested purchase price per share and the Offeree shall have
the right to accept or refuse the offer with the thirty (30) day period
commencing on the date of receipt of such offer.
3-3 If the Offeree gives the Offeror written notice within the above
period of its desire to purchase the shares so offered, such shares shall be
divided among the Offeree in proportion to their shareholdings.
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3-4 If, after an offer has been made pursuant to Article 3.2, the Offeree
refuses or fails to accept such offer, the Offeror may sell, transfer or
otherwise dispose of the shares so offered to any third party, provided,
however, that the terms and conditions of the offer shall not be more
favorable than those offered to the Offeree.
3-5 The third party shall submit to the other party of this Agreement and
to the Company a written oath stating that the third party agrees to be
governed by all of the terms and provisions of this Agreement and to be fully
bound by the terms thereof, assuming all obligations of the party from which
it has purchased the shares.
3-6 Any of shares of the Company held by Inben shall be prohibited to
sell, transfer, mortgage or pledge without prior written consent of all
parties.
3-7 Any share transfer under this Article shall be subject to any
necessary governmental validation or approval.
Article 4. MANAGEMENT OF JVC
4-1 The following matters with respect to operation and/or management of
the Company shall require prior written agreement between Medi-Hut and Coa as
follows:
(1) Increase or decrease in capital ;
(2) Issuance of new shares or debentures ;
(2) Borrowing funds other than those for working capital and equipment
investment ;
(4) Merger, consolidation or amalgamation with any other company ;
(5) Dissolution or liquidation ;
(6) Sale, transfer or any other disposal of all or substantially part of
the assets or business of the Company in consideration for an amount
of one hundred thousand (100,000) U.S. Dollars or more ;
(7) Acquisition or lease of substantial assets or business of any other
company in consideration for an amount of one hundred thousand
(100,000) U.S. Dollars or more ;
(8) Investment in property, plant, equipment or other facilities in an
amount of two hundred thousand (200,000) U.S. Dollars or more;
(9) Commencement of business other than that provided for in Article 1.2
hereof, or investment in such business ;
4-2 The Company shall have 3 members of board of directors or more and 1
auditor, they shall be nominated by Coa.
4-3 The Company shall appoint Mr. Joseph A. Sanpietro of Medi-Hut as
Chairman. Also, the Company shall appoint Mr. Young Kil Shin as
President/C.E.O. and Representative directors who shall be authorized to
represent the Company.
4-4 A quorum for any meeting of the Board of Directors shall be a majority
of all directors then in office, and resolutions of the Board of Directors
shall be adopted by the affirmative vote of a majority of all directors then
in office ; provided, however, that a notice calling a meeting of the Board of
Directors setting forth the agenda of such meeting shall be dispatched to each
director and auditor in accordance with the Articles of Incorporation, and
resolutions shall not be made with respect to matters other than those
appearing on such agenda, unless all directors, whether present or not,
unanimously agree to do
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otherwise.
4-5 Both parties understood that Coa has been engaged in the export
business of Disposable Syringes and Coa has purchased the goods for their
export from other Korean manufacturers of Disposable Syringes. Once the
Company set up the manufacturing facility, entire quantity of Coa's orders
shall be executed by the Company and further, Coa shall transfer their orders
to the Company gradually.
Article 5. FINANCING
5-1 The Company shall raise and procure funds necessary for its business
operations by itself. If necessary, Medi-Hut and Coa shall consult with each
other as to appropriate assistance.
5-2 The Company shall lend the necessary funds of approximately
U.S.$1,461,100 or more or less to cover the lack of amount between initial
capital and total investment amount for the new manufacturing facility. Total
amount for the new manufacturing facility - initial capital and loan, shall be
used to procure the items/facilities of the Company such as ; Factory
building, Molds & Assembly M/C, Packing Machines, Sterilizers, Operation cost
and Factory building repairing costs etc.
Article 6. DIVIDENDS
The Company, depending upon the results of each fiscal year's settlement
of accounts, shall make periodic payments of dividends to the shareholders
according to the Articles of Incorporation.
Article 7. ACCOUNTING AND REPORTS
7-1 The Company's accounting matters shall be conducted in accordance
with generally accepted accounting standards and practices under the Korean
laws, and shall conform to internationally accepted accounting standards and
practices.
7-2 The Company shall keep accurate accounting books and records with
regard to all of its operations and activities on a timely basis. Medi-Hut or
Coa shall have the right to inspect such books and records during the regular
business hours of the Company.
7-3 The annual financial statements shall be audited at the expense of
the Company at least once each year by a independent certified public
accountants, who shall be of international repute and shall have been
appointed by the Board of Directors of the Company.
7-4 Quarterly business reports shall be made by the Company to Medi-Hut
and Coa in a form and at such dates as are mutually acceptable to the parties.
Whenever Medi-Hut or Coa so requests, the Company shall furnish a report of
its business operations to the requesting party.
Article 8. TERM AND TERMINATION
8-1 This Agreement shall become effective as of the later of (1) the date
of this Agreement or (2) the date upon which any governmental validations,
approvals or other formalities necessary for the
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effectuation of this Agreement under the Korean law shall have been obtained
and completed, and shall remain in force and effect until terminated in
accordance with the terms and provisions hereof.
8-2 Unless otherwise agreed upon by Medi-Hut and Coa, this Agreement
shall forthwith terminate upon the occurrence of any of the following:
should governmental validations or approvals necessary for the
incorporation of the Company not be obtained within Two (2) months after
the date of contribution of the Medi-Hut's full capital ;
should the Company not be able to commence its business by reason of
operation of law, governmental order or regulation ; or
should the Company be dissolved and liquidated for any reason.
