EXHIBIT 10.4
DISTRIBUTION AGREEMENT
This Agreement (the "Agreement") is entered into this 26th day of
August, 1993, by and between REAADS Medical Products, Inc., a Delaware
corporation with offices at 00000 Xxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxxxx, Xxxxxxxx
00000, XXX ("RMP") and Chugai Pharmaceutical Co., Ltd., a corporation organized
and existing under the laws of Japan, with offices at 0-0, Xxxxxxxx 0-xxxxx,
Xxxx-xx, Xxxxx 000, Xxxxx, or one of its affiliated companies ("Chugai").
RECITALS
WHEREAS, RMP is the owner of all rights, title and interest in and to the
"REAADS" enzyme immunoassay product line more particularly described in Article
1.1 hereof (the "Product Line"), including Patent rights (as hereinafter
defined) and/or Know-How (as hereinafter defined) relating thereto, and is
seeking an equity infusion from Chugai, the proceeds of which will be used to
fund research and development of the Vascular Products (as hereinafter defined);
and
WHEREAS, Chugai is engaged in the business of selling and distributing
diagnostic tests and related products in Japan, and desires to obtain from RMP
the rights for distribution of the Product Line in Japan on its own behalf, and
is willing to invest RMP US$500,013 for funding research and development of the
Vascular Products, and desires to purchase such products and sell and distribute
them under Chugai's own label and trademark in Japan; and
WHEREAS, RMP is willing to grant to Chugai the rights to sell and
distribute such products, subject to the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants, representations
and warranties and agreements hereinafter contained, the parties hereto agree as
follows:
AGREEMENT
Article 1. Definitions
1.1 "Product Line" shall mean RMP's Autoimmune Products (defined below)
and Vascular Products (defined below) collectively.
1.1.1 "Autoimmune Products", which shall mean and include Autoimmune
Disease Detection Products for the determination of analyses useful in the
diagnosis and management of systemic rheumatic and autoimmune disease, which
Products are currently under development or were heretofore developed,
manufactured and/or sold by or on behalf of RMP and are identified in Exhibit A
annexed hereto; and
1.1.2 "Vascular Products", which shall mean and include
Vascular Disease Detection Products for the determination of analyses useful in
the diagnosis of vascular disease, which Products are currently under
development or proposed to be developed and/or sold by or on behalf of RMP
identified in Exhibit B annexed hereto. The list of Products set forth in
Exhibit B may be amended from time to time by mutual agreement of the parties.
1.1.3 "Products" shall mean a group of product(s) Chugai selected
for commercial exploit in Territory in either Autoimmune Products or Vascular
Products.
1.2 "Patent Rights" means any or all patent applications and issued
patents held by RMP in the Territory in connection with the Product Line.
1.3 "Know-How" shall mean the accumulation of skills, processes and
experience, including formulas and specifications, heretofore developed by RMP
pertaining to the Product Line, including, but not limited to, any and all
technical information, trade secrets, test results, studies and analysis,
approved vendor list for any raw materials, preclinical and clinical data,
manufacturing data, formulation or production technology, engineering or
assembly methods and other information necessary or useful in the manufacture,
sale and use of the Product Line.
1.4 "Standard Retail Price" shall mean Chugai's average retail prices of
diagnostic kits in the Territory which generally equals to twenty (20) percent
of the National Health Insurance reimbursement prices for any diagnosis.
1.5 "Territory" shall mean and include Japan.
1.6 "Affiliate" shall mean and include any individual, corporation,
business association or entity that controls, is controlled by, or is under
common control with the specified party. For purposes of this definition,
"Control" shall mean direct or indirect beneficial ownership of more than fifty
percent (50%) of the voting stock or other ownership interest of, and fifty
percent (50%) or more interest in the income of, such entity.
1.7 "Effective Date" shall mean the date as set forth on the first page
hereof.
Article 2. Sales and Distribution Rights.
2.1 Non-exclusive Rights. Subject to the terms and conditions hereinafter
set forth, RMP hereby grants to Chugai the non-exclusive right to sell and
distribute the Products in Autoimmune Products under Chugai's label and
trademark in the Territory during the term of this Agreement.
