SALES DISTRIBUTION AGREEMENT
THIS AGREEMENT ("Agreement") is made and entered into as of the
Effective Date (as defined below), by and between XXXXXXXXXX
LABORATORIES, INC., a Texas corporation having its registered office in
Dallas, Texas, and XXXXXXXXXX LABORATORIES BELGIUM N.V., a Belgium
corporation having its registered office in Waasmunster, Belgium,
jointly (together hereinafter referred to as Xxxxxxxxxx ) and
RECORDATI, S.P.A., an Italian corporation having its registered office
located at Xxx X Xxxxxxxx, 0, 00000 Xxxxxx, Xxxxxx (hereinafter
referred to as "Recordati").
W I T N E S S E T H :
WHEREAS, Xxxxxxxxxx is engaged in the business of developing,
manufacturing, selling and distributing certain medical devices and is
desirous of establishing a competent and exclusive marketing and
distribution source for sales of such products in Italy (defined in
Article 1 hereof as the Territory); and
WHEREAS, Recordati is desirous of marketing and distributing such
products in the Territory, represents that it has experience in
obtaining registration of pharmaceuticals and other healthcare related
products in the Territory, is well introduced on the market, is willing
and able to provide a competent distribution organization in the
Territory, and Recordati desires to be Xxxxxxxxxx'x exclusive
distributor for such products in the Territory;
NOW, THEREFORE, the Parties hereto, in consideration of the
premises and mutual covenants and undertakings herein contained, agree
as follows:
Article 1. Definitions
1.1 As used in this Agreement, the following terms shall have
the meanings specified in this Article 1.1:
(a) "Effective Date" shall mean the date of last signature of
the Parties hereto.
(b) Governmental Authorities shall mean any and all
appropriate authorities, including but not limited to,
governmental, regulatory, legislative, and health
authorities.
(c) "Italian Registration" shall mean the notification by
Recordati to the appropriate Italian Governmental
Authorities of the grant of the Registration, and any other
official approval, authorization or recordation necessary
for the lawful marketing of the Products in the Territory.
(d) Know-how shall mean Xxxxxxxxxx'x secret and substantial
technical, clinical and scientific information,
manufacturing processes and procedures, testing methods,
and controls regarding the Products, which may be
necessary, useful or advisable to enable Recordati to
obtain the Italian Registration and to promote, distribute,
market and sell the Products in the Territory, and as is or
will be specified in the Registration documentation which
Xxxxxxxxxx has delivered or will deliver to Recordati after
the Effective Date and during the term of this Agreement.
(e) Parties shall mean Xxxxxxxxxx, as defined above, and
Recordati and Party shall mean either of them as the
context indicates.
(f) "Products" shall mean the wound, oral, and skin care
products manufactured by or for Xxxxxxxxxx set forth on
Exhibit A hereto. No Product shall be added or
discontinued with respect to Exhibit A without Recordati's
approval, excepting (i) Products which Xxxxxxxxxx
discontinues worldwide and (ii) Products which experience
material, adverse regulatory complications, including but
not limited to government required changes in manufacturing
or packaging requirements, additional clinical trials or
studies, or Product reformulation. Xxxxxxxxxx will provide
a ninety (90) day notice to Recordati of its intent to add
Products to Exhibit A and not less than twelve (12) months
notice of its intent to discontinue Products. If Recordati
does not respond to such notice of intention within said
period, then said intention shall be automatically deemed
approved by Recordati.
(g) "Registration" shall mean the granting of the CE xxxx to
the Products, in accordance with the relevant requirements
of Council Directive 93/42/EEC of June 14, 1993 concerning
medical devices, by the competent authorities of the United
Kingdom or any other European Member State.
(h) "Territory" shall mean the following country: Italy,
including Vatican City and the State of San Marino.
(i) Trademarks shall mean all mutually agreed upon Xxxxxxxxxx
Trademarks, trade names, service marks, logos and
derivatives thereof relating to the Products.
(j) Trade name shall mean Recordati s company name.
Article 2. Appointment
2.1 Subject to the terms and conditions of this Agreement,
Xxxxxxxxxx hereby appoints Recordati as Xxxxxxxxxx'x exclusive sales
distributor in the Territory for the promotion, distribution, marketing
and sale of the Products under the Trademarks and Recordati's Trade
name, and Recordati hereby accepts such appointment. As the exclusive
sales distributor in the Territory, Recordati shall, subject to the
terms and conditions of this Agreement, have the right to obtain the
Italian Registration and to promote, distribute, market and sell the
Products in the Territory on an exclusive basis. Recordati shall not
solicit orders from third parties outside the Territory.
2.2 As consideration for Recordati's appointment as the
exclusive sales distributor for the Products in the Territory,
Recordati hereby agrees to pay to Carrington the sum of $300,000.00
U.S. as follows:
(a) $100,000.00 U.S. within thirty (30) days of the Effective
Date;
(b) $100,000.00 U.S. within thirty (30) days of the approval of
the Registration; and,
(c) $100,000.00 U.S. within thirty (30) days of the initial
launch of the Products in the Territory.
If the Registration of the Products does not occur within
eighteen (18) months after submission of the relevant filing to the
United Kingdom Governmental Authorities or any other mutually agreed
upon authority or if Recordati is not allowed to promote, distribute,
market and sell the Products by the Italian Governmental Authorities
within twelve (12) months of Recordati s notification to the Italian
Governmental Authorities, then Xxxxxxxxxx shall refund the amount
actually paid by Recordati to Xxxxxxxxxx. No refund shall be required
by Xxxxxxxxxx, however, if the Italian Governmental Authorities
disapprove of Registration as a result of Recordati s negligence or
willful intent or omission.
2.3 Xxxxxxxxxx will provide Recordati with training and support
of manufacturing or marketing personnel, if necessary. In the event
Recordati requires such training and support, and such assistance by
Xxxxxxxxxx requires travel to Recordati's facilities in Milan, Italy or
such other mutually agreed upon location, Recordati agrees to be
solely responsible for and cover all of Xxxxxxxxxx s reasonable direct
expenses for such travel, training and support.
