Exhibit 10.27
SETTLEMENT AGREEMENT
THIS SETTLEMENT AGREEMENT ("Agreement") is made and entered into this 27th
day of March 1997 by and between Intelligent Medical Imaging, Inc. ("IMI") and
Xxxxxxx Corporation ("Xxxxxxx").
WITNESSETH
WHEREAS, IMI and Xxxxxxx entered into a Distribution Agreement, effective
as of August 25, 1995 and amended January 5, 1996 (the "Distribution
Agreement");
WHEREAS, disagreements arose between IMI and Xxxxxxx concerning various
provisions of the Distribution Agreement, the continued enforceability of the
Distribution Agreement and the parties' respective right to relief, if any;
WHEREAS, the parties to the Distribution Agreement submitted their disputes
to arbitration in an action styled Intelligent Medical Imaging, Inc. vs. Xxxxxxx
Corporation before the American Arbitration Association, Case No.: 00-000-00000
96 KMG (the "Action");
WHEREAS, each party has contested, and continues to contest, the
allegations and assertions made by the other, and neither party has admitted any
liability or wrongdoing with respect to any allegations asserted in the Action;
WHEREAS, sharply contested issues of both law and fact exist and, absent
this Agreement, the parties would have vigorously litigated all such issues in
the Action;
WHEREAS, the costs associated with litigating these contested issues will
be substantial, time-consuming and disruptive of the parties' ongoing respective
activities and businesses;
WHEREAS, the parties hereto agree that, in order to avoid the costs,
disruption and uncertainty associated with such additional litigation and/or
appeals, it would be advantageous to settle the Action on the terms and
conditions set forth herein;
NOW, THEREFORE, for and in consideration of the mutual covenants set forth
herein and other good and valuable consideration the receipt and sufficiency of
which are hereby
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acknowledged, the parties hereto agree as follows:
1. RECITALS. The above recitals are true and correct and are incorporated
herein by this reference.
2. TERMINATION OF THE DISTRIBUTION AGREEMENT. The parties acknowledge that
there is a dispute as to the effective date of termination of the Distribution
Agreement. For purposes of this Agreement, the Distribution Agreement shall be
deemed terminated as of the close of business on March 27, 1997. In connection
with said termination, the parties agree to the following:
A.) STIPULATION OF DISMISSAL AND RELEASES. Upon the execution of this
Agreement, the parties shall execute and exchange a joint stipulation of
dismissal with prejudice of the Action in the form attached hereto as Exhibit A,
and releases in the forms annexed hereto as Exhibits B and C.
B.) COVENANTS. The mutual covenants relating to intellectual property,
warranty, indemnity and liability set forth on Schedule I attached hereto are
incorporated herein by eference and shall apply to activities and
relations of the parties prior to the date of this Settlement Agreement and
thereafter.
C.) SETTLEMENT COSTS.
(i)IMI will pay [ * ] as reimbursement for certain of Xxxxxxx'x
costs and expenses incurred in the sale and marketing the Micro21 system and in
exchange for the return of 26 of Xxxxxxx'x used inventory of MICRO21 systems and
parts, all of which shall be in good condition, reasonable wear and tear
excepted, and shipped at Xxxxxxx'x expense FOB to IMI's warehouse facility in
Palm Beach Gardens, Florida. In addition, IMI will pay Xxxxxxx [ * ] for
assignment of four (4) certain customer contracts to IMI. Xxxxxxx will deliver
substantially all of its inventory of Micro21 systems and parts or transfer
title of any of such systems placed with customers for evaluation (and assign
any evaluation contracts or purchase orders), within 30 days of this Agreement,
and the balance of such systems will be delivered promptly thereafter. In
addition, spare parts and equipment previously purchased by Xxxxxxx from IMI
will be returned to IMI and Xxxxxxx will be reimbursed for such parts and
equipment at original price paid for by Xxxxxxx. Payments by IMI of amounts due
Xxxxxxx hereunder shall be due as follows: thirty days from the date of this
Agreement - 50%; and sixty days from the date of this Agreement - 50%.
(ii) Xxxxxxx will promptly purchase from IMI [ * ] current
model MICRO21 systems to replace such systems in Japan at a purchase price of
[ * ] and Xxxxxxx will arrange for pick up from IMI and payment of all shipping
costs (i.e. FOB at IMI).
(iii) IMI's obligation to pay Xxxxxxx for the four (4) systems
sold by Xxxxxxx to four customers in the U.S. is subject to the approval by each
customer to the assignment from Xxxxxxx to IMI of all applicable customer
contracts, leases, and finance agreements. The customer must approve assignment
to IMI of the customers' remaining obligations to Xxxxxxx, with a novation in
favor of Xxxxxxx, and assumption by IMI of Xxxxxxx'x remaining obligations to
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the customers. For each customer contract transferred pursuant to this section,
Xxxxxxx will be entitled to pro-rata proceeds through March 31, 1997 and IMI
will be entitled to pro-rata proceeds after March 31, 1997, as set forth on
Schedule II attached hereto. In the event any of such customers will not approve
of such assignment, then Xxxxxxx will retain the relationship with the customers
and IMI will not purchase such customer contracts from Xxxxxxx.
