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EXHIBIT 10.5
DISTRIBUTION AGREEMENT
Dated as of June 30, 1999
Among
DonJoy, L.L.C.
And
Xxxxx & Nephew, Inc.
Xxxxx & Nephew GMBH, Austria
Xxxxx & Nephew GMBH, Xxxxxxx
Xxxxx & Nephew OY, Finland
Xxxxx & Nephew Nederland BV, Xxxxxxx
Xxxxx & Nephew K.K., Japan
Xxxxx & Nephew LDA., Portugal
Xxxxx & Nephew (Belgium) S.A. - N.V., Belgium
Xxxxx & Nephew FZE, Dubai
Xxxxx & Nephew Medical Limited, India
Xxxxx & Nephew Limited, Korea
Xxxxx & Nehpew (Malaysia) Ltd., Malaysia
Xxxxx & Nephew (Overseas) Limited Philippine Branch
Xxxxx & Nephew Inc., Puerto Rico
Smith & Nephew Limited, Thailand
Xxxxx & Nephew AB, Sweden
Xxxxx & Nephew Limited, Ireland
Xxxxx & Nephew Laboratoires Xxxxx XX, France
Xxxxx & Nephew AG, Switzerland
Xxxxx & Nephew S.r.I., Italy
Xxxxx & Nephew A/S, Norway
Xxxxx & Nephew Iberica S.A., Spain
Xxxxx & Nephew A/S, Denmark
Xxxxx & Nephew Medical Limited, UK
Xxxxx & Nephew Pty. Limited, Australia
Xxxxx & Nephew Pte. Limited, Singapore
Xxxxx & Nephew Limited, Hong Kong
Xxxxx & Nephew SA de CV, Mexico
Xxxxx & Nephew Inc., Canada
Xxxxx & Nephew Limited, South Africa
Xxxxx & Nephew Limited (New Zealand)
And
Xxxxx & Nephew (Far East) - Taiwan Branch
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DISTRIBUTION AGREEMENT
DISTRIBUTION AGREEMENT, (this "Agreement") dated as of June 30, 1999
among DonJoy, L.L.C., a Delaware limited liability company ("DonJoy, L.L.C."),
Xxxxx & Nephew, Inc., a Delaware corporation ("S&N"), and the affiliates of S&N
listed on Schedule 1 hereto (the "S&N Group Companies").
WHEREAS, pursuant to a Recapitalization Agreement dated April 29,
1999 (the "Recapitalization Agreement") among DonJoy, L.L.C., S&N and Xxxxx XX
Partners, LLC ("Investor"), DonJoy, L.L.C. is selling Investor 645,500 Common
Units of DonJoy, L.L.C. and DonJoy, L.L.C. is redeeming 2,000,000 Common Units
from S&N, such that upon consummation of the transactions contemplated by the
Recapitalization Agreement, Investor will own approximately a ninety percent
(90%) membership interest in DonJoy, L.L.C.;
WHEREAS, it is a condition to Investor's obligations under the
Recapitalization Agreement that S&N and DonJoy, L.L.C. enter into this
Agreement;
WHEREAS, any term not otherwise defined herein shall have the meaning
ascribed to such term in the Recapitalization Agreement; and
WHEREAS, the parties wish to provide for the continued distribution by
S&N Group Companies of certain products of the Business to be hereafter
manufactured or sourced from third-party vendors and sold by DonJoy, L.L.C.;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
DonJoy, L.L.C., S&N and the S&N Group Companies hereby agree as follows:
1. PURCHASE AND SALE OF PRODUCTS. From time to time during the
term of this Agreement, DonJoy, L.L.C. will sell to S&N and S&N will purchase
from DonJoy, L.L.C. certain health care products as set forth in Schedule 1
attached hereto under the "DonJoy", "ProCare" and other brand names of the
specific type manufactured or purchased from third parties, and sold on and
prior to the date hereof by the Business and such other products as may be
generally offered for sale by DonJoy, L.L.C. during the Term (as hereinafter
defined) of this Agreement (the "Products").
