EXHIBIT 10.45
EXCLUSIVE MARKET ACCESS AND SUPPLY AGREEMENT
THIS EXCLUSIVE MARKET ACCESS AND SUPPLY AGREEMENT (the "Agreement") is
made as of September 21, 2001, (the "Effective Date") by and between:
ENDOCARE, INC., a corporation organized and existing under the laws of the
State of Delaware, USA, with its principal offices at 7 Studebaker, Xxxxxx, XX
00000, ("ENDOCARE")
AND
CRYOCATH TECHNOLOGIES INC., a corporation organized and existing under the
laws of Quebec, Canada, with its principal offices at 00000 Xxxxxx Xxx-Xxxxx,
Xxxxxxxx, Xxxxxx, Xxxxxx X0X 0X0 ("CryoCath").
WITNESSETH:
WHEREAS ENDOCARE develops, manufactures and commercializes medical devices
and has specific Argon-based cryosurgical probe and Cryo-Console development
expertise;
WHEREAS CryoCath develops, manufactures, markets and distributes various
cryotherapy devices and systems which treat cardiovascular diseases including
ventricular and atrial arrhythmias;
WHEREAS ENDOCARE wishes to supply CryoCath with certain products and with
rights to create a market for and distribute certain cryoablation systems and
devices manufactured by ENDOCARE on an exclusive worldwide basis; and
WHEREAS the parties desire to enter into this Agreement for that purpose.
NOW THEREFORE, in consideration of the representations, warranties,
covenants and agreements contained herein, and for other valuable consideration,
the receipt and adequacy of which is hereby acknowledged, the parties mutually
agree as follows:
-1-
2
ARTICLE 1
DEFINITIONS
SPECIFIC DEFINITIONS. As used in this Agreement, the following terms have the
meanings set forth or referenced below:
"AFFILIATE" of a specified person (natural or juridical) means a person
that directly or indirectly, through one or more intermediaries, controls,
or is controlled by, or is under common control with, the person
specified. "Control" shall mean ownership of more than 50% of the shares
of stock entitled to vote for the election of directors in the case of a
corporation, and more than 50% of the voting power in the case of a
business entity other than a corporation.
"CONFIDENTIAL INFORMATION" will refer to the definition set forth in
Schedule 4 which is incorporated herewith.
"CryoCath" means CryoCath Technologies Inc. and its Affiliates.
"CRYOCATH TERRITORIES" means all territories worldwide subject to Section
2.1(e) below.
"ENDOCARE" means ENDOCARE, Inc. and its Affiliates.
"FIELD OF USE" means accessing the heart surgically through the chest wall
for the purpose of treating arrhythmias by the cardiovascular surgeon.
"INTELLECTUAL PROPERTY" means all patents, trade names, trademarks,
service marks, copyrights and applications or registrations for any of the
foregoing, inventions, discoveries, know-how, trade secrets, data,
information, technology, processes, formulas, drawings, designs, computer
programs, licenses, and all amendments, modifications, and improvements to
any of the foregoing.
"SPECIFICATIONS" means the current performance specifications for the
Systems, as may be amended from time to time hereafter by mutual agreement
between ENDOCARE and CryoCath.
"SYSTEMS" means all equipment and devices ENDOCARE has developed for
performing surgical cryoablative procedures for the treatment of
arrhythmias, including but not limited to Cryo-Consoles (as defined below)
and single use probes using ENDOCARE's Argon Gas technology, together with
such further developments, improvements and replacements to the Systems as
described or contemplated herein.
3
1.2 OTHER TERMS.
(a) Other terms may be defined elsewhere in the text of this Agreement
and shall have the meaning indicated throughout this Agreement.
1.3 OTHER DEFINITIONAL PROVISIONS.
(a) The words "hereof," "herein," and "hereunder" and words of similar
import, when used in this Agreement, shall refer to this Agreement
as a whole and not to any particular provisions of this Agreement.
(b) The terms defined in the singular shall have a comparable meaning
when used in the plural, and vice versa.
(c) References to a "Schedule" are, unless otherwise specified, to one
of the Schedules attached to or referenced in this Agreement, and
references to an "Article" or a "Section" are, unless otherwise
specified, to one of the Articles or Sections of this Agreement.
(d) The term "person" includes any individual, partnership, joint
venture, corporation, trust, unincorporated organization or
government or any department or agency thereof.
(e) The term "Dollars" or "$" shall refer to the currency of the United
States of America.
(f) The term "knowledge" means actual knowledge of a fact or the
knowledge which such person or its officers or employees could
reasonably be expected to have based on reasonable investigation and
inquiry.
(g) All references to time shall refer to Montreal time.
(h) "Cryo-Console" shall mean the cryoablation unit specified in
Schedule 1.
(i) "annual period" shall mean consecutive twelve month periods, the
first of which commences on the date that the malleable cryoprobe is
approved for sale in the United States and the European Community
and made available to CryoCath by ENDOCARE as specified in Section
2.9 (g), and each subsequent twelve month period thereafter.
(j) "European Community" shall mean all of the countries in the European
Community from time to time.
4
ARTICLE 2
CRYOCATH AS EXCLUSIVE WORLDWIDE MARKET ACCESS PARTNER
2.1 APPOINTMENT.
(a) ENDOCARE hereby appoints CryoCath, and CryoCath hereby accepts
appointment, as ENDOCARE's market access partner having the sole and
exclusive right to market, sell and distribute the Systems in the
Field of Use in the CryoCath Territories. ENDOCARE represents and
warrants to CryoCath that all other marketing, distribution or sales
representative agreements, if any, written or oral, with any third
party permitting the sale of Systems in the Field of Use in the
CryoCath Territories have been terminated at ENDOCARE's sole cost
and expense.
(b) CryoCath may appoint sub-distributors for the sale or distribution
of Systems in the Field of Use in the CryoCath Territories.
Notwithstanding such appointment of sub-distributors, CryoCath shall
remain fully responsible for the performance of all of its covenants
and obligations hereunder, and any sales by ENDOCARE to such
CryoCath sub-distributors shall be billed by ENDOCARE to CryoCath
directly. Without the pre-approval of ENDOCARE, there will be no
changes made to the product, labeling, or changes or additions to
the brand labeling on the SYSTEMS made by CryoCath's
sub-distributors.
(c) ENDOCARE shall promptly forward to CryoCath all leads for sales or
distribution of Systems in the Field of Use in the CryoCath
Territories.
(d) During the term of CryoCath's exclusive distribution rights pursuant
to this Article 2, CryoCath shall not market or sell products that
compete in the Field of Use with the Systems, as defined herein, in
the CryoCath Territories.
(e) At any time after the *** period of this Agreement, ENDOCARE may
provide a written notice to CryoCath identifying a market where
CryoCath has not commenced activity and indicating that CryoCath
must develop the market by showing a plan of market entry and by
initiating sales activity within *** of the notice by selling, at
normal pricing, at least one Cryo-Console. In the event that
CryoCath advises ENDOCARE in writing that it wishes to forego the
market opportunity or if CryoCath does not develop the market as
described above, the market will cease to form part of the CryoCath
Territories.
----------
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the Commission.
5
2.2 REGULATORY APPROVALS.
(a) ENDOCARE represents to CryoCath that it has and that it will
maintain the necessary government approvals in the U.S.A. and the CE
Xxxx in the European Community. In all other countries CryoCath will
be responsible for obtaining regulatory approvals for the
importation and marketing of the Systems. ENDOCARE will cooperate
with CryoCath by providing all required documentation and System
specifications short of specific animal or clinical data or clinical
outcome results. ENDOCARE will pay for all expenses incurred in
compiling documentation or performing bench testing to create
performance specification data that may be required. CryoCath will
be responsible for bearing all expenses associated with collecting
any animal test results or clinical test results that may be
required for gaining regulatory approval in CryoCath Territories as
well as all other fees or expenses associated with gaining import or
marketing approvals in CryoCath Territories. ENDOCARE will provide
free of charge any Cryo-Console or cryoprobes required for testing
to gain regulatory approvals at CryoCath's request. In cases where
ENDOCARE supplies the Cryo-Console or cryoprobes free of charge,
CryoCath will apply for product registration in the names of both
CryoCath and ENDOCARE. CryoCath shall act as the ENDOCARE authorized
representative in the CryoCath Territories when dealing with
government and regulatory authorities.