2.2 Exclusive Rights. Subject to the terms and conditions hereinafter set
forth, RMP hereby grants to Chugai the exclusive right, with the right to
appoint subdistributors, to sell and distribute the Vascular Products under
Chugai's label and trademark in the Territory during the term of this Agreement.
RMP and Chugai may agree to add new products to Exhibit B during the term of
this Agreement.
2.3 RMP shall not enter into any new agreements for any product in the
Product Line allowing rights to distribution in Japan without prior written
consent of Chugai, except for products which Chugai elects not to commercialize
in Japan as specified in Article 3.2.
Article 3. Selection of Products.
3.1 Review of Projects for Product Development. RMP shall utilize the
investment made by Chugai in the development of Vascular Products. RMP and
Chugai shall review potential projects for such product development on a regular
basis. Chugai's opinion of project importance shall be considered by RMP in the
preparation of priority ranking for RMP's Research and Development schedule.
This review shall occur at least once per year while this Agreement is in
effect, and at least one review shall occur just prior to the preparation of
RMP's annual operating plan and budget. Notwithstanding Chugai's participation
in such reviews, the final decision on incorporation of projects into the RMP
Research and Development program shall be RMP's and shall reflect limitations in
the Research and Development manpower and facility resources.
3.2 Selection of Products for Japanese Market. Chugai shall have the right
to select which Products of the Vascular Products are appropriate for commercial
exploitation in Territory. For product(s) in Vascular Products which Chugai
chooses not to select for commercial distribution in Territory, RMP shall have
the rights to distribute the products in Territory either directly or
indirectly. RMP shall inform Chugai in writing of the availability of a product
before RMP files application of such product to the FDA for approval, and Chugai
shall inform RMP in writing of its acceptance or rejection of such product for
commercial exploitation in Territory within six (6) months after FDA approval
has been received for such product.
Article 4. Terms and Conditions of Product Sale
4.1 Purchase Orders. All purchase orders and amendments thereto must be in
writing, must reference this Agreement, and should contain (i) all technical
information necessary for RMP to accurately supply the Products, (ii) quantity,
(iii) date of requested delivery, and (iv) preferred shipping instructions. All
such orders are subject to acceptance by RMP and RMP reserves the right not to
accept any purchase order within one (1) week of receipt of the purchase order.
If RMP fails to notify non-acceptance of any order within the aforesaid term by
written notice to Chugai stating the reasons for such non-acceptance, the
purchase order shall be deemed accepted. Acceptance of orders may not be
unreasonably withheld by RMP.
4.2 Prices. The price per unit at which RMP shall sell the Products to
Chugai hereunder shall be negotiated on an annual basis, and will be reflective
of RMP's cost, Chugai's pricing at the retail level in Territory and other
market conditions. The prices for Products purchased hereunder shall be the
prices in effect on the date RMP receives Chugai's purchase order. A price list
in effect until December 1, 1994 is attached as Exhibit A.
The Prices will be adjusted as necessary before December 1 each year,
beginning December 1, 1994, and such adjusted Prices shall be applied for the
next calendar year, provided that the Prices shall not increase by more than the
rate of increase in the United States Consumer Price Index - All Urban
Consumers, published by the United States Department of Commerce. Prices shall
not exceed twenty-five (25) percent of Standard Retail Price for each Product
nor be less than RMP's fully burdened manufacturing cost plus fifty percent
(50%).
Should the parties be unable to agree on adjustment of Prices for the
following calendar year by December 1 of the year before, the Prices of the year
before shall be applied also for the first six (6) months of the following
calendar year. Should the parties be still unable to agree by June 1, the Prices
for the last six (6) months shall be determined by a mutually agreeable
conciliator at a mutually agreeable place.
In any case, RMP shall provide Chugai with pricing no less favorable for
Autoimmune Products than pricing provided by RMP to other companies with
distribution rights to Autoimmune Products in Territory.
4.3 Invoices. RMP shall invoice Chugai at its address set forth below at
the time of each shipment of any Products. Invoices shall not be issued prior to
shipment of all items covered by the invoice. Invoices shall contain the
purchase order number, description of items purchased, price, freight charges
and total. Payment shall be made by Chugai to RMP in US dollars.
