Exhibit 10.1
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WORLDWIDE OEM AGREEMENT
THIS WORLDWIDE OEM AGREEMENT (this "Agreement") is made and entered
into this 12th day of June 2006 (the "Effective Date"), by and between Paradigm
Medical Industries, Inc., a Delaware corporation with corporate offices at 0000
Xxxxx 0000 Xxxx, Xxxx Xxxx Xxxx, Xxxx 00000, XXX, x000-000-0000 (hereinafter
referred to as "Paradigm"), and MEDA Co., Ltd., with business offices at Xxxx X,
X0, Xxxxxxxx X0, Xxxxxx Science Skill Park, Huayuan Industry Xxxxxxxxxxx Xxxx,
Xxxxxxx, 000000, Xxxxx, x00-00-00000000 (hereinafter, together with its
subsidiaries and representative offices referred to as "MEDA") (each of the
foregoing parties are referred to singly as a "Party" and collectively as the
"Parties").
WITNESSETH:
WHEREAS, Paradigm and MEDA desire to enter into an agreement for the
purpose of MEDA supplying MEDA Products, as defined below, modified or
unmodified, in accordance with Appendix 1, to Paradigm for the purpose of resale
by Paradigm through the Paradigm distribution channels consisting of ophthalmic
and medical product distributors and independent sales representatives in the
Territories, as defined below;
NOW, THEREFORE, in consideration of the mutual and reciprocal
covenants, promises, recitals, terms and conditions herein contained, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged by each Party, the Parties hereby agree as follows:
1. Definitions
1.1 "MEDA Products" shall mean the products as defined in Appendix 1,
which shall be supplied by MEDA to Paradigm, and by Paradigm to
its customers/distributors in the Territories, as defined below,
under either the MEDA type/model number or labeled as a Paradigm
product with either the MEDA type/model number or a new and
different Paradigm model/type number. Other products and
territories can be included under the terms of this Agreement by
means of amending this Agreement, including appending to the items
listed in Appendix 1.
1.2 "Territories" shall mean the territories as defined in Appendix 1.
2. Grant of License and Rights of the Parties
2.1 MEDA agrees to grant to Paradigm a non-exclusive license to
redistribute and resale the MEDA Products in the
Territories.
2.2 In the interests of promoting MEDA Products as part of
Paradigm's product line, the Parties agree (a) to
participate in periodic meetings to monitor the results of
this Agreement; (b) to review, modify and add to the MEDA
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Products in order to improve the products wherever
possible; (c) to jointly develop and collaborate in the
improvement and enhancement of the MEDA Products; and (d)
to determine intellectual property ownership or percent of
ownership of major enhancements to existing Products and
development of new Products as well as to creating improved
products by combining the intellectual properties and
expertise of both Parties.
2.3 In the interest of product development, enhancement and
differentiation, MEDA shall give consideration to potential
software development or enhancements made available by
Paradigm for the MEDA Products. Software and hardware
modifications designed exclusively by Paradigm for the
purpose of product uniqueness shall be exclusive to the
MEDA Products supplied to Paradigm under Paradigm's name,
to Paradigm customers and be made available to MEDA and
MEDA customers who are not competing directly with Paradigm
and Paradigm distributors and sales agents within the
Territories. Such software and hardware modifications may
be used by MEDA in its markets and, with approval of
Paradigm, in the Territories. To avoid any ambiguity, such
software and hardware modifications shall be described in
writing and agreed to by both Parties prior to making such
modifications.
2.4 Software and hardware modifications designed jointly by
Paradigm and MEDA shall be considered the joint
intellectual property of Paradigm and MEDA and may be used,
without restriction, unless otherwise previously agreed to,
by either Party.
2.5 In the interest of product improvement, MEDA shall
collaborate with Paradigm and its designated engineers,
employees or consultants to consider and potentially
implement jointly or individually the development of
product enhancements on the products marketed by Paradigm
and the products manufactured by MEDA. Paradigm and MEDA
shall develop a unique appearance for the products
manufactured for Paradigm in order to differentiate the
Paradigm specific product appearance from the products
manufactured by MEDA. Changes in the structure of the
Parties shall not cause a change of ownership in the
intellectual property.
2.6 Joint product development resulting in new MEDA Products as
a result of contributions made by both Parties in the
creation of new MEDA Products shall result in the
intellectual property of the new products being jointly
owned by both Parties unless other written agreements are
made prior to or during the product development process.
