CONCEPTUS, INC.
MARKETING AND DISTRIBUTION AGREEMENT
This Marketing and Distribution Agreement (the "AGREEMENT") is entered into
as of September 16, 1997 (the "Effective Date"), between CONCEPTUS, INC., a
corporation organized under the laws of Delaware, with principal offices at 0000
Xxxxxx Xxxxxx, Xxx Xxxxxx, Xxxxxxxxxx 00000 ("CONCEPTUS") and UROHEALTH, a
corporation organized under the laws of Delaware, with principal offices
at 0 Xxxxx Xxxxx, Xxxxx 000, Xxxxxxx Xxxxx, XX 00000 ("UROHEALTH").
RECITALS
A. UROHEALTH represents that it has the capability and resources to
promote and sell CONCEPTUS's MicroGyn bipolar sheath products for urology
applications and to fulfill the needs and requirements of customers for such
products worldwide.
B. CONCEPTUS desires to appoint UROHEALTH to promote, sell and distribute
CONCEPTUS's MicroGyn bipolar sheath products for urology applications worldwide
in accordance with the terms and conditions stated herein.
AGREEMENT
IN CONSIDERATION OF THE FOREGOING, it is mutually agreed by and between the
parties as follows:
1. DEFINITIONS. For purposes of this Agreement, the following terms
shall have the following meanings:
(a) "INTERNATIONAL TERRITORY" shall mean the entire world, excluding
the U.S. Territory.
(b) "KITS" shall mean a collection of more than one surgical device
or instrument that (i) contains a Product, (ii) contains a .010" specialty loop
product and (iii) is sold as a packaged collection.
(c) "PRODUCTS" shall mean the FUTURA Sheath products manufactured by
or on behalf of CONCEPTUS and identified on EXHIBIT A.
(d) "TERRITORY" shall mean the U.S. Territory and the International
Territory.
(e) "U.S. TERRITORY" shall mean the United States of America and its
possessions.
2. GRANT OF MARKETING AND DISTRIBUTION RIGHTS.
(a) APPOINTMENT. CONCEPTUS hereby grants to UROHEALTH the exclusive
right to purchase from CONCEPTUS the Products for sale for urology applications
worldwide. CONCEPTUS appoints UROHEALTH as its exclusive representative in the
Territory to promote, sell, market and distribute the Products in the Territory
for urology applications. UROHEALTH hereby accepts the appointment and agrees
to represent CONCEPTUS on the terms and conditions set forth herein and in
accordance with the Terms and Conditions of Sale attached hereto as EXHIBIT B
and incorporated herein by reference and made a part hereof. After Kits are
available, UROHEALTH shall only sell the Products in the US Territory in Kits.
CONCEPTUS shall make available for purchase by UROHEALTH sufficient quantities
of Products in light of UROHEALTH's Rolling Forecasts (as defined below) to meet
UROHEALTH's reasonable needs and requirements in order to fulfill the terms and
conditions of this Agreement.
(b) DIRECT SALES. During the term of this Agreement CONCEPTUS shall
not have the right to make sales of Products for urology applications directly
itself, or indirectly through affiliates, agents, distributors or otherwise
other than through UROHEALTH within the Territory for which UROHEALTH has
exclusive distribution rights for such Products pursuant to this Agreement.
(c) PROMOTION OF PRODUCTS. UROHEALTH agrees to use commercially
reasonable efforts to develop a market for and promote the Products in the
Territory.
(d) TAKE OR PAY MINIMUM PURCHASE COMMITMENTS. UROHEALTH agrees to
purchase from CONCEPTUS Products for sale in the Territory with the minimum
aggregate purchase prices set forth on EXHIBIT C over the time periods set forth
therein (the "TAKE OR PAY MINIMUM PURCHASE COMMITMENTS").
(e) FAILURE TO MEET TAKE OR PAY MINIMUM PURCHASE COMMITMENTS. In the
event that UROHEALTH fails to meet a particular Take or Pay Minimum Purchase
Commitment for either the US Territory or the International Territory, CONCEPTUS
shall notify UROHEALTH within 10 days after the end of the applicable period of
UROHEALTH's failure to meet the Take or Pay Minimum Purchase Commitment and the
amount of the shortfall for the US Territory or the International Territory, as
applicable. Thereafter, UROHEALTH must purchase Products equal to the amount of
the shortfall for such period, at the purchase price which would have applied
had UROHEALTH purchased such Products on the last day of such period, within 20
days after the end of the applicable period. If UROHEALTH does not satisfy its
obligations set forth in the preceding sentence, CONCEPTUS may, at its option
and in addition to any other legal or equitable remedies it may have, terminate
this Agreement effective immediately upon notice of termination.
(f) YEARLY MINIMUM PURCHASE COMMITMENTS. Beginning not later than
October 1 of each year during the term of this Agreement, commencing with 1998,
UROHEALTH and CONCEPTUS will negotiate in good faith to establish a worldwide
minimum purchase commitment (in units) for UROHEALTH for the Products (the
"YEARLY
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MINIMUM PURCHASE COMMITMENTS") for the next calendar year. UROHEALTH hereby
agrees that, beginning in the 1999 calendar year and for each calendar year
thereafter during the term of this Agreement, it will purchase from CONCEPTUS
Products in order to meet the Yearly Minimum Purchase Commitments agreed upon
by UROHEALTH and CONCEPTUS. In the event that the parties cannot agree on a
Yearly Minimum Purchase Commitment for a calendar year within the applicable
90-day negotiation period, the Yearly Minimum Purchase Commitment for such
calendar year shall be equal to UROHEALTH's actual end-user sales for the
previous calendar year (in units) multiplied by 1.25.
(g) FAILURE TO MEET YEARLY MINIMUM PURCHASE COMMITMENTS. In the
event that UROHEALTH fails to meet a Yearly Minimum Purchase Commitment for any
calendar year during the term of this Agreement, CONCEPTUS may, at its option,
terminate this Agreement effective immediately upon notice of termination.
