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EXHIBIT 10.2
SALES, MARKETING AND DISTRIBUTION AGREEMENT
THIS SALES, MARKETING AND DISTRIBUTION AGREEMENT (the "Agreement") is made
and entered into as of December 14, 1999 (the "Effective Date"), by and between
Genomic Solutions, Inc., a Delaware corporation, and PerkinElmer, Inc., a
Massachusetts corporation.
RECITALS:
Genomic Solutions, Inc. manufactures and distributes biochip systems,
protemic systems, gel analysis products and other products, software and systems
in the United States and throughout the world.
Genomic Solutions, Inc. desires to hire PerkinElmer, Inc. to promote,
market and distribute its products and services and perform certain field
service responsibilities, subject to the terms and conditions of this Agreement.
NOW THEREFORE, for and in consideration of the foregoing Recitals, the
mutual covenants and undertakings set forth below and other good and valuable
consideration, the receipt and adequacy of which are acknowledged, the
undersigned agree as follows:
1. Definitions. The following terms shall have the meaning set forth in this
section. All other capitalized terms shall have the meaning set forth in
the section defining such terms.
(a) "Active Date" means January 1, 2000 or such other date as the parties
shall mutually agree in writing.
(b) "Affiliates" of a party shall mean any person, corporation or other
business entity controlled, controlled by or under common control with
such party, with "control" meaning a fifty percent (50%) or greater
ownership interest.
(c) "Core Markets" means the United States of America, the United Kingdom
and Japan.
(d) "GSI" means Genomic Solutions, Inc. and its Affiliates.
(e) "GSI Products" means the products identified on Exhibit A hereto. In
the event that during the Term, GSI offers any other products not
described on Exhibit A, such products shall automatically be deemed
"GSI Products" for purposes of this Agreement. GSI shall provide PKI
with thirty (30) days advance written notice of the discontinuation of
the manufacture of any GSI Product and the material modification or
improvement of any GSI Product.
(f) "PKI" means PerkinElmer, Inc. and its Affiliates
(g) "Term" means the two (2) year period commencing on the Active Date,
provided, that upon expiration of the initial Term, this Agreement
shall automatically review for successive two (2)
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year periods unless either party notifies the other in writing at
least ninety (90) days prior to the expiration of the then current
term of its intention not to renew.
2. Preparation Activities.
(a) Preparation Sales. Commencing on the Effective Date, PKI may begin
promoting the sale of the GSI Products and will work with GSI to
prepare for the assumption of certain sales, marketing, distribution
and field service activities on the Active Date. GSI shall be
responsible for all sales and distribution activities world-wide prior
to the Active Date (including all sales, marketing, distribution and
service costs) and shall be entitled to receive all revenue from such
activities. GSI shall also be entitled to all world-wide revenue from
orders for GSI Products placed prior to the Active Date, so long as
such GSI Products are actually shipped within one hundred eighty (180)
days after the Active Date.
(b) Preparation Activities. Commencing on the Effective Date, GSI and PKI
shall jointly and cooperatively prepare for PKI's distribution of GSI
Products outside of Core Markets and promotion of GSI Products in the
Core Markets as contemplated in Sections 3 and 4, respectively. GSI
and PKI shall provide sufficient resources commencing on the Effective
Date to allow PKI to undertake sales and distribution of GSI Products
on the Active Date. Such preparation activities shall include, but not
be limited to, the following:
(i) Training and preparation of PKI sales and field service forces,
including account planning, quota setting, role definition and
other sales preparation activities.
(ii) Incorporation of sales and service activities into PKI
infrastructure, including logistics preparation and planning.
(iii) Development of coordinated marketing launch and plan, including
development of integrated message to customers, branding
preparation and other launch related activities.
3. Exclusive Distributor Appointment.
(a) Exclusive Rights and Responsibilities of PKI. Effective as of the
Active Date and subject to the terms of this Agreement, PKI shall have
the exclusive right and responsibility to engage in sales, marketing,
distribution and field service activities with respect to GSI Products
in any market or geographical area other than the Core Markets
provided, however, that: (i) GSI has distributor contracts for
non-Core Markets with those third parties listed in Exhibit B hereto,
with territories and termination notice periods as set out in such
Exhibit B for each such contract; and (ii) GSI shall send all of its
distributors in the non-Core Markets as listed on Exhibit B notices of
termination as soon as possible, but no later than four (4) days after
the first date on which it may send such termination notices, through
whatever means necessary to ensure that such third parties receive
those notices as soon as possible (except the parties will work
together in good faith to allow PKI to utilize Science & Technology,
Ltd., the current distributor for GSI in New Zealand, from and after
the Active Date).
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(b) Sales Goals and Quotas. GSI shall make GSI Products available to PKI
in accordance with the terms and pricing in Section 7 below. Exhibit C
attached is a schedule of PKI sales targets for the first four (4)
quarters after the Active Date. Purchases of GSI Products in excess of
the minimum sales target set forth in Exhibit C for any calendar
quarter shall be credited towards the minimum sales target set forth
therein for subsequent calendar quarters. These minimum sales targets
are U.S. Dollar volumes based on GSI Product orders received by GSI
from PKI on or before the last day of such calendar quarter, and are
based on GSI's transfer price to PKI for such GSI Products. Exhibit C
shall be reviewed and updated annually by the parties to set new
quarterly minimum sales targets. In the event that parties are unable
to agree on sales targets, the matter will be submitted for
arbitration before a single arbitrator approved by the parties. All
arbitration shall take place in accordance with the rules of the
American Arbitration Association at such organization's Wilmington,
Delaware offices. Such arbitrator shall make such adjustments based on
then-current market conditions.
(c) Failure to Meet Minimum Sales. In the event that PKI fails to meet the
quarterly minimum sales for GSI Products for three (3) consecutive
calendar quarters, GSI, in its sole discretion and upon notice to PKI,
may convert PKI's right to sell, market, distribute and provide field
services for GSI Products outside of the Core Markets from exclusive
to non-exclusive.
