EXHIBIT 10.1
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED
FOR THE PORTIONS OF THIS EXHIBIT.
CONFIDENTIAL PORTIONS ARE INDICATED BY BRACKETS.
MARKETING AND DISTRIBUTION AGREEMENT
This Agreement, effective as of this 1st day of October, 1997, by
and between CAS MEDICAL SYSTEMS, INC., a Delaware corporation with its
principal place of business at 00 Xxxxxxxx Xxxx Xxxxx, Xxxxxxxx, Xxxxxxxxxxx
00000 ("CAS") and GRAPHIC CONTROLS CORPORATION, a New York corporation with
its principal place of business at 000 Xxxxxxxxxx Xxxxxx, Xxxxxxx, Xxx Xxxx
00000 ("Graphic Controls").
RECITALS
WHEREAS, CAS manufactures and sells medical devices and equipment,
including without limitation certain devices and equipment used in
connection with the provision of neonatal medical care;
WHEREAS, Graphic Controls markets and distributes medical devices to
national purchasers, including devices and equipment used in connection with
neonatal medical care;
WHEREAS, CAS has agreed to manufacture and supply and Graphic Controls
has agreed to market and distribute CAS' neonatal products listed on
Schedule A, attached hereto (the "Products"), to certain national accounts
of Graphic Controls listed on Schedule B, attached hereto and the hospital
and other members thereof (the "Specified Accounts").
NOW THEREFORE, in consideration of the mutual covenants contained herein,
the parties agree as follows:
1. Appointment and Scope.
CAS appoints Graphic Controls as the non-exclusive marketer and
distributor for the Products solely to the Specified Accounts. The
territory in which Graphic Controls shall market and distribute the
Products to the Specified Accounts shall be the United States (the
"Territory").
2. Term.
This Agrement shall be in effect for an initial term of three (3) years
from the effective date hereof (the "Initial Term"). This Agrement may be
cancelled by either party (i) upon six (6) months prior written notice, if
termination is to occur, during the first year of the Initial Term; and (ii)
upon twelve (12) months prior written notice, if termination is to occur,
during the second and third years of the Initial Term. This Agreement shall
be automatically renewed for consecutive one (1) year periods thereafter,
unless either party provides notice of its intent to terminate the Agreement
not less than twelve (12) months prior to the end of such consecutive term.
3. Manufacture and Sale By CAS.
3.1 Manufacture and Sale By CAS. CAS shall manufacture and sell to
Graphic Controls and Graphic Controls shall order and purchase from
CAS the Products at the prices set forth on Schedule A, attached
hereto. CAS shall notify Graphic Controls before making any
material changes to the labeling, artwork or packaging used in
connection with the Products.
3.2 Quality.
(a) CAS agrees to manufacture and distribute the Products in
accordance with all applicable Good Manufacturing Practices,
the requirements of the Food and Drug Administration (the
"FDA"), and all federal, state and local laws, rules and
regulations. CAS shall maintain an effective quality control
system for the design, manufacture and distribution of the
Products. CAS shall notify Graphic Controls of any changes to
any Product that may affect the safety or efficacy of such
Product. For "Medical Devices" (as defined under the U.S.
Food and Drug and Cosmetic Act), CAS shall provide Graphic
Controls with the information listed on Schedule C, attached
hereto. All such information shall be considered Confidential
to the extent provided for in Section 7.1.
(b) The Products shall be qualified in accordance with the Graphic
Controls' "Purchase Product Qualification Procedure
Documents," attached hereto as Exhibit A.
3.3 Prices.
Prices for the Products shall be fixed for the Initial Term as set
forth in Schedule A. During the Initial Term, CAS shall have the
right to increase the prices of the Products only in the event that
(a) there is a material and unforeseen increase in the price of
matrials comprising the Products or (b) taxes or fees applicable to
the manufacture and sale of the Products (other than any presently
in effect) are imposed on CAS by any governmental authority,
provided, however, that prior to effectuating any such price
increase CAS shall provide Graphic Controls with evidence
supporting, and consult with Graphic Controls regarding, any price
increase permitted hereunder; and that no increase shall be
permitted under clause (b) of this Section 3.3 due to any increase
of any taxes or fees of the type currently imposed on CAS by any
governmental authority. Beginning on the third anniversary of the
effective date of this Agreement, the prices of the products may be
changed by written agreement of both parties. All price changes
shall be effective for orders received by CAS on or after the
effective date of such change. If one party requests a change and
the other party does not agree, then the pror year pricing remains
in effect. Any price discouns offered by CAS for prompt payment of
invoices by Graphic Controls shall be calculated by Graphic
Controls from the date of the invoice.