(b) CryoCath will be responsible for all dealings with the appropriate
competent authority such as notification, medical device vigilance
and national labeling issues, provided that translation and
preparation of such labels are subject to final review and
verification by ENDOCARE, and to the mutual agreement of the
parties. For purposes of this Section 2.2, labeling shall include
labels, instructions for use, operating manuals, and service and
maintenance manuals. CryoCath will be responsible for identifying
the required documentation in all territories outside of the U.S.A.
and the European Community (CE Xxxx) and for the cost of translation
of English documents supplied by ENDOCARE at its sole cost including
a Cryo-Console operator's manual and instructions on the proper use
of the Cryo-Console and probes. ENDOCARE will be responsible for
supplying all documentation necessary to obtain the regulatory
approvals being sought by CryoCath outside the U.S.A. and the
European Community (CE Xxxx). In all jurisdictions where CryoCath
deals with the regulatory authorities, oversees the work, expends
the funds necessary for obtaining regulatory approvals (including
payment to ENDOCARE for any required Cryo-Consoles or cryoprobes and
third party fees and out-of-pocket expenses, but excluding all
required documentation from ENDOCARE), the approval will be
registered solely in CryoCath's name or in the name of a third party
designated by CryoCath and CryoCath shall be the sole owner of the
regulatory
6
approval. In the event that CryoCath holds the registration solely
in its name and wishes to sell or transfer such registration,
CryoCath will provide Endocare with a first right of refusal to
acquire the registration.
(c) As long as CryoCath maintains exclusivity under this Agreement, in
all labeling and packaging, the CryoCath name will appear more
prominently as the product will be sold under the CryoCath name.
ENDOCARE's name shall appear as follows: "Manufactured by ENDOCARE
exclusively for CryoCath Technologies Inc." CryoCath and ENDOCARE
will work jointly following contract execution to design and develop
mutually agreeable labelling.
2.3 LICENSE FEES.
Subject to the terms of this Agreement, CryoCath will pay ENDOCARE license
fees as follows:
***
***
***
***
2.4 PRICING AND PURCHASE REQUIREMENTS.
(a) During the term of this Agreement and any non-exclusive period
hereunder, CryoCath will purchase the Systems from ENDOCARE at the
prices set forth in Schedule 2 and at minimum volumes as set forth
in Schedule 3. CryoCath will supply on a monthly basis a rolling
12-month demand forecast, the first two months of each rolling
12-month forecast is binding and constitutes a firm purchase
commitment. ENDOCARE agrees that it will use reasonable efforts to
supply products in accordance with the forecast. If ENDOCARE is more
than 30 days late in the delivery of products, then CryoCath's
Minimum Purchase Requirements shall be suspended for the period of
any delay beyond 30 days.
(b) ENDOCARE will provide CryoCath with *** cryosurgical probes for use
with the first *** patients treated in clinical trials for each of
the malleable cryoprobe and the deflectable cryoprobe. Endocare will
provide on *** sample cryoprobes of each new design and ***
Cryo-Consoles prior to commercial availability.
(c) CryoCath shall be entitled to purchase from ENDOCARE a number of
demonstration Cryo-Consoles and probes in the quantities and at the
prices shown in Schedule 2.
----------
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the Commission.
7
(d) Payments made by CryoCath for Systems purchased for resale by
CryoCath pursuant to Article 2.4(a) shall be due and payable in full
within thirty (30) days after the date of invoice. ENDOCARE will
exercise reasonable efforts to deliver product in a timely manner
per CryoCath orders as described in Section 2.9.
2.5 INSPECTION AND WARRANTY.
(a) Specifications for the Systems will be established by ENDOCARE
subject to written agreement by CryoCath, and will be subject to
modification from time to time by mutual agreement. In the event of
any shortage, damage or discrepancy in or to a shipment of Systems
or parts thereof or in the event any of the Systems fail to comply
with the then current Specifications for the Systems, CryoCath shall
report the same to ENDOCARE and furnish such written evidence or
other documentation as ENDOCARE reasonably may deem appropriate. If
the substantiating evidence delivered by CryoCath demonstrates that
such shortage, damage or discrepancy or non-conformity with
Specifications existed at the time of delivery of the Systems at the
*** , CryoCath may return the Systems to ENDOCARE at ENDOCARE's
expense, and ENDOCARE shall issue a credit or replacement for such
returns at the invoiced price less any adjustments that may have
been made based on actual annual purchase volumes. Any credit will
be issued at the time that the returned product is received by
ENDOCARE. ENDOCARE shall use reasonable efforts to promptly deliver
replacement Systems to CryoCath in accordance with the delivery
procedures set forth herein.
(b) ENDOCARE represents and warrants to CryoCath that all Systems sold
and delivered under this Agreement will have been manufactured in
accordance with FDA Good Manufacturing Practices, European Medical
Device Directive requirements, ISO 9000 series certification, and
all other applicable manufacturing requirements, and that
continually during the term of this Agreement no Systems delivered
by ENDOCARE to CryoCath shall be adulterated or misbranded at the
time of delivery within the meaning of the U.S. Food, Drug and
Cosmetic Act and regulations thereunder. ENDOCARE shall provide
CryoCath's regulatory personnel with reasonable access from time to
time, but not more than ***, to the facilities and records of
ENDOCARE for the purpose of confirming ENDOCARE's compliance with
all applicable requirements noted in this Article.
(c) ENDOCARE warrants to CryoCath and to CryoCath's customers that the
Systems are in accordance with the warranty attached hereto as
Section 2.5 (d). CryoCath shall bear all responsibility for, and
shall indemnify and hold ENDOCARE harmless from any claim, action or
loss which arises
----------
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the Commission.
8
out of or results from any other warranties made by CryoCath (other
than ENDOCARE warranties) its employees or agents with respect to
the Systems.
(d) THE PRODUCTS THAT ENDOCARE IS PROVIDING TO CRYOCATH ARE WARRANTIED
ONLY TO THE EXTENT THAT THEY WILL BE FREE FROM DEFECT IN MATERIAL,
DESIGN AND WORKMANSHIP. ENDOCARE MAKES NO OTHER WARRANTIES, EXPRESS,
IMPLIED OR STATUTORY REGARDING THE PRODUCTS PROVIDED HEREUNDER
INCLUDING, BUT NOT LIMITED TO, IMPLIED WARRANTIES OF MERCHANTABILITY
AND FITNESS FOR A PARTICULAR PURPOSE, WHICH ARE HEREBY EXPRESSLY
DISCLAIMED. SUBJECT TO ENDOCARE'S EXPRESS REPRESENTATIONS AND
WARRANTIES HEREIN, ENDOCARE DOES NOT REPRESENT THAT THE PRODUCTS
WILL OPERATE ERROR-FREE, OR THAT THEY WILL OPERATE WITHOUT
INTERRUPTION, OR THAT THEY WILL FUNCTION IN ACCORDANCE WITH
CRYOCATH'S REQUIREMENTS. IN NO EVENT SHALL ENDOCARE HAVE ANY
LIABILITY FOR, NOR SHALL ANY THIRD PARTY HAVE ANY REMEDY AGAINST
ENDOCARE FOR, CONSEQUENTIAL DAMAGES, ANY LOSS OF PROFITS OR SAVINGS,
LOSS OF USE, OR ANY OTHER COMMERCIAL LOSS.
