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Biotech / Medical : H-QUOTIENT,INC. (HQNT) -- Ignore unavailable to you. Want to Upgrade?

To: scion who wrote (126)	8/31/2005 5:08:57 PM
From: scion	Respond to of 136

Note A – Consolidation of Variable Interest Entity — Mycosol Investment In March 2005, the Company sold 458,333 shares of Mycosol common stock to Mineola Holding Corporation for $500,000. Simultaneously, the Company purchased 687,500 shares of Mycosol common stock from Mycosol founding shareholders for $110,000 and 6,000,000 shares of Veridien common stock. The Veridien stock is valued at its fair market value of $300,000 and because Mycosol is consolidated as a variable interest entity, the $410,000 investment is shown as goodwill. The $500,000 amount is shown as an increase in minority interest. Veridien is committed to transferring the entire $500,000 to Mycosol for payment of Mycosol expenses. As of June 30, 2005 all $500,000 had been transferred. As of June 30, 2005 Veridien owned 35.69% of Mycosol, but Mycosol is consolidated since Veridien has control through its majority funding of Mycosol operations. Also, during the first quarter of 2005, the Company sold 204,000 Mycosol warrants for accrued interest owed to debt holder(s) valued at $222,360. This amount increased the minority interest ownership of Veridien’s consolidated subsidiary, Mycosol. secinfo.com Veridien is developing new patentable products in concert with Mycosol, a company in which Veridien has invested and has the right to acquire majority ownership interest. Mycosol is a development-stage chemical and pharmaceutical company based in the Research Triangle Park area of North Carolina. The Company is developing a proprietary, low cost platform technology with the objective being to safely and effectively treat and prevent microbial-induced and microbial-exacerbated problems. Mycosol's proprietary multi-active compound has demonstrated potent anti-mold, anti-fungal, anti-bacterial, anti-inflammatory, and anti-allergic properties. Using this 'core technology' platform, a library of over 1,500 known analogs and 6 patents pending, Mycosol believes that a broad portfolio of products can be developed for many medical, industrial, veterinary and agricultural applications. Mycosol is also developing its core technology for use as safe and effective biological staining reagents in academic, biotechnology and pharmaceutical research laboratories. veridien.com Exhibit 10.37 INVESTMENT AGREEMENT THIS AGREEMENT made effective as of the 4th day of March, 2005. A M O N G: Mineola Holding Corporation, a corporation incorporated under the laws of Delaware. (hereinafter referred to as "Investor") OF THE FIRST PART Veridien Corporation, a corporation incorporated under the laws of Delaware. (hereinafter referred to as "Veridien") OF THE SECOND PART Mycosol, Inc., a corporation incorporated under the laws of Delaware. (hereinafter referred to as "Mycosol") OF THE THIRD PART "AS TO ONLY THOSE PROVISIONS RELATING TO RIGHTS OR OBLIGATIONS OF MYCOSOL INC., OR ITS WHOLLY-OWNED SUBSIDIARY, ELION MEDICAL, INC., AND, FOR GREATER CERTAINTY, NOT AS TO ARTICLES 3, 5, 7 OR SCHEDULES 8.1 AND 8.2 OR , EXCEPT TO THE EXTENT A SPECIFIC CONSENT OF MYCOSOL IS REQUIRED BY LAW, ARTICLE 12." SCHEDULE 9.1 FULL DEVELOPMENT PLAN FOR REAGENT/DIAGNOSTIC PRODUCT LINE USING MYCOSOL LEAD COMPOUND "M301" OR ONE OR MORE OF ITS HOMOLOGS OR SISTER COMPOUNDS -------------------------------------------------------------------------------- SCHEDULE 10.1 PATENTS AND PATENT APPLICATIONS Published Patent Applications: Publication / Application Publication Jurisdiction Number Date Title Status United 20040224984 November 11, 2004 Methods of treating Published States inflammations and infections with pyridium salts United 20040235898 November 25, 2004 Compounds and Published States methods for controlling fungi, bacteria and insects Patent WO 2004/078136 September 16, 2004 Pyridinium salts, Published Cooperation compounds and Treaty - methods of use World Omnibus patent application Patent Applications Filed: Jurisdiction File Number Filing Date Title Status United States 60/524,784 December 17, 2004 Methods for Filed controlling fungi and bacteria United States 60/636,952 December 22, 2003 Thiazolium Filed compounds and uses United States 60/635,461 December 10, 2004 Wide dispenser with Filed wipe guide United States 60/637,183 December 17, 2004 Stilbazium and Filed sec.edgar-online.com

