EXHIBITS 10.14
INTERNATIONAL DISTRIBUTOR AGREEMENT
-----------------------------------
December 21, 1998
MDH s.r.1. Forniture Ospedaliere
Xxx xxxxx Xxxxxxxx 0
Xxxxxx 00000
Xxxxx
Dear Xxxxxxxxxx Xxxxxxxx:
This letter is the agreement ("Agreement") between MDH s.r.l. Forniture
Ospedaliere ("you") and XXXX Medical Systems, Inc. ("XXXX") under which you are
appointed as a distributor in the territory described on Exhibit A to this
Agreement (the "Territory") of the XXXX-branded products listed on Exhibit B to
this Agreement (the "Products"). This Agreement constitutes the entire agreement
and understanding of the parties with respect to the subject matter of this
Agreement and supersedes all prior discussions, agreements and understandings,
including, without limitation, that certain International Distributor Agreement
between XXXX, you and Xxxxxxxxxx Xxxxxxxx made as of December 1, 1996. That
certain agreement is hereby terminated as of December 31, 1998. The terms and
conditions under which you will act as RITA's distributor are as follows:
1. PRODUCTS AND TERRITORY
----------------------
You shall act as XXXX s distributor in the Territory (described in Exhibit
A) to promote, sell and distribute the Products (described in Exhibit B)
for XXXX approved applications only and to provide service with respect to
the Products, to the medical community. As used in this Agreement, "medical
community" means medical doctors, institutions such as hospitals and
clinics, and similar institutions which are active in the personal care of
patients. You are not authorized to sell any Products to any of your
competitors or to any of RITA's competitors without RITA's prior written
consent. You shall not actively solicit orders from customers domiciled
outside the Territory, or sell or deliver any Product to any customer which
is not in the Territory. Furthermore, you shall not appoint any distributor
or any agent or maintain any sales, service or stock facility outside the
Territory. Except with the prior written consent of XXXX , you shall not
sell or advertise within the Territory, either on your own behalf or on
behalf of any other person, company, or corporation, products which
compete, directly or indirectly, with the Products.
2. SALES PROMOTION AND REPORTING RESPONSIBILITIES
----------------------------------------------
You shall be obligated to actively promote RITA's products according to
Section 1 above, at your sole expense. This includes, but is not limited
to, the activities described below in this Section. You shall attend and
exhibit at all major trade shows in your
Territory related to the Products. You shall provide training and clinical
education to all of the customers in your Territory. You shall provide
appropriate promotional materials in the language of your Territory. You
shall be obligated to provide a sales report to XXXX on a monthly basis, by
the 15th of the month following the reporting period, which details your
sales to customers, including the customer name, quantity and selling price
as well as the current inventory status of all Products which are in your
possession at the end of the month. You shall provide to XXXX, on request,
copies of any tenders for the Products in your Territory. Prior to the
commencement of each Sales Year (defined in Section 14) you shall provide
to XXXX a business plan which will describe your results for the prior year
and your plans for the coming year.
XXXX shall be obligated to provide you with such technical support as may
be deemed necessary by XXXX to provide you with a full understanding of the
Products. XXXX shall also provide you with a reasonable number of its then
existing catalogs, brochures and other promotional materials in the English
language to facilitate your promotion of the Products.
3. ORDERS AND MINIMUM PURCHASE QUANTITIES
--------------------------------------
All purchase orders shall be governed by the terms of this Agreement and
RITA's standard acknowledgement form, provided that if any conflicts shall
occur, this Agreement shall prevail.
In the first two years of this Agreement, you shall purchase the minimum
quantity of Products set forth on Exhibit C. In (a) succeeding years or (b)
if additional products are added by XXXX to the Products listed in Exhibit
B; then, in accordance with Section 14, the minimum quantity of Products to
be purchased shall be as agreed between the parties in writing.
For the purpose of securing orderly shipments, you shall submit to XXXX a
rolling four quarter forecast of orders for the Products at the beginning
of each quarter.
4. RETURNS
-------
Products may only be returned with the prior written approval of XXXX. Any
such approval shall reference a return material authorization number issued
by XXXX. Repair and transportation costs for returned Products shall be
borne by XXXX, provided, if XXXX determines that the returned Products were
not defective, such costs shall be borne by you.