2.6 MINIMUM PURCHASE REQUIREMENTS, SALES AND SERVICE.
(a) In addition to the fee payments set forth in Section 2.3, during the
term of this Agreement, CryoCath agrees to certain minimum purchase
requirements for cryoprobes and Cryo-Consoles as described in
Schedule 3 (the "Minimum Purchase Requirements").
(b) CryoCath shall be responsible for selling all Systems in the Field
of Use in the CryoCath Territories, provided that ENDOCARE shall be
responsible for all repairs and servicing performed at the Endocare
manufacturing facilities during the one year warranty period.
ENDOCARE shall make available repair service on a contractual basis
following the expiration of the one-year warranty period. ENDOCARE
will carry sufficient inventory of spare parts to support rapid
turnaround for repairs. ENDOCARE will also carry sufficient
inventory of loaner Cryo-Consoles to meet customer need during the
initial one-year warranty period and any subsequent years covered
under service agreement where loaner units are included in the
service agreement. Endocare will ship either the repaired unit or a
loaner unit to customers within five (5) days of the date that the
product returned for repair is received at ENDOCARE's facility. The
replacement Cryo-Consoles and parts will be located in ENDOCARE's
Irvine, California facility or, by mutual agreement at a
9
future U.S.-based CryoCath facility as may be appropriate. ENDOCARE
may, at its option also inventory loaner Cryo-Consoles at CryoCath's
European facility in Nieuwegein, The Netherlands.. The location of
CryoCath's European facility may change at CryoCath's sole
discretion.
(c) Subject to Article 2.8 below, CryoCath shall be solely responsible
for providing customer and physician training to any purchaser of
Systems for use in the Field of Use in the CryoCath Territories.
2.7 MARKETING.ERROR! BOOKMARK NOT DEFINED.
(a) CryoCath shall be solely responsible at its cost for the design and
production of marketing, advertising and promotional materials for
use in the CryoCath Territories. CryoCath shall be the sole end
customer interface hereunder and sole owner of all customer lists.
(b) CryoCath shall be solely responsible for establishing the marketing,
selling and pricing strategies for the Systems in the Field of Use
in the CryoCath Territories.
(c) ENDOCARE shall have the right to review all marketing and
promotional materials and approve them relative to the use of
ENDOCARE trademarks or copywritten words or phrases.
2.8 TRAINING.
(a) During the first two annual periods, ENDOCARE will, *** , provide
training personnel for *** training sessions for technical training
of CryoCath's sales and field service representatives in the use,
installation, trouble shooting and service of the Systems on such
date and place as both CryoCath and ENDOCARE shall mutually agree.
ENDOCARE will supply at *** all associated documentation for end
user training including a Cryo-Console operator's manual and
instructions on the proper use of the Cryo-Console and probes, all
of which documentation shall be in English. ENDOCARE will pay for
all facilities and related expenses provided that the training is
conducted at ENDOCARE's Irvine facilities. CryoCath will provide and
pay for the facilities and for any other associated expenses of any
training outside of ENDOCARE's Irvine facilities. CryoCath will bear
any travel expenses associated with CryoCath personnel's attendance
at all such training. ENDOCARE shall also provide, ***, any
additional training necessary with respect to any enhancements or
modifications made by ENDOCARE to the System.
(b) Based on an initial training to CryoCath personnel as outlined
above, CryoCath trained personnel will provide training for the
"customer
----------
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the Commission.
10
trainers" (i.e. those CryoCath personnel and other third parties
engaged in training customers at training sites) in the CryoCath
Territories on such dates and at such places as CryoCath shall
designate. CryoCath will bear the cost of such training and CryoCath
will bear the costs associated with the CryoCath personnel and
customers.
2.9 ORDERS.
(a) CryoCath and ENDOCARE shall jointly develop order and delivery
procedures and guidelines for the Systems, including rolling
forecasts as outlined in Section 2.4(a) above. CryoCath's orders
shall be given no less favorable treatment by ENDOCARE than orders
from customers in ENDOCARE's other business areas. Except for the
first month of the first annual period, ENDOCARE will exercise
reasonable efforts to ship CryoCath's orders within 5 working days
of the delivery dates specified on CryoCath purchase orders.
(b) CryoCath shall submit purchase orders for Systems to ENDOCARE in
writing, either by mail, facsimile or e-mail, which shall, at a
minimum, set forth the product numbers, quantities, requested
delivery dates, special shipping instructions and shipping addresses
for all Systems ordered. All orders shall be subject to acceptance
in accordance with the terms of this Agreement by ENDOCARE. The
terms and conditions of this Agreement shall govern and supersede
any additional or contrary terms set forth in CryoCath's purchase
order or any ENDOCARE or CryoCath acceptance, confirmation, invoice
or other document unless duly signed by an officer of CryoCath and
an officer of ENDOCARE and expressly stating and identifying which
specific additional or contrary terms shall supersede the terms and
conditions of this Agreement.
(c) No accepted purchase order shall be modified or canceled except upon
the mutual agreement of both parties. Mutually agreed upon change
orders shall be subject to all provisions of this Agreement, whether
or not the change order so states. Notwithstanding the foregoing,
any purchase order may be canceled by CryoCath as to any Systems
which are not delivered within sixty (60) days of the delivery date
requested by CryoCath or as otherwise provided for herein, and any
such cancellation shall not limit or affect any contract remedies
available to CryoCath with respect thereto. Any such cancellation by
CryoCath must be by written notice to ENDOCARE, given within fifteen
(15) business days after such sixtieth (60th) day.
11
(d) All deliveries of Systems shall be ***. All Systems deliveries shall
be made by a common carrier specified by CryoCath. In the event that
no carrier shall have been specified by CryoCath, a common carrier
may be selected by ENDOCARE.
(e) Within the term of this Agreement and subject to the Field of Use
and within the CryoCath Territories, ENDOCARE shall not make any
modifications or enhancements of the Systems or any other changes in
the Specifications for the Systems in the Field of Use without prior
written approval from CryoCath. If such changes would affect the
applicable regulatory approvals of the Systems, CryoCath shall not
be required to purchase such Systems until such time as regulatory
authorization is received. Endocare shall have the right to make
changes to the Systems for applications outside of the Field of Use.
(f) ENDOCARE shall be responsible for supplying the Systems in a
finished state appropriate for delivery to the end customer
including packaging and any necessary sterilization of Systems
purchased under this Agreement in accordance with the
Specifications.
(g) In addition to the payments specified in Section 2.3 above, upon
execution of this Agreement, CryoCath will place a stocking order
with ENDOCARE consisting of *** single probe ENDOCARE Cryo-Consoles
and *** malleable cryoprobes. CryoCath agrees to take delivery of
the entire order within the first annual period on the dates
specified within the CryoCath purchase orders.
(h) CryoCath will place an additional purchase order at the beginning of
the second annual period for *** single probe ENDOCARE Cryo-Consoles
and *** cryosurgical probes. CryoCath agrees to take delivery of
that order within the second annual period on the dates specified
within the CryoCath purchase orders. Product delivery will be
determined by CryoCath.
(i) In the event that CryoCath fails to place the second stocking order
and/or fails to pay the second license fee payment when due, then
ENDOCARE has the option of terminating this Agreement. In this case
the rights and responsibilities following conversion to a
non-exclusive period as outlined below in Section 5.3 will not
apply. Notwithstanding termination, CryoCath will have the right to
service existing customers only using the ENDOCARE product for a
minimum of 18 months from termination in order to ensure proper
customer support.
----------
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the Commission.
12
(j) ENDOCARE may refuse to fill any purchase order in the event that
CryoCath is delinquent in any payment of previous purchase orders or
milestone payments.
2.10 REPORTS.
(a) CryoCath shall use reasonable efforts to report any "adverse
incidents" (as defined by FDA regulations, Medical Devices Directive
and national regulations) promptly to ENDOCARE.