(h) ASSUMPTIONS. The Take or Pay Minimum Purchase Commitments set
forth on EXHIBIT C assume that CONCEPTUS satisfies its obligations to supply
Products to UROHEALTH pursuant to this Agreement. In the event that the
assumption set forth in the preceding sentence is not met, UROHEALTH and
CONCEPTUS will mutually agree to appropriate reductions in the Take or Pay
Minimum Purchase Commitments.
3. PRODUCTS. UROHEALTH shall have the rights of first refusal set forth
in this Section to distribute under this Agreement for urology applications all
products constituting improvements or enhancements of any Product (each, a "Next
Generation Product"). CONCEPTUS will inform UROHEALTH promptly when any Next
Generation Product is ready for the market. CONCEPTUS will by written notice
offer UROHEALTH the right to add such Next Generation Product to this Agreement
for exclusive distribution by UROHEALTH in the Territory, subject to the parties
agreeing upon the applicable transfer pricing and minimum purchase commitments
for such Next Generation Product. In the event UROHEALTH decides that it does
not want to add the Next Generation Product to this Agreement, or in the event
that, notwithstanding their good faith negotiations, the parties cannot agree on
the applicable transfer pricing or minimum purchase commitments for such Next
Generation Product within 45 days from the effectiveness of the notice delivered
by CONCEPTUS, CONCEPTUS shall have the right to have such Next Generation
Product distributed in the Territory by one or more other representatives.
4. PRICES; PURCHASE ORDERS.
(a) PRICES. Prices to UROHEALTH shall be in United States dollars
and will be as set forth in EXHIBIT D hereto. All prices are calculated and
stated in EXHIBIT D as F.O.B. CONCEPTUS's distribution site, currently located
in San Carlos, California. Customs, duties and charges, if any, shall be borne
by UROHEALTH. All import or export licenses, approvals or both shall be
obtained by UROHEALTH at its cost. Prices to UROHEALTH do not include any
federal, state, local or foreign taxes directly applicable to the sale by
CONCEPTUS to UROHEALTH of the Products. When CONCEPTUS has the legal obligation
to collect such taxes, the appropriate amount shall be added to UROHEALTH's
invoice and paid by
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UROHEALTH unless UROHEALTH provides CONCEPTUS with a valid tax exemption
certificate authorized by the appropriate taxing authority.
(b) PURCHASE ORDERS. Pursuant to this Agreement, UROHEALTH will
submit purchase orders for the Products ("PURCHASE ORDERS"). Such Purchase
Orders shall be subject to the Terms and Conditions attached hereto as EXHIBIT
B. Within fourteen (14) days after the Effective Date and in any event by
September 20, 1997, UROHEALTH shall submit an initial Purchase Order for
Products with an aggregate purchase price of at least three hundred fifty
thousand dollars ($350,000).
5. PAYMENT. Full payment of UROHEALTH's purchase price (including any
freight, taxes or other applicable costs initially paid by CONCEPTUS but to be
borne by UROHEALTH) shall be in United States of America dollars. Payment terms
shall be net forty-five (45) days, and payment shall be made by wire transfer,
check or other instrument approved by CONCEPTUS. Any invoiced amount not paid
when due shall be subject to a service charge at the lower of the rate of 1.5%
per month or the maximum rate permitted by law. If UROHEALTH fails to make any
payment to CONCEPTUS when due, CONCEPTUS may, without affecting its rights under
this Agreement, cancel or delay any future shipments to UROHEALTH until such
delinquent payment is made.
6. TERMS AND TERMINATION.
(a) TERM OF AGREEMENT. This Agreement shall commence on the
Effective Date and continue in full force and effect until midnight on December
31, 1998, unless terminated earlier under the provisions of this Section 6 or
other applicable termination provisions of this Agreement. At the end of such
fixed term, this Agreement may be renewed in one-year increments (but only for a
maximum of three one-year increments) provided that CONCEPTUS and UROHEALTH
agree in writing not later than 60 days prior to the end of such fixed term, and
each additional term, upon the terms and conditions of such renewal, including,
without limitation, any amendments to this Agreement and the exhibits hereto.
Neither party shall be under any obligation to renew this Agreement, and if such
written agreement is not reached prior to the end of the then-current contract
term, then this Agreement shall terminate at the end of such current contract
term.
(b) TERMINATION FOR CAUSE. If either party defaults in the
performance of any provision of this Agreement, and such default is not cured
within thirty (30) days of notice thereof from the nondefaulting party, then the
nondefaulting party may terminate this Agreement immediately upon written notice
to the defaulting party.
(c) TERMINATION FOR INSOLVENCY OR WRONGDOING. Either party may
terminate this Agreement in the event that the other party becomes insolvent,
files a petition in bankruptcy, is declared bankrupt, makes an assignment for
benefit of creditors or there is reasonable evidence indicating the imminent
possibility of such filing or assignment, during the term that this Agreement is
in effect. In addition, either party may terminate this Agreement in the event
the other party is found liable in any civil proceeding of any wrongdoing
involving its manufacture, development, marketing, sale or support of the
Products or any other products or is found guilty
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in any criminal proceeding of any wrongdoing. Termination under this
provision shall be effective 20 days following written notice that this
Agreement is being terminated for the reason stated in this Section 6(c).
(d) TERMINATION FOLLOWING A CHANGE OF CONTROL.
(i) CHANGE OF CONTROL OF CONCEPTUS. In the event of a Change
of Control (as defined below) of CONCEPTUS, either CONCEPTUS (or its
successor corporation) or UROHEALTH may terminate this Agreement by giving
thirty (30) days written notice to the other party within fifteen days of the
effective date of the Change of Control; provided, however, that if CONCEPTUS
(or its successor corporation) terminates this Agreement pursuant to this
Section 6(d)(i), CONCEPTUS (or its successor corporation) shall repurchase at
cost, within five business days after the effective date of such termination
and the receipt of the requisite information, that portion of UROHEALTH's
inventory that is equal to the last three months of UROHEALTH's actual sales
of Products to end-users prior to the effective date of such termination.