(d) Consideration. The consideration for the grant of exclusivity of
distribution to PKI in the non-Core Markets shall consist of PKI's
obligations under this Agreement to sell, market, distribute and
service the GSI Products and other good and valuable consideration,
the receipt and adequacy of which are acknowledged.
4. Non-Exclusive Sales Representative Activities of PKI; PKI Providing
Technical Assistance Services.
(a) Appointment of PKI as Sales Representative. PKI shall promote the
products within the Core Markets, providing sales leads and opening
access to PKI's broad network of customer relationships within the
Core Markets. PKI shall therefore, from time to time after the Active
Date, identify Leads in the Core Markets and communicate the identity
of those Leads to GSI. GSI hereby appoints PKI, effective as of the
Active Date, as a non-exclusive sales representative for the GSI
Products in Core Markets. GSI further agrees that it will not, without
first obtaining PKI's written consent (with such consent not to be
unreasonably withheld) appoint any additional sales representatives,
dealers, distributors or other agents in connection with the marketing
and distribution of the GSI Products in the Core Markets after the
Effective Date; except, however, that GSI may make customary changes
in the ordinary course of business to its dealer/distributor network
in Japan without first obtaining PKI's written consent.
(b) Sales Commissions. GSI shall pay sales commissions to PKI for sales
procured as a result of assistance or efforts of PKI as follows:
(i) For all sales directly attributable to Leads or assistance
provided by PKI to GSI, GSI shall pay to PKI a commission based
on a percentage of the Net Revenue (as defined below) actually
received by GSI with respect to such sales. The commission
payable to PKI shall be between [*] and [*] of Net Revenue
actually received by GSI with respect to such sales, with the
commission amount to be determined based on the level of
assistance and effort provided by PKI Sales Personnel. By way
of example, PKI would receive a commission of [*] in instances
where GSI was unaware of any lead and a PKI sales
representative facilitates the sale, including without
limitation by making one or more sales calls. Likewise, PKI
shall receive a commission of [*] if GSI was aware of the lead
but PKI sales representatives assists in connection with the
sale. The commission for any particular sale shall be
determined based on the mutual agreement of the parties taking
into consideration the foregoing and the relative contributions
to the sale by the parties. For purposes of this section,
"Lead" means a qualified lead or prospect, including name of
company, key contact, defined need, reasonable indication of
finances, and other information to indicate that a relationship
has been established for a bona fide prospective purchaser of
GSI Products.
(ii) Timing of Payments. All commissions due and payable to PKI shall
be paid by GSI to PKI within thirty (30) days after the end of
the calendar quarter in which payment is actually received by
GSI. Such commissions shall be paid in three separate checks,
corresponding to the amounts earned in each of the three Core
Markets.
(iii) Definition of Net Revenue. For purposes of this Agreement, Net
Revenue means the invoice amount of sales of GSI Products to end
users attributable to Leads or assistance provided by PKI,
excluding fees for personal or field services, software upgrade
or maintenance services, freight charges, tariffs, taxes or
similar charges and net of all discounts, returns and
allowances, for (A) an initial purchase and subsequent purchases
by an account during the six-month period immediately following
such initial purchase; and thereafter (B) any subsequent
purchases by such account, for which PKI sales personnel were
directly involved in obtaining such purchases.
(iv) GSI shall deliver to PKI within forty-five (45) days after the
end of each calendar quarter, beginning with March 31, 2000, a
written report describing, for the applicable quarter: (A) GSI's
Net Revenues subject to the commissions described in this
Section 4(b); and (B) the Leads who have paid such amounts to
GSI. Each such report shall be accompanied by full payment to
PKI of the total commissions due to PKI for such Net Revenues.
(v) All commissions payable to PKI hereunder shall be paid in U.S.
Dollars and there shall be no chargebacks against such
commissions. To the extent that the Net Revenues upon which such
commissions are computed are received by GSI in a currency other
than U.S. Dollars, GSI shall convert such fees into U.S. Dollars
in accordance with its normal accounting procedures.
(vi) In order for PKI to confirm full payment of the commissions due
to PKI from GSI in accordance with this Section 4(b), GSI agrees
to make and keep full and accurate books and records in
sufficient detail to enable commissions payable hereunder to be
determined. On thirty (30) days' prior written notice to GSI
(but no more than twice during any calendar year), PKI's
independent certified public accountants shall have full access
to the books and records of GSI necessary to confirm the
commissions which are due to PKI hereunder, and for no other
purposes, and such accountants shall have the
[*] Certain information on this page has been omitted and filed
separately with the Commission. Confidential treatment has been
requested with respect to the omitted portion.
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right to make copies therefrom at PKI's expense. PKI's
independent certified public accountants shall have such access
during normal business hours. Prompt adjustment shall be made by
the proper party to compensate for any errors or omissions. PKI
shall pay all costs of conducting audits pursuant to this
Section 4(b)(vi); provided, however, that GSI shall reimburse
PKI in full for PKI's reasonable out-of-pocket costs whenever an
audit reveals that, with respect to any audited period, the
underpayment of commissions due was greater than ten percent
(10%) of the commissions actually paid to PKI for such period.
PKI agrees to hold confidential all information learned in the
course of any audit of GSI's books and records hereunder, except
when it is necessary for PKI to reveal such information in order
to enforce its rights under this Agreement, or except when
compelled by law.
(c) All commissions due and owing to PKI hereunder but not paid by GSI on
the due date thereof shall bear interest (in U.S. Dollars) at the rate
of the lesser of: (i) twelve per cent (12%) per annum; and (ii) the
maximum lawful interest rate permitted under applicable law. Such
interest shall accrue on the balance of unpaid amounts from time to
time outstanding from the date on which portions of such amounts
become due and owing until payment thereof in full.