2. PRICES AND TERM OF SALE. (a) Except as otherwise noted in
Schedule 2, S&N will pay the same transfer prices charged by S&N for equivalent
Products on its sales to S&N Group Companies immediately prior to the date
first set forth above (the "Effective Date"). Such prices shall remain firm
until December 31, 1999. Thereafter, DonJoy, L.L.C. and S&N agree to
renegotiate the price of any Product in good faith. Such renegotiations shall
be finalized on or before September 1, 1999. All invoices from DonJoy, L.L.C.
to S&N will be due and payable net within sixty (60) days. All shipments shall
be sent FOB factory and all shipping charges shall be paid by S&N, and
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the title and risk of loss shall pass to S&N on delivery of the products to the
common carrier designated by S&N. S&N shall be responsible for the payment of
taxes assessed in respect of the sale, import duties and insurance relating to
Products purchased from DonJoy, L.L.C. All amounts to be paid or credited and
the prices set forth hereunder shall be denominated in United States dollars.
Shipments shall be made either to the Territory (as hereinafter defined) or a
consolidation center designated by S&N in accordance with practices in effect
as of the Effective Date; provided that S&N shall provide information with
respect to in-market sales to DonJoy, L.L.C.
To place an order for the Products hereunder, S&N Group
Companies shall deliver to DonJoy, L.L.C. purchase orders specifying the type
and quantities of the Products to be purchased, which purchase orders shall
provide for the delivery date for the shipment. DonJoy, L.L.C. shall use
commercially reasonable efforts to fill any such purchase order within the time
period set forth therein or such other reasonable period of time as is
customarily required for DonJoy, L.L.C. to fill an order of such Products
within the specified time requested on such order. For a period of forty-five
(45) days following receipt of a shipment by an S&N Group Company at the
address specified in the applicable purchase order, such S&N Group Company
shall have the right of inspection and may reject any Product which (a) fails
to meet specifications, (b) which was not Processed (as hereafter defined),
Packaged (as hereafter defined) or shipped in compliance with applicable
governmental or regulatory requirements or the provisions of this Agreement,
(c) which is defective in material or workmanship, (d) otherwise fails to
comply with the requirements of this Agreement or (e) which was damaged in
transit prior to delivery to the common carrier designated by S&N. Any notice
of rejection must be given on or before the forty-fifth (45th) day following
receipt of the particular shipment of the Products by such S&N Group Company,
and any failure to give such notice shall be deemed to constitute acceptance of
delivery; provided, however, that notices of rejection based on latent or
otherwise unapparent defects in the Products may be given at any time following
receipt of the particular shipment of the Products by S&N Group Companies. If
any defective or damaged Products are timely rejected by an S&N Group Company,
DonJoy, L.L.C. shall credit the account of the S&N Group Companies for the
portion of the invoiced amount that relates to such defective or damaged
Products, such credit to be applied against the invoice relating to such
defective or damaged Products if not previously paid by S&N Group Companies or,
if such invoice has been paid by S&N Group Companies, against future purchases
of S&N Group Companies under this Agreement. If, in lieu of such credit, a S&N
Group Company requests in its rejection notice that it desires to receive
replacement Products, DonJoy, L.L.C. shall ship such replacement Products at
DonJoy, L.L.C.'s expense within ten (10) days after receipt of, or as otherwise
provided in, the notice of rejection hereunder. If requested by DonJoy,
L.L.C., S&N Group Companies shall return such defective or damaged Products to
DonJoy, L.L.C. at DonJoy, L.L.C.'s expense. For purposes of this Agreement,
the term "Packaged" shall mean the procedure whereby the Products, or any part
thereof, were inspected, labeled, packaged and packed in accordance with the
requisite specifications. The term "Processed" shall mean the procedures
involved in the manufacture and preparation of the Products or any part thereof
in accordance with the requisite specifications.
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3. QUANTITIES. During the term of this Agreement, S&N will use
its commercially reasonable efforts to have S&N Group Companies purchase,
subject to changing market conditions, from DonJoy, L. L.C. the same quantities
of Products included in DonJoy, L.L.C. budgets set forth on Schedule 3, ("1999
Purchase Level"); provided, however, that the S&N Group Companies shall not be
subject to any minimum purchase requirements. S&N shall give DonJoy, L.L.C. a
30 day forecast at the beginning of each month of its requirements for such
month. DonJoy, L.L.C. will use its commercially reasonable efforts to supply
and sell to the S&N Group Companies the quantities of the Products that S&N
Group Companies desire to purchase under this Agreement. DonJoy, L.L.C. agrees
that it will sell to S&N Group Companies, pursuant to purchase orders properly
delivered pursuant to Section 2 hereof, quantities of Products at least equal
to the 1999 Purchase Level. DonJoy, L.L.C. shall, if DonJoy, L.L.C. reasonably
determines that its available manufacturing capacity permits, and may, in its
sole discretion if otherwise, agree to sell quantities of Products in excess of
the 1999 Purchase Level.
