How about that deal with Mexico, eh?
How many customers do they have now?
Form 8-K for COMPUTERIZED THERMAL IMAGING INC filed on Oct 13 2000
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act
October 11, 2000
----------------
Date of Report
(Date of Earliest Event Reported)
COMPUTERIZED THERMAL IMAGING, INC.
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(Exact name of registrant as specified in its charter)
Nevada 000-23955 87-0458721
------------------------ ------------------------ ------------------------
(State or Other (Commission File Number) (I.R.S. Employer
Jurisdiction of Identification Number)
Incorporation or
Organization)
476 HERITAGE PARK BOULEVARD, SUITE 210
LAYTON, UTAH 84041
--------------------------------------------------
(Address of principal executive offices)
(801) 776-4700
------------------------
(Registrant's telephone number)
Not Applicable
------------------------
(Former Name and Address of Principal Executive Offices)
Item 5. Other Events.
In connection with Latin America markets, in September 1999, we engaged
William L. Mazilly and Amirali A. Rajwany, independent consultants, to establish
a consortium in Latin America to market and deploy our Breast Imaging System
throughout Central and South America. For services rendered in connection
therewith, each was paid 100,000 shares of our common stock
valued at $1.20 per share. As a result of their efforts, we entered into two
Letter Agreements (collectively, the "Agreements") on October 28, 1999 with
Computerized Thermal Imaging International, Inc. ("CTII"), an entity in which we
received a 15 percent interest, whereby CTII received, among other things, 1)
the exclusive right to represent the expansion of our business into Central and
South America, 2) the obligation to prepare and implement a marketing strategy
for deployment of our Breast Imaging System in those areas of the world, 3) the
right of first refusal on our Health Card manufacturing worldwide, and 4) the
obligation to sell a minimum of 100 of our Breast Imaging Systems over a
two-year period in the target territories. The Agreements further provided that
we would grant to CTII, as compensation, options to purchase up to 5 million
shares of our common stock in 50,000 share increments contingent on their
placement of each Breast Imaging System into commercial use in the specified
territories. Each 50,000 block of options granted the holder thereof the right
to purchase, for a period of two years, 50,000 shares of our common stock at a
strike price equal to $1.6745, a 15 percent discount to the bid price of our
common stock on October 28,1999.
Pursuant to the Agreements, on June 6, 2000, we sold 10 Breast Imaging
Systems to CTII for $5 million. In connection therewith, we received a down
payment of $1.75 million with the remaining $3.25 million to be received upon
delivery of the systems. The sales invoice obligated us to deliver the 10
systems to CTII on, or about, mid-October, 2000. In connection therewith, we
expected to issue 500,000 options upon the delivery and placement of such
systems into commercial use. As of the date hereof, we have not issued any
options to CTII.
In late September 2000, we advised CTII of our desire to renegotiate
the foregoing Agreements given the substantial change in market conditions, the
increased value of our common stock and unresolved issues concerning their
deployment of our systems in Mexico. On October 11, 2000, following attempts to
reach more favorable terms, we decided it was in the best interests of the
Company and our shareholders to mutually terminate the Agreements and the sale
of the 10 units. We accordingly did so and have refunded by wire transfer the
down payment received from CTII on the initial sale of the 10 units. In
connection with the termination of the Agreements, our 15% ownership in CTII
reverts back to the remaining principals of CTII and each party to the
Agreements will bear the respective costs of any performance under the
Agreements. In consideration of these efforts to expand our business into
Latin America, Mr. Mazilly and Mr. Rajwany will retain the common stock
previously granted to them.
Item 7. Exhibits
The following exhibits are filed herewith:
Exhibit 10. Letter of Agreement Terminating Agreements dated
October 28, 1999 and Purchase Order dated June 5, 2000.
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this Report to be signed on its behalf by
the undersigned hereunto duly authorized.
COMPUTERIZED THERMAL IMAGING, INC.
Date: 10/13/2000 By: /s/ Kevin L. Packard
------------------- ------------------------
Kevin L. Packard
Chief Financial Officer,
Secretary & Treasurer
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EXHIBIT 10
Letter of Agreement
This Letter of Agreement is entered into on October 11, 2000 by and between
Computerized Thermal Imaging Inc. International ("CTII de Mexico"), a
corporation duly organized and existing under the laws of the country of Mexico,
and Computerized Thermal Imaging, Inc. ("CTI"), a corporation duly organized and
existing under the laws of the state of Nevada, U.S.A. and located at 476
Heritage Park Blvd, Suite 210, Layton, Utah 84041.
Recitals
1. CTI develops and deploys thermal imaging and associated technologies for use
in the enhancement of medical screening, diagnosis and patient management. It is
currently seeking FDA approval for the use of the Computerized Thermal Imaging
System as an adjunctive diagnostic test to the mammogram and clinical
examination for the detection of breast cancer.
2. CTII de Mexico provides marketing support, deployment of product, in-country
political consulting and financing throughout Central and South America (Latin
America).
3. On October 28, 1999 CTI and CTII de Mexico entered into two agreements
("Agreements") to develop an exclusive relationship in Central and South America
(Latin America).
4. Both CTI and CTII de Mexico wish to terminate the Agreements and any other
contractual relationship between the CTI and CTII de Mexico, including that
certain Purchase Order ("Purchase Order") dated June 5, 2000.
Now, therefore, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, and intending to be legally bound, CTI and
CTII de Mexico hereby agree as follows:
CTI and CTII de Mexico mutually agree to terminate the Agreements and the
Purchase Order ab initio (the termination is effective as of October 28, 1999
for the Agreements and as of June 5, 2000 for the Purchase Order), including all
of the terms and conditions in the Agreements and the Purchase Order, and hereby
release each other from any and all obligations arising out of or relating to
the Agreements and the Purchase Order and the performance by such other party
thereunder. As part of the termination of the Agreements and the Purchase Order,
both parties hereby agree as follows:
1. CTII de Mexico shall no longer represent CTI in expanding its business in
Central and South America (Latin America).
2. CTII de Mexico shall not be obligated to purchase any equipment from CTI.
3. CTII de Mexico shall no longer have a right of first refusal on Health Card
manufacturing worldwide.
4. CTII de Mexico shall not receive options of CTI common stock or any other
compensation provided for in the Agreements or the Purchase Order.
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5. CTI shall not be obligated to provide any technology, equipment or training
to CTII de Mexico, including the ten units ordered by CTII de Mexico in the
Purchase Order.
6. CTI shall not receive 15% of the common shares of CTII de Mexico.
7. CTI and CTII de Mexico shall bear the respective costs of any performance
under the Agreements or the Purchase Order to date.
8. CTI shall return to CTII de Mexico the $1.75 million deposit, along with
interest accrued at a rate of 6.5% from the date the deposit was received by CTI
to the date of this Letter of Agreement, provided by CTII de Mexico in
connection with the ten units ordered pursuant to the Purchase Order.
This Letter of Agreement may be executed in any number of identical
counterparts, any or all of which may contain the signatures of fewer than all
of the parties but all of which shall be taken together as a single instrument.
In witness whereof, CTI and CTII de Mexico have each caused this agreement to be
executed on the 11th day of October, 2000, by their respective authorized
representatives.
Computerized Thermal Imaging, Inc.
By: /s/ Richard V. Secord
---------------------
Name: Richard V. Secord
Title: Chairman & CEO
Computerized Thermal Imaging, Inc. International
By: /s/ Jay Tayebi
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Name: Jay Tayebi
Title: CEO |