(iv) With respect to the MICRO21 system installed for
evaluation at Xxxx Israel Hospital in New York, Xxxxxxx and IMI representatives
will approach the customer, explain that the Action has been resolved and
determine whether the customer would prefer to purchase a MICRO21 system from
IMI or from Xxxxxxx. In the event the customer wants to purchase the MICRO21
system from IMI, IMI will be free to sell the system at a price to be determined
by IMI and the customer and to pursue the relationship without Xxxxxxx'x
involvement. In the event the customer wants to purchase the MICRO21 system from
Xxxxxxx, IMI agrees to sell a MICRO21 system to Xxxxxxx at a one time special
discounted transfer price of [ * ]. If Xxxxxxx is required to provide a Mircro21
system to Xxxx Israel under a previously negotiated agreement between Xxxxxxx
and Xxxx Israel, the transfer price from IMI to Xxxxxxx shall be [ * ].
(v) It is understood that the [ * ] MICRO21 systems sold in the
first quarter of 1997 by IMI to Xxxxxxx XX Japan for placement in Japan, outside
of the terms of the Distribution Agreement, will not be repurchased by IMI and
the customers purchasing such systems in Japan will be serviced by Xxxxxxx XX
Japan.
(vi) IMI and Xxxxxxx shall immediately reconcile all accounts
receivable and other payments due from Xxxxxxx to IMI or from IMI to Xxxxxxx
(including amounts under section 2(B)(iii) as promptly as possible) for
expenses, reimbursements, inventory or equipment and such adjustments shall be
made to the amount of any payments due from IMI to Xxxxxxx under this Section
2(C).
D.) CUSTOMER SERVICE OBLIGATIONS
(i) Subject to customer approval, IMI will assume responsibility for
customer service and support for MICRO21 systems sold and placed in the U.S. and
for MICRO21 systems sold by IMI directly or through distributors other than
Xxxxxxx or Xxxxxxx XX Japan, or any other Xxxxxxx affiliate, in any foreign
country. Xxxxxxx shall retain responsibility for customer service and support
for MICRO21 systems purchased by Xxxxxxx and sold by Xxxxxxx or its affiliates
to foreign customers, such as the customers of Xxxxxxx XX Japan in Japan.
(ii) Subject to IMI's consent and approval which shall not be
unreasonably withheld, with respect to foreign customer accounts of Xxxxxxx, IMI
will provide spare parts on consignment to Xxxxxxx in accordance with IMI's
normal and customary commercial practices and
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IMI will provide technical support, including software and applications support
for the installed MICRO21 systems and for new procedures subsequently purchased
from IMI. This arrangement shall continue until Xxxxxxx and IMI agree to other
arrangements. Spare parts will be sold by IMI to Xxxxxxx at [ * ]. Initial in
field (at a customer's location) technical support will be provided by IMI to
Xxxxxxx at IMI's cost which shall include non-burdened labor, travel, room,
board and miscellaneous out-of-pocket expenses. Initial training at IMI's
facilities shall be at no cost. It is understood that IMI does not have an
international network of technical support personnel and that most of such
support is anticipated to be provided via telephone at a reasonable level at no
charge.
(iii) IMI will sell new procedures for the Micro21 system to
Xxxxxxx at IMI's average end-user prices less discounts ranging from [ * ]% to
[ * ]% based on volume.
(iv) Subject to Xxxxxxx'x consent and approval which shall not
be unreasonably withheld, in the event IMI or any customer of IMI or any
customer of Xxxxxxx desires to engage Xxxxxxx for service and support in
connection with the MICRO21 system, then IMI will subcontract with Xxxxxxx for
the provision of hardware and installation support services at a price
equivalent to [ * ]% off of Xxxxxxx'x published service price for such support.
IMI will provide Xxxxxxx with necessary spare parts on consignment in amounts in
accordance with IMI's normal and customary commercial practices. Spare parts
will be sold by IMI to Xxxxxxx at [ * ].
(v) IMI will provide customer training and neural net training for
nonstandard customer stains at Xxxxxxx'x request at IMI's facility at IMI's
normal and customary prices.
(vi) Any of the foregoing service arrangements will be documented
in separate agreements acceptable to IMI, Xxxxxxx and the customers, including
customary and commercially reasonable provisions and such arrangements will
continue until otherwise agreed by the parties.
E.) NONEXCLUSIVE DISTRIBUTION RIGHTS AND "MOST FAVORED DISTRIBUTOR"
RELATIONSHIP.