2.11 EXPORT/IMPORT APPROVALS.
(a) CryoCath shall be responsible for obtaining, at CryoCath's cost and
expense, all necessary documentation and licenses necessary to
export product from the U.S. provided that ENDOCARE's manufacturing
of the Systems remains in the U.S.
(b) ENDOCARE shall be responsible for obtaining, at ENDOCARE's cost and
expense, all export licenses and permits as may be required to
export the Systems from any country of manufacture other than the
U.S. into the particular countries within the CryoCath Territories.
(c) CryoCath shall be responsible for obtaining, at CryoCath's cost and
expense, such import licenses and permits as may be required to
import the Systems into particular countries within the CryoCath
Territories as selected by CryoCath in accordance with then
prevailing laws and regulations of such countries. This
Import/Export approval is separate and distinct from FDA and CE Xxxx
approvals as described in section 2.2 (a). All such filings and
registrations of the Systems shall be made in the name of CryoCath
whenever feasible in accordance with prevailing laws and regulations
except as provided for in Section 2.2 (a). ENDOCARE shall exercise
reasonable cooperation with CryoCath in its efforts to obtain any
such approvals.
2.12 BUSINESS OVERSIGHT GROUP.
(a) The parties agree to establish a business oversight group for
purposes of planning, reviewing the business, and ensuring smooth
operations and a mutually beneficial relationship between the
parties under this Agreement. The group will initially consist of
two designated individuals from each of ENDOCARE and CryoCath. The
group will meet as deemed necessary and mutually agreed to, but not
less than three times during the first annual period. Meetings will
be held alternately at CryoCath's and ENDOCARE's head offices and
each party shall bear the expenses for its representatives
13
to attend these meetings. The business oversight group will discuss
such topics as marketing activities, progress and strategies
including targets, plans, etc. as well as manufacturing and supply
issues, future product requirements, new product designs etc.
ARTICLE 3
ENDOCARE DEVELOPMENT RESPONSIBILITIES
ENDOCARE will develop Systems at ENDOCARE's sole cost as follows:
3.1 CRYOPROBES.
(a) ENDOCARE will develop such cryosurgical probes as CryoCath may
request from time to time in accordance with sections 3.3, 3.4 and
3.5 of this Agreement. The first generation probe hereunder will be
a surgical, disposable, epicardial/endocardial linear cryoablation
probe that can be used to cure arrhythmias during open chest,
stopped heart surgery (MV/CABG), with specifications as more
particularly described in Schedule 1 which shall be subject to being
finalized by mutual agreement as described in section 3.4(a).
3.2 CRYO-CONSOLES.
(a) ENDOCARE will develop a first generation Cryo-Console that will not
have a display screen or dedicated microprocessor/software and with
specifications as more particularly described in Schedule 1 which
shall be subject to being finalized by mutual agreement as described
in section 3.4(a).
3.3 NEW CRYOPROBES.
(a) CryoCath may request that ENDOCARE develop new cryoprobes by, at
CryoCath's option, placing an order for *** such probes (to be paid
50% prepaid and 50% upon delivery) or making a cash payment of ***
(to be paid 50% prepaid and 50% upon delivery). CryoCath is
responsible for supplying a product requirement document at the time
of placing an order, which shall be based on a product requirement
document (MRS) jointly signed by the parties. Any such new *** probe
order will not be applied to CryoCath's Minimum Purchase
Requirements hereunder. However, in the event that CryoCath has
selected the *** cash payment option, all subsequent orders for such
new probes will apply to the Minimum Purchase Requirements. CryoCath
may request two new cryoprobe designs in addition to the malleable
cryoprobe under the terms of this
----------
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the Commission.
14
Section 3.3. The terms for the supply of additional cryoprobe
designs requested beyond the malleable and the *** additional
designs referenced above will be negotiated and agreed to by both
parties.
3.4 MUTUAL AGREEMENT TO DESIGN OF SYSTEMS.
(a) All probe and Cryo-Console designs will be mutually agreed upon by
both parties prior to finalization and market introduction. Basic
performance and design requirements for the second generation
malleable and deflectable tip probe are described in Schedule 1 and
shall be subject to being finalized by mutual agreement. All other
new design requirements will be supplied to ENDOCARE when CryoCath
places a formal new product request.
(b) Except for the products described in Schedule 2, ENDOCARE reserves
the right to make pricing adjustments based on any new product
design specifications which must be mutually agreed to in writing
prior to the development of such new products by ENDOCARE.
3.5 TIMELINES FOR SYSTEM DEVELOPMENTS.
(a) ENDOCARE must deliver the new malleable cryoprobe within 6 months of
the execution of this Agreement and ENDOCARE must deliver the new
Cryo-Console with a limited probe reuse function within 9 months of
the execution of this Agreement. Functional prototypes for animal
studies will be made available for CryoCath to purchase at
ENDOCARE's cost as soon as is reasonable prior to clinical product
availability.
(b) ENDOCARE will provide CryoCath with a System including a second
generation simplified Cryo-Console incorporating a means of limiting
probe reuse as described herein for market sales (i.e. animal trials
completed and all required regulatory documentation in place for the
U.S. and the European Community) within 9 months of the Effective
Date of this Agreement.
(c) If either of the product availability commitments outlined in
Sections 3.5 (a) or (b) are late and subject to the cure period
allowed for in section 3.5 (e),
***
***
***
----------
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the Commission.
15
(d) ENDOCARE must deliver the new deflecting tip probe design for market
sale within 12 months of the purchase order payment as outlined in
Section 3.3. The timeline for delivery of the third probe design
that CryoCath may require shall be established by mutual agreement.
(e) If ENDOCARE does not deliver new products within the specified time
limit described in Section 3.5 (a), (b) or (d), then ENDOCARE will
have 90 days after the time period to rectify the problem and
deliver the product for market sale. ENDOCARE must submit plans
showing a good faith effort to deliver the product in a timely
manner. During this 90 day period all CryoCath minimum sales
commitments will be suspended and delayed until such time as the new
product becomes available. If after 90 days the product is still not
available for sale, then CryoCath will have the option of either
terminating this Agreement and obtaining a full refund of all monies
paid to ENDOCARE including but not limited to the "new probe" cash
payment or pre-payment, or converting the Agreement to non-exclusive
as per the terms of Article 5 and meeting all milestone payments as
specified in Section 2.3 up to the point of conversion to
non-exclusive status. Alternatively, CryoCath may continue to wait
for the new product and all minimum sales commitments will continue
to be suspended and delayed until such time as the new product
becomes available.
(f) ENDOCARE will develop the probes, at ENDOCARE's cost, including
safety validation testing and performance testing in animal models
sufficient to satisfy the requirements for human use as determined
by the physician(s) that ENDOCARE selects to assist in the product
development process provided that CryoCath has accepted the probe
designs as required by Section 3.4.
ARTICLE 4
TERM AND TERMINATION
4.1 INITIAL TERM.
(a) The initial term (the "Initial Term") for CryoCath's rights and
obligations as the sole and exclusive worldwide market access
partner with rights to market, sell and distribute the Systems in
the Field of Use in the CryoCath Territories shall commence on the
Effective Date of this Agreement and end five (5) years thereafter.
16
4.2 RENEWAL TERM; MINIMUM PURCHASE REQUIREMENTS; CONTINUOUS SUPPLY.
(a) The Initial Term of CryoCath's rights and obligations as sole and
exclusive worldwide market access partner with rights to market,
sell and distribute the Systems in the Field of Use in the CryoCath
Territories may be renewed for up to (a) two (2) additional three
(3) year periods (each a "Renewal Term") by mutual agreement,
provided CryoCath and ENDOCARE have met or exceeded the Minimum
Purchase Requirements set forth on Schedule 3 and product
availability requirements as defined in Article 3.5, respectively,
and thereafter to be established by the parties for the CryoCath
Territories for the then current Renewal Term and provided the
parties mutually agree to pricing and Minimum Purchase Requirements
for the Renewal Term. The parties agree to commence good faith
negotiations regarding renewal by not later than 12 months prior to
the expiry of the Initial Term or Renewal Term and to conclude such
negotiations by not later than 6 months prior to each such expiry.