4. DISTRIBUTION AND RESALE. S&N will use its commercially
reasonable efforts to have each S&N Group Company distribute and resell,
subject to changing market conditions, the Products in the same geographical
markets within the Territories. DonJoy, L.L.C. shall make available to S&N at
the same costs in effect as of the Effective Date, adequate and reasonable
sales literature, promotional support, training and samples of Products of the
same quality and quantity as S&N made available to the S&N Group Companies
prior to the Effective Date. The S&N Group Companies shall not sell or supply
the Products or other products similar to the Products (other than products
(not Products) that the S&N Group Companies are selling or supplying as of the
Effective Date) to any other person, firm or corporation operating outside the
Territories without the prior written consent of DonJoy, L.L.C.
5. SPECIFICATIONS AND QUALITY CONTROL. (a) DonJoy, L.L.C.
warrants that the Products sold pursuant to this Agreement (i) shall be
Processed and Packaged in strict accordance with the specifications and quality
control standards in effect immediately prior to the Effective Date (the
"Specifications"); (ii) will be Processed and Packaged in accordance with all
applicable laws, rules, orders and regulations, including good manufacturing
practice, ISO and CE Marking requirements; (iii) will be free from defects in
materials and workmanship; (iv) are merchantable and fit for the purposes for
which the products were manufactured; (v) will be free of all liens and
encumbrances; and (vi) will not be adulterated or misbranded within the meaning
of the United States Food, Drug and Cosmetic Act or of any other applicable
law, rule, order or regulation.
(b) DonJoy, L.L.C. warrants that it shall maintain all
material permits, registrations, licenses and any other approvals necessary to
Package, Process and supply the Products under this Agreement.
6. DUTIES OF THE S&N GROUP COMPANIES. S&N and each S&N Group
Company agrees that during the term hereof each S&N Group Company will employ
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efforts and methods to sell and promote the sale of the Products in its
respective Territory that are substantially the same as to the efforts and
methods employed by such S&N Group Company prior to the date hereof.
7. EXCLUSIVITY. (a) In connection with each S&N Group Company
acting as a distributor of the Products in the territory indicated next to such
S&N Group Company on Schedule 1 hereto (each, a "Territory" and collectively,
the "Territories"), each S&N Group Company shall not, while the Territory is
subject to this Agreement, directly or indirectly, personally or, knowingly,
through an intermediary:
(i) import, sell or promote or be engaged in the sale of
any of the products listed on Schedule 8.5(c) to the Recapitalization
Agreement other than products purchased from DonJoy, L.L.C.;
(ii) seek customers, establish a branch or maintain a
distribution depot outside its Territory;
(iii) incur any liability or assume any obligation of any
kind on behalf of DonJoy, L.L.C. or in any way pledge or purport to
pledge DonJoy, L.L.C.'s credit or accept any order to make any
contract binding upon DonJoy, L.L.C. without DonJoy, L.L.C. first
approving in writing the terms thereof; or
(iv) misrepresent DonJoy, L.L.C.'s descriptions or
indications for use of the Products.
(b) DonJoy, L.L.C. shall not sell or supply the Products or any
products similar to the Products to any other person, firm or corporation
operating in the Territories without the prior written consent of S&N.
8. TERM. (a) This Agreement shall remain in full force and
effect until the termination of the last Territory under this Agreement. (the
"Term").
(b) Notwithstanding anything contained herein to the contrary, S&N
shall have the right to terminate this Agreement with respect to any individual
Territory or Territories, without terminating the entire Agreement: (i) on
sixty (60) days prior written notice to DonJoy, L.L.C. with respect to
Territories listed in Column "A" on Schedule 1; and (ii) on sixty (60) days
prior written notice to DonJoy L.L.C. with respect to Territories listed in
Columns "B" and "C" on Schedule 1, but in no event shall notice be given prior
to November 1, 1999.