4.4 Delivery. RMP shall deliver such Products in accordance with
Chugai's shipping instructions within thirty (30) days from RMP's receipt of
Chugai's purchase order. All Products shall be delivered to Chugai in finished
and packaged form, C&F Tokyo International Airport, to the address specified in
the applicable purchase order. RMP shall be responsible for boxing, crating,
handling, storage and all other packaging requirements prior to shipment. All
Products shall be packed, marked and otherwise prepared for shipment in a manner
which is in accordance with good commercial practice and adequate to ensure the
safe arrival of the Products.
If RMP wants to change the scheduled delivery date or the quantity to
deliver which RMP accepted in accordance with the Article 4.1, RMP shall notify
Chugai of the change in writing at least seven (7) days prior to the delivery
date originally scheduled. If, for any reason, other than as expressly provided
for in this Agreement, RMP fails to dispatch, without prior notice to Chugai as
set forth hereinabove, all quantities of Products Chugai ordered within five (5)
business days after the delivery date originally scheduled, RMP agrees to pay to
Chugai ten (10) percent of total invoice amount of the order place by Chugai.
4.5 Forecasts. Every six (6) months, on or before May 31 and November 30,
Chugai shall submit a non-binding forecast of its estimated requirements of
Products for the six (6) month periods of July 1 and January 1. Chugai agrees
that all such forecasts shall be prepared in good faith in order to facilitate
RMP's timely manufacture and shipment of the Products in accordance with the
terms of this Agreement. RMP shall provide Chugai with expected availability
dates of new products so that Chugai can include the new products in the
forecast provided to RMP.
4.6 Rejection. All Products shall be subject to inspection and acceptance
by Chugai. In the event that Chugai believes that any of the Products shipped by
RMP to Chugai hereunder do not meet the quality standards and specifications set
forth in this Agreement, Chugai shall have the right to reject such shipment by
giving RMP prompt notice thereof. Upon receipt of any such notice, RMP may at
its option obtain samples of the rejected shipment from Chugai for analysis. At
Chugai's option, Chugai may either request RMP to promptly deliver a new
shipment of the Products to replace the rejected shipment or return the rejected
shipment to RMP so that RMP may cure all defects and deficiencies and deliver
the corrected shipment to Chugai within thirty (30) days after RMP's receipt of
such returned shipment. In either event, RMP shall bear all freight costs in the
delivery of the Products between Chugai and RMP.
4.7 Quality Assurance. RMP shall strictly adhere to the quality control
procedures and specifications for the manufacture and performance of Products or
as may be otherwise necessary to meet applicable governmental specifications for
the manufacture of the Products. RMP shall certify to Chugai with respect to
each such shipment that all such procedures and specifications have been met and
complied with, and shall furnish Chugai with copies of the test results and
other definite data supporting its certification if requested in writing.
4.8 Labeling and Trademarks. The Products shall bear such trade names,
trademarks, designs and logos as may be designated and supplied by Chugai,
subject to the requirements of applicable law.
4.9 Product Warranty. All Products furnished by RMP to Chugai hereunder
shall be warranted (i) to be manufactured in accordance with applicable product
specifications; (ii) to be manufactured in accordance with good manufacturing
practices (as defined by FDA regulations); (iii) to be free from defects in
formulation and manufacture under the normal use and service for which they were
designed; (iv) to be suitable for sale to the public in accordance with the
terms of the Products' labels and inserts; and (v) as to RMP's good title and
conveyance of good title to Chugai. Such warranties shall run to Chugai, and its
successors, assigns and users of the Products and shall expressly survive any
inspection, delivery, acceptance, payment, expiration or earlier termination of
this Agreement. Except as set forth in Article 10 the warranties of RMP set
forth in this Article 4.9 are the sole and exclusive warranties provided to
Chugai, its successors, assigns and users of the Products, and are in lieu of
all other warranties, whether written or oral, implied or statutory. RMP shall
not be liable to Chugai for any loss of profits or other special, indirect or
consequential damages suffered by Chugai resulting from the failure of or a
defect in any Product, provided, however, that no such limitation shall apply
with respect to any such damages suffered by unaffiliated third parties. All
Product labels shall appropriately reflect the product warranties, and
limitations thereof, provided by this Article 4.9. RMP shall not be responsible
to Chugai or Chugai's agents for any breach of warranties hereunder which
depends solely upon Chugai's willful misconduct or negligence in handling of the
Products, to the extent RMP has theretofore fully disclosed to Chugai the
appropriate way of handling the Products when particular cautions are required
in connection therewith.