In the event that the terms for a Renewal Term cannot be agreed upon
notwithstanding the reasonable efforts of both parties, the
Agreement shall be converted into a non-exclusive license and the
rights and responsibilities of Article 4.3 shall come into effect.
(b) In determining whether CryoCath has met its Minimum Purchase
Requirements hereunder, CryoCath will be entitled to a reduction in
the Minimum Purchase Requirements for up to two (2) consecutive
quarters for the amount that CryoCath has exceeded its Minimum
Purchase Requirements in the current quarter. CryoCath will be
responsible to meet the Minimum Purchase Requirements for each
annual period as specified in Schedule 3 without the benefit of
carryover.
(c) In the event that ENDOCARE is unable or unwilling to continue to
supply product at any time during the Initial Term, or any Renewal
Term or non-exclusive period, then ENDOCARE must provide written
notice to CryoCath that it wishes to stop supplying product to
CryoCath effective twelve (12) months from the date such notice is
received by CryoCath. In this case, ENDOCARE shall continue to
supply CryoCath with all of CryoCath's product needs for the twelve
(12) month notice period in accordance with the pricing terms set
forth in this Agreement. During this twelve (12) month period,
CryoCath will be responsible for maintaining quarterly purchases
from ENDOCARE calculated as one-fourth the total purchases of the
twelve months prior to the notice. However, during the twelve (12)
month period, or any portion thereof, the minimum quarterly
purchases may be reduced if CryoCath is able to substantiate, in
writing, that it no longer sells products to a customer who
purchased products prior to the twelve (12) month notice period. In
the event that ENDOCARE
17
fails to supply CryoCath at any time during the said twelve (12)
month notice period, ENDOCARE shall upon written notice from
CryoCath provide CryoCath or a CryoCath-designated third party with
a royalty-free license to manufacture the ENDOCARE Systems for the
Field of Use for the remainder of the twelve (12) month notice
period. This transfer will include ENDOCARE's full and immediate
cooperation in the transfer of all required know-how, manufacturing
procedures, specifications and such other information as may be
required to manufacture the Systems. Under no circumstances may
CryoCath designate a third party to manufacture the Systems who is a
direct competitor of ENDOCARE in the use of cryotherapy.
4.3 CONVERSION TO NON-EXCLUSIVE FOR FAILURE TO MEET MINIMUM PURCHASE
REQUIREMENTS OR FAILURE TO MEET PRODUCT AVAILABILITY
(a) Subject to Article 7 thereof, following the first two annual
periods, if CryoCath fails to meet the quarterly Minimum Purchase
Requirements for the CryoCath Territories as set out in Schedule 3
for *** , ENDOCARE shall have the right to notify CryoCath that it
will convert CryoCath's future rights and obligations as the
exclusive worldwide market access partner for the CryoCath
Territories to a non-exclusive basis for a period of *** from the
date of conversion.
(b) CryoCath shall have *** following written notice from ENDOCARE to
convert the Agreement to non-exclusive due to breach including
failure to meet Minimum Purchase Requirements, in which to cure such
default by making up the total deficiency together with reasonable
evidence of a plan that will cure any such failure to meet the
Minimum Purchase Requirements in the future.
(c) ***
***
***.
(d) In the event that the aggregate difference amount is not purchased
or the fee not paid as described above, ENDOCARE will have the
option of either converting to non-exclusive status in accordance
with the terms set forth herein or continuing to wait for CryoCath
to rectify the cumulated missed Minimum Purchase Requirements. In
the latter case, ENDOCARE will have no further obligation to supply
newly developed products hereunder for as long as the default
remains uncured.
----------
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the Commission.
18
(e) During any non-exclusive period, CryoCath will maintain minimum
quarterly product purchases from ENDOCARE equal to the greater of
*** or *** .
(f) ***
***
***
***
***.
4.4 CRYOCATH'S TERMINATION FOR ENDOCARE BREACH.
(a) Subject to Article 6 hereof, if ENDOCARE breaches any of its
material obligations under this Agreement including but not limited
to ENDOCARE's development responsibilities under Article 3, then
CryoCath shall be entitled to terminate CryoCath's rights and
obligations under this Agreement without prejudice to all other
rights and recourses for damages or otherwise. CryoCath shall give
ENDOCARE written notice of any such intent to terminate, and
ENDOCARE shall have ninety (90) days in which to cure such material
breach. ENDOCARE hereby acknowledges CryoCath's right to continue to
sell Systems purchased from ENDOCARE to any person or entity in the
CryoCath Territories for eighteen (18) months or the remainder of
any non-exclusive period, whichever is greater.
4.5 ENDOCARE'S TERMINATION FOR CRYOCATH BREACH.
(a) Subject to Article 6 hereof and except as otherwise provided in
Article 4.3, if CryoCath breaches any of its material obligations
under this Agreement, then ENDOCARE shall be entitled to terminate
CryoCath's rights and obligations under this Agreement without
prejudice to all other rights and recourses for damages or
otherwise. ENDOCARE shall give CryoCath written notice of any such
intent to terminate, specifying whether such termination will apply
to CryoCath's rights and obligations, and CryoCath shall have ninety
(90) days in which to cure such material breach.
4.6 RIGHTS AND OBLIGATIONS ON TERMINATION.
(a) In the event of termination of all or a portion of this Agreement
for any reason, the parties shall have the following rights and
obligations: In the event of the termination of CryoCath's
distribution rights with respect to
----------
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the Commission.
19
all of the CryoCath Territories in accordance with Article 4.4 or
Article 4.5,
(i) CryoCath shall be permitted to fill any outstanding orders
from customers made prior to the date of termination, and
(ii) CryoCath and ENDOCARE shall cooperate to ensure continued
service and support to customers in the CryoCath Territories
who purchased Systems from CryoCath.
ARTICLE 5
INDEMNIFICATION
5.1 ENDOCARE'S LIABILITY.
(a) ENDOCARE shall, at ENDOCARE's sole cost and expense, indemnify,
defend and hold CryoCath, its officers, directors, employees, agents
and consultants harmless from and against any judgment or settlement
and associated litigation and/or settlement costs (including
reasonable attorney's fees and costs) that arise out the products'
failure to meet the warranty as described in Subsection 2.5(d), for
any claims based on products liability theory against the products.
CryoCath shall provide ENDOCARE with written notification of any
claim subject to indemnification pursuant to this Section 5.1 and of
any associated court filings promptly after CryoCath first learns of
them. CryoCath shall provide ENDOCARE with such assistance and
cooperation as ENDOCARE may reasonably request from time to time in
connection with the defense thereof. CryoCath will use reasonable
efforts to mitigate all such claims, losses, damages, expense or
liability after receipt of notice thereof. Without restricting the
generality of the foregoing, ENDOCARE indemnification shall extend
to (i) any breach of representation, warranty, covenant or agreement
on the part of ENDOCARE under this Agreement, (ii) total or partial
Systems recalls, (iii) alleged defects in materials, workmanship,
product performance or design of the Systems, but in any event
excluding matters for which CryoCath is responsible under Article
5.2 below, or (iv) any infringement claims by third parties of
Intellectual Property related to the System, but not including the
methods applied in the use of the Systems, nor on any future
products requested by CryoCath, nor any products jointly developed.
ENDOCARE shall maintain product liability insurance in such amounts
as is advisable pursuant to ordinary good business practice for a
similar company in a similar type of business, and shall provide
CryoCath with evidence of this coverage. CryoCath will use
reasonable efforts to mitigate all such claims, losses, damages,
expense or liability after receipt of notice thereof.