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5. PRICES
------
In the first two years of this Agreement, you shall pay for Products the
prices listed on Exhibit D hereto. In (a) succeeding years or (b) if
additional products are added by XXXX to the Products listed in Exhibit B;
then, in accordance with Section 14, the prices of Products to be purchased
shall be as agreed between the parties in writing.
6. PAYMENT
-------
Full payment of your purchase price for the Products (including any
freight, taxes or other applicable costs initially paid by XXXX but to be
borne by you) shall be in United States of America dollars. All exchange,
interest, banking, collection, and other charges shall be at your expense.
Payment terms shall be net ninety (90) days, and payment shall be made by
wire transfer, check or other instrument approved by XXXX. Any invoiced
amount not paid when due shall be subject to a service charge at the lower
of the rate of one and one-half percent (1.5%) per month or the maximum
rate permitted by law. If you fail to make any payment to XXXX when due,
XXXX may, without affecting its rights under this Agreement, cancel or
delay any future shipments of the Products to you. Further, such a failure
to pay shall be considered a failure to fulfill a material obligation under
this Agreement.
7. COMPLAINTS
----------
If you receive or become aware of any complaints concerning the Products
you shall promptly report them to XXXX on copies of the form attached as
Exhibit E to this Agreement (or on such form as XXXX may provide from time
to time) and you shall provide all necessary assistance in connection with
any corrective action with respect to the Products. Any determination of
corrective action shall be made by XXXX in its sole discretion.
8. COMPLIANCE WITH TERRITORIAL REGULATIONS
---------------------------------------
You shall comply with all applicable laws, rules and, regulations of the
Territory governing the use, sale, distribution, shipment and import of the
Products. With respect to those Products that have not yet received
approval for commercial sale, you shall also comply with the laws, rules
and regulations of the Territory concerning use, sale, distribution,
shipment and import of unapproved products, and with any applicable XXXX
clinical trial protocol. In connection with this obligation, you shall
obtain and keep in effect all required licenses, permits and authorizations
(collectively, "Registration(s)").
XXXX shall provide you with all necessary assistance in connection with
your obtaining Registrations which XXXX concurs in writing are necessary
for the conduct of your business. You will advise XXXX, upon RITA's
request, of the status of all Registrations,
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and will notify XXXX whenever any change of Registration status occurs and
whenever any Registration is called into question. All such Registrations
shall be in the name of XXXX or, if Registration in RITA's name is
prohibited by applicable law, in the name of a party designated in writing
by XXXX or in trust for XXXX. XXXX shall have the sole authority to cancel
or transfer (or direct the cancellation or transfer of) all such
Registrations. If this Agreement is terminated for any reason, you shall
promptly transfer all Registrations held by you in connection with your
distribution of the Products to XXXX or its designee. You shall pay all
applicable Registration fees, duties, taxes and other expenses relating to
the sale and use of the Products within the Territory.
To the extent that the law requires XXXX. rather than you, to file any
Registration, XXXX may register the Products as required by law. You shall
provide all necessary assistance in connection with the filing of such
Registrations.
All activities with respect to tenders shall be conducted so as to allow,
upon termination of this Agreement for any reason, and upon RITA's written
request, transfer of such tenders to XXXX or to such party as XXXX
designates in writing.
XXXX may provide you with information concerning the manufacture of the
Products to increase your ability to obtain Registrations. You agree that
such information will be disclosed only to those of your employees who are
authorized by XXXX in writing to receive such information.
9. COMPLIANCE WITH U.S. REGULATIONS
--------------------------------
XXXX shall be responsible for compliance with all applicable United States
laws and regulations governing the manufacture and sale of the Products.
You shall comply, and use your best efforts to assist XXXX in complying,
with all applicable United States laws and regulations including the
maintenance of all required books, records and reports. In particular, you
shall track the serial numbers and lot numbers of Products delivered to
your customers.
10. RECALLS
-------
You shall cooperate with XXXX in effecting any recall of the Products
which, in RITA's opinion, is necessary.