2.7 Either Party may provide specific products or concepts
owned and patented by such Party to the other Party for the
purpose of production, sales, marketing and/or
distribution. In such cases, unless otherwise specified and
agreed to in writing by both Parties, the intellectual
property and patents governing said products shall remain
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the property of the Party responsible for the design and
development of said products or concepts.
2.8 Any unpatented intellectual properties, proprietary
software and hardware design or modifications, and trade
secrets mentioned in Section 2.7 above and the receiving
Party's obligation hereunder shall not extend to or apply
to any part of the properties or information which (a) is
or becomes publicly known other than through breach of this
Agreement by the receiving Party, or is or becomes
commercially available; (b) is received by receiving Party
in good faith from any third party; (c) is known to the
receiving Party prior to the disclosure; or (d) is
independently developed by employees of the receiving
Party, as evidenced by written records, without access to
the disclosing Party's confidential information.
3. Liaison
3.1 Paradigm and MEDA shall each appoint a primary
representative who shall be responsible for co-coordinating
the activities of the Parties.
3.2 The initial primary representatives shall be:
MEDA:
Song Xuedong
General Manager
MEDA Co., Ltd.
Xxxx X, X0, Xxxxxxxx XX
Xxxxxx Science Skill Park
Huayuan Industry Xxxxxxxxxxx Xxxx
Xxxxxxx, 000000
Xxxxx
Paradigm:
Xxxxxxx X.X. Xxxxxxxx
President and Chief Executive Officer
Paradigm Medical Industries, Inc.
2355 South 0000 Xxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Xxxxxx Xxxxxx of America
4. Maintenance and Installation
4.1 Warranty: MEDA shall provide twelve (12) months warranty
from the date of dispatch for all MEDA Products supplied to
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Paradigm. If faults cannot be corrected at Paradigm's
facilities or at the facilities of trained Paradigm repair
centers, the MEDA Products may be returned to MEDA after
obtaining approval and a returned merchandise authorization
number on a freight paid basis. MEDA will carry out such
repairs as required and return the goods to Paradigm or to
its designated agent or distributor within ten (10) working
days from the date of receiving such goods, at no cost to
Paradigm, and MEDA will pay return freight costs.
5.1 The performance specification for the MEDA Products, as
described in product manuals and promotional printed
material, shall be the only performance guarantee offered
by Paradigm and shall be the same performance
specifications provided by MEDA.
5.2 If the performance specifications change, it shall be the
responsibility of MEDA to notify Paradigm within three (3)
days of the date of change of the performance specification
to any MEDA Products, providing specific details concerning
the change and the impact the change will have on the MEDA
Products as well as the impact this change will have on the
users of the MEDA Products and their patients.
6. Scope of Supply, Delivery, Pricing and Packaging
6.1 The standard conditions of purchase of MEDA Products shall
apply to all sales of all MEDA Products to Paradigm.
6.2 MEDA shall make every effort to deliver MEDA Products
within the delivery times stated in Appendix 3 of this
Agreement. MEDA shall promptly make Paradigm aware of any
problem that may cause late delivery of the MEDA Products.
Paradigm shall promptly make MEDA aware in advance of any
significant expected increase or decrease in product order
demand. Paradigm shall notify MEDA as far as possible of
any fluctuation of the estimated product delivery
requirement and MEDA will use all reasonable endeavors to
accommodate such requirements.
6.3 Paradigm agrees to purchase the MEDA Products from MEDA at
the prices specified in Appendix 2.
6.4 MEDA shall acknowledge all purchase orders from Paradigm
within three (3) business days from receipt of any order.
6.5 MEDA shall be entitled to invoice on the shipping of MEDA
Products, which amount shall be paid by Paradigm prior to
shipping. Sixty percent (60%) of the invoice shall be
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pre-paid by Paradigm prior to shipping and the remaining
portion of the invoice shall be paid within forty-five (45)
days of receipt of the invoice after a credit facility is
established. MEDA will evaluate Paradigm's credit
application and will work with Paradigm to establish such
credit facility. An alternative form of payment is by
letter of credit with mutually acceptable terms.
6.6 Prices set forth in Appendix 2 will be valid for twelve
(12) months from the Effective Date. MEDA will notify
Paradigm at least six (6) months in advance of any price
increase and will supply a new price-list at that time. The
product prices set out in Appendix 2 are in U.S. Dollars
and based upon the established global banking exchange in
effect on March 1, 2006.
6.7 Installation of the MEDA Products shall be made by Paradigm
or its nominated subsidiary, distributor, representative or
agent, at no cost to MEDA. MEDA may be contacted during
product installation to answer any questions that are
unique and have not been previously addressed. MEDA shall
provide Paradigm with a specific contact for this purpose.