5. PKI Obligations Generally.
(a) Product Labeling. All GSI Products shall be sold under the GSI name
and logo which will be the predominant branding element. Both parties
acknowledge and agree that the presence of PKI's "PerkinElmer" brand
will facilitate market recognition, credibility and customer
communications. Accordingly, PKI shall cooperate with GSI to design
and produce a subordinated brand label for GSI Products distributed
outside Core Markets (eg. "in partnership with PerkinElmer) and a
miniature brand label (eg. "Xxxxxx Xxxxx global alliance partner) for
use in Core Markets. PE shall bear all of its own costs and expenses
incurred in connection with such design activity and GSI shall bear
its own cost in connection with production activities.
(b) Inventory and Production Forecasts. PKI shall provide GSI with a six
month non-binding rolling production forecast of anticipated sales and
GSI Products requirements. Such forecast shall be updated and
delivered to GSI on a monthly basis for each of the particular
countries where PKI will be undertaking sales activities. PKI shall
also keep GSI reasonably informed of potential problems concerning the
GSI Products. All shipments shall be made by GSI to PKI facilities or
warehouses, with PKI (or its distributors) then responsible for
further distribution to end-users.
(c) Marketing, Promotion and Sales Efforts. PKI shall use commercially
reasonable efforts to market, promote the sale of, maintain and
service the GSI Products in markets other than Core Markets and to
market and promote the sale of GSI Products in Core Markets, subject
to the other provisions of this Agreement. PKI shall provide and
maintain, at its own expense, suitable facilities with adequate and
efficient sales personnel and field engineers. PKI shall provide all
ordinary service to its customers in markets outside the Core Markets
as the nature of the business makes necessary or desirable in
connection with the sale and distribution of GSI Products.
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(d) Promotional Materials. PKI will develop marketing and promotional
material for generating leads and sales of the GSI Products at its
sole cost and expense. Such materials shall conform with the labeling
standards set forth in subsection (a) above and shall be subject to
the approval of GSI.
(e) License to GSI Marks. GSI hereby grants to PKI a nonexclusive,
royalty-free license during the Term to use GSI's name and any other
trademarks or service marks associated with the GSI Products
(collectively, the "GSI Marks") in connection with PKI's performance
of its rights and obligations under this Agreement and to market and
sell the GSI Products under such GSI Marks. Such license shall be
non-transferable, except that PKI shall be entitled to grant its
dealers and others to which it sells GSI Products a nonexclusive,
nontransferable license to use such GSI Marks in connection with the
marketing, promotion and sale of such GSI Products. PKI acknowledges
that GSI is the sole and exclusive owner of all right, title and
interest in and to the GSI Marks. At no time, whether during or after
the term of this Agreement, shall PKI (i) represent, in any manner,
that it has any right, title or interest whatsoever in or to the GSI
Marks; (ii) use the GSI Marks in any way other than that expressly
contemplated in this Agreement; (iii) register or attempt to register
the GSI Marks or any xxxx or name similar to the GSI Marks under the
laws of any jurisdiction; or (iv) cause or allow to be done any act or
thing which would tend to impair the distinctiveness of the GSI Marks
or any part of GSI's right, title and interest in the GSI Marks. In
order to comply with GSI's quality control standards, PKI shall: (x)
use the GSI Marks in compliance with all relevant laws and
regulations; (y) accord GSI the right to inspect during normal
business hours, without prior advance notice, PKI's facilities used in
connection with efforts to sell the GSI Products in order to confirm
that PKI's use of such GSI Marks is in compliance with this Section
5(e); and (z) not modify any of the GSI Marks in any way and not use
any of the GSI Marks on or in connection with any goods or services
other than the GSI Products.
(f) License to PKI Marks. PKI hereby grants to GSI a nonexclusive,
royalty-free license during the Term to use PKI's name and any other
trademarks or service marks of PKI (collectively, the "PKI Marks") in
connection with affixing co-branded labels to the GSI Products, in
accordance with the co-branding arrangements contemplated herein. Such
license shall be non-transferable, except that GSI shall be entitled
to grant its sales representatives, dealers, distributors and other
agents to which it sells GSI Products in the Core Markets a
nonexclusive, nontransferable license to use such PKI Marks in
connection with the marketing, promotion and sale of such GSI
Products, subject to their compliance with GSI's obligations under
this Section 5(f). GSI acknowledges that PKI is the sole and exclusive
owner of all right, title and interest in and to the PKI Marks. At no
time, whether during or after the term of this Agreement, shall GSI
(i) represent, in any manner, that it has any right, title or interest
whatsoever in or to the PKI Marks; (ii) use the PKI Marks in any way
other than that expressly contemplated in this Agreement; (iii)
register or attempt to register the PKI Marks or any xxxx or name
similar to the PKI Marks under the laws of any jurisdiction; or (iv)
cause or allow to be done any act or thing which would tend to impair
the distinctiveness of the PKI Marks or any part of PKI's right, title
and interest in the PKI Marks. In order to comply with PKI's quality
control standards, GSI shall: (x) use the PKI Marks in compliance with
all relevant laws and regulations; (y) accord PKI the right to inspect
during normal business hours, without prior advance notice, GSI's
facilities used in connection labeling the GSI Products in order to
confirm that GSI's use of such PKI Marks is in
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compliance with this Section 5(f); and (z) not modify any of the PKI
Marks in any way and not use any of the PKI Marks on or in connection
with any goods or services other than the GSI Products.
6. Non-Competition.
(a) Reverse Engineering, etc. PKI shall not reverse engineer, redesign or
disassemble or dismantle any GSI Products, except to the extent
required to carry out the terms and conditions of this Agreement, in
the biochip or proteomic area for the purpose of attempting to create
products potentially competitive with the GSI Products. All such data
regarding the GSI Products will be considered "confidential" for
purposes of the Mutual Confidentiality Agreement between PKI and GSI
of even date herewith. In the event that PKI engages in any activity
as described in the first sentence of this subsection, then GSI may
immediately terminate this Agreement.