(c) Notwithstanding anything contained herein to the contrary,
DonJoy, L.L.C. shall have the right to terminate this Agreement with respect to
any individual Territory or Territories, without terminating the entire
Agreement: (i) on thirty (30) days prior written notice to S&N with respect to
Territories listed in Column "A" on Schedule 1; (ii) on sixty (60) days prior
written notice to S&N with respect to Territories listed in
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Column "B" on Schedule 1, but in no event shall notice be given prior to August
1, 1999 ; and (iii) on sixty (60) days prior written to S&N with respect to
Territories listed in Column "C" on Schedule 1, but in no event shall notice be
given prior to November 1, 1999.
(d) Without waiving any other rights or remedies which may be
available for breach or default of this Agreement, a party hereto may terminate
this Agreement on thirty (30) days' written notice to the other party if:
(i) The other party makes an assignment for the benefit
of creditors.
(ii) A receiver shall be appointed to take over all or a
substantial part of the other party's business or property and such
receivership shall not have been vacated or stayed within thirty (30)
days.
(iii) The other party commences any proceeding relating to
itself under any bankruptcy, insolvency, and readjustment of debt,
arrangement with creditors, dissolution, liquidation or similar laws
of any jurisdiction now or hereafter in effect.
(iv) The other party is adjudicated insolvent or an order
for relief is entered against such party under applicable bankruptcy
law.
(v) The other party materially fails to perform any part
of this Agreement or the Recapitalization Agreement or any other
agreement contemplated thereby and, upon written notice of such
failure by the other party, fails to remedy the same within thirty
(30) days of such notice.
9. TRADEMARKS. (a) The S&N Group Companies shall have the
royalty-free right to use the trademarks of DonJoy, L.L.C. related to the
Products solely in connection with the S&N Group Companies' distribution of the
Products as contemplated hereby, subject to DonJoy, L.L.C.'s right to approve
or disapprove of the S&N Group Companies' manner of usage of such trademarks.
Except as provided herein, neither S&N nor any of the S&N Group Companies shall
have any right to any xxxx, trade xxxx, name or symbol of DonJoy, L.L.C. or any
translation thereof now or hereafter applied or used by either party in
relation to any of the Products. DonJoy, L.L.C. shall be responsible, at
DonJoy, L.L.C.'s expense, for the registration of any such marks or trademarks
in the Territories. Except with respect to Repurchased Inventory not actually
purchased by DonJoy, L.L.C., the S&N Group Companies will, on termination of
this Agreement for a Territory, discontinue any use (and shall ship to DonJoy,
L.L.C. or destroy any such material at DonJoy, L.L.C.'s option and expense) in
that Territory of the DonJoy, L.L.C. trademarks on any signs, stationery,
invoices, promotional materials or otherwise and thereafter will not use,
either directly or indirectly, such trademarks or any other names, titles or
expressions so nearly resembling the same as would be likely to lead to
confusion or uncertainty, or to deceive the public.
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(b) The S&N Group Companies shall not alter or add to any of the
trademarks or trade names used by DonJoy, L.L.C. on the Products and shall at
all times use such trademarks or trade names in the advertising and promotion
of the Products; provided, however, that DonJoy, L.L.C. and the S&N Group
Companies may agree that the Products shall be sold under other trademarks or
trade names.
(c) Neither S&N nor any S&N Group Company shall have any right to
use any DonJoy, L.L.C. trademark, including "DonJoy" or "ProCare", in
connection with sales by any S&N Group Company of any similar products not
sourced by DonJoy, L.L.C. as may be permitted by Section 7(a) hereof.
10. CONFIDENTIALITY. Except as set forth herein below, during the
term hereof and for a period of five (5) years thereafter, DonJoy, L.L.C., on
the one hand, and S&N and each of the S&N Group Companies, on the other hand,
agree that they will maintain in confidence all Confidential Information of the
other party, and will not disclose such Confidential Information to any third
party. As used herein, the term "Confidential Information" means technical,
business, customer, marketing, financial, corporate or any other information of
a party, or of its subsidiaries, affiliates or parent companies, which, whether
or not pursuant to this Agreement, is disclosed orally or in writing or which
another party obtains by any other means, excluding information which (i) is or
becomes available to such party from a source other than such party, (ii) is or
becomes available to the public other than as a result of disclosure by such
party or its agents, or (iii) is required to be disclosed under applicable law
or judicial process, but only to the extent it must be disclosed.