It is agreed that Xxxxxxx may purchase MICRO21 systems from IMI at prices
and volumes to be set and agreed to by IMI, in its sole discretion, (other than
those volumes and prices specifically agreed to in this Agreement) for placement
with customers worldwide. In addition, to the extent and for so long as IMI
sells the MICRO21 system through distributors other than Xxxxxxx for resale or
lease to end users, then Xxxxxxx shall have the following rights as a "most
favored distributor," as described in paragraph 2(E)(i) below:
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(i) Xxxxxxx shall have the right to purchase MICRO21 systems from
IMI on the same terms such systems are sold by IMI to other distributors on a
country by country basis, including and subject to all of the conditions of such
sale transactions such as price, discounts, and quantity. For example, if IMI
sells [ * ] MICRO21 systems under terms requiring the purchase of a minimum of
[ * ] MICRO21 systems within one year to a distributor for placement in Spain
at a transfer price of [ * ] per system, then Xxxxxxx will have an opportunity
to purchase the same minimum number of systems (and no less) within one year at
the transfer price of [ * ] per system for placement in Spain. As another
example, if IMI sells a limited number of MICRO21 systems to a distributor at a
special discount price for the purpose of "seeding" a market, e.g. [ * ] systems
for [ * ] each to a distributor for placement in Germany, then Xxxxxxx may also
purchase [ * ] systems for [ * ] each for placement in Germany. At Xxxxxxx'x
request, IMI will provide to Xxxxxxx reasonable verification of their
arrangements with third party distributors on a territory by territory basis. An
example of an acceptable method of verification may include use of IMI's outside
independent auditors to provide such verification.
(ii) The foregoing "most favored distributor" right shall
terminate in the event IMI terminates the sale and marketing of MICRO21 systems
through distributors other than Xxxxxxx, but shall be reinstated in the event
IMI recommences sales and marketing of the MICRO21 system through other
distributors. Notwithstanding the foregoing, the "most favored distributor"
right shall terminate and shall not be subject to reinstatement in the event of
a sale of all or substantially all of the stock or assets of IMI, or a merger,
consolidation, or reorganization of IMI involving a change in control of IMI
(collectively a "Change in Control Transaction"). However, at this time no such
change of control transaction is under negotiation.
(iii) If a Change in Control Transaction closes within three
years of the date of this Agreement, then (in addition to Xxxxxxx'x rights under
section 2(F) below) Xxxxxxx may purchase the following number of then current
base MICRO21 systems configured for WBC Diff procedure only for a discount
transfer price of [ * ] per system:
CLOSING DATE OF CHANGE IN CONTROL TRANSACTION NUMBER OF SYSTEMS PURCHASABLE
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within year 1 [ * ] systems
within year 2 [ * ] systems
within year 3 [ * ] systems
F.) LIMITED DISCOUNT TRANSFER PRICE TO XXXXXXX FOR UP TO TWENTY ONE
SYSTEMS.
IMI agrees to sell to Xxxxxxx up to (but no more than) twenty-one (21)
MICRO21
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systems, (IMI's then current base Micro21 system at the time of purchase
configured for WBC Diff procedure only), for a discount transfer price of [ * ]
per system, for placement by Xxxxxxx only with end user customers located in
foreign countries outside the U.S. This limited discount transfer price shall
apply only to MICRO21 systems, if purchased, for sale and installation outside
the U.S., and shall in any event expire three years from the date of this
Settlement Agreement. However, Xxxxxxx shall be under no obligation to purchase
and/or sell any of the twenty-one (21) MICRO21 systems referred to herein.
G.) USE OF NAMES OF XXXXXXX AND IMI. IMI agrees that it will not use
Xxxxxxx'x name or the fact of Xxxxxxx'x prior association with IMI as its
exclusive distributor of the MICRO21 system in any of its present or future
marketing. Any sales by Xxxxxxx of the MICRO21 systems shall be under the IMI
trademark and trade name.
H.)PUBLIC ANNOUNCEMENTS AND DISCLOSURES. IMI and Xxxxxxx shall mutually
agree upon the wording of any public announcement, press release or public
statement relating to this Settlement Agreement, it being understood that
neither party desires disclosure of any of the special limited discount transfer
prices granted by IMI to Xxxxxxx as part of this Settlement Agreement, and
provided that IMI must comply with public disclosure obligations required under
securities laws and regulations.
I.) SOFTWARE LICENSE AGREEMENT. IMI and Xxxxxxx will promptly finalize and
execute a Software License Agreement, on terms mutually acceptable, providing
for acknowledgment of IMI's sole proprietary interest and right and title to the
software developed and utilized by IMI in connection with the MICRO21 system and
the licensing of such software (at no additional compensation) by IMI to
Xxxxxxx solely for purposes of Xxxxxxx'x resales or lease of MICRO21 systems.
The Software License Agreement will provide for the terms of shrink-wrap
software licenses from IMI, or Xxxxxxx pursuant to a sublicense, to the
customers who purchase or lease a MICRO21 system.
3. NON-DISPARAGEMENT. The parties shall refrain from making any written or
oral statement or taking any action, directly or indirectly, which they know or
reasonably should know to be disparaging or negative concerning the other. The
parties also shall refrain from suggesting to anyone that any written or oral
statements be made which they know or reasonably should know to be disparaging
or negative concerning the other, or from urging or influencing any person to
make any such statements. However, this section shall not apply to any judicial,
self regulatory organization, arbitral or administrative proceeding in which IMI
or Xxxxxxx is a party or has been subpoenaed to testify under oath.
4. CORPORATE AUTHORIZATION. It is a material and essential condition of
this Agreement that each party represents that their respective undersigned
officer has the requisite corporate
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authority to enter into this Agreement.