3.4 Minimum Purchase Obligations
(a)[ ] Failure to purchase such minimum amount shall constitute
amaterial breach of this Agreement and CAS may pursue its remedies at
law and equity, and further may , at is option, immediately terminate
the Agreement. The parties mutually agree to increase the minimum
annualpruchase amount as new Specified Accounts are added to tis
Agreement.
(b)If on account of force majeure as provided for in Section 16.3
hereof which affects CAS, Product production shortage or for any other
reason CAS is unable to supply and Products ordered by Graphic Controls
hereunder ("supply Failure"), then CAS shall notify Grpahic Controls
immediately. The minimum purchase obligations of Graphic Controls set
forth in this Section 3.4 shall be decreased equitably by the parties
based on the proportion of any twelve (12) month period during which a
Supply Failure should continue.
(c)[ ] Subject to existing confidentiality obligations set forth
in Section 7.1 of ths Agreement, CAS agrees to provide Graphic Controls
with all relevant customer information for such Specified Accounts
reasonably necessary for Graphic Controls to verify such representation
and warranty, promptly after the execution of this Agreement.
4. Marketing and Sale By Graphic Controls
Graphic Controls shall market, distribute and sell the Products solely
to the Specified Accounts. In marketing, distributing and selling the
Products and in its contracts with the Specified Accounts, Graphic
Controls shall, at all times, promote CAS' reputation and goodwill,
reference each Product's trademark(s) and indicate that such Product is
manufactured and the trademarks are owned by CAS. Graphic Controls
shall use its best efforts to sell the Products to the Specified
Accounts and each of the members thereunder and to increase the
compliance of the members of the Specified Accounts. No Specified
Account shall be added to this Agreement except by written agreement
signed by both parties. Graphic Controls shall be responsible for
working with the materials management departments of each member of a
Specified Account for conversion and contract compliance as well as the
distribution relationship with each member of a Specified Account,
including without limitation, stocking and shipment of the Products and
the issuance and collection of invoices. CAS shall provide Graphic
Controls with reasonable service and sales support during CAS' normal
business hours.
5. Orders, Warehousing, and Terms and Conditions of Sale.
5.1 Orders. Beginning as of the effective date of this Agreement
and continuing for six (6) months thereafter, each order for
Products ("Order") placed by Graphic Controls shall be
submitted to CAS not less than eight (8) weeks prior to the
requested shipment date in such a format and containing such
information as may be mutually agreed upon by the parties.
After such six (6) month period, each Order shall be submitted
to CAS not less than four (4) weeks prior to the requested
shipment date.
5.2 Minimum Orders. The minimum order that may be placed by
Graphic Controls at any one time is for one hundred (100) cases
of electrodes (assorted part numbers) and twenty five (25)
cases for each line item Product group, as listed in Schedule
A.
5.3 Warehousing. CAS shall, when necessary, warehouse all of the
Products it manufactures prior to shipment to Graphic Controls
at no cost to Graphic Controls. Graphic Controls shall be
responsible for the warehousing of all Products shipped by CAS
to Graphic Controls at no cost to CAS. Warehousing conditions
shall be such that the quality and appearance of the Products
is not adversely affected and the safety and efficacy of the
Products is not impaired.
5.4 Shipping. Products shall be shipped to Graphic Controls F.O.B.
CAS. After the first six (6) months of the Initial Term, CAS
shall ship the Products no later than four (4) weeks after the
date CAS receives an Order. In the event that the Products
require special shipping, handling, storage, security and
safety, CAS shall notify Graphic Controls of such requirements.
Shipments will be made in exact order quantities unless
otherwise agreed to in writing by the parties. Graphic
Controls' acceptance of a shipment does not imply acceptance of
the entire lot. Graphic Controls shall notify CAS of
discrepancies in shipment or pricing within thirty (30) days
following receipt of invoice. Subject to applicable lead times
set forth herein, if CAS anticipates, at the time it receives
an Order, that it will be unable to deliver a Product by the
requested shipment date, CAS will promptly request consent from
Graphic Controls to an extension of time for shipment, which
consent shall not be unreasonably withheld. If CAS does not
make such request, Graphic Controls may cancel the Order
without any liability to Graphic Controls. Any premium freight
charges, required by any late shipment, are CAS'
responsibility.