(b) Sales of Competitive Products. In the event that PKI sells, markets or
distributes, directly or indirectly, any products (other than GSI
Products) which are competitive with any GSI biochip products (defined
as any products which print or spot DNA on a glass slide or similar
substrate) or competitive with any GSI proteomics products (defined as
gels and mass spec products), then GSI shall have the right to convert
the exclusive rights granted to PKI under Section 3 above to
non-exclusive rights, upon giving PKI written notice of such
conversion.
7. Acceptance of Orders: Fulfillment; Pricing. The following terms shall
apply for PKI ordering and sales outside of the Core Markets:
(a) Order Placement. PKI shall submit to GSI, its orders for the GSI
Products in writing at least sixty (60) days before delivery is
required for hardware, instruments and equipment and thirty (30) days
before delivery is required for consumables, reagents and gels. All of
PKI's orders for GSI Products consisting of consumables, reagents and
gels (but excluding demonstration products) shall be for complete
lots, the size of which shall be determined by GSI in its reasonable
discretion. In this regard, GSI shall use reasonable efforts to
minimize its lot sizes.
(b) Order Acceptance and Fulfillment. GSI shall give careful consideration
to PKI's orders for GSI's Products, but all such orders shall be
subject to GSI's approval and acceptance. If GSI does not communicate
its rejection of an order to PKI within seven (7) days after receiving
such order, then GSI shall be deemed to have accepted such order. GSI
shall not be liable for any rejection of an order. All rejected orders
shall be deemed purchased by PKI for the purposes of determining
whether PKI has met the quarterly minimum sales targets in Exhibit C
hereto. In the event of a shortage of GSI Products, GSI shall accept
orders and allocate GSI Products in a reasonable manner so as to
support PKI as a distributor of GSI Products, and at a minimum, GSI
shall allocate its manufacturing capability on a unit basis so that
PKI receives the same percentage of GSI's total output of GSI Products
as PKI received on average during the most recent six (6) months prior
to the shortage.
(c) Servicing and Certain Revenue. PKI shall be solely responsible for all
installation, field servicing, maintenance and warranty repair with
respect to GSI Products distributed by PKI
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outside of Core Markets, provided, that GSI shall provide reasonable
application and technical support to PKI marketing and sales
personnel. PKI shall be entitled to receive all revenue generated from
field servicing and maintenance outside of the Core Markets. Revenue
from software upgrades and maintenance or subscription services shall
be split equally by GSI and PKI.
(d) GSI Product Pricing. GSI shall sell the GSI Products to PKI at the
transfer prices set forth on Exhibit A attached. If GSI develops any
new products which constitute GSI Products at anytime after the Active
Date, the parties shall negotiate in good faith toward reaching a
mutual understanding as to the rate at which GSI shall sell such GSI
Products to PKI. All orders of GSI Products by PKI shall be
non-cancelable. The parties agree to annually evaluate the pricing of
GSI with consideration to be given for adjustment based on market
dynamics, the cost of products and services, and changing consumer
conditions. In the event that the parties fail to reach agreement on
product pricing, any price changes shall be subject to arbitration as
provided in Section 3(b) above.
(e) F.O.B. All prices are and shall be, and all deliveries of GSI Products
shall be made, F.O.B. GSI's U.S. or U.K. shipping dock. Risk of loss
and title to the GSI Products passes to PKI at such F.O.B. point.
(f) Invoicing. All invoices for GSI Products shipped shall be due and
payable in U.S. Dollars on or before the thirtieth (30th) day after
the later of (i) the date the invoice is sent by GSI; and (ii) the
date of shipment. All payments due and owing to GSI hereunder but not
paid by PKI on the due date thereof shall bear interest (in U.S.
Dollars) at the rate of the lesser of: (i) twelve per cent (12%) per
annum; and (ii) the maximum lawful interest rate permitted under
applicable law. Such interest shall accrue on the balance of unpaid
amounts from time to time outstanding from the date on which portions
of such amounts become due and owing until payment thereof in full
(g) Taxes. All prices for GSI Products shall be quoted or listed exclusive
of any federal, state or local sales, use or excise taxes levied on or
measured by the sale, sales price or use of GSI Products
(collectively, "Taxes"). Unless PKI is exempted from such Taxes, all
such prices shall be increased by the amount of the Taxes, if any, to
which the GSI is subject in connection with the sale of the GSI
Products.
(h) Resale Prices. PKI may sell the GSI Products at such prices and on
such terms and conditions as it deems appropriate in its sole
discretion. PKI shall have no authority to obligate GSI in any way
through the terms and conditions on which it sells the GSI Products.
(i) Limited GSI Products Warranty. GSI will warrant all GSI Products
(parts only) sold outside of Core Markets against defects in materials
or workmanship for a period of twelve (12) months from the customer
installation date under normal service and use; except that GKI will
warrant consumables, gels and reagents for a period of ninety (90)
days after shipment to the customer. The GSI Warranties shall not
apply to any GSI Product which is used for a purpose or in a manner
for which it was not intended, which is defectively or improperly
installed, which is altered in any way other than in connection with
its proper installation, or which is subject to misuse, negligence,
accident or neglect, so as to affect adversely the condition,
performance or
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value of such GSI Product. GSI's obligations with respect to this
warranty are limited to the repair and replacement of defective parts
after GSI's inspection and verification of such defects. Such
obligations specifically exclude labor costs.
(j) Disclaimer of Express and Implied Warranties. THE GSI WARRANTY ABOVE
IS THE ONLY WARRANTY MADE WITH RESPECT TO THE GSI PRODUCTS OR ANY
PARTS OR COMPONENTS THEREOF, EXPRESS OR IMPLIED. GSI MAKE NO IMPLIED
WARRANTIES AND SPECIFICALLY DISCLAIMS ANY WARRANTY THAT ITS PRODUCTS
ARE MERCHANTABLE OR FIT FOR ANY PARTICULAR PURPOSE.