5. LIMITATIONS ON USE AND SCOPE OF SETTLEMENT AGREEMENT. If for any reason
this Agreement does not become final, this entire document and anything said or
done as part of the negotiations leading thereto, shall be null and void and
shall not be used or admitted in any action or proceeding for any purpose
whatsoever. However, it is an express condition of this Agreement that the
provisions of paragraph 6 shall survive the withdrawal, expiration or
termination of this Agreement and shall remain binding.
6. INADMISSIBILITY AND NO COLLATERAL ESTOPPEL EFFECT OF THIS SETTLEMENT
AGREEMENT. Neither this Agreement, whether or not approved by the parties, nor
any document referred to herein nor any action taken to carry out this
Agreement: (a) shall be construed as or deemed to be evidence of any
presumption, inference, concession or admission by either party (or any past or
present officer, director, employee or agent thereof) on any point of fact or
law, or of any liability, fault, omission or other wrongful act whatsoever; (b)
shall be offered or received as evidence in any litigation or proceeding
whatsoever of any presumption, inference, concession or admission of any
liability, fault, omission or wrongdoing by either party (or any past and
present officer, director, employee or agent thereof); or (c) shall be offered
or received as evidence in any action or proceeding whatsoever other than such
proceedings by the parties hereto as may be necessary to enforce the provisions
of this Agreement.
7. ENTIRE AGREEMENT. This Agreement represents the entire understanding as
of the date of execution hereof between the parties with respect to the subject
matter hereof, and no rights, duties or obligations shall be implied except as
provided herein. No modification, alteration, waiver or change in any of the
terms of this Agreement shall be valid or binding upon the parties hereto unless
made in writing and duly executed by each of the parties hereto. The parties
also acknowledge and stipulate that the compromise and settlement which forms
the basis of this Agreement has been arrived at after thorough bargaining and
negotiation, consultation with legal counsel of their own choice, and that this
Agreement represents a fair, final and mutually agreeable compromise of the
matters provided herein. Each party further acknowledges that if it may
hereafter discover facts in addition to or different from those which it now
knows or believes to be true with respect to the matters encompassed by this
Agreement, it is the intention of each party to, and each party does hereby,
fully, finally and forever settle the matters provided by this Agreement,
notwithstanding the discovery or existence of any such additional facts.
8. FURTHER ASSURANCES. In the event other acts or documents are required to
fully effectuate the terms, conditions and obligations described herein, then in
that event, the parties shall perform any lawful additional acts and make,
execute and deliver or cause to be made, executed and delivered (and, where
appropriate, shall cause to be recorded or filed) any and all such further
documents or instruments necessary or desirable to complete or perfect the
terms,
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conditions or obligations herein.
9. GOVERNING LAW. This Agreement shall be governed by and interpreted
in accordance with the laws of the State of Florida without regard to
conflicts of laws provisions.
10. CONSTRUCTION. Any controversy regarding the construction of this
Agreement shall be decided neutrally, in light of its conciliatory purpose, and
without regard to the events of authorship or negotiation. The determination of
the terms of, and the drafting of, this Agreement has been by mutual agreement
after negotiation, with consideration by, and participation of all parties
hereto and consultation with their counsel.
11. AGREEMENT TO ARBITRATE. The parties hereby knowingly, voluntarily and
intentionally waive any right which they may have to trial by jury in respect to
any litigation based hereon (including, but not limited to, any claims,
counterclaims, crossclaims and third-party claims), or arising out of, under, or
in connection with this Agreement or the parties' performance hereunder
(including, without limitation, any action to rescind or cancel this Agreement
and any claims or defenses asserting that this Agreement was fraudulently
induced or is otherwise void or voidable). In the event of any dispute relating
to or arising out of, under or in connection with this Agreement, Xxxxxxx and
IMI shall meet promptly to discuss the matter in good faith. Any dispute that
cannot be resolved in the above fashion within thirty (30) days after the
dispute was raised, shall be submitted to binding arbitration before a panel of
three (3) arbitrators, one of whom shall be chosen by Xxxxxxx, another of whom
shall be selected by IMI, and the third of whom shall be chosen by the two
arbitrators already selected. The panel shall convene in Miami, Florida and
shall otherwise observe the Commercial Arbitration Rules of the American
Arbitration Association then in effect. The parties shall take all reasonable
measures to expedite this arbitration process. The decision of the panel shall
be binding and may be enforced by any court having competent jurisdiction
thereof. The parties hereby agree that jurisdiction for enforcement of any
decision of the arbitration panel shall lie in the Circuit Court for Dade County
or in the U.S. District Court for the Southern District in the event the dispute
qualifies for federal jurisdiction.
12. ATTORNEY'S FEES. In the event that arbitration is commenced regarding
this Agreement, the prevailing party shall be entitled to recover attorneys'
fees and costs from the other party, including attorneys' fees and costs
incurred in connection with the enforcement or challenge to any arbitral award.
13. NO DURESS. The parties to this Agreement acknowledge, represent and
warrant that they signed this Agreement only after due consideration and with
the opportunity to consult with counsel of their own choice; that they were not
fraudulently induced, coerced or intimidated to sign this Agreement; and that in
signing this Agreement they have not relied upon any oral or
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written statement or acts made by any person other than those expressly set
forth in this Agreement.