5.5 Product Marking and Packaging.
(a) Marking. If applicable, CAS will xxxx either a lot code
or a serial number on any Product or packaging and
document the procedure to allow for ease in traceability.
If applicable, CAS shall also xxxx the expiration date
on each Product. CAS shall notify Graphic Controls of
the procedure detailing the assignment and control of
this process.
(b) Packaging. CAS shall use its standard packaging and
labels with all of the Products. Such packaging and
labels shall comply with applicable requirements of
common carriers. Graphic Controls may request CAS'
consent to modifications or additions to such standard
packaging and labels (e.g. bar codes), which consent
shall not be unreasonably withheld. Any such
modifications or additions to the packaging and labels
shall be made by CAS at the sole expense of Graphic
Controls. Any material damage to any Products not
packaged as such, will be charged to CAS, provided such
packaging is not altered or modified by Graphic Controls
or a third party prior to shipment to a member hospital
of a Specified Account.
5.6 Payment Terms. Contemporaneously with the delivery of the
Products pursuant to an Order, CAS will invoice Graphic
Controls for the total price of such Products and corresponding
freight charges with CAS' standard discount option (1.0% 10
day/net 30). Graphic Controls will pay the amount invoiced
within thirty (30) days of receipt of invoice. Interest shall
accrue on all past due invoices at the lesser of: (a) 1.5% per
month (or any part thereof), or (b) at the highest rate allowed
by U.S. law. Invoices shall be mailed to Accounts Payable,
Attention: Xxxxx Xxxxxx, Graphic Controls Corporation, X.X. Xxx
0000, Xxxxxxx, XX 00000. All invoices shall contain reference
to applicable purchase order number, CAS part numbers, Graphic
Controls' part numbers, quantity, price and date shipped.
5.7 Other Terms and Conditions. Except as provided in this
Agreement, all purchases hereunder shall be subject to CAS'
then current standard written terms and conditions as set forth
in Exhibit B, attached hereto. Where such terms and conditions
conflict in any way with any terms and conditions contained in
this Agreement, the terms and conditions of this Agreement
shall prevail.
6. Trademarks
Graphic Controls acknowledges that any goodwill or other benefit
arising from the prior use or continued use in the future of any CAS
trademarks has inured and will continue to solely inure to the
benefit of CAS. Neither Graphic Controls, any affiliates or any of
their directors, officers, employees or agents shall at any time,
either during the term of this Agreement or at any time hereafter,
directly or indirectly contest, or aid others in contesting, or do
anything which might impair the validity of, any or all of the CAS
trademarks or the exclusive use thereof by CAS. Graphic Controls
shall not remove or otherwise impair any CAS trademarks displayed on
the packages and labels of the Products. Graphic Controls shall not
acquire any right to or under any trademark, patent, copyright,
design, goodwill or other intellectual property rights of CAS. If
any such rights should become vested in Graphic Controls by operation
of law or otherwise, Graphic Controls agrees that it will, on CAS'
request, forthwith assign any or all such rights to CAS. Graphic
Controls shall immediately notify CAS of any unauthorized use of CAS'
trademarks and any adverse uses of marks which are confusingly
similar to any CAS trademarks.
7. Confidential Information.
7.1 Nondisclosure. Each party agrees not to disclose to any third
party or to use any information obtained from the other party
concerning the Products (including their design, manufacture
and operation) and the business, operations, intellectual
property or financial status of the other party (including
without limitation, sales forecasts, customer information,
manufacturing processes, orders and financial statements),
without the prior written consent of the other party, except
(i) information generally available to the public without
breach of this Agreement, (ii) information developed
independently by the receiving party, (iii) information
obtained from a third party not under any obligation of
nondisclosure, and (iv) information required to be disclosed by
law or governmental regulation; provided, however, that before
making any use or disclosure in reliance on (iv), the party
that intends to use or disclose such information shall give at
least fifteen (15) days prior written notice to the other party
specifying the circumstances giving rise thereto. Each party
shall protect all information received from the other party and
marked as "Confidential" in a manner similar to the protection
it provides to its own confidential information. Each party
shall make commercially reasonable efforts to insure that all
affiliates as well as directors, officers, employees, agents
and representatives of the party and its affiliates comply with
this section 7.1. To the extent possible, each party shall
disclose the information obtained from the other party to only
those directors, officers, employees and agents that have a
need to know and that have agreed to be bound by the terms of
this section 7.1. In the event of the termination or
expiration of this Agreement, each party agrees to return or
destroy all information received from the other party that is
marked as "Confidential," and each party shall certify in
writing that it has complied with this obligation.