(k) Remedy; Limitation of Liability. If PKI believes that GSI has breached
any warranty it shall notify GSI of the way in which the GSI Product
is defective and, upon request, shall return at GSI's expense the
defective GSI Product or component part to GSI. If GSI agrees that the
GSI Product is defective, it shall promptly repair or replace the
defective GSI Product or issue a credit for the price of the GSI
Product. EXCEPT WITH RESPECT TO THIRD PARTY PRODUCT LIABILITY CLAIMS
ARISING FROM GSI PRODUCTS NOT CONFORMING TO THIS WARRANTY AND EXCEPT
FOR GSI'S INDEMNIFICATION OBLIGATIONS UNDER SECTION 8(b)(vi) BELOW, IN
NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR ANY
PURCHASER OF GSI PRODUCTS FOR INDIRECT, SPECIAL, INCIDENTAL,
EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES, FOR LOSS OF ANTICIPATED
PROFITS OR BUSINESS, OR FOR INTERRUPTIONS IN BUSINESS, WITH RESPECT TO
ANY CLAIM OF ANY KIND RESULTING FROM THE GSI PRODUCTS OR THEIR USE OR
MISUSE, ANY ORDER UNDER THIS AGREEMENT OR ANY PERFORMANCE,
NON-PERFORMANCE OR BREACH OF THIS AGREEMENT, WHETHER THE BASIS OF SUCH
LIABILITY IS BREACH OF CONTRACT, TORT (INCLUDING, WITHOUT LIMITATION,
NEGLIGENCE AND STRICT LIABILITY), STATUTORY OR ANY OTHER LEGAL THEORY
WHATSOEVER. The remedy set forth in this Section shall be PKI's sole
and exclusive remedy for breach of GSI's warranties.
8. Indemnity.
(a) PKI shall defend and hold harmless GSI, its Affiliates and all
officers, directors, employees and agents thereof against and from any
and all claims made against GSI based upon, arising out of or in any
way related to (i) PKI's acts or omissions in connection with the
sale, marketing, distribution, installation, maintenance and servicing
of the GSI Products; (ii) PKI's conduct or operation of its business;
(iii) any negligent acts or omissions of PKI or any of its agents,
contractors or employees; (iv) any representations or warranties made
by PKI with respect to the GSI Products which were not authorized by
GSI; (v) any breach or violation of this Agreement; and (vi) PKI's
failure to comply with relevant laws and regulations. Such indemnity
shall extend to all costs, awards, claims or damages of any kind or
nature, including attorney fees and related expenses ("Damages").
(b) GSI hereby agrees to indemnify, defend and hold harmless PKI, its
Affiliates and all officers, directors, employees and agents thereof
from all Damages arising out of (i) GSI's acts or omissions in
connection with the production, sale, marketing, distribution,
installation, maintenance and servicing of the GSI Products; (ii)
GSI's conduct or
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operation of its business; (iii) any negligent acts or omissions of
GSI or any of its agents, contractors or employees; (iv) GSI's breach
of this Agreement; (v) GSI's failure to comply with relevant laws and
regulations; and (vi) PKI's use or reselling of the Products
infringing on the intellectual property rights of third parties or
constituting a misappropriation of any third party's trade secrets;
provided, however, that with respect to part (vi) above:
(A) In the event that any GSI Product is held in a suit or proceeding
to infringe any intellectual property rights of a third party and
the use or reselling of such GSI Product is enjoined, or GSI
reasonably believes that it is likely to be found to infringe or
likely to be enjoined, then GSI shall, at its sole cost and
expense, either (1) procure for PKI the right to continue
reselling such GSI Product; or (2) modify such GSI Product so
that it becomes non-infringing. If neither (1) nor (2) is
practicable, then GSI may, in its sole discretion, cease
distributing such GSI Product in the affected countries outside
the Core Markets, in which case such GSI Product shall be deemed
removed from this Agreement with respect to such affected
countries upon repurchasing PKI's inventory of such GSI Product
which are saleable and in the original packages and unaltered
from their original form and design, subject to GSI's inspection,
test, and acceptance. Any such repurchase of PKI's inventory of
GSI Products shall be at the product prices indicated in Exhibit
A hereto. Such repurchased inventory shall be shipped by PKI,
freight and insurance to be paid by GSI, according to GSI's
instructions. GSI shall pay PKI for such repurchased GSI Products
within thirty (30) days after GSI receives those GSI Products in
one of its facilities.
(B) GSI shall have no obligation for any claim of infringement
arising from: (1) any combination of GSI Products with products
not supplied or approved in writing by GSI, where such
infringement would not have occurred but for such combination;
(2) the adaptation or modification of GSI Products not approved
by GSI, where such infringement would not have occurred but for
such adaptation or modification; (3) the use of a GSI Product in
an application for which it was not designed, intended or
approved by GSI, where such infringement would not have occurred
but for such use; (4) a claim based on intellectual property
rights owned by PKI or any of its Affiliates; or (5) improper
service or installation.
(c) The party seeking indemnification (be it GSI under Section 8(a) above
or PKI under Section 8(b) above) (the "Indemnified Party") hereby
agrees that: (i) the Indemnified Party shall give the other party (the
"Indemnifying Party") prompt written notice of each such claim; (ii)
the Indemnifying Party shall have sole control and authority with
respect to the defense or settlement of any such claim; and (iii) the
Indemnified Party shall cooperate fully with the Indemnifying Party,
at the Indemnifying Party's sole cost and expense, in the defense of
any such claim. Any settlement of any such claim that imposes any
liability or limitation on the Indemnified Party shall not be entered
into without the prior written consent of the Indemnified Party.
10
(d) In the event a claim is based partially on an indemnified claim
described in Sections 8(a) and/or 8(b) above and partially on a
non-indemnified claim, or is based partially on a claim described in
Section 8(a) above and partially on a claim described in Section 8(b)
above, any payments and reasonable attorney fees incurred in
connection with such claims are to be apportioned between the parties
in accordance with the degree of cause attributable to each party.
(e) During the term of this Agreement, GSI shall maintain an occurrence
based comprehensive general liability insurance policy issued by a
reputable insurance company, naming PKI as an additional insured,
which policy shall insure against any and all bodily injury and/or
property damages for which GSI has agreed to indemnify PKI as stated
above in this Section 8. Such insurance shall be in the amount of at
least $1,000,000 per claim and $2,000,000 for claims in the aggregate.