14. SEVERABILITY. Should any part of this Agreement be held unenforceable
or in conflict with the applicable laws or regulations of any jurisdiction, the
invalid or unenforceable part or provision shall be replaced with a provision
which accomplishes, to the extent possible, the original business purpose of
such part or provision in a valid and enforceable manner, and the remainder of
this Agreement shall remain binding upon the parties.
15. NOTICES. Any notices required or permitted by the Agreement or given in
connection herewith, shall be in writing and shall be made by certified mail
return receipt requested or by overnight carrier, addressed to the party to be
notified, at the address listed below. Notices sent in such manner shall be
deemed as received on the next business day after timely mailing (by overnight
carrier) or five (5) business days after date of posting (by certified mail
return receipt requested) to the following addresses:
Xxxxxxx Corporation
Attn: Senior Vice President
00000 X.X. 000xx Xxxxxx
Xxxxx, Xxxxxxx 00000-0000
cc: Corporate Counsel (same address which shall not constitute notice)
Intelligent Medical Imaging, Inc.
Attn: Xxxx Xxxxxxxxxx
0000 Xxxxx Xxxx Xxxxxxxxx, Xxxxx 000
Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000
cc: Corporate Counsel (which shall not constitute notice)
Attn: Xxxx Xxxx, Esq. Xxxxx X. Xxxxx, Esq.
Xxxxxxx & Xxxxx Xxxxx & Xxxxxx, P.A.
000 Xxxxx Xxxx Xxx 0000 Xxxxxxxxxxxxx Xxxxx
Xxxx Xxxxx, Xxxxxxx 00000-0000 000 X.X. 0xx Xxxxxx
Xxxxx, Xxxxxxx 00000
16. COUNTERPARTS. This Agreement may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered shall be an
original, but all such counterparts shall together constitute but one and the
same instrument.
IN WITNESS WHEREOF this Agreement is made and entered into as of March 27,
1997.
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Xxxxxxx Corporation
By: /s/Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx
Title: Senior Vice President
Intelligent Medical Imaging, Inc.
By: /s/Xxxx Xxxxxxxxxx
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Xxxx Xxxxxxxxxx
Title: President
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SCHEDULE I
TO
SETTLEMENT AGREEMENT
INTELLECTUAL PROPERTY
1.0 OWNERSHIP OF INTELLECTUAL PROPERTY RIGHTS. IMI represents and warrants
to Xxxxxxx that IMI owns all rights relating to the Micro21 system, including,
without limitation the hardware design, including electrical and mechanical,
software, ideas, drawings, source code, data, patents pending, patentable rights
or inventions. All modifications, enhancements, improvements, new
applications or procedures, and ideas, techniques, concepts, or designs for the
Micro21 system and such modifications, enhancements, improvements,
new applications or procedures, including any new products and any new micro21
procedures, shall remain the property of IMI. Xxxxxxx will not acquire any
rights to any of the foregoing, by evidence of development efforts or funding or
otherwise, without the prior written agreement of IMI which shall not
unreasonably withheld with respect to proposed development efforts.
1.1 LICENSE OF SOFTWARE AND TECHNOLOGY. IMI will xxxxx Xxxxxxx a limited
license to use of the Micro21 system's software and technology and the right to
sub-license such software and technology to end-user's for use with the Micro21
system . This license will be documented in a separate Software License
Agreement acceptable to IMI and Xxxxxxx.
1.2 PROTECTION OF INTELLECTUAL PROPERTY RIGHTS. If a third party violates
IMI's intellectual property rights, IMI must resolve the problem at its own cos
and expense.
1.3 INFRINGEMENT CLAIM BY A THIRD PARTY. IMI shall protect, defend and
indemnify Xxxxxxx from and against any claim, suit or other action by a third
party alleging that IMI products sold to Xxxxxxx infringed such third party's
intellectual property right(s) at IMI's sole cost and expense; except that
Xxxxxxx shall bear proportionate responsibility for any infringement caused by
actions or omissions of Xxxxxxx.
If Xxxxxxx is prevented from selling the Micro21 system because of such
alleged infringement, Xxxxxxx shall not have recourse against IMI for
indemnificaton or reimbursement as a result of Xxxxxxx no longer selling the
Micro21 system.
1.4 TRADEMARK LICENSE. IMI hereby grants to Xxxxxxx the right to use IMI's
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trade name and trademark in connection with the sale of the Micro21 system.
1.5 PROTECTION OF PROPRIETARY INFORMATION. Both Xxxxxxx and IMI will
protect the confidentiality of product information, technical know-how and other
information concerning corporate business management which was obtained through
the Distribution Agreement or which is obtained through any continuation of the
non-exclusive relationship between IMI and Xxxxxxx after the date of this
Settlement Agreement. Neither party will share any such proprietary information
with any third party.
WARRANTY; INDEMNITY; LIABILITY
2.0 PRODUCT WARRANTY. IMI warrants that all Micro21 systems sold to Xxxxxxx
will be free from defects in materials and workmanship at the time of the
installation and for one (1) year thereafter, subject to normal installation and
operation.