20
5.2 CRYOCATH'S LIABILITY.
(a) CryoCath shall, at CryoCath's sole cost and expense, indemnify,
defend and hold ENDOCARE and its officers, directors, employees,
agents and consultants harmless from and against any judgment or
settlement and associated litigation and/or settlement costs
(including reasonable attorney's fees and costs) that arise out of
the negligent or intentionally tortuous conduct of CryoCath's
business, or CryoCath's use or sale of products delivered to it by
ENDOCARE or any representations made by CryoCath regarding proposed
or recommended methods of use for the Products, or any claim of
patent infringement related to CryoCath's method of use of the
products delivered to it by ENDOCARE. ENDOCARE shall provide
CryoCath with written notification of any claim subject to
indemnification pursuant to this Section 5.2 and of any associated
court filings promptly after ENDOCARE first learns of them. ENDOCARE
shall provide CryoCath with such assistance and cooperation as
CryoCath may reasonably request from time to time in connection with
the defense thereof. ENDOCARE will use reasonable efforts to
mitigate all such claims, losses, damages, expense or liability
after receipt of notice thereof.
5.3 THIRD PARTY CLAIMS.
(a) If a claim by a third party is made against any indemnified party,
such indemnified party shall promptly notify the indemnifying party
of such claim, provided however that failure to give timely notice
shall not affect the rights of the indemnified party so long as the
failure to give timely notice does not materially adversely affect
the indemnifying party's ability to defend such claim against a
third party. The indemnifying party shall have the sole right to
manage, settle and defend such claim, at the expense of the
indemnifying party and with counsel chosen by the indemnifying
party. The indemnified party shall have the right to participate in
such action, at its own expense and with counsel of its own choice.
The indemnified party shall provide reasonable cooperation and
assistance to the indemnifying party, at the expense of the
indemnifying party. The indemnified party shall not enter into any
agreement with respect to such claim or threatened claim without
receipt of prior written approval from the indemnifying party.
(b) In the event of a third party claim of Intellectual Property
infringement with respect to the single-probe Cryo-Console or
malleable cryoprobe where ENDOCARE indemnifies CryoCath, ENDOCARE
will (1) make reasonable efforts to obtain a license which can be
used by CryoCath or, (2) make reasoanble efforts to modify the
Systems to make them noninfringing.
21
5.4 COOPERATION AS TO INDEMNIFIED LIABILITY.
(a) Each party hereto shall cooperate fully with the other parties with
respect to access to books, records or other documentation within
such party's control, if deemed reasonably necessary or appropriate
by any party in the defense of any claim that may give rise to
indemnification hereunder.
ARTICLE 6
FORCE MAJEURE
6.1 FORCE MAJEURE.
(a) "Force Majeure" shall mean any event or condition, not existing as
of the date of signature of this Agreement, not reasonably
foreseeable as of such date and not reasonably within the control of
either party, which prevents in whole or in material part the
performance by one of the parties of its obligations hereunder, such
as an act of God, act of government, war or related actions, civil
insurrection, riot, sabotage, epidemic, fire, flood, windstorm,
earthquake and similar events.
6.2 NOTICE.
(a) Upon giving notice to the other party, a party affected by an event
of Force Majeure shall be released without any liability on its part
from the performance of its obligations under this Agreement, except
for the obligation to pay any amounts due and owing hereunder in
respect of products sold and delivered, but only to the extent and
only for the period that its performance of such obligations is
prevented by the event of Force Majeure.
6.3 SUSPENSION OF PERFORMANCE.
(a) During the period that the performance by one of the parties of its
obligations under this Agreement has been suspended by reason of an
event of Force Majeure, the other party may likewise suspend the
performance of all or part of its obligations (other than payment
obligations) hereunder to the extent that such suspension is
commercially reasonable.
22
ARTICLE 7
INTELLECTUAL PROPERTY
7.1 TRADEMARK LICENSE.
(a) ENDOCARE grants CryoCath a non-transferable, royalty-free and
non-exclusive license to use ENDOCARE's trademarks, service marks,
icons or logos ("ENDOCARE Marks") provided to CryoCath by ENDOCARE,
only in the CryoCath Territories and only in connection with the
obtaining of regulatory approval of the Systems and the marketing
and promotion of Products to end-users. The trademark license
granted to CryoCath herein is only sublicensable by CryoCath to
distributors of the Systems. CryoCath shall submit to ENDOCARE in
writing for its prior written approval, which approval may not be
unreasonably withheld or delayed, one (1) sample of each Product
brochure or other marketing material on which any ENDOCARE Xxxx is
proposed to be used. ENDOCARE will provide CryoCath written notice
of its approval or disapproval within fifteen (15) days after
receiving such request; provided, however, that if ENDOCARE does not
disapprove CryoCath's request within such fifteen (15) day period,
the proposed use shall be deemed approved. ENDOCARE reserves the
right to change, modify or replace any ENDOCARE Xxxx at any time,
and CryoCath agrees to comply with such changes at its sole cost.
Except for the permitted uses as described in Section 4.6, CryoCath
will cease using any materials containing any ENDOCARE Xxxx
immediately upon termination of the Agreement, or at any time
sooner, upon written request by ENDOCARE. CryoCath will not alter,
modify or change any ENDOCARE Xxxx, or use it in combination with
any other words or symbols, without the prior written authorization
of ENDOCARE. CryoCath agrees that the presentation and image of
ENDOCARE Marks will be uniform and consistent with respect to the
Products associated with such ENDOCARE Marks. The use of ENDOCARE
Marks by CryoCath shall inure to the sole benefit of ENDOCARE.
CryoCath agrees not to apply for registration of ENDOCARE Marks (or
any xxxx confusingly similar thereto) anywhere in the world.
7.2 OWNERSHIP.
(a) Subject to all the terms and conditions of this Agreement, ENDOCARE
grants CryoCath a non-transferable, non-sub-licensable, and
royalty-free license to use any technology, know how, trade secrets,
and other propriety information of ENDOCARE that ENDOCARE may share
with CryoCath under this Agreement (including, without limitation,
the specifications and all Confidential Information shared with
CryoCath in an effort to obtain regulatory approval of the Systems),
only in connection with the obtaining of regulatory approval of the
Systems and the
23
marketing and promotion of Systems to end-users in the CryoCath
Territories. All such technology, however, is and shall remain the
sole property of ENDOCARE and shall be subject to the
confidentiality provisions of Schedule 4. Nothing in this license or
elsewhere in this Agreement shall be construed to grant to CryoCath
any rights whatsoever in ENDOCARE's technology or intellectual
property other than as delineated in this license
(b) ENDOCARE represents and warrants to CryoCath that as of the
Effective Date: It has the right to grant the rights and licenses
granted to CryoCath in this Agreement and the execution and
performance of this Agreement by ENDOCARE and the transactions
contemplated herein do not conflict with any agreement to which
ENDOCARE is a party or by which it is bound;
(c) ENDOCARE represents and warrants to CryoCath that as of the
Effective Date: It has sufficient right, title and interest to the
the Intellectual Property necessary for the manufacture, use or sale
of the Systems as contemplated herein;
(d) As of the Effective Date of this Agreement, ENDOCARE warrants to
CryoCath and to CryoCath's customers that Systems sold by ENDOCARE
do not infringe any patents, trade secrets, trademarks or other
intellectual property rights of any third party;
(e) ENDOCARE has no knowledge of any claim by a third person that
manufacture, use or sale of the Systems as contemplated in this
Agreement infringes the patent, copyright, trademarks, trade secret
or other intellectual property rights of any third person.
(f) CryoCath will acquire good and marketable title to all Systems and
product free and clear of all liens and other charges.