9. Assistance.
(a) Promotional Materials. GSI shall make available to PKI, such
advertising, sales and promotional materials, price lists, sales
assistance and other information concerning the GSI Products as GSI
deems appropriate in its reasonable discretion. PKI shall not produce
or cause to be produced any advertising, sales, promotional or other
information concerning the GSI's Products without GSI's prior review
and written consent, which shall not be unreasonably withheld or
delayed. On termination of this Agreement by either party for any
reason whatsoever, PKI shall immediately return to GSI any and all
advertising, sales or promotional materials, price lists, copies of
invoices and any and all other documents, materials or records
pertaining to the GSI Products, whether produced by or at the
direction of PKI or GSI.
(b) Technical Support and Assistance. GSI agrees to make reasonable
efforts to answer any technical support inquiries which GSI receives
from PKI.
10. Early Termination.
(a) Termination by Either Party. Any provision of this Agreement to the
contrary notwithstanding, either party shall have the right to
terminate this Agreement, at any time without prior notice, except as
required below, on the occurrence of any of the following:
(i) The other party fails, neglect or refuses in any material manner
to satisfactorily perform the duties assigned to or required of
it under this Agreement, but only after such other party has
been given sixty (60) days notice of and opportunity to cure
such failure, neglect or refusal;
(ii) The other party becomes insolvent or unable to pay its debts as
they become due or makes an assignment for the benefit of its
creditors;
(iii) A receiver or a trustee is appointed for the other party's
assets, and such receiver or trustee is not discharged within
sixty (60) days of such appointment;
11
(iv) A proceeding of any nature under the federal Bankruptcy Code, as
amended, or any state insolvency statute, is commenced by or
against the other party, and such proceeding, if involuntary, is
not set aside within sixty (60) days from the date of its
institution;
(v) Either party shall have the right to terminate this Agreement
with ninety (90) days written notice given no later than sixty
(60) days after the occurrence of the following two conditions:
(A) the consummation of a bona fide initial public offering of
GSI's capital stock that is firmly underwritten by a nationally
recognized underwriter, that results in no less than $20,000,000
of gross proceeds to GSI and that results in GSI's stock being
listed for trading on the New York Stock Exchange or the
National Market Tier of the Nasdaq Stock Market (defined herein
as "IPO"), and (B) a post-IPO "change in control" of GSI,
defined as the sale of all or substantially all of the business
and assets of GSI or a sale of more than 50% of the issued and
outstanding shares of GSI. The parties further agree that the
foregoing right of termination shall not apply (X) merely
because an IPO has occurred, or to an event that may be
considered a change of control in GSI but does not follow an
IPO, including by way of example, (Y) the sale of all or
substantially all of the business and assets of GSI prior to an
IPO or (Z) a sale of more than 50% of the issued and outstanding
shares of GSI prior to an IPO.
(b) Termination by GSI. In addition to the foregoing, GSI may terminate
this Agreement in the event that PE fails to make any required
payments on the due date thereof and such failure is not cured within
fifteen (15) days of notice by GSI to the addresses indicated in
Section 14 below.
(c) Effect of Termination or Expiration. Upon termination or expiration of
this Agreement, as the case may be, PKI shall have no right to market
and distribute the GSI Products (except for the six-month period
immediately following the effective date of termination or expiration,
as the case may be, during which PKI shall be entitled to sell-off its
inventory of GSI Products) and all licenses hereunder shall
immediately terminate. PKI shall not be entitled to any commissions
for sales closed after termination or expiration, regardless of
whether PKI participated in the sale. In addition, each party shall
return to the other party all copies of any promotional material,
written literature, product samples, and any Confidential Information
as herein defined. Termination and expiration shall not affect PKI's
obligations with respect to GSI Products previously sold hereunder or
with respect to any indebtedness owed by either party to the other.
11. RESERVED
12. Dealer Status. Nothing in this Agreement shall be construed in such a
manner as to constitute one party the agent or legal representative of the
other party for any purpose whatsoever. Neither party shall have any
authority whatsoever, whether express or implied, to assume, create or
incur any obligation or liability whatsoever on behalf of or in the name of
the other party, or to bind the other party in any manner whatsoever.
Neither party shall be liable for any damages, loss, cost or expense
whatsoever, including incidental or consequential damages, resulting from
any sale or other activities performed by the other party.
12
13. Cooperative Exchange and Licensing. Attached as Exhibit D hereto is a list
of representative PKI technologies. PKI agrees to license GSI, on a
non-exclusive basis, the right to use those technologies to make, use and
sell products for the proteomic market and/or for the biochip market. As
GSI identifies each such use of those PKI technologies, the license fee
level for such use will be set by the parties at then-current market rates,
based upon the specific technology to be licensed and the intended use. GSI
will receive a 30% discount on the agreed-upon license fees so long as: (i)
this Agreement remains in effect; and (ii) PKI's rights under Section 3
above remain exclusive. If either of these conditions (i) or (ii) is not
met, then GSI will lose the 30% discount, but will maintain the license
rights at the agreed-upon market rates. At the time the parties set the
license fee level for each such use, they shall also negotiate in good
faith to conclude the other terms and conditions of such license agreement.
14. Notices. Any and all notices, requests, demands and other communications
permitted under or required pursuant to this Agreement (each, a "notice")
shall be in writing and shall be (i) personally delivered; (ii) sent by
facsimile transmission (with a hard copy to follow in one of the other
manners contemplated in this Section 14); (iii) sent via overnight courier,
shipping charges prepaid; or (iv) sent via U.S. Mail, postage prepaid,
certified mail, return receipt requested, to the parties at the addresses
or fax numbers set forth below, or at such other addresses or fax numbers
as they may indicate by written notice given as provided in this Section
14.
If to PKI: With a required copy to:
PerkinElmer, Inc.