2.1 WARRANTY ACTION. If a defect in material or workmanship is found and
IMI receives prompt notice, IMI shall at its cost, settle the defect either by
repairing the defective part at IMI's facility or, at its option, by sending a
replacement part. To the extent permitted by law, IMI assigns any warrants and
indemnities from IMI's component vendors to Xxxxxxx. Xxxxxxx may convey the
foregoing IMI warranty to the Micro21 system end users. Xxxxxxx shall in any
event convey the warranty disclaimers set forth in Section 2.2 and 2.3 to the
Micro21 system end users and to any Xxxxxxx third party distributor or
sub-dealer.
2.2 NO OTHER WARRANTIES. The Warranty and the remedy provided for in
section 2.1 above supersede and are in lieu of all other warranties or
conditions, expressed or implied, and all other obligations or liabilities of
IMI, including any warranty of merchantability and fitness for a particular
purpose. Xxxxxxx is not authorized to make any warranties on behalf of or in the
name of IMI or to assume for IMI any other liability in connection with the
Micro21 system or procedures. IMI makes no representations or warranties as to
performance of products or as to service to Xxxxxxx or to any other person,
except as set forth above.
2.3 LIMITATION ON LIABILITY. With regard to sale or use of the Micro21
system, in no event shall IMI be liable for any indirect, incidental,
consequential, or special damages, including lost profits, sustained or incurred
in connection with the Micro21 system, or caused by defects in the Micro21
system, regardless
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of the form of action, whether in contract, tort (including, without limitation,
negligence and strict liability), or otherwise, and whether or not such damages
were unforeseen.
2.4 RECIPROCAL LIMITATION ON LIABILITY. Xxxxxxx and IMI may be liable to
each other for damages resulting from a breach of the obligations of such party
under Sections 2.0 and 2.1, including reasonable attorney fees and costs;
provided that in no event will Xxxxxxx or IMI be liable to the other for any
indirect, incidental, consequential or special damages, including lost profits,
as a result of a breach of such obligations.
2.5 LIABILITY TO THIRD PARTY. If a Micro21 system causes injury to person
or property and such injury results from design or manufacture of the Micro21
system, IMI shall assume the responsibility for such injury. IMI will purchase
and maintain product liability insurance sufficient to cover potential
compensation for injuries to life, health or damage to the property of a third
party in the minimum amount of $5,000,000. IMI will provide Xxxxxxx with a
certificate of insurance evidencing such coverage and naming Xxxxxxx as
additional insured party as its interest may appear. If injury to person or
property results from the intentional or negligent acts or omissions of Xxxxxxx
or its employees, contractors, agents or representatives, Xxxxxxx shall assume
the responsibility for such injury. Xxxxxxx will purchase and maintain
appropriate liability insurance relating to its activities in product support,
servicing, training, installation, maintenance, sales and other services,
sufficient to cover potential compensation for injuries for life, health or
damage to the property of a third party. Xxxxxxx will provide IMI with a
certificate of insurance evidencing such coverage and naming IMI as additional
insured party as its interest may appear.
PRODUCT QUALITY ASSURANCE
3.0 FDA COMPLIANCE REPRESENTATION. The Micro21 system and/or procedures is
hereby guaranteed as of the date of shipment or delivery, to be, on such date,
not adulterated or misbranded within the meaning of the Federal Food Drug and
Cosmetic Act, and not an article which may not, under the provisions of Section
5.10(k) or 515 of the act be introduced into interstate commerce.
3.1 PRODUCT QUALITY CONTROL AND MANAGEMENT. IMI will manufacture, manage
quality, and ship Micro21 systems according to GMPs for medical devices in
effect at the time the Micro21 system was manufactured. In addition, IMI's
manufacturing facility shall be equipped with a quality assurance system,
product
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standard documentation, product quality standard documentation, documented work
procedure instruction, work operations record file, and other procedures
required under GMP and other applicable regulations. Responsibility for FDA
compliance, if applicable, is with IMI.
3.2 PRODUCT RECALL AND ITS COSTS. If there is a concern for possible loss
or injury to the life, health, and property of a third party due to a cause
attributable to the Micro21 system, users will be informed of the situation
promptly and necessary action will be taken after consultation with IMI. Xxxxxxx
shall effect any recall using the same procedures it employs for its own
products. IMI will be responsible for the expense of such action unless the
recall is necessary because of actions or omissions of Xxxxxxx, its sub-dealers,
or third party distributors.
-------------------
* Denotes confidential material omitted and filed separately with Securities
and Exchange Commission.
SCHEDULE II
XXXXXXX LEASING CORPORATION
MICRO 21 ACTIVE CUSTOMER CONTRACTS
March 27, 1997
Customer & Months & Amount Credit to
START DATE PAYMENTS PAID/THRU IMI (XXXXXXX)
---------- ---------- ------------ --------------
Baystate [ * ] [ * ] [ * ]
July 1996 [ * ] Feb 1997
[ * ]
[ * ]
Emory [ * ] [ * ] [ * ]
Oct 1996 [ * ] Mar 1997
[ * ]
[ * ]
Tulane [ * ] [ * ] [ * ]
June 1996 [ * ] Mar 1997
UTMB [ * ] [ * ] [ * ]
June 1996 [ * ] Mar 1997
-------- ------
TOTAL [ * ] [ * ]
Net [ * ] (Amount Paid less Net Credit
to IMI of [ * ])
---------------
* Denotes confidential material omitted and filed separately with Securities
and Exchange Commission.