4.10 Compliance with Law. RMP shall take all necessary action to comply
with all applicable FDA and other regulatory requirements in connection with the
manufacture of Products. Such obligations shall include, without limitation,
complying with all applicable good manufacturing practices and good laboratory
practices as promulgated under applicable U.S. law, and any material state or
local law or regulation applicable to the manufacture of Products hereunder.
Chugai shall have the right upon reasonable notice to RMP to inspect RMP's
manufacturing facilities and operations and quality control records to review
and inspect the manufacture of Products, to audit and confirm compliance with
the requirements of this Article 4.10 and to trace production in connection with
any recall, product liability or other problems related to the manufacture. Any
such inspection or right to inspect by Chugai shall in no way relieve RMP of its
obligation to deliver Products conforming to the terms and specifications set
forth in this Agreement, or Chugai's right to inspect and reject Products.
4.11 Insurance. RMP shall at all times maintain product liability
insurance, insuring against losses arising out of the manufacture and use of the
Products and all components thereof, naming Chugai as an additional insured
under such policy of insurance. The liability of such policy shall be no less
than Two Million Dollars ($2,000,000) for each occurrence. RMP agrees that it
shall provide within sixty (60) days of execution of this Agreement, a
certificate of insurance evidencing the existence of such insurance and
confirmation of the fact that Chugai is listed as an additional insured.
Article 5. Assignment
5.1 Assignment. Neither party shall assign this Agreement without the
prior written consent of the other party hereto, except to (i) an Affiliate of
such party, (ii) a transferee of substantially the entire business of such party
to which this Agreement pertains or (iii) a successor to such party by merger or
consolidation, in connection with the transfer or sale of substantially its
entire business to which this Agreement pertains, or in the event of its merger
or consolidation with another company. Any assignee shall assume all obligations
of its assignor under this Agreement. No assignment shall relieve any party of
responsibility for the performance of any accrued obligation which such party
then has hereunder. This Agreement shall be binding on and inure to the benefit
of the respective successors and permitted assigns of the parties. Except as
provided herein, no other person shall acquire or have any right under or by
virtue of this Agreement.
5.2 License to Manufacture. In the event that a change in control of RMP
occurs without Chugai's approval, including, but not limited to, the merger or
consolidation with a third party company, RMP will grant to Chugai a perpetual,
non-exclusive for Autoimmune Products, exclusive for Vascular Products, license
under the Patent Rights and/or the Know-How to make, use and sell the assays in
the Product Line in Territory, and Chugai shall pay to RMP royalty of three (3)
percent on the net sales of Product Line sold by Chugai in Territory.
Chugai shall have the royalty-free right to utilize RMP's Patent Right
and/or Know-How, if for any reason RMP ceases or suspends performance of its
obligations under this Agreement (i) in connection with the manufacture of
Products or (ii) to complete any development effort with respect to Vascular
Products.
5.2.1 Right to Sublicense. In the event that RMP grants Chugai a
license to Manufacture, Chugai shall be entitled to sublicense the rights
conferred upon it under Article 5.2, but only to the extent necessary to allow
third parties to manufacture the Products for and on behalf of Chugai or an
affiliate, and provided that (i) Chugai should give RMP or its assignee thirty
(30) days prior written notice before any such sublicense shall become
effective; (ii) any such sublicense shall be subject in all respects to the
restrictions, exceptions and provisions contained in this Agreement; (iii) no
such sublicense shall relieve Chugai of its obligations hereunder; and (iv)
Chugai and each such sublicensee shall execute documents to the foregoing
effort, a copy of which will be furnished to RMP or its assignee promptly after
execution and delivery.
Article 6. Performance Standards
6.1 Diligent Efforts. At all times during the term of this Agreement,
Chugai will use its commercially diligent efforts to market the Products in
Territory and will not perform any acts that might jeopardize the reputation of
the Products or of RMP in Territory.