11. PROPRIETARY PROPERTY OF XXXX
----------------------------
You expressly acknowledge that you do not have and shall not acquire under
this Agreement any rights in or to any of RITA's patents, trademarks or
trade names or to any patents, trademarks or trade names of any subsidiary
or other affiliate of XXXX. You further acknowledge that you shall not at
any time use, register, or obtain in your own or any other name, RITA's
corporate name, or any of its other trademarks or trade names.
-4-
You agree at all times during the term of this Agreement with XXXX and
thereafter, to hold in strictest confidence, and not use, except for the
benefit of XXXX, or to disclose to any person, firm, corporation or any
other entity without written authorization of the President of XXXX, any
Confidential Information of XXXX which you obtain or create. You further
agree not to make copies of such Confidential Information except as
authorized by XXXX. You understand that "Confidential Information" means
any XXXX proprietary information, technical data, trade secrets or know-
how, including, but not limited to research, product plans, products,
services, suppliers, customer lists and customers (including, but not
limited to, customers of XXXX on whom you called or with whom you became
acquainted during the relationship), prices and costs, markets, software,
developments, inventions, laboratory notebooks, processes, formulas,
technology, designs, drawings, engineering, hardware configuration
information, marketing, licenses, finances, budgets or other business
information disclosed to you by XXXX orally, in writing or by drawings.
12. WARRANTY
--------
XXXX extends to you, only, in respect of each new and unused Product
supplied to you, a warranty on terms identical to that contained in the
warranty certificate enclosed and delivered with such Product when sold
directly by XXXX. RITA's liability is limited in all respects by the terms
and conditions of such warranty.
XXXX agrees that such warranty will have a minimum term of twelve (12)
months from the date of its sale to you for Products with no expiration
date and a minimum term extending until the expiration date for Products
which have such an expiration date, providing they are unopened and
undamaged.
ALL OTHER GUARANTEES, WARRANTIES, CONDITIONS AND REPRESENTATIONS, EITHER
EXPRESS OR IMPLIED, WHETHER ARISING UNDER ANY STATUTE, COMMON LAW, CASE
LAW, COMMERCIAL USAGE, CUSTOM OR OTHERWISE, INCLUDING IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, ARE HEREBY EXCLUDED.
13. LIABILITY ACTIONS
-----------------
You shall give XXXX immediate written notice if you become aware of any
legal action deriving from the use of the Products by customers, and
include in such notice all facts relating to the legal action of which you
are aware. XXXX shall indemnify you during the term of this agreement to
the extent that it and you are covered by its commercial general liability
policy (including products liability) then in effect for any such claims
which are brought against you, except for claims which arise from your
negligence, action or failure to act. XXXX shall have the right, but not
the obligation, to defend any such claim, even after this Agreement
terminates, and settle it on such terms as XXXX xxxxx appropriate. You
shall cooperate fully with XXXX in connection with such defense.
-5-
14. DURATION AND TERMINATION
------------------------
This Agreement shall be for a two (2) year period commencing on January 1,
1999. This agreement shall automatically renew for successive one year
periods beginning on January 1, 2001 unless notice of termination is given
by either party for any reason or no reason within the ninety (90) days
proceeding the commencement of any succeeding one year renewal period. Each
one year period, as described above, shall be called a "Sales Year".
Further, this agreement may be terminated:
(1) by XXXX, upon thirty (30) days written notice if minimum quantity of
Products, as per Section 3, is not purchased by you by the end of any Sales
Year.
(2) by either party upon thirty (30) days written notice to the other if
the parties fail to reach agreement as to the Minimum Purchase Quantity
(according to Section 3 above) or as to the prices (according to Section 5
above) either (a) prior to the commencement of any one year renewal period
or (b) within sixty days of written notification by XXXX of an addition to
the Products.
(3) by either party upon written notice to the other if the other party
fails to fulfill its material obligations hereunder and such failure is not
cured within sixty (60) days after its receipt of written notice requesting
a remedy thereof.
(4) by either party upon written notice if the other party becomes
insolvent or any voluntary or involuntary petition in bankruptcy is filed
by or against such party or a trustee is appointed with respect to any of
the assets of such party or a liquidation proceeding is commenced by or
against such party and such proceeding has not been terminated within
ninety (90) days, or if such party discontinues its business.