Exhibit A
JOINT STIPULATION OF DISMISSAL WITH PREJUDICE
AMERICAN ARBITRATION ASSOCIATION
AAA CASE NO. 32 181 00400 96 KMG
IN RE: THE MATTER OF:
Intelligent Medical
Imaging, Inc.,
Claimant,
and
Xxxxxxx Corporation,
Respondent.
--------------------------/
STIPULATION FOR VOLUNTARY DISMISSAL WITH PREJUDICE
Claimant Intelligent Medical Imaging, Inc. ("IMI") and respondent Xxxxxxx
Corporation ("Xxxxxxx"), by and through their undersigned counsel, hereby
stipulate to the dismissal with prejudice of all claims asserted, or that could
be asserted, by claimant against respondent, and all claims asserted, or that
could be asserted, by respondent against claimant in this proceeding, with
claimant and respondent to pay their respective costs and attorneys fees
incurred herein.
SO STIPULATED:
Attorneys for Claimant Intelligent Medical Imaging, Inc.
-----------------
* Denotes confidential material omitted and filed separately with Securities
and Exchange Commission.
XXXXX & XXXXXX, P.A.
Dated: March ____, 1997 By:
XXXXX X. XXXXX
0000 Xxxxxxxxxxxxx Xxxxx
000 X.X. Xxxxxx Xxxxxx
Xxxxx, Xxxxxxx 00000
(000) 000-0000
XXXXXXX & XXXXXX
By:
XXXX X. XXXX
XXXX X. XXXXXXXXX
000 Xxxxx Xxxx Xxx
Xxxx Xxxxx, Xxxxxxx 00000
(000) 000-0000
ATTORNEYS FOR RESPONDENT XXXXXXX CORPORATION
XXXXXXX XXXXX XXXX XXXXXXXXX XXXXXXXX
& XXXXXXXXXXX, P.A.
Dated: March ____, 1997 By:
XXXX X. XXXXX
Xxxxx Xxxxxx - 00xx Xxxxx
000 Xxxxx Xxxxxxxx Xxxxxxxxx
Xxxxx, Xxxxxxx 00000
(000)000-0000
--------------
* Denotes confidential material omitted and filed separately with Securities
and Exchange Commission.
Exhibit B
RELEASE BY XXXXXXX CORPORATION
RELEASE
KNOW ALL PERSONS BY THESE PRESENTS:
That Xxxxxxx Corporation ("first party"), for and in consideration of the
sum of TEN AND/NO DOLLARS ($10.00), or other valuable considerations, including
but not limited to the execution of a general release of and from all liability,
received from or on behalf of Intelligent Medical Imaging, Inc. ("second
party"), the receipt whereof is hereby acknowledged, do
HEREBY remise, release, acquit, satisfy, and forever discharge the said
second party and its agents and attorneys, and past and present officers,
directors and employees, of and from all, and all manner of action and actions,
cause and causes of action, suits, debts, dues, sums of money, accounts,
reckonings, bonds, bills, specialties, covenants, contracts, controversies,
agreements, promises, variances, trespasses, damages, judgments, executions,
claims and demands whatsoever, whether known or unknown, liquidated or
unliquidated, fixed or contingent, both in law or in equity, which said first
party ever had, now have, or which any successor, assign, parent or subsidiary
of said first party, hereafter can, shall or may have, against said second party
or their agents or attorneys, and past and present officers, directors and
employees for, upon or by reason of any matter, cause or thing whatsoever
whether known or unknown, from the beginning of the world to the day of these
presents; provided, however, that such release excludes any and all rights and
obligations of the first party pursuant to that Settlement Agreement between
Intelligent Medical Imaging, Inc. and Xxxxxxx Corporation dated as of March 27,
1997. (Wherever used above the terms "first party" and "second party" shall
include singular and plural, heirs, legal representatives, and assigns of
individuals, and the successors, assigns, parents and subsidiaries of
corporations, wherever the context so admits or requires.)
Without limitation to the foregoing this Release specifically operates
to release Intelligent Medical Imaging, Inc. of any and all claims
which Xxxxxxx Corporation brought or could have brought in the action
entitled Intelligent Medical Imaging, Inc. vs. Xxxxxxx Corporation
before the American Arbitration Association, Case No.:
00-000-00000 96 KMG.
The first party hereby expressly acknowledges, warrants and represents that (i)
this Release was
---------------
* Denotes confidential material omitted and filed separately with Securities
and Exchange Commission.
signed only after due consideration and consultation with its attorney; (ii)
said first party was not fraudulently induced, coerced or intimidated to sign
this release: (iii) no promise, representation, inducement, agreement or
warranty other than those specifically set forth in the contemporaneously
executed Settlement Agreement has been made or relied upon by the parties in
executing this release; and (iv) this Release is the result of a compromise of
disputed claims and shall never at any time for any purpose be considered as an
admission of liability or responsibility of the parties hereby released, who
continue to deny such liability and to disclaim such responsibility. In signing
this Release the first party has not relied upon any oral statements or acts
made by the second party, or their attorneys or agents.