11. INDEMNIFICATION AND INSURANCE. (a) DonJoy, L.L.C. will
indemnify and hold S&N and the S&N Group Companies and their respective
officers, managers, equity holders and affiliates harmless from and against any
liability, damage, claims, cost or expense (including reasonable attorney's
fees) ("Losses") arising out of (i) any injury, death or property damage
arising out of the negligence or willful misconduct of DonJoy, L.L.C. or its
employees or agents (except to the extent that such injury, death or damage was
caused by the negligent act or willful misconduct of S&N or the S&N Group
Companies) in any action or proceeding brought by any third party respecting
such claim, (ii) DonJoy, L.L.C.'s negligent act or omission, (iii) DonJoy,
L.L.C.'s misstatements or false claims with respect to the Products, (iv) any
product liability claims relating to the Products (other than those resulting
from S&N's, any S&N Group Companies' or any third party's fault which do not
give rise to an indemnifiable claim against DonJoy, L.L.C. by S&N under the
Recapitalization Agreement); (v) any governmentally-required recall of Products
(other than those resulting from S&N's, any S&N Group Companies' or a third
party's fault which do not give rise to an indemnifiable claim against DonJoy,
L.L.C. by S&N under the Recapitalization Agreement); (vi) DonJoy, L.L.C.'s
failure to comply with DonJoy, L.L.C.'s obligations, covenants, and
representations and warranties under this Agreement; and (vii) any claimed
infringement of the rights of any third party arising from the S&N Group
Company's use of the DonJoy, L.L.C. trademarks arising in connection with the
distribution of Products pursuant hereto, or any claim of infringement by any
third party of any patents or any
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claimed violation of any other intellectual property right of any third party
arising in connection with the distribution of Products pursuant hereto;
provided, however, that in no event will S&N or any S&N Group Company have any
right to claim indemnity under this Section 11 if the events, facts or
circumstances claim giving rise to such claim constitute a breach of any of the
obligations, covenants and representations and warranties of S&N contained in
the Recapitalization Agreement, or otherwise give rise to an indemnifiable
claim against S&N by DonJoy, L.L.C. thereunder. In order to ensure DonJoy,
L.L.C.'s performance, DonJoy, L.L.C. shall obtain and maintain during the term
of this Agreement at least Three Million Dollars ($3 million) of product
liability and general public liability insurance with a deductible or
self-insurance of no more than One Hundred Thousand Dollars ($100,000).
DonJoy, L.L.C. shall name S&N and the S&N Group Companies as additional insured
parties on such insurance and shall provide S&N with a certificate evidencing
such coverage.
(b) S&N will indemnify and hold DonJoy, L.L.C. and DonJoy,
L.L.C.'s officers, managers, equity holders and affiliates harmless from and
against any and all Losses arising out of (i) any injury, death or property
damage arising out of the negligence or willful misconduct of S&N or the S&N
Group Companies or its employees or agents (except to the extent that such
injury, death or damage was caused by the negligent act or willful misconduct
of DonJoy, L.L.C.) in any action or proceeding brought by any third party
respecting such claim; (ii) S&N's or the S&N Group Companies' negligent act or
omission; (iii) S&N's or the S&N Group Companies' misstatements or false claims
with respect to the Products; (iv) S&N's or the S&N Group Companies' misuse of
the Product literature; or (v) S&N's or the S&N Group Companies' failure to
comply with its obligations, covenants and representations and warranties
hereunder.
(c) Indemnification Procedures
Each party shall be entitled to the indemnity described in paragraphs
(a) and (b) of this Section provided the following conditions are met; the
party obliged to provide indemnification is referred to as the "Indemnifying
Party", and the party entitled to be indemnified is referred to as the
"Indemnified Party";
(i) Promptly upon learning of any claim for which
indemnification is sought from the Indemnifying Party, the Indemnified
Party shall notify the Indemnifying Party of such claim and shall
furnish to the Indemnifying Party all information known and available
to the Indemnified Party related to such claim.
(ii) In the event of the commencement of litigation on the
basis of such claim, the Indemnified Party shall tender the defense of
such litigation to the Indemnifying Party.
(iii) The Indemnified Party shall comply with any such
reasonable instructions received from the Indemnifying Party relating
to settlement of such claim (unless settlement of the claim would
establish an adverse precedent for
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other similar claims in the future), if any, to the extent that it
lies within the power of the Indemnified Party to comply with any such
instructions, excluding any instruction that requires the Indemnified
Party to license or otherwise make available technology or other
confidential information to a third party.
(iv) If the Indemnifying Party undertakes defense of such
litigation, the Indemnifying Party shall be entitled to appoint its
attorneys to defend the case in the name of the Indemnified Party, and
the Indemnified Party shall cooperate fully with the Indemnifying
Party and its chosen attorneys in the defense of such litigation. The
Indemnified Party shall be free to appoint its own attorneys in the
same litigation, at its sole expense, although all decisions with
respect to the conduct or settlement of such litigation shall remain
solely with the Indemnifying Party.
12. TRANSITION.
(a) Upon the termination of this Agreement with respect
to a Territory, the parties hereto agree to take all actions reasonably
necessary to effect the transition of the distribution arrangements for the
Products contemplated herein among the parties hereto and the distribution
arrangements entered into for the Products by the S&N Group Companies and third
parties with respect to such Territory, including the transfer of customer
lists and marketing materials relating principally to the customers of the
Products in that Territory. The S&N Group Companies shall assist DonJoy, L.L.C.
in transferring or applying for product registrations or certificates for
products that relate principally to the Products in the terminated Territory.
Transfers of product registrations or certificates for products in the
terminated Territory shall be made solely at DonJoy, L.L.C.'s expense.
(b) Upon the termination of this Agreement with respect to each
respective Territory or Territories, S&N or the appropriate S&N Group Company
shall deliver Products (whether acquired prior to or during the term of this
Agreement) ("Repurchased Inventory") to destinations specified by DonJoy,
L.L.C. in writing and at DonJoy, L.L.C.'s cost. DonJoy, L.L.C. shall pay S&N
or its designee in currency designated by S&N an amount equal to (i) the S&N
Group Company book value of the Repurchased Inventory (i.e., the original
transfer price paid by the S&N Group Company to purchase the Repurchased
Inventory, plus duty and tax paid by the S&N Group Company and the S&N Group
Company's original cost of shipping the Repurchased Inventory to the S&N Group
Company, to the extent such cost was paid by the S&N Group Company with an
appropriate deduction for unsaleable Repurchased Inventory) plus (ii) any sales
tax, VAT, duty or fee incurred by the S&N Group Company related to the delivery
of the Products to DonJoy, L.L.C. or such other destination specified by
DonJoy, L.L.C., within sixty (60) days following receipt of S&N's or S&N Group
Companies' invoice. In the event that DonJoy, L.L.C. designates another
distributor to receive Repurchased Inventory pursuant hereto, DonJoy, L.L.C.
may specify that such distributor shall pay all amounts to be paid to S&N or
its designee pursuant to this Section 12(b); provided, however, that, DonJoy,
L.L.C. shall remain primarily liable to S&N for all such amounts. In the event
of a dispute concerning the price to be paid by DonJoy, L.L.C. or its
disributor, as applicable, for the Repurchased Inventory or the condition of
the
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Repurchased Inventory then senior representatives of the parties shall meet and
attempt to resolve the dispute in good faith. If the parties are unable to
resolve the dispute within ten (10) business days then the S&N Group Companies
shall have the right to sell or distribute the Products that are the subject of
the dispute to third parties either within or outside the Territories following
the termination of this Agreement with respect the relevant Territory. Upon the
expiration of this Agreement with respect to all Territories, DonJoy, L.L.C. or
its designated distributor shall purchase all remaining Repurchase Inventory
from S&N in accordance with this Section.
13. INDEPENDENT CONTRACTORS. DonJoy, L.L.C., on the one hand, and
S&N and each of the S&N Group Companies, on the other hand, shall each be
treated for all purposes as an independent contractor and not as an agent or
representative of the other party. Each party shall be responsible for
complying with laws and regulations applicable to its business, for obtaining
required licenses and permits, for the payment of applicable taxes, and for the
conduct and compensation of its own employees.
14. NOTICES. All notices or other communications required or
permitted hereunder shall be in writing and shall be deemed given or delivered
when delivered personally or when sent by registered or certified mail or by
private courier addressed as follows:
If to DonJoy, L.L.C., to:
DonJoy, L.L.C.
0000 Xxxxx Xxxxxx
Xxxxx, Xxxxxxxxxx 00000-0000
Attention: President
If to S&N or any S&N Group Company, to:
Xxxxx & Nephew, Inc.
0000 Xxxxxx Xxxx
Xxxxxxx, Xxxxxxxxx 00000
Attention: General Counsel
or to such other address as such party may indicate by a notice delivered to
the other party hereto.
15. SUCCESSORS AND ASSIGNS. The rights of DonJoy, L.L.C., on the
one hand, and S&N and each of the S&N Group Companies, on the other hand, under
this Agreement shall not be assignable without the written consent of DonJoy,
L.L.C., in the case of assignment by S&N or any of the S&N Group Companies, and
S&N, in the case of assignment by DonJoy, L.L.C.; provided, however, that
DonJoy, L.L.C. may assign its rights and obligations under this Agreement to
any affiliate or subsidiary (including DJ Orthopedics, LLC) without the prior
written consent of S&N or any S&N Group Company; provided further, that neither
party hereto shall be released from any of its
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obligations hereunder by reason of any such assignment. This Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
successors and permitted assigns.
16. ENTIRE AGREEMENT; AMENDMENTS. This Agreement contains the
entire understanding of the parties hereto with regard to the subject matter
contained herein and supersedes all prior agreements, understandings or letters
of intent between or among any of the parties hereto. Contrary provisions in
any purchase order, invoice or other commercial documentation shall be of no
force and effect. This Agreement shall not be amended, modified or
supplemented except by a written instrument signed by an authorized
representative of each of the parties hereto.
17. INTERPRETATION. Headings to sections herein are inserted for
convenience of reference only and are not intended to be a part of or to affect
the meaning or interpretation of this Agreement.
18. WAIVERS. Any term or provision of this Agreement may be
waived, or the time for its performance may be extended, by the party or
parties entitled to the benefit thereof. Any such waiver shall be validly and
sufficiently authorized for the purposes of this Agreement if it is authorized
in writing by S&N, in the case of any waiver by S&N or any of the S&N Group
Companies, or by DonJoy, L.L.C., in the case of any waiver by DonJoy, L.L.C..
The failure of any party hereto to enforce at any time any provision of this
Agreement shall not be construed to be a waiver of such provision, nor in any
way to affect the validity of this Agreement or any part hereof or the right of
any party thereafter to enforce each and every such provision. No waiver of
any breach of this Agreement shall be held to constitute a waiver of any other
or subsequent breach.
19. FORCE MAJEURE. The obligations and performance of a party
hereto shall be excused if made impossible by strikes, riots, fire, inability
to obtain or shortages of labor, materials, equipment or transportation, war,
acts of God, natural disasters or other causes beyond the reasonable control of
the party and acts in compliance with applicable law, regulation or order
(whether valid or invalid) of any governmental body.
20. PARTIAL INVALIDITY. Wherever possible, each provision hereof
shall be interpreted in such manner as to be effective and valid under
applicable law, but in case any one or more of the provisions contained herein
shall, for any reason, be held to be invalid, illegal or unenforceable in any
respect, such provision shall be ineffective to the extent, but only to the
extent, of such invalidity, illegality or unenforceability without invalidating
the remainder of such invalid, illegal or unenforceable provision or provisions
or any other provisions hereof, unless such a construction would be
unreasonable.
21. EXECUTION IN COUNTERPARTS. This Agreement may be executed in
one or more counterparts, each of which shall be considered an original
instrument, but all of which shall be considered one and the same agreement,
and shall become binding when one or more counterparts have been signed by each
of the parties hereto and delivered to
12
each of DonJoy, L.L.C. and S&N. An executed copy hereof delivered by facsimile
shall be deemed an original instrument.
22. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with laws of the State of Delaware (without regard to
conflicts of laws principles thereof).
[Remainder of Page Left Intentionally Blank]
13
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed the day and year first above written.
DONJOY, L.L.C.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------
Name: Xxxxxx X. Xxxxx
Title: President and CEO
XXXXX & NEPHEW, INC.