(5) by XXXX upon thirty (30) days written notice if Xxxxxxxxxx Xxxxxxxx,
for any reason, fails to devote substantially all of his time to fulfilling
the terms of this Agreement.
15. FORCE MAJEURE
Neither party shall be responsible to the other party for non-performance
or delay in performance under this Agreement due to acts of God, civil
commotion, war, riots, strikes, lockouts, severe weather, fires,
explosions, governmental actions or other similar causes beyond the control
of such party, provided that the party so affected shall promptly give
notice thereof to the other party and shall continue to take all action
reasonably within its power to comply herewith as fully as possible. In
any event, the time for performance hereunder shall only be extended for
the duration of the delay.
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16. GENERAL PROVISIONS
The validity, interpretation, construction and performance of this
Agreement shall be governed by the laws of the State of California, without
giving effect to the principles of conflict of laws. Any dispute or claim
arising out of or in connection with any provision of this Agreement will
be finally settled by binding arbitration in Santa Xxxxx County, California
in accordance with the rules of the American Arbitration Association by one
arbitrator appointed in accordance with said rules. The arbitrator shall
apply California law, without reference to rules of conflicts of law or
rules of statutory arbitration, to the resolution of any dispute. Judgment
on the award rendered by the arbitrator may be entered in any court having
jurisdiction thereof. Notwithstanding the foregoing, the parties may apply
to any court of competent jurisdiction for preliminary or interim equitable
relief, or to compel arbitration in accordance with this paragraph, without
breach of this arbitration provision.
Any notice required or permitted by this Agreement shall be in writing and
shall be deemed sufficient upon receipt, when delivered personally or by
courier, overnight delivery service or confirmed facsimile, or forty-eight
(48) hours after being deposited in the regular mail as certified or
registered mail (airmail if sent internationally) with postage prepaid, if
such notice is addressed to the party to be notified at such party's
address or facsimile number as set forth below, or as subsequently modified
by written notice.
XXXX Medical Systems, Inc.
000 X. Xxxxxxxxx Xxxxxxxxx
Xxxxxxxx Xxxx, XX 00000 XXX
Attn: Xxxxx Xxxxxxx
Fax: 650.390-8505
MDH s.r.l. Forniture Xxxxxxxxxxx
Xxx Xxxxx Xxxxxxxx 0
Xxxxxx 00000 Xxxxx
Attn: Xxxxxxxxxx Xxxxxxxx
Fax: 00-00-000 875
The provisions of this Agreement shall be deemed to be severable and the
invalidity of any provision of this Agreement shall not affect the validity
of the remaining provisions of this Agreement.
No amendment or modification of this Agreement shall be binding on the
parties unless made in writing expressly referring to this Agreement and
signed by authorized representatives of each party.
This Agreement is not assignable by either party in whole or in part
without the prior written consent of the other party, and any attempted
assignment without such approval
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shall be null and void, except that XXXX may assign this Agreement to an
individual or entity which acquires a controlling interest in XXXX.
By your signature below, you acknowledge and agree to all of the foregoing
terms and conditions. Until so executed by you and XXXX and returned to
XXXX, this Agreement shall not be binding on either party, and unless
executed by you and returned to XXXX within ten days of the date set forth
on the first page hereof, this Agreement shall expire without further
notice and shall be null and void.
The parties executed this Agreement on the respective dates set forth
below.
XXXX MEDICAL SYSTEMS, INC.
By: /s/: Xxxxx Xxxxxxx
------------------
Title: President & CEO
Address: 000 X. Xxxxxxxxx Xxxx.
Xxxxxxxx Xxxx, XX 00000
Date: December 22, 1998
MDH S.R.L. FORNITURE OSPEDALIERE
By: /s/: Xxxxxxxxxx Xxxxxxxx
------------------------
Title: General Manager
Address: Xxx Xxxxx Xxxxxxxx 0
Xxxxxx 00000 Xxxxx
Date: January 4, 1999
By his signature below, Xxxxxxxxxx Xxxxxxxx acknowledges and agrees to the
termination as of December 31, 1998 of that certain International Distributor
Agreement between XXXX, MDH s.r.l. Forniture Ospedaliere and Xxxxxxxxxx Xxxxxxxx
made as of December 1, 1996, as set forth on the first page hereof.