-------------
* Denotes confidential material omitted and filed separately with Securities
and Exchange Commission.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this ________ day
of __________ , A.D., 1997.
Signed, sealed and delivered
in presence of:
XXXXXXX CORPORATION
_________________ BY: Xxxxx Xxxxxx
_________________ AS: _________________
STATE OF FLORIDA)
COUNTY OF DADE)
I HEREBY CERTIFY that on this day, before me, an officer duly authorized in
the County aforesaid and in the State aforesaid to take acknowledgments,
personally appeared Xxxxx Xxxxxx as ___________ of Xxxxxxx Corporation, to me
known to be the person described in and who executed the foregoing instrument
and he acknowledged before me that he executed the same.
WITNESS my hand and official seal in the County and State last aforesaid
this ___________ day of___________ , A.D., 1997.
NOTARY PUBLIC
State of Florida
My Commission Expires:
--------------
* Denotes confidential material omitted and filed separately with Securities
and Exchange Commission.
Exhibit C
RELEASE BY INTELLIGENT MEDICAL IMAGING, INC.
RELEASE
KNOW ALL PERSONS BY THESE PRESENTS:
That Intelligent Medical Imaging, Inc. ("first party"), for and in
consideration of the sum of TEN AND/NO DOLLARS ($10.00), or other valuable
considerations, including but not limited to the execution of a general release
of and from all liability, received from or on behalf of Xxxxxxx Corporation,
("second party"), the receipt whereof is hereby acknowledged, do
HEREBY remise, release, acquit, satisfy, and forever discharge the said
second party and its agents and attorneys, and past and present officers,
directors and employees, of and from all, and all manner of action and actions,
cause and causes of action, suits, debts, dues, sums of money, accounts,
reckonings, bonds, bills, specialties, covenants, contracts, controversies,
agreements, promises, variances, trespasses, damages, judgments, executions,
claims and demands whatsoever, whether known or unknown, liquidated or
unliquidated, fixed or contingent, both in law or in equity, which said first
party ever had, now have, or which any successor, assign, parent or subsidiary
of said first party, hereafter can, shall or may have, against said second party
or their agents or attorneys, and past and present officers, directors and
employees for, upon or by reason of any matter, cause or thing whatsoever
whether known or unknown, from the beginning of the world to the day of these
presents; provided, however, that such release excludes any and all rights and
obligations of the first party pursuant to that Settlement Agreement between
Intelligent Medical Imaging, Inc. and Xxxxxxx Corporation dated as of March 27,
1997. (Wherever used above the terms "first party" and "second party" shall
include singular and plural, heirs, legal representatives, and assigns of
individuals, and the successors, assigns, parents and subsidiaries of
corporations, wherever the context so admits or requires.)
Without limitation to the foregoing this Release specifically operates
to release Xxxxxxx Corporation of any and all claims which
Intelligent Medical Imaging, Inc. brought or could have brought
in the action entitled Intelligent Medical Imaging, Inc. vs.
Xxxxxxx Corporation before the American Arbitration Association,
Case No.: 00-000-00000 96 KMG.
The first party hereby expressly acknowledges, warrants and represents that (i)
this Release was
--------------
* Denotes confidential material omitted and filed separately with Securities
and Exchange Commission.
signed only after due consideration and consultation with its attorney; (ii)
said first party was not fraudulently induced, coerced or intimidated to sign
this release: (iii) no promise, representation, inducement, agreement or
warranty other than those specifically set forth in the contemporaneously
executed Settlement Agreement has been made or relied upon by the party in
executing this release; and (iv) this Release is the result of a compromise of
disputed claims and shall never at any time for any purpose be considered as an
admission of liability or responsibility of the parties hereby released, who
continue to deny such liability and to disclaim such responsibility. In signing
this Release the first party have not relied upon any oral statements or acts
made by the second party, or their attorneys or agents.
------------
* Denotes confidential material omitted and filed separately with Securities
and Exchange Commission.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this ________ day
of __________ , A.D., 1997.
Signed, sealed and delivered
in presence of:
INTELLIGENT MEDICAL IMAGING, INC.
____________________ BY: Xxxx Xxxxxxxxxx
____________________ AS: President
STATE OF FLORIDA)
COUNTY OF DADE)
I HEREBY CERTIFY that on this day, before me, an officer duly authorized in
the County aforesaid and in the State aforesaid to take acknowledgments,
personally appeared Xxxx Xxxxxxxxxx as President of Intelligent Medical Imaging,
Inc. to me known to be the person described in and who executed the foregoing
instrument and he acknowledged before me that he executed the same.
WITNESS my hand and official seal in the County and State last aforesaid
this__________ day of __________, A.D., 1997.
NOTARY PUBLIC
State of Florida
My Commission Expires:
