Certain portions of this Exhibit have been omitted pursuant to a request for
confidential treatment. The omitted portions, marked by an * and [ ], have been
submitted to the Commission with the confidential treatment request.
EXHIBIT 99.1
AGREEMENT
This Agreement is made on July 23, 1997 by and between Nidek Co., Ltd.
(hereafter NIDEK) with its business address at 00-00 Xxxxxxx Xxxxxxxxxxx
Xxxxxxxx, Xxxxx 000, Xxxxx and EyeSys Technologies, Inc. (hereafter EYESYS) with
its business address at 0000 Xxxxxx Xxxx, Xxxxxxx, Xxxxx 00000, XXX.
It is the goal of EYESYS and NIDEK to have a mutually profitable relationship
with each of the Agreements below. Therefore, if either party feels the other
is not acting in good faith to maintain these Agreements than upon appropriate
written notification, further negotiation will be anticipated to resolve terms
to mutual satisfaction. Each of the three Agreements (I, II, III) below is
independent from the others with defined terms specific only to their respective
projects.
I. SIMPLE CORNEAL TOPOGRAPHY OEM AGREEMENT
1) EYESYS will exclusively manufacture a simple tabletop corneal topography (CT)
unit under NIDEK'S name as an OEM agreement with NIDEK maintaining exclusive
worldwide distribution rights, including the U.S., for this product. This
product will exclusively use EYESYS software. If necessary to satisfy the
needs of a few specific customers for some custom enhancements, EYESYS will
develop optional accessory software at a reasonable cost in a timely manner
upon a reasonable request from NIDEK. However, under this circumstance, if
optional accessory software development cannot be mutually agreed upon, NIDEK
may have option to develop its own optional accessory software with final
approval of software quality from EYESYS. Additionally in this case, EYESYS
will disclose necessary information to NIDEK to interface NIDEK'S own
software with EYESYS software. The term of this Agreement will be for six
years after the date of first production delivery. As conditions to this
Agreement NIDEK and EYESYS agree to the following:
[*]
EYESYS will pay for freight, insurance, import duty and customs brokerage
charge for these parts from Japan to Houston in bulk orders. There will be
no charge for the parts themselves.
[*]
[*]
Please refer to the enclosed diagram to envision the product concept.
[*]
- EYESYS agrees to adjusting above prices when there is more than a 10%
fluctuation in the Japanese Yen to U.S. dollar ratio up or down from date
of this Agreement (currently 112Y to $1). EYESYS and NIDEK will split the
additional cost over the 10% level equally due to these fluctuations up or
down.
[*]
- NIDEK will pre-order first 100 units by September 15, 1997. Payment
schedule for this first order with conditions completed will be:
September 15, 1997 $100,000 Completion of product specification
October 25, 1997 $100,000 Delivery of prototype system to AAO
February, 1998 $270,000 Net 30 days after delivery of 100
units and received in accordance
with NIDEK'S incoming inspection
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[*]
7) Additional advanced software packages will be available only through EYESYS
distributors, since unit will have a parallel port to connect to a PC
allowing for full corneal topography software capability to customers.
8) The NIDEK label will be the only name on the external housing and hardware,
but when the unit is turned on both the NIDEK name and EYESYS name will
appear on the color LCD screen and both names will print with the printed
hardcopy outputs.
9) NIDEK will pay EYESYS a payment of $990,000 USD for an exclusive distribution
right for this simple corneal topography unit. The following payment
schedule is mandatory on date stated below unless condition is specified:
July 31, 1997 $100,000
October 25, 1997 $250,000 Upon completion of prototype
January 1, 1998 $250,000 Approval of production model by NIDEK
April 20, 1998 $390,000*
* Payment will be reduced by a penalty of $40,000 for each month the start
of production delivery is delayed following February, 1998 provided such
delay is not attributed to NIDEK.