7.3 IMPROVEMENTS AND ENHANCEMENTS TO THE SYSTEMS.
(a) During the term of this Agreement, each party shall promptly inform
and make available to the other any material invention, improvement,
upgrading or modification relating to the Systems or ENDOCARE's
Intellectual Property relating to the Systems at no cost to the
other party.
7.4 OTHER INTELLECTUAL PROPERTY.
(a) All Intellectual Property owned by either party prior to executing
this Agreement remains solely owned by that party and any
Intellectual Property jointly developed within this Agreement will
be jointly owned as a co-inventor as that term is used under the
applicable patent laws with all
24
the rights, title and interests associated with intellectual
property development and ownership.
ARTICLE 8
MISCELLANEOUS
8.1 NON-DISCLOSURE.
(a) The parties to this Agreement will abide by all terms contained in
the Mutual Non-disclosure Agreement that is attached as Schedule 4.
8.2 RELATIONSHIP.
(a) This Agreement does not make either party the employee, agent or
legal representative of the other for any purpose whatsoever.
Neither party is granted any right or authority to assume or to
create any obligation or responsibility, express or implied, on
behalf of or in the name of the other party. In fulfilling its
obligations pursuant to this Agreement, each party shall be acting
as an independent contractor.
8.3 ASSIGNMENT.
(a) Neither ENDOCARE nor CryoCath shall assign its rights or obligations
under this Agreement without prior written consent of the other
party hereto, for any reason including, but not limited to, the
transfer or sale of all or substantially all of the party's assets
or equity, or in the event of a merger or consolidation or change in
control or similar transaction.
(b) In the event of a change of control of either party, the following
options are available:
(i) The parties may mutually agree, in writing, to honor the terms
of this Agreement.
(ii) The parties may choose to renegotiate this Agreement.
(iii) ***
***
***
***.
8.4 COMPLETE AGREEMENT.
(a) This Agreement and the Schedules hereto constitute the entire
agreement between the parties hereto with respect to the subject
matter hereof and
----------
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the Commission.
25
supersede all prior agreements whether written or oral relating
hereto. This Agreement supersedes all written correspondence,
including but not limited to all terms sheets, between ENDOCARE and
CryoCath negotiating the terms related to the subject matter hereof.
8.5 GOVERNING LAW AND DISPUTE RESOLUTION.
(a) In the event of any dispute with respect to the subject matter of
this Agreement which remains unresolved for a period of at least 90
days despite the parties' good faith efforts to negotiate a
resolution thereof and in particular the elevation of the matter to
the parties respective CEO's, the matter shall be submitted by
either party to final and binding commercial arbitration pursuant to
the rules of the American Arbitration Association. The arbitrator
shall be an individual mutually agreed to by the parties, or if the
parties are unable to agree, selected by the AAA, who is
knowledgeable and experienced in the high technology medical device
industry. The venue for any such arbitration shall be Boston,
Massachusetts. This Agreement shall be governed by and interpreted
in accordance with the laws of the Commonwealth of Massachusetts,
including all matters of construction, validity, performance and
enforcement, without giving effect to principles of conflict of
laws.
8.6 SURVIVAL.
(a) All of the representations, warranties and covenants made in this
Agreement, and all terms and provisions hereof intended to be
observed and performed by the parties after the termination hereof,
shall survive such termination and continue thereafter in full force
and effect.
8.7 WAIVER, DISCHARGE, AMENDMENT, ETC.
(a) The failure of any party hereto to enforce at any time any of the
provisions of this Agreement shall in no way be construed to be a
waiver of any such provision, nor in any way to affect the validity
of this Agreement or any part thereof or the right of the party
thereafter to enforce each and every such provision. No waiver of
any breach of this Agreement shall be held to be a waiver of any
other or subsequent breach. Any amendment to this Agreement shall be
in writing and signed by the parties hereto.
8.8 COUNTERPARTS.
(a) This Agreement may be executed in any number of counterparts, each
of which shall be deemed as original and all of which together shall
constitute one instrument.
26
8.9 TITLES AND HEADINGS; CONSTRUCTION.
(a) The titles and headings to Articles and Sections herein are inserted
for the convenience of reference only and are not intended to be a
part of or to affect the meaning or interpretation of this
Agreement. This Agreement shall be construed without regard to any
presumption or other rule requiring construction hereof against the
party causing this Agreement to be drafted.
8.10 BENEFIT.
(a) Nothing in this Agreement, expressed or implied, is intended to
confer on any person other than the parties to this Agreement or
their respective successors or assigns, any rights, remedies,
obligations or liabilities under or by reason of this Agreement.
8.11 NOTICES.
(a) All notices or other communications to a party required or permitted
hereunder shall be deemed given if in writing and delivered
personally or sent by telecopy (with confirmation of transmission)
or certified mail (return receipt requested) to such party at the
following addresses (or at such other addresses as shall be
specified by like notice):
If to CryoCath, to: CryoCath Technologies Inc.
00000 Xxxxxx Xxx-Xxxxx
Xxxxxxxx, Xxxxxx, Xxxxxx X0X 0X0
***
with a copy to: CryoCath Technologies Inc.
00000 Xxxxxx Xxx-Xxxxx
Xxxxxxxx, Xxxxxx, Xxxxxx X0X 0X0
***
and if to ENDOCARE, to: ENDOCARE Inc.
7 Studebaker
Xxxxxx, Xxxxxxxxxx 00000
***
with a copy to: ENDOCARE Inc.
7 Studebaker
Xxxxxx, Xxxxxxxxxx 00000
***
----------
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the Commission.
27
CryoCath or ENDOCARE may change their respective above-specified
recipient and/or mailing address by notice to the other party given
in the manner herein prescribed. All notices shall be deemed given
on the day when actually delivered as provided above (if delivered
personally or by telecopy) or on the day shown on the return receipt
(if delivered by mail).
8.12 ILLEGALITY.
(a) In case any provision of this Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired
thereby.
8.13 PUBLIC ANNOUNCEMENT.
(a) Each of the parties to this Agreement hereby agrees with the other
party hereto that, except as may be required to comply with the
requirements of applicable law or any exchange upon which such
party's capital stock is listed or traded, no press release or
similar public announcement or communication will be made or caused
to be made concerning the execution or performance of this Agreement
unless specifically approved in advance by CryoCath and ENDOCARE.
The foregoing shall not restrict either party's communications with
employees, customers or private investors.
28
8.14 EXECUTION OF FURTHER DOCUMENTS.
(a) Each party agrees to execute and deliver without further
consideration any further applications, licenses, assignments or
other documents, and to perform such other lawful acts as the other
party may reasonably require to fully secure and/or evidence the
rights or interests herein.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed
in the manner appropriate to each, as of the date first above written.
ENDOCARE, INC. CRYOCATH TECHNOLOGIES INC.
/s/ Xxxx Xxxxx /s/ Xxxxxx X. Xxxxxx
------------------------------------ -----------------------------------
President/CEO President/CEO
ATTACHMENTS:
Schedule 1 - Product Development and Specifications
Schedule 2 - Pricing
Schedule 3 - Minimum Purchase Requirements
Schedule 4 - Mutual Nondisclosure Agreement
29
SCHEDULE 1
PRODUCT DEVELOPMENT AND SPECIFICATIONS
[THE FOLLOWING ARE INITIAL SPECIFICATIONS BASED ON CURRENT INFORMATION AND ARE
SUBJECT TO CHANGE BY MUTUAL AGREEMENT]
First Generation Stopped Heart Epicardial/Endocardial MV/CABG Malleable Device
An open chest (intraoperative), disposable, epicardial/endocardial linear
cryoablation probe that can be used to treat atrial fibrillation (AF) during
open chest surgery, stopped heart surgery (MV/CABG).
***
***
***
----------
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the Commission.
30
SCHEDULE 2
PRICING
The transfer price for malleable cryoprobes and single cryoprobe Cryo-Consoles
will be as follows:
***
***
***
----------
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the Commission.