00 Xxxxxxx Xxxxxx Xxxx xxx Xxxx XXX
Xxxxxxxxx, Xxxxxxxxxxxxx 00000 00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax no: 000-000-0000 Fax no.: 000-000-0000
Attn: General Counsel Attention: Xxxxx X. Xxxxxxx
If to GSI: With a required copy to:
Genomic Solutions Inc. Jaffe, Raitt, Heur & Xxxxx,
0000 Xxxxxxx Xxxxx Professional Corporation
Xxx Xxxxx, XX 00000 Xxx Xxxxxxxx Xxxxxx, Xxxxx 0000
Fax: (000) 000-0000 Xxxxxxx, XX 00000
Attn: Xxxx Xxxxxxxx Fax: (000) 000-0000
Attention: Xxxxx Sugar
Any notice sent in the manner contemplated in clause (i) above shall be
deemed to have been given on the date delivered; in the manner contemplated
in clause (ii) above, as of the time the sender receives confirmation from
its fax machine that the facsimile transmission has been successfully
completed (provided, however, that if such time is after 4:00 p.m.,
measured in terms of the recipient's local time, the notice shall be deemed
to have been given as of 8:00 a.m. on the next business day of the
recipient); in the manner contemplated in clause (iii) above, on the first
(1st) business day after the notice has been deposited in a regularly-
maintained receptacle for such a parcel; and in the manner contemplated in
13
clause (iv) above, on the third (3rd) business after the notice has been
deposited in a regularly-maintained receptacle for U.S. Mail.
Each party agrees that any press releases, publicity or advertising which
shall be released by it in which the other party is identified shall
require the prior written approval of such other party, such approval not
to be unreasonably withheld or delayed.
15. Non-Assignable. Neither party may assign this Agreement or its rights or
obligations under this Agreement without the written consent of the other
party; which consent may be granted or withheld in the other party's sole
discretion.
16. Waiver. Any party's waiver of any breach of any provision of this
Agreement, and any party's failure to exercise any of its rights under or
in connection with this Agreement, shall not operate or be construed as a
waiver by such party of any subsequent or similar breach or of any such
rights or preclude exercise of such rights at a later time.
17. Choice of Law: Construction. This Agreement is deemed to have been executed
in the State of Delaware and shall be construed and enforced in accordance
with the laws of the State of Delaware, without regard to its conflict of
laws principles. This Agreement shall not be construed against or in favor
of any party by virtue of the fact that this Agreement was drafted
primarily by any one party.
18. Submission to Jurisdiction. The parties irrevocably submit to the
jurisdiction of the federal and state courts of Wilmington, Delaware;
provided, however, that nothing herein shall preclude -------- -------
either party, if it thinks fit, from instituting proceedings against the
other party or anyone acting by, through or under the other party in any
place which may have jurisdiction for the purpose of protecting and
enforcing such Party's rights either hereunder or pursuant to any other
agreements, documents, instruments or otherwise. Each party hereby
irrevocably waives any objection which it may now or hereafter have to the
laying of venue of any suit, action or proceeding relating to this
Agreement in Wilmington, Delaware, and further irrevocably waives any claim
that Wilmington, Delaware is not a convenient forum for any such suit,
action or proceeding.
19. Remedies. Any remedy provided in this Agreement for a breach of a specific
section of this Agreement shall be the sole and exclusive remedy for the
breach to which it relates. Subject to the preceding sentence, the parties'
respective rights and remedies under or with respect to breaches of this
Agreement which are not specifically provided for in this Agreement are
separate and cumulative, and no one of them, whether or not exercised,
shall be deemed to be an exclusion of any of the others and shall not limit
or prejudice any other legal or equitable right which any party to this
Agreement may have.
20. Entire Agreement; Amendment. This Agreement represents the complete and
final expression of the parties' agreements and understandings with respect
to its subject matter. This Agreement supersedes all other prior oral and
written agreements between the parties with respect to the subject matter
of this Agreement. Except to the extent expressly provided in this
Agreement, this Agreement may not be amended or modified except pursuant to
a written agreement executed by both parties.
14
21. Binding Effect. This Agreement shall be binding on an inure to the benefit
of the parties and their respective successors and permitted assigns.
22. Headings. The headings contained in this Agreement are for reference
purposes only and shall not in any way affect the meaning or interpretation
of this Agreement.
23. No Third-Party Beneficiaries. This Agreement, and the respective
obligations of PKI and GSI under this Agreement, are for the sole and
exclusive benefit the parties to this Agreement. Any provision of this
Agreement to the contrary notwithstanding, no party other than PKI, GSI and
their respective successors and permitted assigns shall have the right to
rely on or enforce the provisions of this Agreement as a third-party
beneficiary or otherwise.
24. Offset. Each party shall be entitled to offset any amounts due it by the
other party against any amounts which it owes the other party.
25. Pronouns. References to a party in the singular or plural, as him, her, it
or other like preferences, shall also, where the context so requires, be
deemed to include the singular or the plural, or masculine, feminine or
neuter reference, as the case may be.
26. Counterparts; Facsimile Signatures. This Agreement may be executed in
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument. Facsimile or photostatic copies
of signatures to this Agreement shall be deemed to be originals and may be
relied on to the same extent as the originals.
27. Severability. If any provision of this Agreement is declared invalid or
unenforceable by a court having competent jurisdiction, it is mutually
agreed that this Agreement shall endure except for the part declared
invalid or unenforceable by order of such court. The parties shall consult
and use their best efforts to agree upon a valid and enforceable provision
which shall be a reasonable substitute for such invalid or unenforceable
provision in light of the intent of this Agreement
IN WITNESS WHEREOF, the undersigned have executed and delivered this Sales,
Marketing and Distribution Agreement as of December 14, 1999.
Genomic Solutions, Inc.
By: Xxxxxxx X. Xxxxxxxx
-----------------------------------
Its: President & CEO
----------------------------------
PerkinElmer, Inc.
By: Xxxxxxxx Xxxxxxx
-----------------------------------
Its: SR V.P.