2.4 In a manner reasonably satisfactory to Xxxxxxxxxx, and at
Recordati's sole expense, Recordati agrees to (a) make and maintain all
declarations, filings, and the Italian Registration with, and obtain
all approvals and authorizations from, Governmental Authorities in the
Territory required to be made or obtained in connection with the
promotion, marketing, sale or distribution of the Products, (b) devote
its reasonable efforts to the diligent promotion, marketing, sale and
distribution of the Products in the Territory, (c) provide and maintain
a competent organization for the promotion, marketing, sale and
distribution of the Products in the Territory, (d) assure competent and
prompt handling of inquiries, orders, shipments, xxxxxxxx and
collections, and returns of or with respect to the Products and careful
attention to customers requirements for all Products, and (e) promptly
assign back to Xxxxxxxxxx any Product Registrations in the Territory,
if Xxxxxxxxxx does not hold them, upon termination of Agreement.
2.5 The Parties agree to use their reasonable efforts to
negotiate manufacturing rights for certain Products in the Territory;
provided, however, that all applicable regulatory, quality control,
quality assurance, licenses, confidentiality and business terms and
conditions can be mutually agreed upon by the Parties.
2.6 During the term of this Agreement, Recordati shall be
considered an independent contractor and shall not be considered a
partner, employee, agent or servant of Xxxxxxxxxx. As such, Recordati
has no authority of any nature whatsoever to bind Xxxxxxxxxx or incur
any liability for or on behalf of Xxxxxxxxxx or to represent itself as
anything other than a distributor and independent contractor.
2.7 Nothing in this Agreement shall be construed as giving
Recordati any right to use or otherwise deal with the Know-how for
purposes other than those expressly provided for in this Agreement
during the term of this Agreement.
2.8 Recordati shall promptly inform Xxxxxxxxxx of any
misappropriation of the Know-how which comes to its attention. After
having discussed such situation with Recordati, Xxxxxxxxxx shall have
sole and absolute discretion to take such action as it deems
appropriate and Recordati, at its own cost but subject to reimbursement
by Xxxxxxxxxx of its out-of-pocket expenses, shall assist Xxxxxxxxxx in
taking legal action, if deemed necessary, against such
misappropriation.
2.9 Unless otherwise stated in this Agreement, costs and
expenses connected with Recordati s activities or performance under
this Agreement are to be borne solely by Recordati.
Article 3. Certain Performance Requirements
3.1 Recordati agrees to promote and market the Products only to
customers and potential customers within the Territory for ultimate use
within the Territory. Recordati shall not, under any circumstances,
either directly or indirectly through third parties, (i) promote or
market Products within or to, or for ultimate use within, the United
States or any place outside the Territory, or (ii) establish any branch
or warehouse for the distribution or sale of the Products outside the
Territory.
3.2 In order to assure Xxxxxxxxxx that Recordati is in
compliance with Article 3.1, Recordati agrees that:
(a) Recordati shall send to Xxxxxxxxxx quarterly sales reports
which set forth the number of units and sizes of each
Product sold; the number of units of free medical samples
distributed, and to whom, if any, such Products were sold
and/or distributed outside the Territory during such
quarter; and
(b) Recordati shall send to Xxxxxxxxxx quarterly inventory
reports of the Products.
(c) Recordati shall send a forecast of anticipated annual sales
for the upcoming year by no later than December 1, of the
preceding year.
3.3 Recordati shall promptly provide Xxxxxxxxxx with written
reports of any importation or sale of any of the Products in the
Territory of which Recordati has knowledge from any source other than
Xxxxxxxxxx, as well as with any other information which Xxxxxxxxxx may
reasonably request in order to be updated on the market conditions in
the Territory.
3.4 Recordati shall maintain a sufficient inventory of Products
to assure an adequate supply of Products to serve all its market
segments. Recordati shall maintain all its inventory of Products
clearly segregated and meeting all storage and other standards required
by applicable Governmental Authorities. All such inventory and
Recordati s facilities shall be subject to inspection by Xxxxxxxxxx or
its agents upon five (5) business days written notice and not more than
once in any twelve (12) month period.
3.5 Recordati shall be responsible for and shall collect all
governmental and regulatory sales and other taxes, charges and fees
that may be due and owing upon sales by Recordati of Products. Upon
written request from Recordati, Xxxxxxxxxx shall provide Recordati with
such certificates or other documents as may be reasonably required to
establish any applicable exemptions from the collection of such taxes,
charges and fees.
3.6 All Products shall be labeled, advertised, marketed, sold
and distributed by Recordati in compliance the Italian Registration and
with the rules and regulations, as amended from time to time, of (i)
all applicable Governmental Authorities within the Territory in which
the Products are marketed, and (ii) all other applicable laws, rules
and regulations. Recordati shall pay all expenses associated with (i)
any alterations to the packaging and labeling of the Products which
deviate from Carrington's standard packaging materials, designs,
methods and/or procedures, and (ii) any additional inserts in the
general packaging. The Parties shall agree on minimum production runs
for such custom labels.
3.7 Save as provided in Article 3.6, Recordati shall not make
any alterations or permit any alterations to be made to the Products.
3.8 Recordati shall assume all responsibility for and at all
times comply with all applicable laws, regulations and requirements
concerning the Registration and the Italian Registration, inventory,
use, promotion, distribution and sale of the Products in the Territory.
3.9 Recordati agrees not to make, or permit any of its
employees, agents or representatives to make, any claims of any
properties or results relating to any Product, unless such claims have
received written approval from Xxxxxxxxxx or from the applicable
Governmental Authorities.
3.10 Recordati shall not use any packaging, label, advertisement
or marketing material on or with respect to or relating to any Product
unless such packaging, label, advertisement or marketing material has
first been submitted to and approved by Xxxxxxxxxx in writing.
Approval by Xxxxxxxxxx shall be deemed granted if no response is
received from Xxxxxxxxxx within thirty (30) days from Recordati s
submission.
3.11 Recordati will actively and aggressively promote, develop
demand for and maximize the sale of the Products to all customers and
potential customers within the Territory. Recordati agrees not to
manufacture, promote, market, sell or distribute to any customers or
potential customers in the Territory without ninety (90) days written
notice to and approval from Xxxxxxxxxx, any competitive wound care
product.
Article 4 Registration of Products
4.1 It being understood that Xxxxxxxxxx shall file for
Registration within three (3) months from the Effective Date and shall
supply Recordati with a copy of the Registration dossier and that
Registration is a prerequisite to obtaining the Italian Registration
and to the lawful sale of the Products in the Territory, Xxxxxxxxxx
hereby agrees to supply Recordati, promptly after the execution of this
Agreement, with any Know-how or relevant documentation necessary for
preparing the Italian Registration dossier to be submitted to the
applicable Governmental Authorities of the Territory.
4.2 It shall be the responsibility of Recordati, at its sole
expense, to apply for, obtain and maintain the Italian Registration.
Subject to having obtained the prior approval of Xxxxxxxxxx and
subsequent to Registration, Recordati shall notify the grant of the
Registration to all applicable Governmental Authorities in the
Territory, and said notification shall be in the name of Xxxxxxxxxx,
with Recordati being named as Products distributor for the Territory.
Recordati expressly acknowledges and agrees that the absolute and
exclusive ownership of the Registration and all rights originating out
of or from the same shall at all times belong only and exclusively to
Xxxxxxxxxx.
4.3 As soon as Recordati has received the Know-how and the
Registration dossiers from Xxxxxxxxxx, Recordati shall prepare, at its
sole expense, the Italian Registration dossier and notification and any
translation which may be required by the applicable authorities of the
Territory. Recordati shall promptly supply Xxxxxxxxxx with a copy of
the said Italian Registration dossier and submission and Xxxxxxxxxx
shall be entitled to a free and unrestrained use of the same outside
the Territory.
4.4 Subject to having obtained Xxxxxxxxxx'x written approval of
all such documentation and any subsequent amendments thereto, Recordati
shall, as soon as possible and in any case within sixty (60) days of
Xxxxxxxxxx'x approval, submit the Italian Registration to the
appropriate authorities of the Territory.
4.5 Recordati shall copy and keep Xxxxxxxxxx fully and timely
informed, throughout the term of this Agreement, of all material
communications sent to or received from all applicable authorities,
including the health authorities, of the Territory concerning the
Products.
4.6 Xxxxxxxxxx makes no warranty that the supplied Know-how
will necessarily result in the grant of the Italian Registration and
Recordati shall have no claim against Xxxxxxxxxx arising out of any
delay or refusal by the authorities to issue the Italian Registration,
other than the refund stated in Article 2.2.
4.7 Recognizing the importance of sampling to the success of a
product launch, upon Registration approval, the parties shall meet in
good faith to discuss the sampling budget required for the first year.
Article 5. Sale of Products by Xxxxxxxxxx to Recordati
5.1a Subject to the terms and conditions of this Agreement,
including specifically Article 5.6 hereof, Xxxxxxxxxx shall sell to
Recordati and Recordati agrees to purchase from Xxxxxxxxxx the Products
in finished packaged form ready for sale at a specified price for each
of the Products (the "Contract Prices"). For orders placed by
Recordati during the first two 12-month periods of the term of this
Agreement, the Contract Prices for the Products listed on Exhibit A are
set forth on such exhibit opposite each Product. At least 90 days
prior to the end of each 12-month period of the term of this Agreement,
(a) Recordati shall provide in writing to Xxxxxxxxxx a purchase
forecast for the following 12-month period, and (b) at least 90 days
prior to the end of the second of the two 12 month periods aforesaid,
the Parties shall commence good faith negotiations to determine and
agree upon the Contract Prices for Products for the next 12-month
period of the term. Not more than once during any twelve (12) month
period following the first two 12-month periods, Xxxxxxxxxx reserves
the right to change its Contract Price for each Product, only as
permitted in this Article and in Article 5.1b below. Notwithstanding
the foregoing, the adjustment of Contract Prices shall in no event
exceed the annual increase in the Producers Price Index, Drugs and
Pharmaceuticals, subdivision code 063 issued by the U.S. Department of
Commerce. Any change of the Contract Prices and/or adjustment thereto
shall apply on a Product by Product basis commencing as each individual
Product is launched.
5.1b In the event that the specified index is discontinued or in
the event the basis of its calculation is modified, a comparable index
mutually agreed upon shall be applied. Should the applicable index not
be available when needed, an estimate of the missing index shall be
made. In such case, a recalculation of the Contract Prices shall be
made when the applicable index is available and an adjustment shall be
included in the next invoice submitted to Recordati.
The above applies as long as the Products are sold as a medical
device. If new material claims or a new classification occurs and such
claims or classification result in a material change to the end-user
purchase price for the Products, then the Contract Prices shall be
renegotiated without the limitation stated above.
Further, if Recordati increases its selling prices greater than
the increase in the margin of the above-stated index calculation,
Xxxxxxxxxx and Recordati shall agree upon a similar percentage increase
in the Contract Prices. If for any reason, Xxxxxxxxxx'x Product costs
become higher than the index permits, the Parties shall attempt to
mutually agree on a change to the Contract Prices. If the Parties fail
to agree upon a change to the Contract Prices in this instance, then
said issue may be submitted for arbitration; provided, however, until
such arbitration is completed, Xxxxxxxxxx shall not be required to sell
any Product at a loss.
5.2 As consideration for its appointment as the exclusive sales
distributor entitled to a Product discount, Recordati agrees to
purchase from Xxxxxxxxxx, during each 12-month period of the term of
this Agreement, commencing with the 12-month period beginning on the
second anniversary of the Effective Date through and ending on the
expiry of the initial term of this Agreement at the Contract Prices, a
specified minimum aggregate dollar amount (based on the Contract
Prices) of the Products (the "Specified Minimum Purchase Amount"). The
first two 12-month periods of the term of this Agreement shall be
considered benchmark years and there shall be no Specified Minimum
Purchase Amount. The Specified Minimum Purchase Amounts for each
subsequent 12-month period shall correspond to fifty (50%) percent of
Recordati s sales forecast for each of the following 12-month periods.
5.3 Recordati shall order Products by submitting a purchase
order to Xxxxxxxxxx describing the type and quantity of the Products to
be purchased. All purchases shall be spaced in a reasonable manner in
agreed upon volumes. Purchase orders exceeding the most recent
purchase forecast by more than 120% are subject to acceptance by
Xxxxxxxxxx. Xxxxxxxxxx will invoice Recordati upon delivery of the
Products. Unless otherwise agreed, Recordati shall pay all invoices in
full within sixty (60) days of the date of invoice. Recordati shall be
solely responsible for all costs in connection with affecting payments.
All sales and payments shall be made in the State of Texas.
5.4 Xxxxxxxxxx shall not be obligated to deliver Products to
Recordati at any time when payment of an amount owed by Recordati is
more than 30 days overdue or when Recordati is otherwise in material
breach of this Agreement.
5.5 All deliveries shall be initiated by a purchase order.
Product delivery dates will be specified in the purchase order. These
dates may not be scheduled prior to ninety (90) days after the date the
purchase order is received and acknowledged in writing by Xxxxxxxxxx,
unless by mutual consent of the Parties. Purchase orders will be non-
cancelable. Recordati will issue to Xxxxxxxxxx on a monthly basis, a
twelve (12) month rolling forecast so that Xxxxxxxxxx may incorporate
said forecasts into its planning system. The triggering document for
roduction activities is, however, the purchase order, as stated above.
Xxxxxxxxxx will guarantee delivery dates for Product quantities that
vary up to 20% above the last monthly rolling forecast issued prior to
the purchase order placed by Recordati. Variation above 20% shall be
discussed between the Parties and Xxxxxxxxxx will use its best efforts
to maintain delivery dates requested by Recordati.
5.6 All deliveries of Products will be packaged in accordance
with the requirements of the Registration and using Xxxxxxxxxx'x
standard packaging procedures. Recordati shall supply Xxxxxxxxxx with
labeling masters, instructions and specifications for labeling and
packaging of the Products. All packaging and labeling shall be in the
Italian language only and sold under the Recordati Trade name.
Xxxxxxxxxx shall supply to Recordati a written statement of
manufacturing, processing and/or packaging procedures, quality control
procedures and methods of analysis together with samples from each
batch of Products supplied. Recordati shall perform analyses on such
samples and send its approval of such batch of Products to Xxxxxxxxxx
within forty five (45) days from delivery. If any batch fails to
conform to the specifications therefor then Recordati shall promptly
notify Xxxxxxxxxx in writing together with copies of its quality
control results from testing such samples. If Xxxxxxxxxx does not
accept Recordati s evaluation thereof after re-analyzing the relevant
batch then the Parties shall nominate an independent, reputable
laboratory acceptable to both for determination as to whether or not
such batch fails to conform to the specifications therefor. All
Contract Prices are F.C.A. (Incoterms, 1990) Xxxxxxxxxx'x facility,
Irving, Texas. Ownership of and title to Products and all risks of
loss with respect thereto shall pass to Recordati upon delivery of such
Products by Xxxxxxxxxx.
5.7 Xxxxxxxxxx shall use its reasonable best efforts to ensure
availability of all Products ordered by Recordati under this Agreement.
However, if necessary in the best judgment of Carrington, Carrington
may allocate its available supply of Products among all its customers,
distributors or other purchasers, including Recordati, on such basis as
it shall deem reasonable, practicable and equitable, without liability
for any failure of performance or lost sales which may result from such
allocations provided that Xxxxxxxxxx shall continue to supply Recordati
with a minimum of seventy five percent (75%) of its forecasted
requirements.
5.8 Liability and Indemnification: Xxxxxxxxxx accepts
liability for defective Products and agrees to replace such defective
Products should they occur with new Products. Xxxxxxxxxx warrants that
upon delivery by Xxxxxxxxxx the finished Products will comply with all
Product specifications as set forth in the Registration. Except as
warranted aforesaid or as may be expressly stated by Xxxxxxxxxx on the
Product or on Xxxxxxxxxx'x packaging, or in Xxxxxxxxxx'x information
accompanying the Product, at the time of delivery to Recordati
hereunder, XXXXXXXXXX MAKES NO REPRESENTATIONS OR WARRANTIES OF ANY
KIND WITH RESPECT TO THE PRODUCTS, EXPRESS OR IMPLIED, INCLUDING ANY
IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE. XXXXXXXXXX NEITHER ASSUMES NOR AUTHORIZES ANYONE TO ASSUME
FOR IT ANY OBLIGATION OR LIABILITY IN CONNECTION WITH THE PRODUCTS.
Recordati shall not make any representation or warranty with respect to
the Products that is more extensive than, or inconsistent with, the
limited warranty set forth in this Article 5.8 or that is inconsistent
with the policies or publications of Xxxxxxxxxx relating to the
Products.
RECORDATI'S EXCLUSIVE REMEDY FOR BREACH OF ANY WARRANTY HEREUNDER
IS THE DELIVERY BY XXXXXXXXXX OF ADDITIONAL QUANTITIES OF THE PRODUCTS
IN REPLACEMENT OF THE NON-CONFORMING PRODUCTS OR THE REFUND OF THE
CONTRACT PRICE FOR THE PRODUCTS THAT ARE COVERED BY THE WARRANTY, AT
RECORDATI'S OPTION. SUBJECT TO THE PROVISIONS OF THIS ARTICLE 5.8,
XXXXXXXXXX SHALL HAVE NO OTHER OBLIGATION OR LIABILITY FOR DAMAGES TO
RECORDATI OR ANY OTHER PERSON OF ANY TYPE, INCLUDING, BUT NOT LIMITED
TO, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES, LOSS OF PROFITS OR
OTHER COMMERCIAL OR ECONOMIC LOSS, OR ANY OTHER LOSS, DAMAGE OR
EXPENSE, ARISING OUT OF OR IN CONNECTION WITH THE SALE, USE, LOSS OF
USE, NONPERFORMANCE OR REPLACEMENT OF THE PRODUCTS.
RECORDATI SHALL DEFEND, INDEMNIFY AND HOLD HARMLESS XXXXXXXXXX
AND XXXXXXXXXX S AFFILIATES, OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS
FROM AND AGAINST ALL CLAIMS, LIABILITIES, DEMANDS, DAMAGES, EXPENSES
AND LOSSES (INCLUDING REASONABLE ATTORNEYS' FEES AND EXPENSES) ARISING
OUT OF OR CONNECTED WITH (i) RECORDATI'S NEGLIGENT ACTS OR OMISSIONS IN
RELATION TO THE HANDLING OR STORAGE OF THE PRODUCTS, (ii) ANY BREACH BY
RECORDATI OF ANY OF ITS REPRESENTATIONS, WARRANTIES OR COVENANTS UNDER
THIS AGREEMENT, OR (iii) ANY ACTS OR OMISSIONS ON THE PART OF RECORDATI
OR ITS AGENTS, SERVANTS OR EMPLOYEES WHICH ARE OUTSIDE OR BEYOND
RECORDATI'S AUTHORIZATION GRANTED HEREIN.
XXXXXXXXXX SHALL DEFEND, INDEMNIFY AND HOLD HARMLESS RECORDATI
AND RECORDATI'S AFFILIATES, OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS
FROM AND AGAINST ALL CLAIMS, LIABILITIES, DEMANDS, DAMAGES, EXPENSES
AND LOSSES (INCLUDING REASONABLE ATTORNEYS' FEES AND EXPENSES) ARISING
OUT OF OR CONNECTED WITH ANY (i) THIRD PARTY PRODUCT LIABILITY CLAIM
ARISING FROM AN INHERENT DEFECT IN THE PRODUCTS (I.E. WHICH OCCURS OR
ARISES THROUGH NO NEGLIGENCE OF RECORDATI S OR THE ABOVE-REFERENCED
ASSOCIATES THEREOF), (ii) INFRINGEMENT OF THIRD PARTIES INTELLECTUAL
PROPERTY RIGHTS IN CONNECTION WITH THE MANUFACTURE, USE AND/OR SALE OF
THE PRODUCTS IN THE TERRITORY IN ACCORDANCE WITH THE TERMS OF THE
AGREEMENT, (iii) WILFUL ACTS OR OMISSIONS OR NEGLIGENCE OF XXXXXXXXXX,
AND (iv) USE, SALE OR DISPOSITION OF THE PRODUCTS.
IN NO EVENT SHALL ANY PARTY OR ITS AFFILIATES BE LIABLE TO THE
OTHER PARTY FOR SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES,
WHETHER IN CONTRACT, WARRANTY, TORT (INCLUDING, BUT NOT LIMITED TO
NEGLIGENCE, FAILURE TO WARN OR FAILURE TO TEST), STRICT LIABILITY OR
OTHERWISE, INCLUDING, BUT NOT LIMITED TO, LOSS OF PROFITS OR REVENUE,
LOSS OF USE OF THE PRODUCT.
5.9 Adverse Events. Each Party shall:
(a) inform the other Party in writing in English of any
serious (i.e. fatal, life threatening,
causing/prolonging hospitalization, causing
severe/permanent disability, or related to cancer,
congenital anomaly or overdose) or unexpected adverse
event concerning the active ingredient or the
Products. Xxxxxxxxxx shall report serious or
unexpected adverse events to Recordati in standard
CIOMS format within twenty-four (24) hours of such
event coming to its knowledge and shall co-operate
with Recordati in providing any additional
information required by Recordati and technical
support to Recordati (i.e. a copy of the original
documentation, direct contact with the physician or
other person who generated the Adverse Event Alert).
Recordati shall notify Xxxxxxxxxx of any serious or
unexpected adverse events in standard CIOMS format as
soon as consistent information on any such adverse
event is collected. In addition, promptly following
such written notification the notifying Party shall
submit all further details which come to its
knowledge with respect to such events;
(b) no later than June 30 and December 31 of each year,
inform the other Party in writing of any adverse
events other than those refereed to in Article 5.9(a)
that have occurred during the preceding six (6) month
period;
(c) be responsible for notifying events reported to it
under this Article to the governmental authorities in
accordance with the legal requirements applying in
the Parties respective territories; and
(d) provide to the other Party the name of an appointed
representative ("the Representative") to whom all
adverse event information set forth above shall be
addressed.
In the event of termination or expiration of this Agreement, each
Party s adverse event reporting obligations shall continue for a period
of twelve (12) months after such termination or expiration.
5.10 Credits for defective Products to Recordati shall include
importation and shipment expenses and will be calculated by Xxxxxxxxxx
based on the original Contract Prices of the Products returned, whether
identified by lot number or another method. Xxxxxxxxxx shall provide
Recordati with a copy of its liability Insurance Certificate and shall
include Recordati thereunder.
5.11 For purposes of clarification, all references herein to
Xxxxxxxxxx shall include both Xxxxxxxxxx Laboratories, Inc. and
Xxxxxxxxxx Laboratories Belgium, N.V., and each shall be jointly and
severally liable regarding all of Xxxxxxxxxx'x obligations under this
Agreement.
Article 6. Term and Termination
6.1 The term of this Agreement shall be for an initial term of
ten (10) years from the effective date of Registration of the Products.
After such term, this Agreement shall be automatically renewed for a
two year term unless either Party gives the other notice to terminate
the Agreement at least six months prior to the end of the initial term
hereof. Notwithstanding the foregoing, this Agreement may be
terminated earlier in accordance with the provisions of this Article 6
or as expressly provided elsewhere in this Agreement.
6.2a Either Party shall have the right to terminate this
Agreement if the other Party fails to perform or breaches, in any
material respect, the terms or provisions of this Agreement without
remedying the same within sixty (60) days of being notified of such
failure to perform or material breach. Without limiting the events
which shall be deemed to constitute a breach or material breach of this
Agreement by Recordati, Recordati understands and agrees that it shall
be in material breach of this Agreement, and Xxxxxxxxxx subject to the
aforesaid shall have the right to terminate this Agreement under this
Article 6.2a, if:
(i) Recordati fails or refuses to pay to Xxxxxxxxxx any
sum when due; or
(ii) Recordati breaches any provision of Article 2.2, 3.4,
4, 5.3, 5.8, 7 or 8.
6.2b In the event, Recordati fails to purchase the Specified
Minimum Purchase Amounts of Product for any required period other than
a result of Xxxxxxxxxx'x failure to supply the Products, Xxxxxxxxxx
shall have the option on sixty (60) days notice to convert the
Agreement from an exclusive to a semi-exclusive status; i.e.,
Xxxxxxxxxx shall be permitted to appoint one (1) other distributor, in
addition to Recordati, to promote and market the Products in the
Territory under their separate, respective trademarks.
6.3 Each Party shall have the right to terminate this Agreement
in the event that the other Party shall become insolvent, or if there
is instituted by or against the other Party procedures in bankruptcy,
or under insolvency laws or for reorganization, receivership or
dissolution, or if the other Party is acquired by another company.
Additionally, Xxxxxxxxxx shall have the right to terminate this
Agreement if Recordati acquires another company which manufactures,
sells or distributes competing wound care products, unless Recordati
(i) continues to satisfy the Specified Minimum Purchase Amount
requirements and (ii) provides Xxxxxxxxxx ninety (90) days notice of
such acquisition.
6.4 During the one-year period following termination of this
Agreement, any inventory of Products held by Recordati at the
termination of this Agreement may be sold by Recordati to customers in
the Territory in the ordinary course; provided, however, that for the
period required to liquidate such inventory, all of the provisions
contained herein governing Recordati's performance obligations and
Xxxxxxxxxx'x rights shall remain in effect. In order to accelerate the
liquidation of any such inventory, Xxxxxxxxxx shall have the option,
but not the obligation, to purchase all or any part of such remaining
inventory at the price at which the inventory was originally sold by
Xxxxxxxxxx to Recordati, plus importation and shipping costs.
6.5 The termination of this Agreement shall not impair the
rights or obligations of either Party hereto which shall have accrued
hereunder prior to such termination. The provisions of Articles 5.8,
5.9, 6.4, 7, 8, 13 and 16 and the rights and obligations of the Parties
thereunder shall survive the termination of this Agreement.
Article 7. Trademarks and Patents
7.1 The Trademarks and all patents, Know-how, and other
intellectual property relating to the Products and of the goodwill
associated therewith, are the sole and exclusive property of Xxxxxxxxxx
and/or its affiliates. The Products shall be promoted, sold and
distributed only under the Trademarks and Recordati s Trade name.
Xxxxxxxxxx hereby grants Recordati an exclusive license to use the
Trademarks for the sole purpose of performing its obligations under
this Agreement. Xxxxxxxxxx may, upon mutual consent with Recordati,
modify or discontinue the use of any Trademark and/or use one or more
additional or substitute marks or names, and Recordati shall be
obligated to do the same.
7.2 The Trademarks shall appear on all Product packaging,
labels, and inserts and other materials which Recordati uses for the
marketing of the Products in such form and manner as Xxxxxxxxxx shall
reasonably require. Xxxxxxxxxx retains the right to review and approve
all intended uses by Recordati of the Trademarks in any packaging,
inserts, labels, or promotional or other materials relating to the
Products prior to Recordati s actual use thereof. Xxxxxxxxxx'x right
of approval thereof shall be exercised within thirty (30) days from
receipt of Recordati s proposal. Approval shall be deemed granted if
Xxxxxxxxxx does not respond by the end of said period.
7.3 It shall be the sole responsibility of Xxxxxxxxxx, at its
sole expense, to keep in force and maintain the Trademarks in the
Territory by paying all necessary fees throughout the term of this
Agreement. The Trademarks shall always be used together with the sign
[R] or the sign [TM]. Recordati may not use any Trademark as part of
any corporate name or with any prefix, suffix or other modifying word,
term, design or symbol. In addition, Recordati may not use any
Trademark in connection with the sale of any unauthorized product or
service or in any other manner not explicitly authorized in writing by
Xxxxxxxxxx.
7.4 Except as provided in Article 6.4, in the event of the
termination of this Agreement for any reason, Recordati's right to use
the Trademarks shall cease, and Recordati shall cease using such
Trademarks at such time as Recordati's inventory of Products has been
sold. Recordati shall, as soon as it is reasonably possible, remove
all Trademarks which appear on or about the premises of the office(s)
of Recordati and any of the advertising of Recordati used in connection
with the Products.
7.5 In the event of a breach or threatened breach by Recordati
of the provisions of this Article 7, Xxxxxxxxxx shall be entitled to
apply for an injunction or injunctions to prevent such breaches.
Nothing herein shall be construed as prohibiting Xxxxxxxxxx from
pursuing other remedies available to it for such breach or threatened
breach of this Article 7, including the recovery of damages from
Recordati.
7.6 In the event that Recordati becomes aware of any
infringement of, or challenge to, Recordati s use of any of the
Trademarks or any Xxxxxxxxxx patent on the Products Recordati is
obligated to notify Xxxxxxxxxx immediately. Xxxxxxxxxx and Recordati
shall investigate any alleged violation and, if necessary, Xxxxxxxxxx
will within sixty (60) days of receipt of such notification take
appropriate legal action to resolve the issue and to prevent other
competitors from infringing on said intellectual property rights within
the Territory. In any event, Xxxxxxxxxx shall have sole and absolute
discretion to take such action as it deems appropriate. In the event
that Xxxxxxxxxx determines not to take any action or fails to take any
action within the sixty (60) days aforesaid, then Recordati shall have
the right to take such action as it sees fit; using Xxxxxxxxxx'x name,
if necessary, and Xxxxxxxxxx shall provide Recordati with all
reasonable assistance in connection therewith.
7.7 Should for some reason the Trademark be prevented from
being used in any part or whole of the Territory, the Parties shall
consult as to a suitable other trademark (which trademark shall be also
defined as Trademark for purposes of this Agreement) owned by
Xxxxxxxxxx or to be transferred from Recordati to Xxxxxxxxxx for use in
connection with the marketing and sale of the Products; it being
agreed, however, that Xxxxxxxxxx retains the right to ultimately
determine what such alternative Trademark shall be used, provided it is
not confusingly similar to a Trademark owned by Recordati in the
Territory.
Article 8. Confidential Information
8.1 Recordati recognizes and acknowledges that Recordati will
have access to confidential information and trade secrets, including
"Know-how", of Xxxxxxxxxx and other entities doing business with
Xxxxxxxxxx relating to research, development, manufacturing, marketing,
financial and other business-related activities ("Confidential
Information"). Such Confidential Information constitutes valuable,
special and unique property of Xxxxxxxxxx and/or other entities doing
business with Xxxxxxxxxx. Other than as is necessary to perform the
terms of this Agreement, Recordati shall not, during and after the term
of this Agreement, make any use of such Confidential Information, or
disclose any of such Confidential Information to any person or firm,
corporation, association or other entity, for any reason or purpose
whatsoever, except as specifically allowed in writing by an authorized
representative of Xxxxxxxxxx. In the event of a breach or threatened
breach by Recordati of the provisions of this Article 8, Xxxxxxxxxx
shall be entitled to apply for an injunction restraining Recordati from
disclosing and/or using, in whole or in part, such Confidential
Information. Nothing herein shall be construed as prohibiting
Xxxxxxxxxx from pursuing other remedies available to it for such breach
or threatened breach of this Article 8, including the recovery of
damages from Recordati. The above does not apply to information or
material that was known to the public or generally available to the
public prior to the date it was received by Recordati becomes available
or known to the public thereafter due to no fault of Recordati or is
received by Recordati from a third party not bound by an obligation of
confidentiality in connection therewith.
8.2 Recordati shall not disclose any of the terms of this
Agreement without prior written consent of Xxxxxxxxxx.
8.3 Xxxxxxxxxx undertakes obligations of confidentiality and
non-use in terms identical to those given by Recordati in Article 8.1
in relation to any confidential business or other information supplied
to Xxxxxxxxxx hereunder.
Article 9. Force Majeure
9.1 Neither Recordati nor Xxxxxxxxxx shall have any liability
hereunder if either is prevented from performing any of its obligations
hereunder by reason of any factor beyond its control, including,
without limitation, fire, explosion, accident, riot, flood, drought,
storm, earthquake, lightning, frost, civil commotion, sabotage,
vandalism, smoke, hail, embargo, act of God or the public enemy, other
casualty, strike or lockout, or interference, prohibition or
restriction imposed by any government or any officer or agent thereof
("Force Majeure"), and Recordati or Xxxxxxxxxx'x obligations, so far as
may be necessary, shall be suspended during the period of such Force
Majeure. Such affected Party shall give to the other Party prompt
notice of any such Force Majeure, the date of commencement thereof and
its probable duration and shall give a further notice in like manner
upon the termination thereof. Each Party hereto shall endeavor with
due diligence to resume compliance with its obligations hereunder at
the earliest date and shall do all that it reasonably can to overcome
or mitigate the effects of any such Force Majeure upon both Party's
obligations under this Agreement. Should the Force Majeure continue
for more than six (6) months, then the other Party shall have the right
to terminate this Agreement.
9.2 The Parties agree that any obligation to pay money is never
excused by Force Majeure.
Article 10. Amendment
10.1 No oral explanation or oral information by either Party
hereto shall alter the meaning or interpretation of this Agreement. No
modification, alteration, addition or change in the terms hereof shall
be binding on either Party hereto unless reduced to writing and
executed by the duly authorized representative of each Party.
Article 11. Entire Agreement
11.1 Excepting the Confidential Disclosure Agreement dated June
8, 1996, this Agreement represents the entire Agreement between the
Parties and shall supersede any and all prior agreements,
understandings, arrangements, promises, representations, warranties,
and/or any contracts of any form or nature whatsoever, whether oral or
in writing and whether explicit or implicit, which may have been
entered into prior to the execution hereof between the Parties, their
officers, directors or employees as to the subject matter hereof.
Neither of the Parties hereto has relied upon any oral representation
or oral information given to it by any representative of the other
Party.
11.2 Should any provision of this Agreement be rendered invalid
or unenforceable, this shall not affect the validity or enforceability
of the remainder.
Article 12. Assignment
12.1 Neither this Agreement nor any of the rights or obligations
of Recordati hereunder shall be transferred or assigned by Recordati
without the prior written consent of Xxxxxxxxxx (such consent not to be
unreasonably withheld or delayed), executed by a duly authorized
officer of Xxxxxxxxxx provided that Recordati shall be free to transfer
or assign its rights or obligations hereunder to an affiliate.
Article 13. Governing Law
13.1 It is expressly agreed that the validity, performance and
construction of this Agreement will be governed by the laws and
jurisdiction of Texas.
Article 14. Notices
14.1 Any notice required or permitted to be given under this
Agreement by one of the Parties to the other shall be given for all
purposes by delivery in person, registered air-mail, commercial courier
services, postage prepaid, return receipt requested, or by fax
addressed to:
(a) Xxxxxxxxxx at: Xxxxxxxxxx Laboratories, Inc., 0000 Xxxxxx
Xxxx Xxxx, Xxxxxx, Xxxxx 00000; Attention President, or at
such other address as Xxxxxxxxxx shall have theretofore
furnished in writing to Recordati (Fax No. 000-000-0000).
(b) Recordati at: Recordati, Xxx X. Xxxxxxxx, 0 - 00000 Xxxxxx,
Xxxxxx, Attention VP and Director, Corporate Development or
at such other address as Recordati shall have theretofore
furnished in writing to Xxxxxxxxxx. (Fax No. 00 0 00 00 00
23)
Article 15. Waiver
15.1 Neither Recordati nor Xxxxxxxxxx'x failure to enforce at
any time any of the provisions of this Agreement or any right with
respect thereto, shall be considered a waiver of such provisions or
rights or in any way affect the validity of same. Neither Recordati's
nor Xxxxxxxxxx'x exercise of any of its rights shall preclude or
prejudice either Party thereafter from exercising the same or any
other right it may have, irrespective of any previous action by either
Party.
