SERVICE AGREEMENT
EXHIBIT
10.2
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Medis-El -
Cell Kinetics Service Ag.
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Execution
Copy
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THIS
SERVICE AGREEMENT (this “Agreement”), effective date
as of July 27, 2007 ("Effective Date"), by and between
MEDIS EL LTD., a company incorporated in Israel (company
no.
1213001), with offices at 0 Xxxxxx Xx. Xxxxxx Xxxx, Xxx 00000, Xxxxxx
(“Medis-El”), MEDIS TECHNOLOGIES LTD., a
corporation incorporated in New York (“Xxx.Xxxx”, and
collectively with Med-El, “Medis”), and CELL KINETICS
LTD., a company incorporated in Israel (company
no. 1213017), with offices at 0 Xxxxxx Xx. Xxxxxx Xxxx, Xxx 00000, Xxxxxx
(“CK”).
W I T N E S S E T H:
WHEREAS,
CK is involved, inter alia, in the development, manufacture, marketing and
sale
of the cell scanning system known as the CellScan (the “CellScan
Business”); and
WHERES,
Medis-El is the controlling shareholder of CK; and
WHEREAS, Xxx.Xxxx
is the parent company of Medis-El; and
WHEREAS,
Xxx.Xxxx and Medis-El wish to provide to CK and CK wishes to obtain from
Xxx.Xxxx and Medis-El certain services as further detailed in this Agreement;
and
WHEREAS, the
parties wish to describe their understanding in connection with the grant of
the
abovementioned services.
NOW,
THEREFORE, the parties agree as follows:
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1.
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SERVICES
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Xxx.Xxxx
and Medis-El jointly undertake to provide CK with the services set forth in
Exhibit 1.
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2.
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CHARGING
AND CONSIDERATION
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2.1. In
consideration for the services to be provided to CK under this Agreement, Medis
shall charge CK with an amount to be calculated by Medis according to the
principles set forth in Exhibit
2.1
2.2. The amounts
which should otherwise have been charged by Xxx.Xxxx to CK according to section
2.1 above, shall be charged by Medis-El, and Medis-El hereby undertakes to
repay
Xxx.Xxxx such amount, either directly or indirectly through
Medis,Inc.
2.3. The
amounts charged by Medis-El to CK pursuant to section 2.1 above and the amounts
charged by Xxx.Xxxx. to CK and assigned to Medis-El pursuant to section 2.2
above, shall be charged to CK’s appropriate asset or expense accounts and shall
be credited as additional contribution to the share capital of CK issued to
Medis.
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Medis-El -
Cell Kinetics Service Ag.
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Execution
Copy
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3.
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TERM
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This
Agreement shall enter into force upon its execution by all parties thereto
and
shall then take effect as of July 27, 2007 and shall remain in force for a
period of 18 months from the closing of the initial rights offering by CK to
Xxx.Xxxx.’s stockholders.
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4.
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GENERAL
PROVISIONS
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4.1. Expenses. Except
as otherwise provided, each party shall bear its respective direct and indirect
expenses incurred in connection with the negotiation, preparation, execution
and
performance of this Agreement and the transaction contemplated
hereby.
4.2. Miscellaneous
Tax Matters. All amounts set forth in this Agreement are
exclusive of tax, which if, applicable, shall be added to such amount by the
payor.
4.3. Notices. All
notices, requests, claims, demands and other communications hereunder shall
be
in writing and shall be given or made (and shall be deemed to have been duly
given or made upon receipt) by delivery in person, by overnight courier service,
by cable, by facsimile, by telegram, by telex or by registered or certified
mail
(postage prepaid, return receipt requested) to the respective parties at the
following addresses (or at such other address for a party as shall be specified
in a notice given in accordance with this Section 4.3):
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if
to the Medis-El:
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Medis
El Ltd.
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0
Xxxxxx Xx. Xxxxxx Xxxx
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Xxx
00000
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Xxxxxx
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Attn:
VP Finance
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Tel:
x000-0-0000000
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Fax:
x000-0-0000000
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0
Xxxxxx Xx. Xxxxxx Xxxx
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Xxx
00000
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Xxxxxx
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Attn:
Chief Executive Officer
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Tel
x000-0-0000000
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Fax
x000-0-0000000
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or
such
other address with respect to a party as such party shall notify each other
party in writing as above provided.
4.4. Headings.
The headings contained in this Agreement are for reference purposes only and
shall not affect in any way the meaning or interpretation of this
Agreement.
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Medis-El -
Cell Kinetics Service Ag.
