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EXHIBIT 10.197
 
 
Dated    July 2010
 

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CALYPTE BIOMEDICAL CORPORATION (1)
 
MARR TECHNOLOGIES B.V. (2)
 
MARR TECHNOLOGIES LIMITED (3)
 
and
 
MARR TECHNOLOGIES ASIA LIMITED (4)
 
 

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DEBT AGREEMENT
 

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THIS AGREEMENT is dated
 
July 2010 and is made BETWEEN:

 
(1)
CALYPTE BIOMEDICAL CORPORATION a Delaware corporation whose registered office is
at 16290 SW Upper Boones Ferry Road, Portland, OR 97224, USA (“Calypte”);

 
(2)
MARR TECHNOLOGIES B.V. a company incorporated in the Netherlands whose
registered office is at Strawinskylaan 1431, 1077 XX Amsterdam, The
Netherlands (“MTBV”);

 
(3)
MARR TECHNOLOGIES LIMITED a company incorporated in Mauritius whose registered
office is at 7th Floor New Caudan, Dias Pier, Caudan Waterfront, Port Louis,
Mauritius  (“MTL”); and

 
(4)
MARR TECHNOLOGIES ASIA LIMITED a company incorporated in the Seychelles whose
registered office is at Oliaji Trade Center, 1st Floor, Victoria, Mahe,
Seychelles (“MTAL”)

 
each a “Party” and together the “Parties”.
 
WHEREAS:
 
A.
On 4 April 2005, Calypte and the investors who are parties thereto, including
MTBV, entered into a purchase agreement (the “Purchase Agreement”), pursuant to
which Calypte issued to such investors certain secured 8% convertible promissory
notes. Calypte has issued to MTBV, pursuant to the Purchase Agreement, an
initial note dated 4 April 2005 in a principal amount of $2,800,000 (the
“Initial MTBV Note”) and subsequent notes as interest payments (the Initial MTBV
Note and all subsequent notes, as amended by amendment agreements dated 21 March
2007, 3 July 2007 and 4 December 2007, being the “MTBV Notes”).

 
B.
On 4 April 2005, Calypte as borrower and MTBV as lender entered into a credit
facility agreement, as amended by amendment agreements dated 23 November 2005,
22 February 2006, 26 July 2006, 22 December 2006, 6 February 2007, 21 March 2007
and 4 December 2007 (the “Credit Facility”) under which MTBV has lent Calypte
money and Calypte has issued to MTBV various secured promissory notes (the “CF
Notes”).

 
C.
Calypte and MTL are shareholders in Beijing Calypte Biomedical Technology Ltd.,
a company organised and existing in China (“Beijing Calypte”). Calypte is the
holder of a 51% equity interest in Beijing Calypte and MTL is the holder of a
49% equity interest in Beijing Calypte.

 
D.
Calypte and MTAL are shareholders in Beijing Marr Biopharmaceutical Co. Ltd., a
company organised and existing in China (“Beijing Marr”). Calypte is the holder
of a 51% equity interest in Beijing Marr and MTAL is the holder of a 49% equity
interest in Beijing Marr.

 
E.
MTBV, MTL and MTAL are Affiliates. MTBV is, subject to the satisfaction of
certain conditions, willing to release Calypte from $­­­­­3,000,000 of its
indebtedness to MTBV under the MTBV Notes and the CF Notes and to convert the
balance of such indebtedness into shares of Calypte.

 
NOW IT IS HEREBY AGREED as follows:
 
 
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1
Definitions and interpretation

 
1.1
In this Agreement:

 
“Affiliate” means in relation to a Party any of the following from time to time:
its subsidiaries and any holding company or parent undertaking of that Party and
all other subsidiaries of any holding company or parent undertaking of that
Party;
 
“Aggregate Indebtedness” means the aggregate indebtedness at the relevant time
of Calypte to MTBV  arising under the MTBV Notes and the CF Notes, including
accrued interest;
 
“BC Shareholders Agreement” means the agreement dated as of 1 September 2005
between Calypte and MTAL relating to, among other things, the ownership and
operation of Beijing Calypte;
 
“BM Shareholders Agreement” means the agreement dated as of 21 December 2005
between Calypte and MTAL relating to, among other things, the ownership and
operation of Beijing Marr;
 
“Beijing Calypte” has the meaning given in the recitals to this Agreement;
 
“Beijing Marr” has the meaning given in the recitals to this Agreement;
 
 “Conversion Price” means the lesser of (a) $0.042 and (b) the lowest price per
share at which SF Capital Partners Limited or Morningtown Limited has agreed to
convert into Shares indebtedness of Calypte to them arising pursuant to the
Purchase Agreement;
 
”Marr Group” means MTBV, MTL, and MTAL collectively and as to each of them;
 
“Shareholders Agreements” means the BC Shareholders Agreement and the BM
Shareholders Agreement and “Shareholders Agreement” means either or the relevant
one of them;
 
“Shares” means ordinary shares of Calypte par value $0.03 ranking in all
respects pari passu with all shares of Calypte in issue; and
 
“$” or “Dollars” means the lawful currency for the time being of the United
States of America.
 