XXXXXXXXXX XXXXXXXX
By: /s/: Xxxxxxxxxx Xxxxxxxx
------------------------
Title: General Manager
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Address: Xxx Xxxxx Xxxxxxxx 0
Xxxxxx 00000
Xxxxx
Date: January 4, 1999
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Exhibit A
Territory
Italy
Switzerland
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Exhibit B
Products
GENERATORS
Model Number Part Number
------------ -----------
Model 500LA 700-101081
ELECTRODES
Model Number Part Number Description
------------ ----------- -----------
Model 30 700-100890 4 array, 3cm, 15cm
Model 30 700-100852 4 array,'3czn, 25cm
Model 70*
ACCESSORIES
Model Number Part Number
------------ -----------
Main Cable 410-100837
Foot Switch 410-100453
Dispersive Electrode 700-100379
Power Cord (Italy) 410-100698
Power Cord (Predabesi, Italy) 410-100703
Power Cord (Europe) 410-100700
At its sole discretion: (1) XXXX may discontinue any product on this list and
(2) XXXX may add additional products to this list, provided that the list shall
contain those XXXX products which are direct replacements for the current
Products in XXXX approved applications.
* When, and if, such product is introduced for Italy
Exhibit C
Minimum Purchase Target
Product 1999 Sales Year 2000 Sales Year
------- --------------- ---------------
Model 500LA Generator* [***] [***]
Model 30Electrodes** [***] [***]
* Each generator is supplied with Power Cord, 2 Main cables and a Footswitch
** Each electrode is supplied with one Dispersive Electrode; if, and when the
Model 70 is introduced for Italy, both Model 30 and Model 70 purchases shall be
credited against the minimum purchase target
___________________________________
*** Material has been omitted pursuant to a request for confidential treatment,
and such Material has been filed separately with the SEC.
Exhibit D
Pricing Schedule
Distributor Price Distributor Price
Product 1999 Sales Year 2000 Sales Year
-------------------------- ------------------- ------------------
Model 500LA Generator* [***] [***]
Model 30 Electrodes** [***] [***]
Main Cable [***] [***]
Foot Switch [***] [***]
Dispersive Electrode [***] [***]
Power Cord (Italy) [***] [***]
Power Cord (Predabesi, Italy) [***] [***]
Power Cord (Europe) [***] [***]
No discounts for sub-agents
* Each generator is supplied with Power Cord, 2 Main Cables and a Foot Switch
** Each Model 30 electrode is supplied with one Dispersive Electrode Model 70
pricing shall be the same as Model 30 pricing in the 1999 and 2000 Sales Year
Note that all part numbers are per Exhibit B and that terms are F.O.B. RITA's
manufacturing location.
_________________________________
*** Material has been omitted pursuant to a request for confidential treatment,
and such Material has been filed separately with the SEC.
Exhibit E
Complaint Form
--------------------------------------------------------------------------------
XXXX MEDICAL SYSTEMS
--------------------------------------------------------------------------------
Complaint Report Form
--------------------------------------------------------------------------------
1. Date Received:______________________________________________________________
2. Received by:________________________________________________________________
3. Complaint Acknowledgement Letter Sent:______________________________________
4. Product Description:________________________________________________________
Lot No. _________________________________Model No.__________________________
5. Customer Name:______________________________________________________________
6. Contact Person:_____________ Telephone:_____________ Fax:___________________
7. Hospital/Address:___________________________________________________________
________________________________________________________________________________
--------------------------------------------------------------------------------
8. Nature of Complaint:
__________________________________________________________________________
__________________________________________________________________________
____________________________________________________________[See Attached]
--------------------------------------------------------------------------------
9. Complete Medical Complaint Decision Tree (Form 160-101223)
--------------------------------------------------------------------------------
[ ] 10.