6.8 MEDA shall provide the MEDA Products to Paradigm as defined
in Appendix 1, fully tested and fit for the requisite
purpose and immediate use, wrapped in a sealed polyethylene
bag, supported inside a sealed cardboard box suitable for
airfreight and shall include all parts, components and
accessories that comprise each product. When arrangements
are made between MEDA and Paradigm, MEDA shall ship to
Paradigm the MEDA Products in Paradigm specific shipping
containers, boxes and/or wrapping.
6.9 MEDA shall ship MEDA Products directly to Paradigm
customers when requested in order to improve delivery time
and aid cost control as well as deal with regulatory
issues. Paradigm may provide special shipping material to
be used in such shipments such as Paradigm branded packing
tape, Paradigm labels and possibly Paradigm branded boxing.
Paradigm shall provide Paradigm and/or Dicon brand specific
labeling to be applied to MEDA Products shipped directly to
Paradigm customers or distributors. Paradigm will provide
instruction regarding the placement of the Paradigm
specific product labels.
7. Training
7.1 MEDA shall endeavor to answer any and all technical
enquiries concerning the MEDA Products. MEDA shall train
Paradigm technical service engineers and Paradigm
designated international distributors as soon as possible
after the signing of this Agreement, and as future needs
arise and as MEDA can reasonably fit such training into the
regular schedules of its employees in Tianjin, China. MEDA
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may determine and request needs for future training on new
products as necessary and shall offer such training in
Tianjin, China. For the training conducted outside China,
Paradigm or designated Paradigm distributors and/or service
centers shall be responsible for the traveling, living and
hotel expenses for MEDA engineers. Training is at no charge
to Paradigm. This training shall also be made available to
Paradigm's designated repair agencies in order to provide
service and repair on a global basis. These agencies will
be considered authorized repair facilities for MEDA
Products marketed under the Paradigm/Dicon brand name.
7.2 MEDA shall provide sales training on an annual basis for
all MEDA Products. Such sales training may be conducted at
the MEDA facilities or in conjunction with a trade-show or
Ophthalmic Congress where MEDA will have a presence. Sales
training shall be at no charge to Paradigm with the
exception of traveling expenses. Living and hotel expenses
for the participants shall be borne by their own Party.
When training is conducted in conjunction with a trade-show
or Ophthalmic Congress and both Parties are participating
in the Ophthalmic Congress, the expenses of traveling,
living and hotel expenses shall be the responsibility of
the individual respective Parties.
8. Testing and Quality
8.1 MEDA shall allow Paradigm access to observe the
manufacturing process of the products relevant to this
Agreement. MEDA shall endeavor to implement measures,
procedures and tests to meet the quality standards required
by Paradigm, the TUV or FDA within one month of receiving
written notification.
8.2 MEDA shall provide Paradigm with copies of all TUV
Regulatory (CE) certificates. In addition, MEDA shall
provide copies of all FDA 510(k) registration certificates
when they are obtained from the FDA.
8.3 MEDA may engage Paradigm to assist in the FDA registration
process of its products in the United States of America.
When such FDA 510(k) registration is performed by Paradigm,
all of the related testing results required for TUV CE
certification shall be made available to Paradigm. Other
required testing results performed by Paradigm shall be
made available to MEDA. Cost of FDA 510(k) registration for
MEDA Products shall be negotiated between MEDA and Paradigm
on a per product basis.
8.4 Both Parties agree to immediately inform the other Party in
the event that their ISO9001 & ISO13485 & MDD93/42/EEC
certification accreditation status changes and both Parties
shall provide to the other Party copies of the ISO9001 &
ISO13485 & MDD93/42/EEC certificates.
8.5 Paradigm shall be authorized to visit the MEDA facility a
minimum of two times each year. MEDA shall be authorized to
visit the Paradigm facility a minimum of two times each
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year. Adequate advance notice from either Party shall be
given to assure all vital representatives of the Parties to
these meetings will be present at these meetings.
9.1 This Agreement shall be effective for three (3) years from
the Effective Date. At the end of the three (3) year term,
representatives of the Parties shall confer to determine
whether to extend the term of the Agreement. This shall
have the practical effect of extending the term of the
Agreement for an additional one hundred twenty (120) days.