1.2
In this Agreement any references to:

 
 
(a)
a clause or schedule is to a clause or schedule to this Agreement;

 
 
(b)
a document is to that document as amended, varied, supplemented or replaced from
time to time;

 
 
(c)
a “person” include an individual, firm, unincorporated association or body
corporate; and

 
 
(d)
a collective defined term shall refer to the collective set and, unless the
facts, context, or sense of this Agreement clearly require otherwise, shall also
extend to mean  “…and each of them”.

 
 
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2
Debt release and conversion to shares

 
2.1
Subject to the terms and conditions of this Agreement, the debt release and
conversion to Shares, if any, shall occur as follows:

 
2.1.1
At such time (if any) as all of the conditions set out in clause 2.2  have been
satisfied to the satisfaction of MTBV (other than those, if any, which MTBV has
expressly waived by signed written notice to Calypte) (the “Effective Time”),
the following shall automatically be deemed to  occur: (a) MTBV forever releases
Calypte from $3,000,000 of the Aggregate Indebtedness and from any and all
formal or informal intercompany obligations and/or claims of the Marr
Group  against Calypte with effect from the time of this release and MTBV hereby
waives with effect from such time all of its rights to demand payment or make
claims for of all or any of such obligations ;and (b) Calypte converts the
balance of the Aggregate Indebtedness as of December 31, 2009, being $
6,398,353.11, at the Conversion Price into  152,341,741 Shares.

 
2.1.2
Prior to the Effective Time, MTBV and Calypte shall exchange (a) any and all of
the original MTBV Notes and of the original CF Notes, to be provided by MTBV to
Calypte, for (b) a stock certificate of  152,341,741 Shares in the name of MTBV
, to be provided by Calypte to MTBV;

 
2.1.3
In the event a lower price per share conversion rate than the Conversion Price
is granted to either or both of SF Capital Partners Limited and Morningtown
Limited for any indebtedness of Calypte to them arising pursuant to the Purchase
Agreement, then the number of Shares to be issued under clause 2.1 shall be
recalculated in accordance with the lowest such price per share conversion rate.

 
2.2
The conditions referred to in clause 2.1 are:

 
2.2.1
(i) MTL or (ii) MTAL or (iii) another Affiliate of MTBV nominated by MTBV or
(iv) a third party  nominated by MTBV   (registration with the applicable
registry being effective evidence of such nomination) has been registered with
the applicable Chinese registry as the owner of Calypte’s 51% equity interest in
Beijing Calypte; and

 
2.2.2
(i) MTL or (ii) MTAL or (iii) another Affiliate of MTBV nominated by MTBV or
(iv) a third party nominated by MTBV (registration with the applicable registry
being effective evidence of such nomination) has been registered with the
applicable Chinese registry as the owner of Calypte’s 51% equity interest in
Beijing Marr; and

 
2.2.3
Calypte has entered into an agreement in form and substance satisfactory to MTBV
for the provision by Calypte to Beijing Marr of, among other things, the
technology, training and know how, all designed to enable Beijing Marr to
produce HIV test kits; and

 
2.2.4
Calypte has lawfully and validly (including without limitation in accordance
with its constitutional documents) issued to MTBV a share certificate in MTBV’s
name for 152,341,741 Shares (subject to any increase in such number as a result
of the operation of clause 2.1.3); and

 
2.2.5
Calypte has ceased to be indebted to SF Capital Partners Limited, Morningtown
Limited and any other persons holding secured promissory notes issued pursuant
to the Purchase Agreement.

 
 
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2.3
The Shares resulting from the conversion hereunder shall be deemed to be issued
and be subject to all the terms of the form of Subscription Agreement between
Calypte and MTBV that was used for the last purchase of Shares by MTBV,

 
2.4
If by the date falling 3 months after the date of this Agreement, the release of
indebtedness under clause 2.1 has not occurred, this Agreement shall, unless the
Parties otherwise agree, automatically terminate.

 
2.5
If at any time prior to the release of indebtedness under clause 2.1, either (a)
SF Capital Partners Limited or Morningtown Limited or any other persons holding
secured promissory notes issued pursuant to the Purchase Agreement demands
payment of all or any of Calypte’s indebtedness to such person, or (b) Calypte
enters into a bankruptcy procedure, including without limitation, Chapter 7 or
Chapter 11 proceedings, then this Agreement shall automatically terminate.