To: scion who wrote (126)	8/31/2005 5:42:01 PM
From: scion	Read Replies (2) \| Respond to of 136

During the first quarter 2004 the Company sold 344,500 HQNT shares and realized a gain at time of sale of $519,524 due to the increase in the sale price from the cost basis of $.70 at time of acquisition. During second quarter 2004 the Company received these 344,500 shares of common stock from an investor in exchange for 486,875 restricted common shares of H-Quotient, Inc. (HQNT). The 486,875 restricted common shares represents H-Quotient’s customer deposit for products to be delivered in future quarters. During the second quarter 2004 the Company sold 358,869 HQNT shares and realized a loss at time of sale of $8,445 due to the decline in the FMV of the stock the from December 31, 2003 closing price of $.72. This represents a net realized gain of $511,079 for the first six months of 2004. • During second quarter 2005 the Company recorded an unrealized loss in the amount of $32,454 which reflects the decline in the FMV of 301,506 HQNT shares from March 31, 2004 at $.45 to $.30 at June 30, 2005; a decline in the FMV of 10,741 HNSTshares from March 31, 2005 at $.075 to $.065 at June 30, 2005; an increase in the FMV of 71,951 SNDH shares of $.23 at June 6, 2005 to $.27 at June 30, 2005; and 400,000 HQNT shares from March 31, 2005 at $.275 to $.30 at June 30, 2005. During the first quarter 2005 the Company recorded an unrealized loss in the amount of $30,741 which reflects the decline in the FMV of 301,506 HQNT shares from December 31, 2004 at $.55 to $.45 at March 31, 2005; and a decline in the FMV of 10,741 HNST shares from December 31, 2004 at $.13 to $.075 at March 31, 2005. During the second quarter 2004 the Company recorded an unrealized loss in the amount of $214,317 which reflects the decline in the FMV of 301,431 HQNT shares from March 31, 2004 at $1.70 to $.989 at June 30, 2004. During the first quarter 2004 the Company recorded an unrealized gain in the amount of $295,402 which reflects the increase in the FMV of 301,431 HQNT shares from $.72 to $1.70 at March 31, 2004. This represents a net unrealized gain of $81,085 for the first six months of 2004. Veridien Corp · 10QSB · For 6/30/5 secinfo.com During first quarter 2004 the Company signed an agreement with H-Quotient, Inc. (HQNT) which involves the sale of product, licensing and service fees. We continue active promotion of our product line through trade-show presentations and direct calls on both existing and potential customers. Our goal is to continue to expand our product lines and we anticipate new products, which are scheduled with various releases this year, will generate new revenue in this and future years. In addition, we continue to pursue strategic alliances with other corporations that have existing distribution networks. Our goal for these alliances is to create immediate distribution and fulfillment avenues for our products, while focusing on our capital resources. We have recently begun expanding our revenue base to include not only sale of our proprietary products but also the sale of licensing rights relating to our existing and/or new technology, as well as service fees. We intend to continue to broaden this initiative from new technology created by Mycosol including their seven patents pending. • During the first quarter 2004, the Company recorded an unrealized gain in the amount of $295,402 which reflects the increase in the FMV of 301,431 HQNT shares from $.72 to $1.70 at March 31, 2004. During first quarter 2004, the Company sold 358,869 HQNT shares and realized a loss of $8,445 due to the decline in the FMV of the stock from December 31, 2003 at $.72. • During first quarter 2005, the Company recorded an unrealized loss in the amount of $30,741 which reflects the decrease in the fair market value of 301,506 HQNT common shares from $.55 to $.45 and Healthnostics, Inc. (HNST) common shares from $.13 to $.075 at March 31, 2005. Veridien Corp · 10QSB · For 3/31/5 secinfo.com