By: Xxxxxxxx X. Xxxxx
-----------------------------
Name: Xxxxxxxx X. Xxxxx
Title: Treasurer
FOR EACH OF THE S&N GROUP
COMPANIES LISTED BELOW:
By: Xxxxxxxx X. Xxxxx
-----------------------------
Name: Xxxxxxxx X. Xxxxx
Title: Treasurer
S&N GROUP COMPANIES:
Xxxxx & Nephew GMBH, Austria
Xxxxx & Nephew GMBH, Xxxxxxx
Xxxxx & Nephew OY, Finland
Xxxxx & Nephew Nederland BV, Xxxxxxx
Xxxxx & Nephew K.K., Japan
Xxxxx & Nephew LDA., Portugal
Xxxxx & Nephew (Belgium) S.A. - N.V. ,
Belgium
Xxxxx & Nephew FZE, Dubai
Xxxxx & Nephew Medical Limited, India
Xxxxx & Nephew Limited, Korea
Xxxxx & Nehpew (Malaysia) Ltd., Malaysia
Xxxxx & Nephew (Overseas) Limited
Philippine Branch
Xxxxx & Nephew Inc., Puerto Rico
Smith & Nephew Limited, Thailand
Xxxxx & Nephew AB, Sweden
Xxxxx & Nephew Limited, Ireland
Xxxxx & Nephew Laboratoires Xxxxx XX,
France
00
Xxxxx & Xxxxxx XX, Xxxxxxxxxxx
Xxxxx & Nephew S.r.I., Italy
Xxxxx & Nephew A/S, Norway
Xxxxx & Nephew Iberica S.A., Spain
Xxxxx & Nephew A/S, Denmark
Xxxxx & Nephew Medical Limited, UK
Xxxxx & Nephew Pty. Limited, Australia
Xxxxx & Nephew Pte. Limited, Singapore
Xxxxx & Nephew Limited, Hong Kong
Xxxxx & Nephew SA de CV, Mexico
Xxxxx & Nephew Inc., Canada
Xxxxx & Nephew Limited, South Africa
Xxxxx & Nephew Limited (New Zealand)
Xxxxx & Nephew (Far East) - Taiwan
Branch
[Signature Page to Distribution Agreement]
15
SCHEDULE 1
S&N GROUP COMPANIES AND TERRITORIES
A B C
Company Territory Company Territory Company Territory
------- --------- ------- --------- ------- ---------
Xxxxx & Nephew GMBH, Germany and Xxxxx & Nephew (Belgium) Xxxxx & Nephew Pty.
Germany Eastern Europe S.A. Belgium Limited Australia
Xxxxx & Nephew GMBH, Xxxxx & Nephew, Inc. Canada
Austria Austria Xxxxx & Nephew FZE Dubai
Xxxxx & Nephew A/S Denmark Xxxxx & Nephew Limited Hong Kong
Xxxxx & Nephew OY Finland Xxxxx & Nephew Medical
Limited India
Xxxxx & Nephew Xxxxx & Nephew Limited Ireland
Laboratoires Xxxxx XX France
Xxxxx & Nephew S.r.I. Italy
Xxxxx & Nephew Nederland Xxxxx & Nephew Limited Korea
BV Xxxxxxx
Xxxxx & Nephew K.K. Japan Xxxxx & Nephew Ltd. Malaysia
Xxxxx & Nephew A/S Norway Xxxxx & Nephew SA de CV Mexico
Xxxxx & Nephew Limited New Zealand Xxxxx & Nephew [ ] Philippines
Xxxxx & Nephew LDA Portugal Xxxxx & Nephew Inc. Puerto Rico
Smith & Nephew AB Sweden Xxxxx & Nephew Pte.
16
Limited Singapore
Xxxxx & Nephew AG Switzerland Xxxxx & Nephew Limited South Africa
Xxxxx & Nephew Limited U.K. Xxxxx & Nephew Iberica S.A. Spain
Xxxxx & Nephew (Far East) Taiwan
Xxxxx & Nephew Limited Thailand
See Schedule 2 for a list of products.
17
SCHEDULE 2
PRICING
SCHEDULE ATTACHED
18
SCHEDULE 3
1999 PURCHASE LEVELS