7.2 Equitable Relief. Either party may obtain permanent and
preliminary injunctive or other equitable relief to remedy an
actual or threatened unauthorized disclosure of confidential
information, or any unauthorized use of such party's
proprietary rights. Both parties agree that such unauthorized
disclosure or use of such information or proprietary rights
will cause injury that cannot adequately be compensated through
money damages. Both parties agree to the entry of an order for
equitable remedies in the event of the unauthorized disclosure
or use of such confidential information or proprietary rights
or the design and specifications of the Products by the other
party. The remedies afforded the parties in this section 7.2
are cumulative and in addition to those provided by law or
equity.
8. Noncompetition.
Except for those goods and products which Graphic Controls is
marketing, selling and distributing on the effective date of this
Agreement as set forth in Schedule D, attached hereto, Graphic
Controls represents and warrants that it does not currently market
neonatal medical care products and that it shall not, or permit any
person or entity affiliated with it to, directly or indirectly,
market, distribute or sell any goods orproducts that are the same or
similar to or competitive with the Products, without CAS' prior
written consent. Except as permitted by the preceding sentence of
this Section 8 and to the extent permitted by law, during the term of
this Agreement, Graphic Controls shall not manufacture or sell in the
Territory any goods or products that are the same or similar to or
competitive with the Products, acquire the right to market,
distribute, or license any such goods or products within the
Territory, or take any action that is adverse to CAS' interests,
Products, market, goodwill or reputation; provided, however, that if
Graphic Controls acquires the business or product line of any third
party which sells products which are similar to or competitive with
the Products, which are not already listed on Schedule D
("Acquisition"), Graphic Controls shall not be in violation of this
Agreement by virtue of such Acquisition or continuing the sale of
such products. In the event of any such Acquisition, CAS shall have
the right to terminate this Agreement upon six (6) months prior
notice to Graphic Controls. Graphic Controls represents and warrants
to CAS that it has no other actual or potential conflicts of
interests with CAS nor with its obligations under this Agreement and
it shall avoid any such other conflicts during the term of this
Agreement.
9. Publicity.
Without limiting the confidentiality or nondisclosure provisions of
this Agreement or any purchase order, sales contract, or other
document, either party may, with the prior consent of the other
party, advertise or publish the fact that Graphic Controls has sold
or has contracted to sell the Products pursuant to this Agreement.
10. Right of Inspection.
10.1 By Graphic Controls. Graphic Controls, or an authorized
representative or agent of Graphic Controls, may, upon five (5)
business days advance notice to CAS and during CAS' normal
business hours, conduct inspections of CAS' nonproprietary
facilities and/or Product audits, to insure that the Product
specifications are being met and that CAS continues to maintain
an effective quality control system, provided that such
inspections may not be conducted more than twice in any twelve
(12) month period commencing on the effective date of this
Agreement. When requested by Graphic Controls, CAS will
provide a "Certificate of Compliance," for each shipment. CAS
shall inform Graphic Controls of any Product recall, market
withdrawal, stock recovery, or any field corrective action of
Products supplied to Graphic Controls. If Graphic Controls
requests corrective action as a result of an inspection or
incident, CAS shall respond (acknowledgement is sufficient)
within three (3) business days.
10.2 By CAS. CAS, or an authorized representative or agent of CAS,
may, upon five (5) business days advance notice to Graphic
Controls and during Graphic Controls' normal business hours,
conduct inspections of Graphic Controls' facilities, to insure
that storage and distribution requirements are being met
regarding the safety and efficacy of the Products, provided
that such inspections may not be conducted more than twice in
any twelve (12) month period commencing on the effective date
ofthis Agreement. Graphic Controls shall inform CAS of any
Product recall, market withdrawal, stock recovery, or any field
corrective action of CAS products. If CAS requests corrective
action as a result of an inspection or incident, Graphic
Controls shall respond (acknowledgement is sufficient) within
three (3) business days.