6.2 Confidentiality. Chugai acknowledges that during the course of this
Agreement it will become privy to confidential information of RMP concerning RMP
itself, RMP's business strategy, and other technical, business and financial
matters. Chugai further acknowledges that the disclosure of such information to
a third party, or the use of such information for purposes other than the
purposes of this Agreement, might cause irreparable injury to RMP, which injury
might not be compensated for adequately by money damages. Chugai accordingly
agrees to hold all such information so designated by RMP in strictest confidence
and not to disclose any such information to a third party except as expressly
permitted by RMP, or use such information for any purpose other than the
purposes hereof. This Article shall survive any termination of this Agreement
for a period of three (3) years.
As used herein, the term "confidential information" shall not include
information that (i) is or becomes generally available to the public other than
as a result of disclosure by Chugai, (ii) was available to Chugai on a
nonconfidential basis prior to its disclosure by RMP or (iii) becomes available
to Chugai on a nonconfidential basis from a source other than RMP that is not
otherwise prohibited from disclosing such information.
6.3 Promotion of Product Awareness. Chugai shall bear all expenses for
marketing and promoting Products in Territory.
6.4 Licenses and Permits. RMP shall be responsible for obtaining all
export licenses required by the U.S. government for any of the Products and will
use its best effort to obtain such licenses as expeditiously as possible, as
well as the cost of such licenses and permits. Chugai shall be responsible for
obtaining all licenses and permits required by any governmental authority in
order to import a Product into Territory, as well as the cost of such licenses
and permits. Each party agrees to comply with all applicable laws, regulations
and orders governing the sale, disposition, shipment, import or export of the
Products and maintain in effect all licenses, permits and authorizations from
all government agencies as may be necessary to perform its obligations
hereunder.
Article 7. Regulatory Compliance
7.1 U.S. Regulatory Approvals. RMP, at its own expense, shall exercise
best efforts with respect to all currently non-FDA approved assays in the
Product Line, to diligently prepare, file and prosecute all necessary
applications as soon as possible to obtain 510(k) approval from the FDA for the
commercial manufacture, use and sale of each such product in the United States,
including, without limitation, submission of all necessary reports, responses to
requests for information, data, samples, test and the like, and the exhaustion
of all administrative remedies available in instances of adverse action by the
regulatory authorities. Subject to the confidentiality provisions of Article
6.2, Chugai shall be given access to all underlying data, reports and summaries
upon which any such applications for FDA approval have been based.
7.2 Japanese Regulatory Approvals. Chugai shall be responsible for, and
shall bear the expense of, filing and prosecuting any application to obtain the
required governmental approvals or consents necessary to manufacture, test and
market Products in Territory. RMP shall, however, provide Chugai, at no cost to
Chugai, with all technical and regulatory documentation and information
(including, without limitation, all clinical data) in RMP's possession or under
its control, or obtainable without unreasonable burden to RMP.
7.3 Customer Complaints. Each party shall immediately notify the other
party in writing should it become aware, through customer complaint or
otherwise, of any defect or condition which may render Products in violation of
law or FDA and/or Japanese equivalent regulations.
Article 8. Technical Support
8.1 Technical Assistance and Training. RMP shall provide training and
technical assistance to Chugai's personnel necessary for the marketing of the
Products. Such technical assistance and training shall be provided at RMP's
facility in Westminster, Colorado, or, if agreed by the parties, at Chugai's
premises. Such technical assistance and training shall be provided by RMP at no
charge to Chugai, except that if the training is performed at Chugai's premises,
RMP's personnel shall be entitled to receive their reasonable expenses of
travel, meals, and lodging upon submission of documentary evidence thereof. If
training is provided at RMP's facility in Westminster, Colorado, Chugai's
personnel shall bear their own expenses of travel, meals and lodging. All
technical assistance and training shall be performed at times convenient to both
parties.
8.2 Sales Aids. RMP shall provide Chugai with minimum amounts of sample,
sales and promotional material and technical literature developed by it with
respect to the Products. All such material shall be furnished by RMP in English.
Any translations of such material into a language other than English shall be
Chugai's responsibility and expense, but RMP shall be provided with a copy of
such translation. RMP shall have the right at all reasonable times to inspect
and approve all materials, including advertising and packaging, used to sell the
Product where such materials employ the RMP's or a subsidiary's patents, pending
patents, or the servicemark REAADS.
8.3 Manuals. RMP shall provide Chugai on a current basis with instructions
and manuals in English relating to the Products.