A. Complaint Number:_________________ C. Device Returned_____________
Treatment Date:___________________ [ ] Yes, Date Returned:_____
Indication:_______________________ [ ] No
Treatment Site:___________________ D. Confirmed Complaint?:
B. Origin of Complaint [ ] Yes
[ ] Domestic [ ] Clinical Study [ ] No
[ ] International E. RMA Number:
11. Investigation:
[ ] Yes
By who:____________________ Date Complete: ________________________
Results of Investigation _______________________________________________
________________________________________________________________________
_________________________________________________________ [See Attached]
12. Corrective Action Number (if assigned): ____________________________________
13. Additional Information:
Complaint Response Sent:____________________
Approved by:_____________________ ____________
Regulatory Affairs Date
_____________________ ____________
Quality Assurance Date
Date File Closed:
--------------------------------------------------------------------------------
AMENDMENT TO INTERNATIONAL DISTRIBUTOR AGREEMENT
------------------------------------------------
September 27, 1999
MDH s.r.l. Forniture Ospedaliere
Xxx Xxxxx Xxxxxxxx 0
Xxxxxx 00000
Xxxxx
Dear Xxxxxxxxxx Xxxxxxxx:
This letter is to amend that certain agreement ("Agreement") between MDH s.r.1.
Forniture Ospedaliere ("you") and XXXX Medical Systems, Inc. ("XXXX") dated
December 21, 1998. Specifically, Section 1 of the Agreement, PRODUCTS AND
------------
TERRITORY, is hereby replaced with the new version below:
---------
1. PRODUCTS AND TERRITORY
----------------------
You shall act as RITA's distributor in the Territory (described in Exhibit
A) to promote, sell and distribute the Products (described in Exhibit B)
for XXXX approved applications only and to provide service with respect to
the Products, to the medical community. As used in this Agreement, "medical
community" means medical doctors, institutions such as hospitals and
clinics, and similar institutions which are active in the personal care of
patients. You are not authorized to sell any Products to any of your
competitors or to any of RITA's competitors without RITA's prior written
consent. You shall not actively solicit orders from any customers domiciled
outside the Territory, or sell or deliver any Product to any customer which
is not in the Territory. Notwithstanding the foregoing, from time to time,
you may be asked to sell or deliver Products (or you may have sold or
delivered Products) to customers in nations outside the Territory but
within the European Economic Area (EEA). You may only sell or deliver
Products to such customers with RITA's prior written consent for each order
or shipment, which will specify the terms on which such a sale or delivery
are acceptable to XXXX. In no event does any such sale or delivery or
RITA's consent to such a sale or delivery confer on you any rights to sell
or deliver Products or provide services to such a customer in the future,
nor does any such sale or delivery entitle you to request any future
compensation regarding that customer. Further, in case XXXX does not
consent to the sale or delivery of Products to a customer outside the
Territory, as described above, you shall not have any rights to any
indemnification or compensation for your activities related to that
customer. Furthermore, you shall not appoint any distributor or any agent
or maintain any sales, service or stock facility outside the Territory.
Except with the prior written consent of XXXX, you shall not sell or
advertise within the Territory, either on your own behalf or on behalf of
any other person, company, or corporation, products which compete, directly
or indirectly, with the Products. Further, you shall not participate in the
development or clinical testing either on your own behalf or on behalf of
any other person, company, or corporation, products which compete, directly
or indirectly, with the Products.
All terms of the original Agreement (including this amendment, which describes
the modification of Section 1, as above, and forms part of the Agreement) remain
in full force and effect except to the extent that it is amended or modified in
writing and signed by authorized representatives of each party, as specified in
Section 16 of the Agreement. In that case, the Agreement as modified and
amended shall remain in full force and effect.
By your signature below, you acknowledge and agree to the above.
The parties executed this amendment to the "Agreement" on the respective dates
set forth below:
XXXX MEDICAL SYSTEMS, INC.
By: /s/: Xxxxx Xxxxxxx
------------------
Title: PRESIDENT AND CEO
Address: 000 Xxxxx Xxxxxxxxx Xxxx.
Xxxxxxxx Xxxx, XX 00000
Date: September 28, 1999
MDH S.R.L. FORNITURE OSPEDALIERE
By: /s/: Xxxxxxxxxx Xxxxxxxx
------------------------
Title: General Manager
Address: Xxx xxxxx Xxxxxxxx 0
Xxxxxx 00000
Xxxxx
Date: September 28, 1999