8-3 In addition, this Agreement may be terminated as follows:
(1) If either party hereto shall default or cause the company to
default in the performance of its material obligations hereunder, and if any
such default shall not be corrected within sixty (60) days after the same
shall have been called to the attention of the defaulting party by the
complaining party by written notice, then the complaining party, at its
option, may thereupon terminate this Agreement,
(2) If either party hereto shall institute or otherwise become a
party, voluntarily or involuntarily, to a proceeding alleging or pertaining to
the bankruptcy or insolvency of such party, be placed in the hands of a
receiver, transfer all or material proportion of its business or assets to, or
be acquired by, merge into or be consolidated with another company, the other
party hereto may terminate this Agreement.
Article 9. EFFECT OF TERMINATION
9-1 Upon termination of this Agreement pursuant to Paragraph (1), (2) of
Article 8-2, the Company shall be dissolved and liquidated.
9-2 Upon termination of this Agreement pursuant to Paragraph (1) or (2)
of Article 8-3, the terminating party shall have the right to elect (?) To
dissolve and liquidate the Company, (?) to purchase or have a third party of
its choosing purchase all or any part of the shares in the Company then held
by the other party.
9-3 Termination of this Agreement for any cause shall not (?) relieve
either party hereto from any obligation accrued hereunder prior to such
termination or from any liability to the other party for breach of this
Agreement, and (?) affect the confidentiality obligations under Article 11
and the terms and conditions set forth in this Article.
Article 10. FORCE MAJEURE
Neither party shall be liable for any delay in or failure of performance
under this Agreement if such delay or failure is caused by acts of God, riots,
war, strikes or other labor troubles, or any other events beyond the control
of the parties affected.
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Article 11. CONFIDENTIALITY
The parties hereto agree to keep secret and confidential all information
furnished to them by the other party or the Company which are designated as
confidential by said other party of the Company, or considered desirable to
remain secret. The parties further agree not to use such information for any
purpose whatsoever except in a manner expressly provided for in this
Agreement.
Article 12. ASSIGNMENT
Neither party shall assign or transfer this agreement or any rights and
obligations under this Agreement to any third party, without prior written
consent of the other party hereto.
Article 13. GOVERNING LAW AND LANGUAGE
This Agreement shall be governed by and interpreted in accordance with
the laws of Korea. This Agreement has been prepared in the English language
that shall be the controlling version regardless of any translations of this
Agreement.
Article 14. DISPUTE SETTLEMENT
All disputes, controversies or differences which may arise between the
parties, out of or in relation to or in connection with this Agreement, or for
the breach thereof shall be finally settled by arbitration in Seoul, Korea in
accordance with the Commercial Arbitration Rules of the Korean Commercial
Arbitration Board and under the laws of Korea. The aware rendered by the
arbitrator(s) shall be final and binding upon both parties concerned.
Article 15. NOTICE
Any notice or other communication required or permitted to be given
under this Agreement shall be in writing in English, and shall be delivered
personally or sent by registered airmail or by telex or facsimile transmission
confirmed by registered airmail, postage prepaid, and, in the case of
registered airmail, shall be deemed to have given ten (10) days after posting
in the U.S.A or Korean mails and, in the case of telex or facsimile
transmission, at the time of transmission. Notices or other communications
under this Agreement shall be sent to the following addresses ; provided,
however, that each party may, from time to time, change the address to which
notice is to b e sent to such party by giving notice of such change in
accordance with this provision :
To Medi-Hut Co., Inc.:
Attention : Mr. Joseph Sanpietro
Address : 1935 Swarthmore Avenue, Lakewood, NJ 08701, U.S.A.
Facsimile : (732) 901-1177
To Coa International Ind., Inc.:
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Attention : Mr. Young Kil Shin
Address : 6th Floor Samwon Bldg., 210-1 Nonhyun-Dong, Kangnam-Ku,
Seoul, Korea :
Facsimile : (02) 562-9406
To Inben Brother Company
Attention : Mr. Duck S. Yim
Address : 5250 N. Leamington Ave., Chicago, IL 60630, U.S.A.
Facsimile : (773) 286-5424
Article 16. MISCELLANEOUS
16-1 No failure or delay on the part of Medi-Hut or Coa to exercise any
of its rights under this Agreement shall operate as a waiver thereof, nor
shall any single or partial exercise by Medi-Hut or Coa of any of its rights
under this Agreement preclude any other or future exercise of such right or
the exercise of any other right.
16-2 Any amendment or supplement to this Agreement shall be valid only if
made in writing and signed by the authorized representatives of the parties
hereto.
16-3 In the event that any term, condition, provision or paragraph of
this Agreement is held to be in violation of any law, statute or regulation
pertaining thereto, the same shall be deemed deleted from this Agreement and
shall be of no force and effect, and this Agreement shall remain in full force
and effect, and this Agreement shall remain in full force and effect as if
such term, condition.
16-4 The terms and conditions hereof shall constitute the entire
agreement between the parties hereto and shall supersede all previous
understandings, oral or written agreement, between the parties with respect to
the subject matter hereof.
IN WITNESS WHEREOF, the parties have caused their duly authorized
representatives to execute this Agreement on the date first written herein
above.
For and on behalf of For and on behalf of
Medi-Hut Co., Inc. Coa International Ind., Inc.
/s/ Joseph Sanpietro /s/ Young Kil Shin
______________________________ _____________________________
Date : 11/16/00 Date : 16 Nov 2000
Name : Mr. Jeseph Sanpietro Name : Mr. Young Kil Shin
Title : President Title : President
Witness
Inben Brothers Company
/s/ Duck S. Yim
__________________________________
Date : 11/15/00
Name : Mr. Duck S. Yim
Title : President