10.3 By the FDA. In the event that an agency or branch of the
federal government, which is seeking to purchase the Products
from Graphic Controls, requests an inspection by the FDA of the
manufacturing facilities and records relative to the Products,
CAS will permit such an inspection, provided that it receives
reasonable prior notice and that the inspection is conducted
during CAS' normal business hours. Graphic Controls also
agrees to any FDA inspections of its facilities and records.
10.4 Product Action and Costs. Graphic Controls may initiate or
direct a Product recall, market withdrawal, stock recovery or
other field corrective action of the Products ("Product
Action"), provided it has given CAS written notice of its
intent to initiate or direct such Product Action no later than
48 hours prior to the initiation or directing of such Product
Action. In the event that CAS agrees to indemnify Graphic
Controls in full for all direct costs associated with any
Product Action, Graphic Controls shall not initiate or direct
any such Product Action. In the event that CAS does not agree
to provide Graphic Controls with full indemnification and
Graphic Controls initiates or directs such Product Action, CAS
shall pay or reimburse Graphic Controls no more than fifty
(50%) percent of all direct out-of-pocket costs and expenses,
(excluding lost profits, lost sales or other consequential
damages as set forth in Section 12.3), incurred by Graphic
Controls in connection with any Product Action, except if, and
to the extent that, the negligence or action of Graphic
Controls with respect to the storage, marketing, distribution,
sale and shipment of Products shall give rise to the Product
Action.
10.5 FDA Product Action and Costs. In the event the United States
Food and Drug Administration ("FDA") initiates or directs a
Product recall, market withdrawal, stock recovery or other
field corrective action of the Products ("FDA Product Action"),
CAS agrees to indemnify Graphic Controls in full for all direct
costs associated with any such FDA Product Action unless, and
to the extent that, the negligence or action of Graphic
Controls with respect to the storage, marketing, distribution,
sale and shipment of Products gave rise to the FDA Product
Action.
11. Books and Records.
11.1 Maintenance of Books and Records. While this Agreement is in
effect, both parties will maintain accurate records and
accounts from which their respective obligations to the other
hereunder may be determined.
11.2 Graphic Controls' Reports. Within thirty (30) days after the
end of each month during the term of this Agreement, Graphic
Controls shall provide CAS with such reports as CAS may
reasonably request including a sales and inventory report with
respect to the period showing:
(i) the quantities of each Product sold by Graphic Controls
during the period.
(ii) the quantities of each Product remaining in Graphic
Controls' inventory at the end of the period.
(iii)the hospital purchases during the period, indicating the
name and address of the hospital, type of Products purchased,
quantity of Products purchased and revenues received by Graphic
Controls as a result of such purchases.
12. Warranty.
12.1 Warranty. CAS warrants that the Products will be free from
defects in materials and workmanship upon initial application
only. Any Products which fail to conform with CAS' Product
specifications are considered defective. Graphic Controls has
no obligation to pay for any defective Products. Any Product
defective in material or workmanship will be repaired or
replaced at no charge to Graphic Controls. The obligation of
CAS hereunder shall be limited solely to repair or replacement
of defective Products and shall be conditioned upon receipt by
CAS of written notice of any alleged defects or deficiency
promptly after discovery by Graphic Controls. CAS shall have
no obligation to repair or replace Products damaged by misuse
by Graphic Controls or a third party or failure of Graphic
Controls or a third party to provide appropriate customary
storage and maintenance.