Article 9. Intellectual Property
9.1 Right of Use. RMP hereby grants to Chugai the right to use any
trademarks, trade names, service marks, copyrights, logos or labels of RMP
relating to the Products in connection with its marketing and sales of Products
under this Agreement. Chugai will not acquire ownership in such marks, or trade
names, copyrights, logos or labels by virtue of such use.
9.2 Infringement. In the event Chugai becomes aware of any infringement by
any third party of any trademarks, copyrights, patents or other property rights
of RMP, Chugai will promptly notify RMP of such infringement and will cooperate
with RMP as reasonably requested by RMP and at the expenses of RMP in taking
steps to end such infringement.
In the event any claim is brought against RMP or Chugai by any third party
alleging infringement of the third party's patents or other property right for
manufacture, use, or sale of Products, (a) Chugai will cooperate with RMP at
RMP's cost as reasonably requested by RMP in defense of any such claims brought
against RMP, and (b) RMP will cooperate with Chugai at RMP's cost in defense of
any such claims brought against Chugai. Chugai shall be reimbursed by RMP for
any damages paid by Chugai as a result of such claims.
Article 10. Shelf Life Warranty; Cancellation and Reschedule Changes
10.1 Shelf Life Warranty. RMP warrants that the Products shall have a
shelf life, at the time of receipt by Chugai, of at least 80% of the shelf life
stated on the label or Product insert. RMP shall not be liable for any failure
to satisfy the shelf life requirement to the extent such variance is caused by
conditions or events occurring after shipment over which RMP has no control.
10.2 Notice. Should Chugai discover any Product which fails to satisfy the
shelf life warranties contained in Article 10.1., Chugai shall notify RMP in
writing within fifteen (15) business days after such discovery. RMP shall, at
Chugai's election, either refund the portion of the purchase price to Chugai,
allocable to the Product which gives rise to the claim, or correct such defect
by suitable replacement at its own expense. RMP's obligation under this section
shall be conclusively discharged, to the extent permitted under applicable laws,
if RMP does not receive written notification of any defect within fifteen (15)
business days after its discovery.
10.3 Third Party Claims. The provisions of this Article 10.1. and
Article 10.2. are not applicable to any third party claims.
10.4 Cancellation and Reschedule Charges. If, for any reason, other than
as expressly provided for in this Agreement, Chugai (i) cancels all or any part
of any order, or (ii) fails to meet any obligation hereunder, causing
cancellation or rescheduling of any order or portion thereof, or (iii) requests
a rescheduling of scheduled shipments of Products, and the request is accepted
by RMP, Chugai agrees to pay to RMP the following cancellation/reschedule
charges:
CANCELLATION OR RESCHEDULE CANCELLATION OR RESCHEDULE
NOTICE RECEIVED CHARGE
Within 7 days after the date of
placing purchase order by Chugai 20% of invoice amount of Product not taken
Thereafter up to scheduled delivery 30% of invoice amount of Product not taken
The aforementioned charges shall not apply in case that the events described in
the first paragraph of this Article 10.4 are due to events of force majeure as
defined in Article 16.7.
Article 11. Effective Date and Term
This Agreement shall become effective upon its execution by both parties
on the Effective Date. Unless earlier terminated by either party, this Agreement
shall be effective for seven (7) years from the Effective Date, and shall be
automatically renewed after the initial term for successive one (1)-year period
each unless terminated by either party as provided in Article 12 hereof.
Article 12. Termination
Either party will have the right to terminate this Agreement if the other
party: (a) assigns this Agreement or any of these rights hereunder in violation
of the provisions of this Agreement; (b) becomes bankrupt or insolvent; (c)
makes an assignment for the benefit of creditors, or a receiver, trustee in
bankruptcy or similar officer is appointed to take charge of all or part of its
property; (d) materially breaches its obligations under this Agreement, and such
breach has not been cured within thirty (30) days of written notice thereof by
the non-breaching party; (e) notwithstanding the foregoing each party will have
the right to terminate this Agreement at the end of the initial term and of each
subsequent term as provided for in Article 11 above by six (6) months prior
written notice.