If mutual agreement for extending the term of the Agreement
is not reached within one hundred twenty (120) days after
the end of the three (3) year term, then the Agreement
shall be deemed terminated. If within the aforesaid one
hundred twenty (120) days, the Parties mutually agree to
extend the term of the Agreement, then thereafter either
Party may terminate the Agreement by providing twelve (12)
months written notice to the other Party. All outstanding
orders at the time of notification shall be supplied under
the terms of this Agreement, and MEDA shall continue to
fulfill all orders from Paradigm until the aforesaid twelve
(12) month notice period has expired. Notwithstanding
anything to the contrary, the provisions of this Subsection
9.1 are subject to the provisions of Subsection 9.2.
9.2 Either Party shall be entitled forthwith to terminate this
Agreement by written notice to the other if:
9.2.1 The other Party commits a material breach of any
of the provisions of this Agreement and, in the
case of a material breach capable of remedy,
fails to remedy the same within thirty (30) days
after receipt of a written notice giving full
particulars of the material breach and requiring
it to be remedied.
9.2.2 Any action that is taken that is equivalent in
the United States to a receiver being appointed
for the other Party or an assignment made for
the benefit of creditors, or if a petition under
the equivalent of Federal bankruptcy or
reorganization action in the United States shall
be filed by or against the other Party and is
not dismissed within sixty (60) days of such
filing or appointment.
9.2.3 An encumbrance takes possessions or a receiver
is appointed over any of the property or assets
of that other Party; that other Party goes into
liquidation (except for the purposes of
amalgamation or reconstruction and, in such
manner, the Party resulting therefore
effectively agrees to be bound by or assume the
obligations imposed on that other Party under
this Agreement); or that other Party ceases or
threatens to cease to carry on business.
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9.3 Upon termination of this Agreement, each Party shall
promptly return to the other Party all materials and other
items furnished to it by the other Party before and during
this Agreement unless such materials and items were
purchased and paid in full.
10. Warranty of Title
10.1 Each Party warrants that it has the right to enter into
this Agreement and has sufficient right, title and interest
in its products and related documentation to make the
grants and the commitments made herein, and shall not make
any commitments to the other Party inconsistent herewith.
11. Relationships of the Parties
11.1 The Parties hereto are independent contractors and nothing
contained in this Agreement shall be construed to create
the relationship of partners, joint ventures or
employer-employee. Each Party acknowledges that it has not
made, and shall not make, any representations to any third
party, either directly or indirectly, that such Party has
any authority to act in the name or on behalf of the other
Party or to obligate the other Party in any way whatsoever
except as expressly provided herein. Each Party agrees not
to use the word "agent" or any other designation that might
imply the other Party is responsible for the acts of such
Party.
11.2 MEDA is responsible for supplying MEDA Products to Paradigm
that are fully compliant with all the European legislation
and directives required for CE labeling. Exceptions to not
providing CE Certification to Paradigm must be provided in
writing by Paradigm to MEDA. This may be the case in
product development projects where product is being
developed, simultaneously, in both the United States and in
China. This may further be the case where product is
provided to research and development centers and to medical
or veterinary applications or to regions of the world where
regulatory approvals from TUV (CE Xxxx) and/or FDA are not
required.
11.3 MEDA is responsible for the performance and safe operation
of the MEDA Products supplied to Paradigm, Paradigm's
customers, distributors and representatives.
11.4 During the course of this Agreement, should the terms
"partner", "marketing partner" or "partnership" be used to
describe the cooperative trading relationship, both Parties
shall make clear to third parties that these terms refer
only to the spirit of cooperation which exists between MEDA
and Paradigm and do not expressly or otherwise imply
partnership in the legal sense of this term.
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12. Miscellaneous
12.1 The Parties shall inform their respective parent or
controlling companies, prior to execution hereof, of the
existence, terms and conditions of this Agreement.
12.2 Neither Party may assign, transfer or delegate any of the
rights or obligations set forth in this Agreement without
the prior written consent of the duly authorized
representative of the other Party.
12.3 This Agreement shall be construed as though all Parties
participated equally in its drafting.
12.4 In the event that any provision of this Agreement shall be
unenforceable or invalid under any applicable law or be so
held by applicable court decision, such enforceable or
invalidity shall not render this Agreement unenforceable or
invalid as a whole, and, in such event, such provision
shall be changed and interpreted so as to best accomplish
the objectives of such provisions within the limits of
applicable law or applicable court decisions.
12.5 The failure of either Party to enforce, in any one or more
instance, any of the terms or conditions of this Agreement
shall not be construed as a waiver of the future
performance of any such term or condition.