(ii) CHANGE OF CONTROL OF UROHEALTH. In the event of a Change
of Control (as defined below) of UROHEALTH, CONCEPTUS may terminate this
Agreement by giving thirty (30) days written notice to UROHEALTH within
fifteen days of the effective date of the Change of Control.
(iii) DEFINITION OF CHANGE OF CONTROL. For purposes of this
Agreement, a CHANGE OF CONTROL of a party shall mean the occurrence of any of
the following events: A merger or consolidation of such party whether or not
approved by its Board of Directors, other than a merger or consolidation
which would result in the voting securities of such party outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) at least 50% of the total voting power represented by the voting
securities of such party or such surviving entity outstanding immediately
after such merger or consolidation, or the stockholders of such party approve
an agreement for the sale or disposition by such party of all or
substantially all of such party's assets.
(e) TERMINATION FOR CONVENIENCE. Either party may terminate this
Agreement at any time upon one hundred-eighty (180) days written notice to the
other party.
(f) EFFECT OF TERMINATION; LIMITATION OF LIABILITY. Except as set
forth in Section 6(d), in the event of termination by either party in accordance
with any of the provisions of this Agreement, neither party shall be liable to
the other, because of such termination, for compensation, reimbursement or
damages on account of the loss of prospective profits or anticipated sales or on
account of expenditures, inventory, investments, leases or commitments in
connection with the business or goodwill of CONCEPTUS or UROHEALTH. Termination
shall not, however, relieve either party of obligations incurred prior to the
termination or of any obligations arising under this Agreement which by their
terms or by operation of law survive termination. Either UROHEALTH and
CONCEPTUS shall be entitled to cancel all Purchase Orders, to the extent
Products have not been delivered to UROHEALTH, which are outstanding
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at the time of notice of termination; provided however that, subject to
payment in advance to CONCEPTUS, UROHEALTH shall be entitled to receive
Products necessary to fulfill valid and binding purchase orders accepted by
UROHEALTH prior to notification of termination of this Agreement. Prior to
filling orders for such Products, CONCEPTUS shall be entitled to request and
receive documentary evidence of all such outstanding purchase orders and an
accounting of UROHEALTH's existing inventory of Products.
(g) POST-TERMINATION USE OF MATERIALS. After termination of this
Agreement, neither party shall use any signs, equipment, advertising matter or
other material which refer to or are related to the other party and each party
shall refrain from acts and omissions that indicate or suggest a relationship
with the other party and shall immediately return to the other party all of such
other party's property, promotional material, and proprietary information.
7. NOTICES.
(a) ADDRESSES. All notices given under this Agreement and the
provisions contained herein shall be sent by first class registered airmail,
postage prepaid and return receipt requested, by Federal Express, or by
Telecopier, or Facsimile as directed below:
To: CONCEPTUS, INC.
0000 Xxxxxx Xxxxxx
Xxx Xxxxxx, Xxxxxxxxxx 00000
Attention: Vice President, Sales & Marketing
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
when directed to CONCEPTUS, and
To: UROHEALTH
______________________________
______________________________
Attention: __________________
Telephone: __________________
Facsimile: __________________
when directed to UROHEALTH.
(b) DELIVERY. Notices shall be considered delivered when mailed or
sent by Telecopier or Facsimile in accordance with the provisions of Section
7(a) above, subject to proof of receipt by Telecopier or Facsimile confirmation
or by mail receipt.
8. MISCELLANEOUS.
(a) ASSIGNMENT. Neither this Agreement nor any of the rights and
obligations of either party under this Agreement may be transferred or assigned
directly or indirectly without the prior written consent of the other party.
Subject to the foregoing sentences, this Agreement
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shall be binding upon and inure to the benefit of the parties hereto and
their successors and assigns.
(b) ATTORNEY FEES. The prevailing party in any legal action brought
by one party against the other and arising out of this Agreement shall be
entitled, in addition to any other rights and remedies that such prevailing
party may have, to reimbursement for reasonable expenses incurred by such
prevailing party, including court costs and reasonable attorneys' fees.
(c) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.
(d) PARTIAL INVALIDITY. If any provision of this Agreement,
inclusive of the provisions set forth in the Terms and Conditions attached as
EXHIBIT B, is held to be invalid, then the remaining provisions shall
nevertheless remain in full force and effect. The parties agree to renegotiate
in good faith any term held invalid and to be bound by the mutually agreed
substitute provision.
(e) TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
(f) TENSES. As used herein, all singular nouns and pronouns shall
include the plural thereof, and vice versa, whenever the context and facts
require such construction.
IN WITNESS WHEREOF, this Marketing and Distribution Agreement has been
executed as of the day and year first above written.
CONCEPTUS, INC. UROHEALTH
("CONCEPTUS") ("UROHEALTH")
By: /s/ Xxxxxxx Xxxxxxxx By: /s/ Xxxxxxx Xxxxxxx
--------------------------------- ---------------------------------
Print Name: Xxxxxxx Xxxxxxxx Print Name: Xxxxxxx Xxxxxxx
------------------------- --------------------------
Title: President & CEO Title: Chairman/CEO
------------------------------ -------------------------------
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EXHIBIT A
PRODUCTS
MICROGYN PRODUCTS FOR UROLOGY APPLICATIONS
FUTURA Sheath
.010" specialty loop
Kit
EXHIBIT B
TERMS AND CONDITIONS OF SALE
These Terms and Conditions of Sale ("TERMS AND CONDITIONS") are
incorporated into and are a part of the Marketing and Distribution Agreement
(the "Agreement") relating to the marketing and distribution of the Products
in the Territory as set forth in the Agreement.
1. DILIGENCE AND SUPPORT.
(a) PROMOTION. UROHEALTH shall exercise due diligence and its
reasonable efforts in promoting and selling the Products within the
Territory. UROHEALTH agrees to devote such portion of sales force time as is
reasonably necessary to market the volume of Products consistent with
UROHEALTH's Purchase Commitments as set forth in the Agreement.
(b) MARKETING.
(i) UROHEALTH shall maintain the financial capability to
perform its obligations under the Agreement and shall, at its own expense,
establish and maintain sales, marketing and distribution, organization and
personnel of sufficient size to adequately and effectively sell the Products
in the Territory. UROHEALTH will be responsible for the market launch of
Products in the Territory during the term of the Agreement. CONCEPTUS shall
provide UROHEALTH with available marketing and technical information
concerning the Products as well as camera-ready copies of brochures,
instructional material, advertising literature and other product data,
provided that all such material will be printed in the English language.
CONCEPTUS shall be responsible for the accuracy of all information so
provided to UROHEALTH. UROHEALTH will produce, and obtain CONCEPTUS's prior
approval (which approval will not be unreasonably withheld) of, all materials
used to promote the Products in the Territory. During the term of the
Agreement, UROHEALTH will represent CONCEPTUS at all key urology conferences
in the Territory as identified and agreed upon by the parties within 45 days
after the date of the Agreement.
(ii) Each party agrees to share with the other its marketing
intelligence regarding product launches, product sales, sales leads and
customer feedback on the MicroGyn Products. Furthermore, the parties agree
to hold quarterly meetings by conference telephone call or in person between
representatives of the parties to discuss market-related and product-related
issues and product development and introduction plans.
(c) RECORDS AND REPORTING. UROHEALTH shall maintain adequate and
accurate books and records with respect to the sale or distribution of the
Products during the term of the Agreement and for a period of two years after
termination of the Agreement. Upon prior notice, employees or agents of
CONCEPTUS shall have the right, during reasonable business hours, to inspect
the facilities of UROHEALTH which are used or provided in connection with the
sale, administration and stocking of the Products, and to inspect such books
and records, subject to the obligations of confidentiality set forth in
Section 10 below. UROHEALTH will submit to CONCEPTUS within 10 days after
the end of each calendar quarter a quarterly report
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setting forth (i) unit volumes, aggregate purchase prices and average selling
prices during such quarter by Product category for each country in the
Territory, (ii) the number of dedicated MicroGyn sales representatives and
marketing managers in each country in the Territory as of the end of such
quarter and (iii) amounts invested in MicroGyn marketing efforts in each
country in the Territory during such quarter.
(d) TRAINING. UROHEALTH shall ensure that the sales personnel
charged or to be charged with marketing the Products are adequately educated
about all of the Products. UROHEALTH shall provide in-service training for
personnel of customers acquiring the Products and shall provide necessary
user education for such personnel.
(e) HARMFUL ACTS. Both CONCEPTUS and UROHEALTH understand,
acknowledge and agree that the continued maintenance of an image of
excellence and high level ethical marketing of the Products is essential to
the continued success of both parties. Each party agrees that its
manufacturing, sales, marketing, distribution, or advertising will not
reflect unfavorably on, or dilute in any way, the other party's image of
excellence and high level ethical marketing. Each party agrees that it shall
not do anything, directly or indirectly, to impair the current image or to
lower the prestige or quality of the Products.
(f) CONFLICT OF INTEREST. UROHEALTH shall not, during the term of
the Agreement, promote or distribute any products which enable resection in
saline or are directly competitive with the Products. Immediately prior to
the execution of the Agreement, UROHEALTH shall provide CONCEPTUS with a list
of the medical device companies and products that it currently represents in
the urology market and shall notify CONCEPTUS in writing of any new companies
or products at such time as its promotion of these new companies or products
in the urology markets commences.
2. DELIVERY, TITLE, RISK OF LOSS, RETURNS AND LABELING.
(a) PURCHASE ORDERS; FORECASTS. Binding Purchase Orders are to be
placed by UROHEALTH at least 90 days prior to the required delivery date.
All Purchase Orders are subject to acceptance in writing by CONCEPTUS. Upon
effectiveness of the Agreement and thereafter prior to the end of each
calendar month during the term of the Agreement, UROHEALTH will provide
CONCEPTUS with a rolling forecast of its anticipated Product needs, by
Product category, for the following 12 months (each such forecast, a "ROLLING
FORECAST"), together with a binding Purchase Order for the next 90 days.
(b) SHIPPING. All Products delivered pursuant to the terms of
this Agreement shall be suitably packed for shipment according to UROHEALTH's
instructions and in CONCEPTUS's standard shipping cartons, marked for
shipment at CONCEPTUS's manufacturing plant to UROHEALTH's address set forth
in this Agreement or such other address as UROHEALTH may specify, and
delivered to UROHEALTH or UROHEALTH's carrier agent F.O.B. CONCEPTUS's
distribution site, at which time title to such Products and risk of loss
shall pass to UROHEALTH. CONCEPTUS shall deliver Products to the carrier
selected by UROHEALTH. In the event that UROHEALTH does not provide written
notice of
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such carrier, CONCEPTUS shall select the carrier. UROHEALTH will obtain
insurance sufficient to cover the value of each shipment.
(c) REJECTION AND RETURNS.
(i) UROHEALTH shall inspect all Products promptly upon
receipt thereof and may reject any product that fails in any material way to
meet the specifications set forth in CONCEPTUS's current brochure for that
Product. Any Product not properly rejected within 30 days of receipt of that
Product by UROHEALTH (the "REJECTION PERIOD") shall be deemed accepted. To
reject a product, UROHEALTH must, within the Rejection Period, notify
CONCEPTUS of its rejection and request a Material Return Authorization
("MRA") number. CONCEPTUS shall provide the MRA number to UROHEALTH within
seven days of receipt of the request. Within seven days of receipt of the
MRA number, UROHEALTH shall return to CONCEPTUS the rejected Product, freight
prepaid, in its original shipping carton with the MRA number displayed on the
outside of the carton. CONCEPTUS reserves the right to refuse to accept any
rejected Products that do not bear an MRA number on the outside of the
carton. As promptly as possible but no later than 30 working days after
receipt of properly rejected Products, CONCEPTUS shall, at its option and
expense, replace the Products. CONCEPTUS shall pay the shipping charges back
to UROHEALTH for properly rejected Products; otherwise, UROHEALTH shall be
responsible for the shipping charges.
(ii) After the Rejection Period, UROHEALTH may not return a
Product to CONCEPTUS for any reason without CONCEPTUS's prior written
consent. For any Product for which CONCEPTUS gives such consent, CONCEPTUS
shall credit eighty percent of UROHEALTH's purchase price for that Product to
UROHEALTH's account within 30 days upon receipt of returned Product.
UROHEALTH shall be responsible for all shipping charges.
(d) LABELING. UROHEALTH will provide the artwork for all
overlabeling and/or outer packaging for CONCEPTUS's prior approval, which
will not be unreasonably withheld. UROHEALTH will supply CONCEPTUS with
sufficient quantities of such labeling and/or outer packaging material and
CONCEPTUS will perform such overlabeling and/or outer packaging (as
appropriate) on all Products, such that both the UROHEALTH and CONCEPTUS
names and trademarks are clearly visible and such labeling, and Product
markings generally, comply with applicable regulatory requirements, which, in
the case of country-specific requirements, shall have been identified by
UROHEALTH and communicated in writing sufficiently in advance to CONCEPTUS.
In the event sufficient quantities of such labeling and/or outer packaging
are not available prior to September 5, 1997, labeling of the initial order
of Products will be the responsibility of UROHEALTH.
(e) NOTIFICATION OF ADVERSE EXPERIENCES. UROHEALTH shall provide
CONCEPTUS with a copy of any reported adverse experience report or product
complaint involving Products promptly after UROHEALTH receives the report of
such occurrence. CONCEPTUS shall provide UROHEALTH with a copy of any reported
adverse experience report or product complaint involving Products with respect
to gynecology applications promptly after CONCEPTUS receives the report of such
occurrence. Any death, serious injury, potential
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for occurrence of the same, or change in the frequency or occurrence in field
experiences required to be reported by CONCEPTUS to the Food and Drug
Administration (the "FDA") or any foreign governmental agency performing
similar functions shall be reported to CONCEPTUS by UROHEALTH in a manner and
time which will enable CONCEPTUS to comply with applicable regulations in a
timely manner.
3. WARRANTY.
(a) STANDARD LIMITED WARRANTY. UROHEALTH shall pass on to its
customers CONCEPTUS's standard limited warranty for Products, including the
limitations set forth in Sections 3(b) and 3(c) below. CONCEPTUS warrants
that the Products (i) have been manufactured in compliance with good
manufacturing practices, (ii) have received clearance for marketing in the
United States for urology applications from the FDA and (iii) are accompanied
by instructions that comply with applicable FDA requirements for the
Products. This warranty is contingent upon proper use of a Product in the
application for which such Product was intended and does not cover Products
that were modified without CONCEPTUS's approval, that have expired or that
were subjected by the customer to unusual physical, chemical or electrical
stress. The parties understand and acknowledge that this warranty does not
relate to personal injury or damage, other than to the Product itself, but
entitles an end-user to make warranty claims directly against CONCEPTUS,
although this shall not in any way affect the allocation of responsibilities
set forth in Section 2(c) above.
(b) NO OTHER WARRANTY. EXCEPT FOR THE EXPRESS LIMITED WARRANTY
SET FORTH ABOVE, CONCEPTUS GRANTS NO WARRANTIES FOR THE PRODUCTS, EXPRESS OR
IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, AND
CONCEPTUS SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTY OF QUALITY, WARRANTY OF
MERCHANTABILITY, WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE.
(c) LIMITATION OF LIABILITY. CONCEPTUS'S LIABILITY UNDER THE
WARRANTY SHALL BE LIMITED TO A REFUND OF THE CUSTOMER'S PURCHASE PRICE. IN
NO EVENT SHALL CONCEPTUS BE LIABLE FOR THE COST OF PROCUREMENT OF SUBSTITUTE
GOODS BY THE CUSTOMER OR FOR ANY SPECIAL, CONSEQUENTIAL OR INCIDENTAL DAMAGES
FOR BREACH OF WARRANTY.
(d) INCREMENTAL WARRANTIES. UROHEALTH may make additional or
incremental warranties on its behalf, provided that (i) such warranties shall
impose no liability on CONCEPTUS, (ii) UROHEALTH shall not make any false or
misleading representations to customers or others regarding the Products and
(iii) UROHEALTH shall comply with the requirements of this Section 3.
4. PROTECTION OF RIGHTS; USE OF TRADEMARKS.
(a) COVENANT NOT TO CONTEST. UROHEALTH shall not dispute or
contest the validity of any of CONCEPTUS's or its affiliated companies'
rights to letters patent, trademarks,
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copyrights, product registrations and approvals, interest, know-how or other
intangible property concerning the Products. This covenant not to contest
validity shall not, however, apply to any CONCEPTUS's letters patent owned by
CONCEPTUS or its affiliated companies to the extent that such letters patent
are invalid under applicable law.
(b) TRADEMARK LICENSE. CONCEPTUS hereby grants to UROHEALTH the
right and license to use CONCEPTUS's trademarks for CONCEPTUS's Products and
any trademark registrations which CONCEPTUS obtains for the Products in the
Territory, but only in connection with sales of the Products purchased from
CONCEPTUS in countries in which UROHEALTH has distribution rights for the
Products, subject to the terms of Section 11. UROHEALTH shall be required to
use CONCEPTUS's trademark with respect to all sales of the Products. All
representations of CONCEPTUS's trademarks shall first be submitted to
CONCEPTUS for approval, which approval shall not be unreasonably withheld, or
shall be exact copies of those used by CONCEPTUS. Such trademark license
shall continue in effect for each country in the Territory while UROHEALTH
retains its distribution rights in such country. All right, title and
interest to CONCEPTUS's trademarks (except the right to use such trademarks
set forth herein) shall remain with CONCEPTUS. UROHEALTH shall not have the
right to use CONCEPTUS's name in any advertising or promotion or otherwise
without CONCEPTUS's prior written consent. Upon UROHEALTH's request,
CONCEPTUS shall, at its expense, file trademark registrations in countries
within the Territory where UROHEALTH plans to market the Products. At no
time during or after the term of this Agreement shall UROHEALTH challenge or
assist others to challenge CONCEPTUS's trademarks or the registration thereof
or attempt to register any trademarks, marks or trade names confusingly
similar to those of CONCEPTUS.
(c) UNAUTHORIZED USE. Each party understands and agrees that it
is not authorized to use the other party's name in connection with its
general business or to imply to third parties that its relationship with the
other party is other than as set forth under the Agreement. Furthermore,
neither party shall use the name of the other party in any public
announcement, press release or other public document without the written
consent of the other party. Notwithstanding the foregoing, nothing in this
Agreement shall prohibit or impede either party from using the name of the
other party in order to meet its disclosure obligations in its public
securities law filings; PROVIDED that this sentence shall not be deemed to
permit or authorize any misrepresentation by such party of the nature of the
relationship between the parties. Each party shall hold the other party
harmless and indemnify it against any liability, including attorneys' fees
and other costs of defense, resulting from actions of third parties claiming
injury or loss as a result of the failure by the offending party to honor the
provisions of this Section 4(c).
(d) UNFAIR COMPETITION. UROHEALTH agrees to give CONCEPTUS prompt
written notice upon becoming aware of the same of any imitations and unfair
competition by others with respect to the Products. UROHEALTH agrees to
cooperate with CONCEPTUS, at CONCEPTUS's request and expense, and take
whatever action is required to cause the termination of such conduct.
CONCEPTUS reserves the right to take whatever action it deems appropriate to
protect its trademarks and trade names.
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(e) UROHEALTH TRADEMARKS. For purposes of Section 2(d) above
(regarding labeling), UROHEALTH hereby grants to CONCEPTUS the right and
license to use and reproduce UROHEALTH's trademarks solely to the extent
necessary to create and reproduce the labeling and/or outer packaging for the
Products for shipment to UROHEALTH. All right, title and interest to
UROHEALTH's trademarks (except the right to use such trademarks set forth
herein) shall remain with UROHEALTH. CONCEPTUS shall not have the right to
use UROHEALTH's name in any advertising or promotion or otherwise without
UROHEALTH's prior written consent, other than where necessary to comply with
CONCEPTUS's legal disclosure obligations.
5. INDEPENDENT CONTRACTOR RELATIONSHIP. It is understood that both
parties hereto are independent contractors and engaged in the operation of
their own respective businesses. Neither party hereto is to be considered
the agent of the other party for any purpose whatsoever, and neither party
has any authority, express or implied, to enter into any contracts or assume
any obligations for the other party, to pledge the credit, or make any
warranties or representations on behalf of the other party except where
expressly authorized in writing to do so. Nothing in the Agreement or in the
activities of either party shall be deemed to create an agency, partnership,
or joint venture relationship.
6. INDEMNIFICATION.
(a) BY CONCEPTUS. CONCEPTUS agrees to indemnify and hold
UROHEALTH harmless from and against any and all damages or costs awarded in
or amounts paid in settlement of any claim, suit or action to the extent
based on a claim that the manufacture, use or sale of the Products infringes
any United States patent, copyright, trade secret or other intellectual
property right; provided that CONCEPTUS shall have no liability under this
Section 6(a) for any infringement caused by (i) any modification to the
Products made after their delivery to UROHEALTH, or (ii) the use or
combination of the Products with any other product to the extent such
infringement would not have arisen but for such use or combination. The
foregoing sets forth CONCEPTUS' entire liability and UROHEALTH's sole remedy
with respect to any infringement of patent, copyright, trademark, trade
secret or other intellectual property rights.
(b) BY UROHEALTH. UROHEALTH agrees to indemnify and hold
CONCEPTUS harmless from and against any and all damages or costs awarded in
or amounts paid in settlement of any claim, suit or action to the extent
based on a claim arising out of the marketing, distribution, sale or use of
the Products where and to the extent caused by the act or omission of
UROHEALTH, its employees or agents.
(c) PROCEDURE. The indemnifying party shall have the right to defend
or, at its option, to settle such claims, and if it chooses to exercise such
right, it shall have sole control over defense of any such claim or settlement
negotiations. The indemnifying party shall be relieved of the foregoing
obligations unless the indemnified party gives prompt notice in writing of any
such claim, suit or proceeding upon becoming aware of the same to the
indemnifying party and, at the indemnifying party's expense, gives the
indemnifying party proper and full
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information and assistance to settle and/or defend any such claim, suit or
proceeding. The parties agree that only direct, non-consequential damages
will be indemnified under this Section 6.
7. INABILITY TO DELIVER.
(a) IMPOSSIBILITY. If, due to industrial conflicts, mobilization,
requisition, embargo, currency restriction, insurrection, general shortage of
transport, material or power supply, fire, explosion, stroke of lightning,
force majeure and similar casualties or other events beyond a party's
control, as well as, in the case of CONCEPTUS, default in deliveries from
subcontractors due to such circumstances as defined in the preceding clause,
and in the case of UROHEALTH, default in transportation by carriers due to
such circumstances, it is impossible for a party to fulfill its supply or
marketing obligations, as the case may be, with respect to purchased
Products, the other party shall not be entitled to any damages during such
period of impossibility and the offending party shall not be considered in
breach or default under the Agreement.
(b) IMPRACTICABILITY. If the performance of the Agreement by
either party is made commercially impracticable (i) by the occurrence of an
economic contingency the non-occurrence of which was a basic assumption on
which this Agreement was made or (ii) by compliance in good faith with any
applicable foreign or domestic governmental law, regulation, or order, then
the Agreement shall terminate immediately. For purposes of the Agreement,
currency devaluation, currency restrictions, currency and exchange controls,
and other monetary controls, restrictions, and restraints shall not be
considered to render the performance of the Agreement by either party
commercially impracticable, or otherwise be considered force majeure with
respect to either party.
8. CHANGES AND ADDITIONS TO AGREEMENT.
The Agreement and the exhibits thereto, including these Terms and
Conditions incorporated therein, constitutes the final agreement between the
parties and supersedes all prior agreements and understandings, oral or
written, all of which are merged herein. No modification, assignment, or any
future representation, promise or agreement in connection with the subject
matter of the Agreement shall be binding on CONCEPTUS and UROHEALTH unless
made in writing and signed by an authorized signatory of each.
9. GOVERNING LAW AND ARBITRATION.
The Marketing and Distribution Agreement shall be governed by, and
construed and interpreted in accordance with, the laws of the State of
California, United States of America, without reference to conflict of laws
principles. Any dispute or claim arising out of or in connection with the
Agreement or the performance, breach or termination thereof, shall be finally
settled by binding arbitration in San Mateo County, California under the
Rules of Arbitration of the International Chamber of Commerce by one
arbitrator appointed in accordance with such rules. Judgment on the
arbitration award by such arbitrator may be entered in any court of competent
jurisdiction. Notwithstanding the foregoing, the parties may apply to any
court of competent jurisdiction for injunctive relief without breach of this
arbitration provision.
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10. PROPRIETARY INFORMATION.
(a) CONFIDENTIALITY. Each party acknowledges that it has or will
have access to valuable proprietary information of the other party, including
but not limited to, technical data and customer and marketing information,
all of which are the property of the other party, have been maintained
confidential, and are used in the course of such other party's business.
Each party shall not, either during the term of the Agreement or thereafter,
disclose the other party's proprietary information to anyone other than those
of its employees having a need to know and shall refrain from use of such
information other than in the performance of the Agreement. In addition, the
receiving party shall take all reasonable precautions to protect the value
and confidentiality of such information to the originating party. All
records, files, notes, drawings, prints, samples, advertising material and
the like relating to the business, products or projects of the originating
party and all copies made from such documents, shall remain the sole and
exclusive property of the originating party and shall be returned to the
originating party immediately upon written request thereby. Each party
agrees to continue to maintain all proprietary information in confidence for
a period of five years following termination of the Agreement, unless written
authorization to do disclose any such information is first obtained from the
originating party hereunder.
(b) NON-PROPRIETARY INFORMATION. Neither party shall be obligated
or required to maintain in confidence any information which it can
demonstrate with written records (i) is in the public domain or known to the
receiving party prior to disclosure by the originating party, (ii) becomes
known to the public after disclosure by the originating party, other than
through breach of the Agreement, (iii) becomes known to the receiving party
from a source other than the disclosing party without breach of any
obligation of confidence, or (iv) is or has been furnished to a third party
by the originating party without restriction on the third party's right to
disclose.
11. GOVERNMENT REGULATIONS.
(a) APPROVALS AND REGISTRATIONS. CONCEPTUS and UROHEALTH shall
collaborate to obtain and maintain regulatory approvals for sale of the Products
for urology applications in Europe and Japan. UROHEALTH shall be responsible
for the reasonable expenses of obtaining and maintaining such approvals.
UROHEALTH agrees that it will, at its own expense, secure any and all additional
required regulatory approvals or registrations of the Products in all other
countries in the International Territory, to the extent necessary for the
implementation, execution and performance of the Agreement. CONCEPTUS agrees
that it will, at its own expense, secure any and all additional required
regulatory approvals or registrations of all Products in the United States of
America to the extent necessary for the implementation, execution and
performance of the Agreement. Each party agrees to cooperate fully with the
other party in its pursuit of applicable approvals or registrations and, when
requested, use its reasonable efforts to assist the other party in obtaining
such requisite approvals and registrations. To the extent permissible,
UROHEALTH shall obtain all approvals in CONCEPTUS's name. With respect to any
approvals of Products in Japan, CONCEPTUS will be assigned in-country caretaker
status and will hold such approvals (the Shonen). Upon any expiration,
cancellation, or termination of the Agreement, any approvals not held by
CONCEPTUS shall be transferred and
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delivered to, and shall inure to the benefit of, CONCEPTUS, to the extent
that this is permissible under applicable law, at no cost to CONCEPTUS other
than the direct costs of transferring such approvals. UROHEALTH shall obtain
all necessary documents or licenses and shall comply with all applicable
laws, including, if required, registration of the Agreement. UROHEALTH shall
notify CONCEPTUS of all permits, approvals and registrations obtained by it
and shall provide CONCEPTUS with copies of all materials and documents
related thereto.
(b) CLINICAL TRIALS. UROHEALTH will pay all costs (including,
without limitation, data collection costs, patient enrollment costs and
Product costs) associated with any clinical trials necessary to obtain
regulatory approval for the Products in the Territory; provided that any such
clinical trials shall be subject to CONCEPTUS' prior written approval.
UROHEALTH shall provide leadership with respect to organizing and conducting
clinical trials with respect to approval of the Products in the Territory and
CONCEPTUS shall provide reasonable assistance and support; PROVIDED, HOWEVER,
that no activities in connection with organizing and conducting such trials
shall be initiated by UROHEALTH without CONCEPTUS's prior written approval
and CONCEPTUS shall not be responsible for any costs incurred in connection
with such trials without CONCEPTUS's prior written approval. For purposes of
clarity, the parties contemplate that such assistance may typically consist
of UROHEALTH field personnel working directly with CONCEPTUS's research and
development or clinical personnel. Nothing in the Agreement shall require
either party to take any action or omit to take any action which action or
omission would result in the breach of any applicable law or governmental
rule or regulation.
(c) ILLEGAL TRANSFER. UROHEALTH agrees that it shall not allow
either the Products supplied to it by CONCEPTUS, CONCEPTUS's Trademarks, any
proprietary data of CONCEPTUS, or any direct product of such data, to be
knowingly made available, either directly or indirectly, or in any way to be
knowingly given, transferred, sold or re-exported to any country in violation
of its laws and export control regulations or applicable laws of any country
(or the European Union). United States laws and export control regulations
governing the exportability of technical data and products to nations are
subject to change. If any country included within UROHEALTH's Territory
shall, at the time of execution of the Agreement, or at any time during the
term of the Agreement, be placed in an excluded category by the United States
government for the receipt of either technical data or the manufacture or
sale of products of the type supplied by CONCEPTUS, UROHEALTH agrees that it
shall take actions necessary to cease business activity in the Products in
the excluded country.
12. UNFAIR COMPETITION AND PATENT INFRINGEMENT.
(a) INFRINGEMENT. UROHEALTH shall promptly advise CONCEPTUS of
any infringement or potential infringement by third parties of which
UROHEALTH becomes aware of any issued patents relating to the Products
supplied by CONCEPTUS under the Agreement. CONCEPTUS shall have the right,
but not the obligation, to xxx alleged infringers. If suit is brought by
CONCEPTUS, CONCEPTUS shall control the prosecution thereof and be entitled to
retain any amounts recovered in full by reason of such infringement.
UROHEALTH agrees to cooperate with and assist CONCEPTUS in any such suit.
CONCEPTUS shall reimburse
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UROHEALTH for costs related to such assistance. CONCEPTUS shall have the
exclusive right to negotiate and approve any settlement of such suits.
(b) MUTUALITY OF LITIGATION COSTS. In the event that UROHEALTH
joins CONCEPTUS by mutual agreement in litigation relating to such
infringement, UROHEALTH shall bear an agreed-upon proportion of the legal
costs. Should any damages or costs in such litigation be awarded to
CONCEPTUS and UROHEALTH, UROHEALTH shall be entitled to recover the same
proportion thereof as its contribution to expenses.
(c) NON-INFRINGEMENT REPRESENTATION. CONCEPTUS represents that it
has no knowledge of any third-party intellectual property rights that would
be infringed by use or sale of the Products in the Territory. In the event
that CONCEPTUS is enjoined from making and selling and/or UROHEALTH is
enjoined from selling Products as a result of changes of infringement of
intellectual property rights, such injunction shall not constitute a breach
of the Agreement.
13. MISCELLANEOUS PROVISIONS.
(a) CONCEPTUS shall have the right to manufacture in the
Territory. UROHEALTH is granted no rights under this Agreement to manufacture
any Product.
(b) UROHEALTH shall comply fully, at its expense, with any and all
applicable health and safety laws and regulations of the Territory.
CONCEPTUS will provide reasonable assistance to UROHEALTH in connection with
such compliance efforts by UROHEALTH.
(c) UROHEALTH shall withdraw the Products from the marketplace in
the event that the parties agree that such action is reasonably necessary for
the protection of the public health.
CONCEPTUS, INC. UROHEALTH
("CONCEPTUS") ("UROHEALTH")
By: /s/ Xxxxxxx Xxxxxxxx By: /s/ Xxxxxxx Xxxxxxx
--------------------------------- ---------------------------------
Print Name: Xxxxxxx Xxxxxxxx Print Name: Xxxxxxx Xxxxxxx
------------------------- --------------------------
Title: President & CEO Title: Chairman/CEO
------------------------------ -------------------------------
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EXHIBIT C
TAKE OR PAY MINIMUM PURCHASE COMMITMENTS
Upon execution: $350,000
From October 1 to December 31, 1997: $150,000 plus 100 units at cost for
demonstration purposes only
For each calendar quarter of 1998: $250,000
CONCEPTUS, INC. UROHEALTH
("CONCEPTUS") ("UROHEALTH")
By: /s/ Xxxxxxx Xxxxxxxx By: /s/ Xxxxxxx Xxxxxxx
--------------------------------- ---------------------------------
Print Name: Xxxxxxx Xxxxxxxx Print Name: Xxxxxxx Xxxxxxx
------------------------- --------------------------
Title: President & CEO Title: Chairman/CEO
------------------------------ -------------------------------
EXHIBIT D
PRODUCT PRICING
UROHEALTH shall pay CONCEPTUS the following amounts for each Product purchased
pursuant to this Agreement:
FUTURA Sheath $77.00
.010" specialty loop $66.00
Kit $136.00
For each calendar quarter after December 31, 1997, CONCEPTUS and UROHEALTH agree
that the pricing of each Product shall be adjusted as follows:
1. The pricing of each Product shall be decreased by fifty percent of
any Manufacturing Savings. (The term "Manufacturing Savings" means any
reductions experienced by CONCEPTUS in its manufacturing costs of each such
Product during the preceding quarter.); and
2. The pricing of each Product shall be increased by fifty percent of
any Sales Increase. (The term "Sales Increase" means any increase
experienced by UROHEALTH in its average sales price of each such Product to
its customers during the preceding quarter.)
CONCEPTUS, INC. UROHEALTH
("CONCEPTUS") ("UROHEALTH")
By: /s/ Xxxxxxx Xxxxxxxx By: /s/ Xxxxxxx Xxxxxxx
--------------------------------- ---------------------------------
Print Name: Xxxxxxx Xxxxxxxx Print Name: Xxxxxxx Xxxxxxx
------------------------- --------------------------
Title: President & CEO Title: Chairman/CEO
------------------------------ -------------------------------
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