Article 16. Arbitration
16.1 Except as expressly provided otherwise herein, any dispute,
controversy or claim arising out of or in relation to or in connection
with this Agreement, the operations carried out under this Agreement or
the relationship of the Parties created under this Agreement not having
been resolved by the Parties within ninety (90) days of such dispute,
controversy or claim having arising, shall be exclusively and finally
settled by confidential arbitration, and any Party may submit such a
dispute, controversy or claim to arbitration. The arbitration
proceeding shall be held in London, England in the English language and
shall be governed by the rules of the International Chamber of Commerce
(the "ICC") as amended from time to time. Any procedural rule not
determined under the rules of the ICC shall be determined by the laws
of the State of Texas, other than those laws that would refer the
matter to another jurisdiction.
A single arbitrator shall be appointed by unanimous consent
of the Parties. If the Parties cannot reach agreement on an arbitrator
within 45 days of the submission of a notice of arbitration, the
appointing authority for the implementation of such procedure shall be
the ICC, who shall appoint an independent arbitrator who does not have
any financial or conflicting interest in the dispute, controversy or
claim. If the ICC is unable to appoint, or fails to appoint, an
arbitrator within 90 days of being requested to do so, then the
arbitration shall be heard by three arbitrators, one selected by each
Party within the 30 days of being required to do so, and the third
promptly selected by the two arbitrators selected by the Parties.
The arbitrators shall announce the award and the reasons
therefor in writing within six months after the conclusion of the
presentation of evidence and oral or written argument, or within such
longer period as the Parties may agree upon in writing. The decision
of the arbitrators shall be final and binding upon the Parties.
Judgment upon the award rendered may be entered in any court having
jurisdiction over the person or the assets of the Party owing the
judgment or application may be made to such court for a judicial
acceptance of the award and an order of enforcement, as the case may
be. Unless otherwise determined by the arbitrator, each Party involved
in the arbitration shall bear the expense of its own counsel, experts
and presentation of proof, and the expense of the arbitrator and the
ICC (if any) shall be divided equally among the Parties to the
arbitration.
Article 17 Interpretation
17.1 The language of this Agreement is English. No translation
into any other language shall be taken into account in the
interpretation of the Agreement itself.
17.2 The headings in this Agreement are inserted for convenience
only and shall not affect its construction.
17.3 Where appropriate, the terms defined in Article 1 and
denoting a singular number only shall include the plural and vice
versa.
Article 18. Exhibits
18.1 Any and all Exhibits referred to herein shall be considered
an integral part of this Agreement.
Article 19. Currency of Account
19.1 This Agreement evidences a transaction for the sale of
goods in which the specification of U.S. dollars is of the essence, and
U.S. dollars shall be the currency of account in all events. All
payments to be made by Recordati to Xxxxxxxxxx hereunder shall be made
either (i) in immediately available funds by confirmed wire transfer to
a bank account to be designated by Xxxxxxxxxx or (ii) in the form of a
bank cashier's check payable to the order of Xxxxxxxxxx.
Article 20. Binding Effect
20.1 This Agreement shall inure to the benefit of and be binding
upon the respective successors of the Parties.
IN WITNESS WHEREOF, the Parties hereto have executed this
Agreement as of the day and year first below written.
XXXXXXXXXX LABORATORIES, INC.
By:
Name:
Title:
Date:
XXXXXXXXXX LABORATORIES BELGIUM N.V.
By:
Name:
Title:
Date:
RECORDATI INDUSTRIA CHIMICA &
FARMACEUTICA S.P.A.
EXHIBIT A
RECORDATI, S.P.A.
Products & Contract Price
December, 1996
Product Contract
No. Product Price
------- -------------------------------------------- ------------
HYDROGEL WOUND DRESSINGS
101002 Carrasyn V Hydrogel $1.61/unit
(1.0oz.Pouch) (Up to 200,000
units)
101002 Carrasyn V Hydrogel (1.0 oz. $1.51/unit
Pouch) (200,001 - 250,000
units)
101002 Carrasyn V Hydrogel (1.0 oz. $1.45/unit
Pouch) (250,001 - 300,000
units)
101002 Carrasyn V Hydrogel (1.0 oz. $1.36/unit
Pouch) (over 300,001 units)
101023 Carrasyn V Hydrogel Wound $4.25/unit
Dressing, 3 oz. tube
101017 CarraGauze 2" x 2" Pad (1 $63.00/case
pkg., 15 pkgs/bx., 6
bxs./cs.) ($0.70 per unit)
101015 CarraGauze 4" x 4" Pad (1 $112.50/case
pkg., 15 pkgs/bx., 6
bxs./cs.) (Up to 150,000
units $1.25 per unit)
WOUND & SKIN CLEANSERS
102060 CarraKlenz Wound & Skin $2.97/bottle
Cleanser ( 6 oz. Pump)
102062 CarraKlenz Wound & Skin $3.97/bottle
Cleanser ( 8 oz. Pump)
102160 CarraKlenz Wound & Skin $6.07/bottle
Cleanser (16 oz. Pump)
Product Contract
No. Product Price
------- -------------------------------------------- ------------
CALCIUM ALGINATES
101032 CarraSorb H Calcium Alginate $125.00/case
Wound Dressing (2 x 2)
10bxs./10ea., 10bxs./case
($1.25/unit)
101033 CarraSorb H Calcium Alginate $272.00/case
Wound Dressing (4 x 4)
10bxs./10ea., 10bxs./case
($2.72/unit)
FREEZE-DRIED GELS
101035 CarraSorb M Freeze-Dried Gel $196.20/box
Wound Dressing (4" diameter)
15 ea./bx., 4 bxs./cs.
($3.27/unit)
ORAL TECHNOLOGY
The Xxxxxxxxxx Patch (6 per $0.75/sleeve
sleeve)
Note: Any volume discounts are based on yearly purchases which
correspond with the specified 12-month period as set forth in Article
5.1 of this Agreement.