----------------------------------
15
EXHIBIT A
GSI PRODUCTS
LIST PRICE AND TRANSFER PRICE
------- ----------------------- ----------------------------------------------------------------
CATEGORY PRODUCT GSI PKI
LIST TRANSFER
PRICE PRICE
------- ----------------------- ----------------------------------------------------------------
1 BioChip Systems GeneTAC 2000 $ 80,000 [*]
------- ----------------------- ------------------------------------------------------
2 BioChip Systems GeneTAC 3000 $ 99,000 [*]
------- ----------------------- ------------------------------------------------------
3 BioChip Systems Flexys Gridding System $ 80,000 [*]
------- ----------------------- ------------------------------------------------------
4 BioChip Systems Flexys Gridding with Autoloader $150,000 [*]
------- ----------------------- ------------------------------------------------------
5 BioChip Systems Flexys Picking System $ 90,000 [*]
------- ----------------------- ------------------------------------------------------
6 BioChip Systems Flexys Picking with Autoloader $160,000 [*]
------- ----------------------- ------------------------------------------------------
7 BioChip Systems Flexys High Density Arraying $ 80,000 [*]
------- ----------------------- ------------------------------------------------------
8 BioChip Systems Flexys High Density Arraying with Autoloader $150,000 [*]
------- ----------------------- ------------------------------------------------------
9 BioChip Systems Hybridization Station 12 Slide $ 59,000 [*]
------- ----------------------- ------------------------------------------------------
10 Proteomic Systems 2-D Electrophoresis System $ 13,700 [*]
------- ----------------------- ------------------------------------------------------
11 Proteomic Systems Gel Processor $ 29,000 [*]
------- ----------------------- ------------------------------------------------------
12 Proteomic Systems Proteomic Analyzer System (Darkroom) $ 55,000 [*]
------- ----------------------- ------------------------------------------------------
13 Proteomic Systems Proteomic Software only $ 25,000 [*]
------- ----------------------- ------------------------------------------------------
14 Proteomic Systems Proteomic Analyzer System (Scanner) $ 30,000 [*]
------- ----------------------- ------------------------------------------------------
15 Proteomic Systems ProGest $ 65,000 [*]
------- ----------------------- ------------------------------------------------------
16 Proteomic Systems ProMS $ 55,000 [*]
------- ----------------------- ------------------------------------------------------
17 Proteomic Systems Flexys Proteomics system (Protein Picker) $127,000 [*]
------- ----------------------- ------------------------------------------------------
18 Proteomic Systems Maldi Mass Spec $265,000 [*]
------- ----------------------- ------------------------------------------------------
19 Gel Analysis GelPrint 2000i $ 13,500 [*]
------- ----------------------- ------------------------------------------------------
NOTE: Destination shipping charges are not included.
Shipping terms: FOB GSI's U.S. or U.K. shipping dock.
Consumables, gels and reagents offered by GSI will be made available to
PKI at [*] of GSI's List Price for such materials, as in effect on the
date PKI's purchase order is received by GSI.
[*] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment has been requested with respect to
the omitted portion.
-16-
16
EXHIBIT B
GENOMIC SOLUTIONS' DISTRIBUTOR SCHEDULE
-----------------------------------------------------------------------------------------------------------------------------
DATE OF AGREEMENT AGREEMENT WITH TERMINATION ASSUMING DEFINITIVE COUNTRY
AGREEMENT SIGNED DEC. 15, 1999
-----------------------------------------------------------------------------------------------------------------------------
12/15/98 Science & Technology Ltd. December 15, 2000* New Zealand
-----------------------------------------------------------------------------------------------------------------------------
2/15/99 Bio/Can Scientific January 14, 2000 Canada
-----------------------------------------------------------------------------------------------------------------------------
12/7/98 B&L March 15, 2000 Benelux
-----------------------------------------------------------------------------------------------------------------------------
5/26/99 Proteigene XXXX Xxxxx 00, 0000 Xxxxxx
-----------------------------------------------------------------------------------------------------------------------------
3/16/99 Xxxxxxxx Xxxxx 00, 0000 Xxxxxx
-----------------------------------------------------------------------------------------------------------------------------
3/31/99 Seoulin Scientific Co., Ltd. March 31, 2000 South Korea
-----------------------------------------------------------------------------------------------------------------------------
3/26/99 AbiMed June 15, 0000 Xxxxxxx
-----------------------------------------------------------------------------------------------------------------------------
8/30/99 Sinc Do Brasil Inst.Cientifica August 30, 2000 Brazil
-----------------------------------------------------------------------------------------------------------------------------
9/18/99 Labmate (Asia) PVT. LTD September 22, 2000 India
-----------------------------------------------------------------------------------------------------------------------------
11/16/98 Australian Laboratory Services November 16, 0000 Xxxxxxxxx
-----------------------------------------------------------------------------------------------------------------------------
12/3/98 Feng Jih December 3, 2000 Taiwan and China
-----------------------------------------------------------------------------------------------------------------------------
? Bio Tech A.S. March 15, 2000** Czech Republic
-----------------------------------------------------------------------------------------------------------------------------
12/3/98 Feng Jih December 3, 2000 Taiwan and China
-----------------------------------------------------------------------------------------------------------------------------
*CURRENT PKI DISTRIBUTOR
**NO CONTRACT CAN BE LOCATED. GSI BELIEVES IT CAN CANCEL THIS AGREEMENT WITH
90 DAYS NOTICE.
17
EXHIBIT C
PKI SALES TARGETS
Calendar Quarter MINIMUM
---------------- -------
Q1, 2000 [*]
Q2, 2000 [*]
Q3, 2000 [*]
Q4, 2000 [*]
Note: These minimums are dollar volume of sales based on orders received by GSI
from PKI and are at GSI's transfer price to PKI.
[*] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment has been requested with
respect to the omitted portion.
18
EXHIBIT D
PKI TECHNOLOGIES
[*]
[*] The information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with
respect to the omitted portion.