Notwithstanding the non-exclusive license to manufacture granted to Chugai
as set forth in the Article 5.2, Chugai may terminate this Agreement within
ninety (90) days of written notice in the event there is a significant change in
the control of RMP or in the event of the departure of any director, officer or
other staff of RMP that might be perceived as having a significant negative
impact on the business. Information referring to the above events should be
given to Chugai within fourteen (14) days from such event, and Chugai should
communicate its intentions to RMP within thirty (30) days.
Article 13. Rights and Obligations Upon Termination
In the event of termination of this Agreement for any reason, Chugai shall
cease all use of any trademarks, trade names or other rights licensed hereunder,
and shall return to RMP all sales or promotional material, and all manuals,
instructions and other material relating to the Products which Chugai then has
in its possession, except for copies of manuals and instructions needed to
accompany Products already sold on the termination date or to be sold in
connection with the termination of the distributorship, or if the materials
belong to Chugai.
Chugai shall not, at any time thereafter, permit the trademarks, trade
names, or other rights to be used in any manner in connection with any business
conducted by it, or in which it may have an interest, or otherwise as
descriptive of or referring to the Products. RMP shall fulfill any orders for
Products placed by Chugai prior to the date of termination. RMP's sole liability
in case of termination shall be to repurchase Chugai's inventory at the prices
set forth in the last applicable purchase order to the extent the same has not
been sold within three (3) months from the termination date. RMP shall not be
obligated to compensate Chugai for any investments made by Chugai or any
goodwill built up by Chugai, or for any losses or damages of whatever nature
incurred by Chugai as a result of such termination. Chugai hereby expressly
assumes all risk for such investments and losses.
Article 14. Arbitration
Any controversy or claim arising under or in relation to this Agreement,
except as otherwise expressly provided below, shall be settled exclusively by
arbitration in accordance with the International Arbitration Rules of the
International Chamber of Commerce (ICC). Arbitration shall take place in Paris,
France. The arbitration shall be conducted in English. The cost incurred by the
arbitration shall be borne equally by the parties except for each attorneys'
fees which shall be borne by each party. The decision of the arbitrators shall
be final and binding on the parties, and judgment upon the award rendered by the
arbitrators may be entered by any court having jurisdiction thereof.
Article 15. Indemnification and Settlement
If RMP wishes to settle a case for which Chugai is liable for
indemnification, RMP shall first obtain the written approval of the Chugai.
Article 16. General Provisions
16.1 Entire Agreement. This Agreement, including the Exhibits, constitutes
the entire agreement between the parties with respect to the subject matter
hereof, and may not be modified (unless expressly provided otherwise herein)
except by a written addendum duly signed by both parties. The terms and
conditions of this Agreement shall prevail notwithstanding any other terms and
conditions on any order submitted by Chugai.
16.2 Waiver, Etc. Except where specific time limits are herein provided,
no delay on the part of either party hereto in exercising any power or right
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any power or right hereunder preclude other or further exercise
thereof or the exercise of any other power or right. No waiver, modification or
amendment of this Agreement or any provision hereof shall be enforceable against
any party hereto unless in writing, signed by the party against whom such
waiver, modification or amendment is claimed, and with regard to any waiver,
shall be limited solely to the one event.
16.3 Notices. Any notices or report required or permitted under this
Agreement must be in writing and by mail, registered or certified, return
receipt requested, postage prepaid addressed to the other party at address set
forth hereinbelow, or to such other address as designated by written notice
given to the other party:
If to RMP: If to Chugai:
Xx. Xxxx X. Xxxxx General Manager
President Diagnostics Division
REAADS Medical Products, Inc. Chugai Pharmaceutical Co., Ltd.
00000 Xxxxx Xxxxxx, Xxxxx 000 21-1, Nishi-Shinjuku 1-Chome
Xxxxxxxxxxx, Xxxxxxxx 00000 Shinjuku-ku, Tokyo 160
U.S.A. Japan
16.4 Governing Law. The validity and interpretation of this Agreement
shall be governed and construed according to the laws of the State of Colorado,
U.S.A.
16.5 Relationship Created. Nothing in this Agreement shall be construed as
establishing an agency, joint venture or partnership between the parties. Chugai
is an independent contractor, and shall have sole responsibility for its
employees, even while such employees are receiving training at RMP's facility.
16.6 Authority. Each party hereby represents and warrants that it has full
power and authority to enter into and perform this Agreement, without any
governmental approvals, and that its entering into and performance of this
Agreement will not conflict with any other agreement to which it is party or by
which it is bound.