12.2 Limitation of Warranty. THE LIMITED WARRANTY EXPRESSED IN
SECTION 12.1 ABOVE IS IN LIEU OF ALL OTHER WARRANTIES EITHER
EXPRESS OR IMPLIED, WHETHER ARISING BY STATUTE, CUSTOM, TRADE,
OR OTHERWISE, INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES
OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
12.3 Limitation of Damages and Remedies. IN NO EVENT SHALL CAS BE
LIABLE FOR ANY INCIDENTAL, CONSEQUENTIAL, SPECIAL, DIRECT OR
INDIRECT DAMAGES INCLUDING BUT NOT LIMITED TO LOST REVENUES,
PROFITS, BUSINESS OR ANTICIPATED SAVINGS, HOWEVER CAUSED AND
WHETHER ARISING UNDER CONTRACT, TORT OR OTHER THEORY OF
LIABILITY. CAS SHALL NOT BE LIABLE FOR ANY DAMAGES IN EXCESS
OF THE PAYMENTS CAS RECEIVED IN CONNECTION WITH THE SALE OF THE
PRODUCTS. THE LIMITATIONS SET FORTH IN THIS SECTION 12.3 SHALL
IN NO WAY LIMIT THE REPAIR OR REPLACE REMEDIES EXPRESSLY
SPECIFIED IN SECTION 12.1 OF THIS AGREEMENT, SUBJECT TO SECTION
15.1 HEREOF.
12.4 Return of Products. Products may be returned to CAS for only
the following reasons: (a) CAS Order entry error and (b)
defective Product. Any returns due to Order entry error by CAS
shall be handled in accordance with CAS' returned goods policy
set forth in Exhibit B. Graphic Controls shall immediately
notify CAS upon discovery of a defective Product. Graphic
Controls will accumulate defective Products discovered by
Graphic Controls or any member of a Specified Account.
Disposition of the defective Product will be arranged between
CAS and Graphic Controls. CAS shall pay directly or reimburse
Graphic Controls for all costs associated with defective
Products, including premium freight charges incurred to ship
the returned defective Products or the replacement Products, if
mutually agreed to be necessary. If a member of a Specified
Account discovers a Product defect, CAS shall be responsible
for the costs of such defective Product and correcting such
defect.
13. Termination.
13.1 Termination in the Event of Default. In addition to each
party's ability to terminate this Agreement in accordance with
Section 2 of this Agreement and with CAS' ability to terminate
in accordance with Section 3.4(a) of this Agreement, either
party may terminate this Agreement upon the occurrence of any
Event of Default, in accordance with the terms of Section 13.2.
13.2 Events of Default.
The following are "Events of Default" hereunder:
(a) Except as provided in subsection (b) below, a party
commits any material breach of any of the obligations or
agreements on its part contained in this Agreement,
provided (i) the defaulting party shall have ninety (90)
days to cure such breach after receipt of written notice
thereof, or, if such default is not of the type
susceptible to being cured with diligent effort within
ninety (90) days, then within a reasonable time period
and provided the defaulting party commences promptly and
proceeds diligently to cure such default within such
ninety (90) day period.
(b) Notwithstanding the foregoing subsection (a), there shall
be no opportunity to cure for any breach of either
party's obligations under Sections 6, 7 and 8, and in the
event of any such breach, termination shall be effective
immediately upon receipt of the nonbreaching party's
notice to the other.
(c) This Agreement shall terminate immediately upon either
party ceasing to conduct its business, or making an
involuntary assignment of all or a material portion of
its assets or its business for the benefit of its
creditors, or if a trustee, receiver or administrator is
appointed to administer or conduct its assets or business
affairs, or if it is adjudged in any legal proceedings to
be bankrupt, or if any insolvency proceedings are
commenced against it.
13.3 Effect of Termination. In the event of termination of this
Agreement for any reason, in addition to any other obligations
contained herein:
(a) Graphic Controls shall immediately stop selling,
advertising and distributing the Products, except as
provided in subsection (c) below, and it shall notify all
Specified Accounts of such termination;
(b) Graphic Controls shall furnish CAS with a list of any
orders placed by member hospitals of the Specified
Accounts for the Products and accepted by Graphic
Controls prior to such termination date. Such list will
be furnished within ten (10) days after the termination
date.
(c) Graphic Controls shall have the right to fill all such
orders from its existing inventory of the Products:
(i) for sixty (60) days following such termination
date; and
(ii) as to the balance or any of Graphic Controls'
inventory of the Products after such orders have
been filled, CAS shall have the option to buy the
whole or any part thereof from Graphic Controls at
Graphic Controls' cost or market value, whichever
is lower; and
(iii) if CAS fails to exercise such option within ten
(10) days after receiving written notice of Graphic
Controls having filled all such orders, Graphic
Controls shall be free to sell any of its existing
inventory of the Products. After such inventory is
sold, Graphic Controls shall have no further right
to sell any of the Products.