31
SCHEDULE 3
MINIMUM PURCHASE REQUIREMENTS
MINIMUM PURCHASE REQUIREMENTS
CryoCath will agree to maintain the quarterly minimum purchases from Endocare as
shown in the following schedule:
***
***
***
----------
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the Commission.
32
SCHEDULE 4
MUTUAL NONDISCLOSURE AGREEMENT
This Mutual Nondisclosure Agreement (the "Agreement") is entered into effective
as of the 7th day of September 2001 by and between ENDOCARE, INC., a Delaware
corporation, and CryoCath Technologies Inc, a Quebec (Canada) corporation. Each
undersigned party (the "Receiving Party") understands that the other party (the
"Disclosing Party") has disclosed or may disclose Confidential Information. The
purpose of this Agreement is to prevent the unauthorized disclosure or use of
Confidential Information.
For purposes of this Agreement, "Confidential Information" shall mean any
information regarding the Disclosing Party (and its business or products),
including the terms of the Exclusive Market Access and Supply Agreement with
Effective Date of September 21, 2001, which is disclosed to the Receiving Party
in connection with any potential or established business relationship or
agreement between the Disclosing Party and the Receiving Party, which has actual
or potential economic value to the Disclosing Party and which is not generally
known to the public at the time it is disclosed to the Receiving Party. Such
Confidential Information shall be in writing and marked confidential, or if
communicated verbally shall be reduced to writing by the Disclosing Party and
marked confidential and sent to the Receiving Party within thirty (30) days of
the verbal communication, and may include, but shall not be limited to, trade
secrets, know-how, negative know-how, formulas, patterns, compilations,
programs, devices, methods, techniques, processes, inventions, source codes,
diagrams, marketing and pricing information, business strategies and information
regarding customers and suppliers.
In consideration of the Disclosing Party's disclosure of Confidential
Information to and other relationships with the Receiving Party, the Receiving
Party hereby agrees as follows:
1. The Receiving Party shall hold and maintain all Confidential Information
in strictest confidence and in trust for the sole and exclusive benefit of
the Disclosing Party.
2. The Receiving Party shall not, without the prior written approval of the
Disclosing Party, use for its own benefit, publish or otherwise disclose
to others, or permit the use by others for their benefit or to the
detriment of the Disclosing Party, any of the Confidential Information. In
addition, the Receiving Party shall not, without the prior written
approval of the Disclosing Party, reverse engineer, decompose or otherwise
analyze the contents or components of products or materials it receives
from the Disclosing Party to acquire information that would be
Confidential Information if then disclosed directly by the Disclosing
Party.
3. The Receiving Party shall carefully restrict access to the Confidential
Information to those of its officers, directors and employees who clearly
need such access in order to participate on behalf of the Receiving Party
in the analysis, negotiation or carrying out of a business relationship or
agreement with the Disclosing Party. The Receiving Party further warrants
and represents that it will advise each of the persons to whom it provides
access to any of
33
the Confidential Information pursuant to the foregoing sentence that such
persons are strictly prohibited from making any use, publishing or
otherwise disclosing to others, or permitting others to use for their
benefit or to the detriment of the Disclosing Party, any of the
Confidential Information.
4. The Confidential Information will not be used in any way against the
interests of the Disclosing Party's interests, including, to file any
patent application relating to the Confidential Information except in the
name of or assigned to the Disclosing Party, to provide any reexamination
or any interference with any patent application which has been filed or
will be filed by the Disclosing Party relating to the Confidential
Information, and will not be used to amend any claim in any pending patent
application to expand the claim to read on, cover, or dominate any
invention (whether or not patentable) disclosed in the Confidential
Information
5. The Receiving Party shall take all necessary action to protect the
confidentiality of the Confidential Information, except for its disclosure
pursuant to paragraph 3 above, and hereby agrees to indemnify the
Disclosing Party against any and all losses, damages, claims, expenses or
liabilities incurred or suffered by the Disclosing Party as a result of
the Receiving Party's breach of this Agreement.
6. The Receiving Party understands and acknowledges that any disclosure or
misappropriation of any of the Confidential Information in violation of
this Agreement may cause the Disclosing Party irreparable harm, the amount
of which may be difficult to ascertain. The Receiving Party therefore
agrees that the Disclosing Party shall have the right to apply to a court
of competent jurisdiction for an order restraining any such further
disclosure or misappropriation and for such other relief as the Disclosing
Party shall deem appropriate. Such right of the Disclosing Party is to be
in addition to the remedies otherwise available to the Disclosing Party at
law or in equity.
7. Disclosing Party and Receiving Party agree that the obligations of
confidentiality and nonuse imposed hereunder in Paragraphs 1 and 2 of this
Agreement shall apply only to Proprietary Information for a period of five
(5) years following the disclosure date thereof. It is further agreed that
the obligations of confidentiality and nonuse imposed in Paragraphs 1 and
2 of this Agreement will not apply to information to the extent of:
a.) information which is now or becomes (through no improper action or
inaction by Receiving Party part of the public domain;
or
b.) information already known to Receiving Party at the time of
disclosure;
or
c.) information that was rightfully disclosed to Receiving Party by a
third party without restriction;
or
34
d.) information which can be shown by clear and convincing written
evidence to have been independently developed by Receiving Party
without use of any Propriety Information or by employees of
Receiving Party who have had no access to such information;
or
e.) information that the Receiving Party is required by law or court
order to disclose, provided Receiving Party so notifies Disclosing
Party in writing as soon as practicable, uses diligent efforts to
limit disclosure and to obtain confidential treatment or a
protective order and has allowed Disclosing Party to participate in
the proceeding.
PROVIDED, however, that nothing in this paragraph shall be construed as
granting, in any way, any type of assignment or license under any patent,
trademark, trade secret or copyright of Disclosing Party or any other entity.
8. The Receiving Party shall return to the Disclosing Party any and all
records, notes and other written, printed or tangible materials pertaining
to the Confidential Information immediately on the written request of the
Disclosing Party.
9. This Agreement and the Receiving Party's obligations hereunder shall be
binding on the representatives, assigns and successors of the Receiving
Party and shall inure to the benefit of the Disclosing Party's assigns and
successors.
10. This Agreement shall be governed by and construed in accordance with the
laws of the Commonwealth of Massachusetts, excluding its conflict of laws
rules. Any action or proceeding to enforce or interpret the provisions of
this Agreement may be brought by either party to final and binding
commercial arbitration pursuant to the rules of the American Arbitration
Association in Boston, Massachusetts.
11. If any action at law or in equity is brought to final and binding
commercial arbitration to enforce or interpret the provisions of this
Agreement, the prevailing party in such action shall be entitled to
reasonable attorneys' fees.
12. This Agreement constitutes the sole understanding of the parties about the
subject matter hereof and may not be amended or modified except in writing
signed by each of the parties to the agreement.
13. This Agreement may be executed in one or more counterparts, each of which
shall be a valid original agreement.
14. If any provision of this Agreement or its application to any person or
circumstance is held invalid or unenforceable to any extent, the remainder
of this Agreement and its other application to any person or circumstance
shall not be affected and shall be enforceable to the full extent
permitted by law.
35
15. No waiver of any provision of this Agreement will be deemed to be or will
constitute a waiver of any other provision or other application of the
same provision, whether or not similar, nor will any waiver constitute a
continuing waiver.
ENDOCARE, INC. CryoCath Technologies Inc.
By: /s/ Xxxx Xxxxx By: /s/ Xxxxxx X. Xxxxxx
-------------------------------- --------------------------------
Signature Signature
Xxxx Xxxxx Xxxxxx X. Xxxxxx
-------------------------------- --------------------------------
Printed Name Printed Name
CEO President & CEO
------------------------------------ ------------------------------------
Title Title