II. EXCLUSIVE DISTRIBUTION RIGHT FOR COMBINATION AR/CT
1) EYESYS will provide NIDEK with an exclusive distribution right for our
corneal topography design in a Combination Auto-Refractor/Corneal Topography
unit which NIDEK will manufacture and distribute worldwide, including the
U.S. NIDEK agrees to use exclusively EYESYS software for this product. Our
current non-exclusive Agreement dated June 1, 1995 will be considered amended
to include such mutually exclusive terms. The term of this Agreement will be
10 years under the condition that NIDEK will use its best effort in selling
this product over this time.
2) NIDEK will pay for EYESYS software in the Combination AR/CT unit as agreed to
in the LICENSE AGREEMENT dated June, 1, 1995.
3) NIDEK will pay EYESYS a $500,000 USD fee for exclusive distribution right of
this Combination AR/CT unit with payment schedule below:
July 31, 1997 $200,000
August 31, 1997 $300.000
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III. EXCLUSIVE DISTRIBUTION RIGHT FOR HANDHELD CT IN JAPAN AND FRANCE
1) EYESYS provides NIDEK with the exclusive right to sell its new Handheld
Corneal Topography product in Japan and in France. The term of this right
will be for 10 years under condition that NIDEK will use best efforts in
selling this product over this time.
2) NIDEK will pay EYESYS a $300,000 USD fee for this exclusive distribution
right with payment schedule below:
July 31, 1997 $200,000
August 31. 1997 $ 50,000
January 1, 1998 $ 50,000
3) EYESYS will begin delivery of the Handheld CT product to NIDEK by the end of
January, 1998. If EYESYS fails to deliver this product in January, 1998,
then EYESYS will credit NIDEK $12,000 for each month delivery is delayed.
This credit will be applied to NIDEK purchases of the Handheld CT units.
4) EYESYS will pay NIDEK a royalty of 1.5% of net sales of this Handheld CT unit
sold to all other distributors for the first $50,000,000 of sales resulting
in a total royalty amount of $750,000 USD. Royalty payments will be made at
the end of each quarter beginning with December 31, 1997.
GENERAL CONDITIONS
5) Renewals:
Upon completion of the term of each Agreement above between EYESYS and
NIDEK, each Agreement can be renewed taking into account the market
conditions at such time under the similar terms of each current Agreement
with no additional fee of distribution right anticipated.
6) Limitation:
EYESYS intends to provide its own corneal topography products in a manner
that minimizes market interference with the NIDEK products above. EYESYS
will discuss with NIDEK, and vice versa, any new plans to develop corneal
topography products to assure EYESYS' and NIDEK'S mutual approval in
reducing product interference. NIDEK will have sole right to select or
change distributors in all countries, including U.S., for products in
Agreements I and II.
7) Assignment:
If EYESYS is acquired or merges with another company, the surviving
company will assume all rights and obligations of these Agreements.
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8) Other:
Other conditions for each of the above Agreements (I,II, III) will be
subject to the following Articles from the EXCLUSIVE DISTRIBUTOR AGREEMENT
dated June 1, 1995 as specified below:
ARTICLE AGREEMENT
Article 5 (Additional Obligations of NIDEK) I, II, III
Article 6 (Additional Obligations of EYESYS) I (6.2 & 6.3 only) III.
Article 9 (Warranty) I, III
Article 10 (Out of Warranty Repair and Service Support) I, III
Article 11 (Intellectual Property Infringement Indemnity) I, II (software only), III
Article 13 (Proprietary Rights) I, II, III
Article 14 (Trademarks) I, II, III
Article 15 (Limitation of Liability)* I, II, III
Article 16 (Compliance with Laws) I, II, III
Article 17 (Miscellaneous) I, II, III
*Limitation of Liability Article for each respective Agreement (I, II, III)
will be limited to the amount of exclusive distribution right payment
received by EYESYS to the date of any such Liability not to exceed the limits
of $990,000, $500,000 and $300,000, respectively for each of the Agreements
I, II, and III.
In order to execute this Agreement and each of the included Agreements the
authorized representatives of both companies will sign and date below:
___________________________________ ______________________________________
Xxx X. Xxxxx, MD Xxxxx Xxxxx
Chairman, EyeSys Technologies, Inc. President, Nidek Co., Ltd.
___________________________________ ______________________________________
Date Date
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