16.7 Force Majeure. Each party shall be relieved of its obligations under
this Agreement to the extent that fulfillment of such obligations shall be
prevented by acts of war, labor difficulties, riots, fire, earthquake, flood,
hurricane, windstorm, acts or defaults of common carrier, governmental laws,
acts or regulations, shortages of materials or any other occurrences, whether or
not similar to the foregoing, beyond the reasonable control of the affected
party.
16.8 Headings. The headings of Articles and Sections herein are for
convenience of reference only and shall not affect the meaning or construction
of the provisions of this Agreement.
IN CONSIDERATION OF the foregoing terms and conditions, Chugai and RMP
have executed this Agreement on the day and year first written above.
ATTEST: REAADS Medical Products, Inc.
/s/ Xxxxxx X. Xxxxxx
-------------------------------- By /s/ Xxxx X. Xxxxx
Secretary (SEAL) ------------------------------------
Xxxx X. Xxxxx, M.D.,
President
ATTEST: Chugai Pharmaceutical Co., Ltd.
/s/ Xxxxx Xxxxxx
--------------------------------- By /s/ Xxxx Xxxx
Secretary (SEAL) ------------------------------------
Xxxx Xxxx, Director/General Manager
Diagnostics Division
EXHIBIT A
Autoimmune Disease Detection Products
Product Proposed Transfer Price (USD)
(per 96-well test kit)
IgM-RF $ 90.00
Anti-dsDNA $ 90.00
Anti-Sm $ 90.00
Anti-ENA (Sm/RNP Complex) $ 90.00
IgG/IgM anti-cardiolipin $ 90.00
IgA anti-cardiolipin $ 90.00
XXX $130.00
Anti SSA/SSB Not yet determined
Anti Scl-70 Not yet determined
Anti Histones Not yet determined
EXHIBIT B
Vascular Disease Detection Products
Anti-endothelial cell antibodies
Anti-neutrophil cytoplasmic antibody
Anti-phosphatidyl serine
Anti-protamine
Antithrombin III
Antitrophoblastic antigen
Beta 2 glycoprotein I antibody
Heparin Cofactor II
Lp(a)
Lupus anticoagulant
Oxidized LDL antibodies
Plasminogen
Plasminogen activator inhibitor - I
Protein C
Protein S
Thrombomodulin
Tissue plasminogen activator
EXHIBIT C
Existing OEM Relationships with Japanese sales rights
Company Approximate Transfer Price
(per 96-well test kit)
Sanofi Diagnostics Pasteur (US) $110.00
Biopool (US) $150.00
IDS (UK) $ 95.00 (Bulk)
Schiapparelli (Italy) $127.00
Chromogenix (Sweden) $127.00
Sigma (US) $100.00 (Bulk)
EXHIBIT D
INTERNATIONAL DISTRIBUTION SALES POLICY
TO ORDER Send order to: REAADS Medical Products, Inc.
00000 Xxxxx Xxxxxx - Xxxxx 000
Xxxxxxxxxxx, XX 00000
U.S.A.
Or Telefax t303-457-4519
Telephone: 000-000-0000
MINIMUM ORDER 25 units of any kit, or any combination of kits.
PRICES List prices are in U.S. Dollars, C & F Tokyo. Unless
otherwise agreed upon by REAADS Medical Products, Inc., and
ordering party, all sales are made on C & F basis (as
defined in Incoterms, I.C.C. Publication No. 350).
PAYMENT Sixty (60) day net. Payment will be made by direct wire
transfer to:
Norwest Bank of Denver
0000 Xxxxxxxx
Xxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Routing No.: REAADS Medical Products, Inc.
1020 0007 6
Instruct to further credit to:
Norwest Bank of Broomfield
#0 Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Account No.: REAADS Medical Products Inc.
#187 0003074
If payment is made via letter of credit, the distributor must request
REAADS's instructions for letters of credit.
SHIPPING Via air freight. Shipments go refrigerated. Kits can
remain in original packaging for only 48 hours. Please
indicate if a Customs Broker should be notified.
RETURNED GOODS No unauthorized returns will be accepted.
WARRANTY There are no warranties which extend beyond the description
and directions set forth on the labeling of our products.