14. Meetings.
The parties agree to meet at least four times per year, at dates and
times and in places mutually agreed upon, to discuss any issues that
have arisen, including without limitation, progress in the sales of
the Products to Specified Accounts, the addition of new accounts and
the potential for international sales and distribution of the
Products. Each party shall bear its respective costs incurred to
attend such meetings.
15. Indemnification.
15.1 Indemnification. CAS agrees, at its sole expense, to defend,
indemnify and hold Graphic Controls (its affiliates, and their
directors, officers and employees) harmless from and against
all costs (including reasonable attorneys' fees) and
liabilities in connection with any claim, suit or action for
(a) infringement of any U.S. trademarks, patents, copyrights,
or other proprietary rights associated with the marketing or
sale of the Products by Graphic Controls; (b) CAS' failure to
comply with all federal, state or local laws and regulations
relating the manufacture and distribution of the Products; (c)
a Product's failure to comply with any applicable federal,
state or local laws or regulations; and (d) personal injury or
property damage resulting from the use of a Product, provided
Graphic Controls promptly notifies CAS in writing of any such
claim, suit or action and cooperates in the defense thereof,
provided further CAS shall have no obligation to Graphic
Controls for such costs and liabilities relating to
representations and warranties made by Graphic Controls (its
affiliates and their directors, officers and employees) in
connection with the marketing, distribution and sale of the
Products, which exceed or differ from the representations and
warranties made by CAS with respect to the Products or any
tortious act(s) committed by Graphic Controls (its affiliates
and their directors, officers, employees and authorized
agents). Graphic Controls shall have the right to be
represented in any suit or action by advisory counsel of
Graphic Controls' selection at Graphic Controls' expense. CAS
shall control the defense of any such suit or action and has
the exclusive authority to settle, terminate or defend same,
provided that any such settlement or termination does not
directly and adversely impact Graphic Controls' trademarks,
patents, or copyrights. CAS may, in its sole discretion,
modify any infringing Product so as to make it non-infringing
or substitute another product for such infringing Product, so
long as there is no degradation to the safety or efficacy of
the Products.
15.2 Insurance. Each party shall obtain and maintain during the
Initial Term and any extensions, as well as for a period of
three (3) years after termination of this Agreement, sufficient
insurance, and in particular product liability insurance and
contractual liability insurance (including the indemnification
referred to in Section 15.1 above), with appropriate policy
limits to cover all reasonable risks associated with the
performance of its obligations under this Agreement. Each
party agrees to name the other as a loss payee, as its
interests may appear, on all insurance policies contemplated by
this Agreement and that all policies shall require thirty (30)
days prior notice to the other party of cancellation. Each
party shall provide a Certificate of Insurance as written
evidence to the other of such coverage.
16. General Provisions
16.1 Notices. All notices and communications required by this
Agreement shall be in writing and shall be either delivered by
hand or by facsimile, or mailed, postage prepaid, by overnight
service, or certified or registered mail, return receipt
requested, to the addresses listed below:
If to CAS:
CAS Medical Systems, Inc.
00 Xxxxxxxx Xxxx Xxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxx Xxxxxx
Facsimile (000) 000-0000
If to Graphic Controls:
Graphic Controls Corporation
000 Xxxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxx Xxxxxxxxxxxxx
Facsimile: (000) 000-0000
Any such notice or communication shall be effective upon
receipt. Either party may change its address by giving thirty
(30) days written notice of such change to the other party as
provided above.
16.2 Titles and Headings. The titles and headings included in this
Agreement are inserted for convenience only and shall not be
deemed to be a part of this Agreement, or considered in
construing this Agreement.
16.3 Force Majeure. If the performance or observance by either
party of any of its obligations under this Agreement is
prevented or hindered, or any failure on the part of either
party to perform or observe its obligations is caused, by
government restrictions, fire, strike, or any other event or
cause outside the reasonable control of such party, then such
failure shall not constitute a breach of this Agreement,
provided that the party seeking to be excused shall notify the
other party of the beginning and end of any event of force
majeure, and shall make every reasonable effort to minimize the
consequences of such event.
16.4 Severability. If any provision of this Agreement is found by
any competent authority to be invalid, illegal, or
unenforceable in any respect for any reason, the validity,
legality, and enforceability of any such provision in every
other respect and the remainder of this Agreement shall
continue in effect so long as it still expresses the intent of
the parties. If the intent of the parties cannot thereby be
preserved, the parties agree to substitute a legally valid
agreement to meet the same economic and technical objectives
of this Agreement.