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Execution
Copy
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4.5. Severability. If
any term or other provision of this Agreement is invalid, illegal or incapable
of being enforced by any applicable law or public policy, all other conditions
and provisions of this Agreement shall nevertheless remain in full force and
effect so long as the economic or legal substance of the transactions
contemplated hereby is not fundamentally changed. Upon such
determination that any term or other provision is invalid, illegal or incapable
of being enforced, the parties hereto shall negotiate in good faith to modify
this Agreement so as to effect the original intent of the parties as closely
as
possible in a mutually acceptable manner in order that the transactions
contemplated hereby be consummated as originally contemplated to the greatest
extent possible.
4.6. Entire
Agreement. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter hereof and
supersedes all prior agreements and undertakings, both written and oral, between
the parties hereto with respect to the subject matter hereof.
4.7. Amendment. This
Agreement may not be amended or modified except by an instrument in writing
signed by the Transferee and the Transferor.
4.8. No
Third-Party Beneficiaries. This Agreement is for the sole benefit
of the parties hereto and their permitted assigns and nothing herein, express
or
implied, is intended to or shall confer upon any other Person or entity any
legal or equitable right, benefit or remedy of any nature whatsoever under
or by
reason of this Agreement.
4.9. Governing
Law. This Agreement shall be governed by, and construed in
accordance with, the Laws of the State of Israel, without regard to the conflict
of laws provisions thereof, and any dispute with respect to this Agreement
or
its execution, biding effect, performance or interpretation shall be adjudicated
solely in the Courts of the District of Tel Aviv, Israel.
4.10. Counterparts. This
Agreement may be executed in one or more counterparts, and by the different
parties hereto in separate counterparts, each of which when executed shall
be
deemed to be an original but all of which taken together shall constitute one
and the same agreement. Delivery of an executed counterpart of a
signature page to this Agreement by telecopier shall be effective as delivery
of
a manually executed counterpart of this Agreement.
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-
signature page follows
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Medis-El -
Cell Kinetics Service Ag.
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Execution
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IN
WITNESS WHEREOF, the Transferor and the Transferee have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
and effective as the Effective Date.
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MEDIS
EL LTD.
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By:
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/s/ Xxxxxx Xxxxxx |
By:
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/s/ Xxxx Xxx-Xxxx | |||
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Name:
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Xxxxxx Xxxxxx |
Name:
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Xxxx Xxx-Xxxx | |||
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Title:
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Senior Vice President |
Title:
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President and CEO | |||
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By:
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By:
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Name:
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Name:
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Title:
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Title:
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MEDIS
TECHNOLOGIES LTD.
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By:
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/s/ Xxxxxx Xxxxxx | |||||
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Name:
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Xxxxxx Xxxxxx | |||||
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Title:
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Senior Vice President | |||||
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Medis-El -
Cell Kinetics Service Ag.
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Execution
Copy
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LIST
OF EXHIBITS
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Exhibit
1
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—
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Services
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Exhibit
2.1
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—
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Principles
for Cost Allocation for Reimbursement
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Medis-El -
Cell Kinetics Service Ag.
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Execution
Copy
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EXHIBIT
1
SERVICES
During
the term of this Agreement, Medisshall provide CK with the following
Services:
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1.
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Finance,
managerial and administrative
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2.
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Purchasing,
All the activity for purchasing supplies and services needed for
regular
activity of CK which is done by the purchasing and supply chain department
of Medis El, including inter alia, issuing of purchase order after
negotiations with suppliers, shipments, warehouse services
etc.
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3.
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Office
and laboratory space, including electricity, telephone fax and internet
connection and use of computer network and maintenance
services.
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4.
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Security.
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5.
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Secretarial
services .
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6.
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Information
technology
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Medis-El -
Cell Kinetics Service Ag.
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Execution
Copy
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EXHIBIT
2.1
COST
CHARGING/ALLOCATION
Cost
items and balance sheet items identified by Medis as specifically related to
the
CellScan Business shall be allocated to CK on a 100% basis.
Cost
items identified by Medis as relevant to the CellScan Business as well as other
businesses operated by Medis (such as occupancy, information technology and
depreciation and amortization) shall be allocated by Medis between Medis and
CK
on proportional basis based on the following guidelines, to be implemented
by
Medis at its sole discretion.
Costs
related to shared services and corporate services, such as management and
administration, stock based compensation, occupancy, accounting, legal,
information technology, foreign currency translation adjustments and the like
shall be allocated to CK on a proportional basis using an allocation base that
would be expected to reasonably reflect the proportion of CK’s incurrence of
such costs.
Costs
categories included in research and development (other than those allocated
on a
100% basis) shall be allocated as follows:
Occupancy
and depreciation and amortization shall be allocated based on relative square
footage.
Information
technology costs shall be allocated based on relative headcount.
Selling,
marketing, general and administrative expenses shall be allocated based on
relative total costs.