 
3
Warranties and undertakings

 
3.1
Each Party warrants that, as at the date of this Agreement:

 
3.1.1
it has full power to enter into and perform its obligations under this Agreement
and has taken all necessary action(s) to approve and authorise the transactions
contemplated by this Agreement;

 
3.1.2
this Agreement constitutes its valid and binding obligations enforceable in
accordance with the terms of this Agreement, subject to general principles of
equity and laws affecting creditors' rights generally; and

 
3.1.3
all relevant consents (if any) to its entering into this Agreement have been
obtained and neither the entering into nor the performance by it of its
obligations under this Agreement will constitute or result in any breach of any
contractual or legal restriction binding on itself or its assets or
undertakings.

 
3.2
Calypte warrants that the only persons holding secured promissory notes issued
pursuant to the Purchase Agreement are MTBV, SF Capital Partners Ltd and
Morningtown Limited.

 
3.3
MTBV undertakes that it will after the release of indebtedness under clause 2.1
above, upon the request of Calypte and at Calypte’s cost, execute such documents
as are necessary to release the security granted to it by Calypte in connection
with the MTBV Notes and the CF Notes.

 
4
Miscellaneous

 
4.1
An agreement for the transfer of Calypte’s 51% equity interest in Beijing
Calypte and/or Beijing Marr may provide for the payment by the transferee to
Calypte of cash consideration for the transfer of such equity interest. If this
provision exists, it is acknowledged and agreed by Calypte that it exists solely
to enable completion of the transfer of the equity interest to occur as soon as
possible. Calypte hereby unconditionally and irrevocably (i) waives all of its
right to receive such consideration and (ii) releases the transferee from its
obligation to pay all or any of such consideration (the release of Calypte’s
indebtedness to MTBV being the true consideration for the transfer).

 
4.2
The Shareholders Agreements shall be terminated as of the Effective Time and:

 
 
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4.2.1
the parties to the Shareholders Agreements shall have no further rights or
obligations under the Shareholders Agreements;

 
4.2.2
no party to a Shareholders Agreement shall be entitled to bring any claim
against the other party to such Shareholders Agreement by reference to such
Shareholders Agreement and hereby irrevocably waives any right to bring any such
claim; and

 
4.2.3
nothwithstanding the terms of the Shareholders Agreements, no provision of
either Shareholders Agreement shall survive termination of such Shareholders
Agreement.

 
4.3
It is acknowledged and agreed that if, after the Effective Time, Calypte enters
into a bankruptcy procedure, including without limitation, Chapter 7 or Chapter
11 proceedings, and a court, trustee in bankruptcy, liquidator or similar
officer (however called), successfully challenges the arrangements reflected in
this Agreement, all of Calypte’s indebtedness to MTBV arising under the MTBV
Notes and the Credit Facility shall be revived as if it had never been released
and all of MTBV’s rights arising under the relevant agreements shall be revived
as if there had been no interruption. In addition, to the extent possible under
applicable law, MTBV’s status as a first secured creditor of Calypte as at the
date of this Agreement shall be recognised.

 
5
Entire Agreement

 
This Agreement represents the entire agreement between the Parties in relation
to the subject matter of this Agreement and supersedes any previous agreement
whether written or oral between the Parties in relation to that subject matter.
 
6
Counterparts

 
This Agreement may be executed in any number of counterparts and by the parties
on separate counterparts, each of which when so executed and delivered shall be
an original, but all counterparts shall together constitute one and the same
instrument.
 
7
Notices

 
Any notice or other document to be given under this Agreement shall be in
writing and shall either be delivered personally or sent by a recognised courier
company (such as FedEx or DHL)  to the registered office of the party to be
served and shall be deemed duly served (a) in a case of a notice delivered
personally, at the time of delivery, and (b) in the case of a notice sent by
courier, five clear business days after the day of dispatch or, if earlier, the
date of receipt.
 
8
Choice of Law

 
This Agreement shall be governed by and interpreted in accordance with the
internal laws of the State of Delaware without regard to the principles of
conflicts of laws thereof.
 
 
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IN WITNESS whereof this Agreement has been entered into the day and year first
above written.
 
EXECUTED by
CALYPTE BIOMEDICAL CORPORATION
 
 
 
 
……………………..
Authorised signatory
 

EXECUTED by
MARR TECHNOLOGIES B.V.
 
 
 
 
……………………
Authorised signatory
 

EXECUTED by
MARR TECHNOLOGIES LIMITED
 
 
 
 
……………………
Authorised signatory
 

EXECUTED by
MARR TECHNOLOGIES ASIA LIMITED
 
 
 
……………………
Authorised signatory
 

 
 
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