16.5 Remedies. All rights and remedies of the parties hereunder
shall be in addition to all other legal and equitable rights
and remedies belonging to them and the same shall be deemed to
be cumulative and not in lieu of such other legal and
equitable rights and remedies.
16.6 Waiver. The failure of any party to enforce any provision of
this Agreement or exercise any right granted hereby shall not
be construed to be a waiver of such provision or right nor
shall it affect the validity of this Agreement or any part
thereof, nor limit, prevent, or impair in any way the right of
any party subsequently to enforce such provisions or to
exercise such right in accordance with its terms.
16.7 Compliance with Laws. The parties shall, during the term of
this Agreement, conduct their business in a highly ethical
manner and in accordance with all federal, state, and local
statutes, laws, regulations and customs of the United States,
including without limitation the requirements of the United
States anti-trust laws, the United States Export
Administration Regulations, the United States Foreign Corrupt
Practices Act, the North American Free Trade Agreement and the
United States Anti-Boycott Regulations, as amended during the
term of this Agreement and as they apply to the parties'
activities under this Agreement.
16.8 Assignment. Neither party may assign or sub-contract any of
its rights, obligations and interests under this Agreement
without the prior written consent of the other party, provided
that either party may assign this Agreement to any entity
acquiring all or substantially all of such party's assets.
16.9 Entire Understanding; Amendment. This Agreement forms the
entire understanding of the parties hereto with respect to the
subject matters described herein, and supersedes all previous
agreements, written or oral, and all previous and
contemporaneous discussions. The terms of this Agreement may
only be amended in writing signed by both parties.
16.10 No Third Party Beneficiaries. This Agreement shall be
construed to be for the benefit of and be binding upon the
parties only, and shall confer no right or benefit to any
other person or entity.
16.11 Independent Contractor. Graphic Controls is an independent
contractor. Nothing in this Agreement shall constitute the
parties as joint venturers, partners, employees, agents or
legal representatives of each other. Each party expressly
acknowledges that it has no power or authority to create any
obligation for the other.
16.12 Effect of Termination; Survival of Certain Provisions. The
termination of this Agreement shall not affect any right or
claim that shall or may have accrued or arisen prior thereto.
The provisions of Sections 6, 7, 13, 15 and 16 shall survive
termination of this Agreement.
16.13 Choice of Law. This Agreement shall be construed in
accordance with the laws of the State of Connecticut without
regard to its conflicts of laws principles.
16.14 Arbitration of Disputes. Any controversy or claim arising out
of or relating to this Agreement shall be settled by
arbitration, in accordance with the Commercial Rules of the
American Arbitration Association, by a sole arbitrator. The
place of any arbitration shall be New Haven, Connecticut. Any
judgment upon the reward rendered by the arbitrator may be
entered by any court having competent jurisdiction thereof.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their duly authorized representative as of the day and year first written
above.
CAS MEDICAL SYSTEMS, INC.
By:/s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: President & CEO
GRAPHIC CONTROLS CORPORATION
By:/s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Vice President & COO
SCHEDULE A
CAS Products
[ ]
SCHEDULE B
Specified Accounts*
[ ]
SCHEDULE C
Medical Device Information
CAS shall provide Graphic Controls with the following information for
Products which are classified as Medical Devices, by the Food and Drug
Administration ("FDA") under the U.S. Food and Drug and Cosmetic Act:
1) Proof of facility registration with the FDA;
2) Medical Device Classification;
3) Copies of existing 510k Approval to Market Notifications;
4) Copies of clinical trials or evaluations which support the safety and
efficacy of the Products;
5) All information regarding the Products for which there is a
reportable incident during the term of this Agreement under the
Medical Device Reporting Regulation of December 13, 1984, including
all reports sent to the FDA;
6) For sterilized Products, if any, certificate of sterilization with
each shipment of an Order; and
7) Statement of latex in Products.
SCHEDULE D
Competing Products Currently Distributed by Graphic Controls
ECL 4103 - Meditrace
ECL 4105 - Meditrace
ECL BRS-50-K - Medicotest
ECL NF-50-K - Medicotest
ECL BR-50-K - Medicotest