12.6 Disputes arising in connection with this Agreement shall be
mediated. If mediation is not successful, any disputes
arising in connection with this Agreement shall be settled
under the United Nations Convention on Contracts for the
International Sale of Goods (1980) in a third country.
12.7 This Agreement shall be governed by and construed in
accordance with the laws of the State of New York of the
United States of America.
12.8 This Agreement may not be amended, modified or changed
except by written instrument of both Parties in a written
document signed by both Parties and appended to this
Agreement.
12.9 The persons signing below warrant that they are authorized
to enter into this Agreement on behalf of their respective
principals identified below and that by their signatures
they bind such principals to this Agreement.
12.10 Both Parties agree to maintain this Agreement, the terms
hereof, and any and all information obtained or provided by
either Party in order to initiate a contractual
relationship, in the strictest of confidence.
12.11 This Agreement, including each Appendix thereto, contains
the entire agreement and only understanding between the
Parties with respect to the subject matter hereof and
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supersedes all previous negotiations, agreements and
understandings between the Parties and affiliates of the
Parties.
12.12 This Agreement may be executed in counterparts and each
such counterpart shall be deemed to be an original
instrument, but all such counterparts together shall
constitute one agreement.
IN WITNESS WHEREOF, Paradigm and MEDA, intending to be legally bound
hereby, have duly executed this Agreement by duly authorized representatives,
effective as of the Effective Date.
PARADIGM MEDICAL INDUSTRIES, INC.
Date: June 12, 2006 By: /s/ Xxxxxxx X.X. Xxxxxxxx
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Xxxxxxx X. X. Xxxxxxxx, President
and Chief Executive Officer
MEDA CO., LTD.
Date: June 12, 2006 By: /s/ Song Zuedong
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Song Xuedong
General Manager
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APPENDICES
Appendix 1
Products and Territories
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Products
MEDA Paradigm Part Number
ODM-1000P Pachymeter P-2200 Pachymeter
ODM-1000A/P Ultrasonic Biometer P-2500 A/P
ODM-1000 A Ultrasonic Biometer P-2000 Biometric A-Scan
ODM-2100 Ultrasonic A/B Scanner P-2700 Ultrasound A/B Scan
ODM-2200 Ultrasonic A/B Scanner P-3700 Ultrasound A/B Scan
BME-300W UBM P-65 Ultrasound BioMicroscope
Territories
Paradigm shall be allowed global product distribution in all countries
with the exclusion of China.
Paradigm shall be allowed exclusive product distribution to Paradigm
ophtlamic and veterinary product distributors who are current Paradigm Medical
Industries product distributors in order to allow for product consistency of
products sold by these distributors.
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APPENDICES
Appendix 2
Product Price (in U.S. Dollars)
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MEDA Price
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ODM-1000 Pachymeter $ 1,600
ODM-1000A/P A-Scan/Pachy Combo $ 2,300
Over 10 sets per order $ 2,200
ODM-1000 Biometric A-Scan $ 1,600
ODM-2100 Ultrasonic A/B Scanner $ 6,300
Over 10 sets per order $ 6,000
ODM-2200 Ultrasonic A/B Scanner $ 6,500 without monitor
BMW300W UBM $ 11,000 without probe and transducer
BME-300W UBM with probe and transducer $ 16,000
BME-300W 50MHz Meda transducer $
Eye Cups: 16mm, 18mm, 20mm, 22mm $ 5
Replacement Probes:
ODM-1000 Pachymeter Probe $ 000
XXX-0000X/X & XXX-0000X A-Scan Probe $ 350
ODM-2100 A-Scan Probe $ 350
ODM-2100 B-Scan Probe $ 1,500
ODM-2200 A-Scan Probe $ 350
ODM-2200 B-Scan Probe $ 1,500
UBM Gantry Arm with Probe Holder $ 400
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APPENDICES
Appendix 3
Delivery Times
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Except for the UBM in quantities of one (1) to five (5) sets, UBM orders in
excess of 5 sets, shall be shipped within eight (8) weeks. All other product
orders shall be shipped within four (4) weeks of receipt of product orders from
Paradigm and receipt of payment as described in Section 6.5 of this Agreement
Products ordered by Paradigm shall be shipped by MEDA to the addresses
designated by Paradigm.
For products shipped directly to Paradigm, the address is the following:
Paradigm Medical Industries, Inc.
0000 Xxxxx 0000 Xxxx
Xxxx Xxxx Xxxx, Xxxx 00000
XXX
(000) 000-0000
(000) 000-0000 (fax)
For product orders shipped directly to Paradigm's authorized distributors, the
distributor's address shall be provided with the product order.
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