LICENSE AND MANUFACTURING AGREEMENT
THIS LICENSE AND MANUFACTURING AGREEMENT (the "Agreement")
is made and entered into as of this 16 day of January, 1997 (the
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"Effective Date"), by and between PARADIGM MEDICAL INDUSTRIES,
INC., a Delaware corporation ("Paradigm") and O.B.F. LABS, LTD.,
a United Kingdom corporation ("Manufacturer"). Paradigm and
Manufacturer are also referred to herein, individually, as
"party," and collectively, as "parties."
RECITALS
WHEREAS, Paradigm is a company engaged in the production,
distribution, and sale of ophthalmic products throughout the
world and is capable of supplying technical products, services
and support to the medical and health care industry;
WHEREAS, Manufacturer is an engineer and manufacturer of
medical and health care products, including an ophthalmic
tonometer (the "Tonometer"); and
WHEREAS, Paradigm desires to obtain from Manufacturer, and
Manufacturer desires to grant to Paradigm, the right to repackage
the Tonometer as well as an exclusive license to sell the
repackaged tonometer in the United States under Paradigm's
tradenames and trademarks and a nonexclusive license to sell the
repackaged tonometer worldwide also under Paradigm's tradenames
and trademarks;
NOW, THEREFORE, in consideration of the respective
representations, warranties, covenants and agreements contained
herein, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the
parties agree as follows:
1. Definitions. The capitalized terms in this Agreement
shall have the following meanings unless otherwise defined
herein:
1.1 "System" shall mean the Tonometer packaged as
a subassembly without the module cover which encloses the
electronic components, but including the tonometer probe, power
cord and modifications thereto.
1.2 "Disposable Tip" shall mean the plastic
membrane tip attached to the Tonometer probe and packaged as a
single unit in a sealed, single-use pack.
1.3 "Repackaged System" shall mean the System
repackaged in a cover designed by or for Paradigm and marketed
under tradenames and trademarks selected by Paradigm.
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2. Right to Repackage. Manufacturer hereby grants to
Paradigm, the right to repackage the System and sell the
Repackaged System under tradenames and trademarks selected by
Paradigm.
3. Ownership of Design and Xxxx. Manufacturer hereby
acknowledges and agrees that the cover designed by or for
Paradigm in which the System will be repackaged as well as the
tradenames and/or trademarks selected by Paradigm to market the
Repackaged System shall be the exclusive property of Paradigm and
Manufacturer shall have no rights to, nor ownership interest in
such property.
4. Exclusive License. Manufacturer hereby grants
Paradigm the exclusive license to sell the Repackaged System in
the United States during the Term or any Renewed Term of this
Agreement (as defined in paragraph 13 below). Manufacturer shall
not grant any other person or entity the right to repackage the
System and sell such repackaged System in the United States.
Notwithstanding the foregoing, Manufacturer shall be entitled to
sell the Tonometer directly or indirectly in the United States
during the Term or any Renewed Term of this Agreement under its
own tradenames and trademarks. Further, Manufacturer shall be
entitled to license other persons or entities to repackage the
System for marketing in any country other than the United States
and its territories provided that such persons or entities are
expressly restricted from selling such repackaged Systems
directly or indirectly in the United States.
5. Non-exclusive Right. Manufacturer hereby grants to
Paradigm, the non-exclusive right to sell the Repackaged System
throughout the world in any country during the Term or any
Renewed Term of this Agreement (as defined in paragraph 13
below).
6. Development and Manufacturing. Manufacturer shall
manufacture and produce the System so that Paradigm can repackage
the System in a cover. Manufacturer shall bear the reasonable
expenses, if any, of packaging the System as subassembly.
Manufacturer shall notify Paradigm of all changes from time to
time made to the System and shall supply Paradigm with written
notice and information concerning such changes. Each party shall
keep its own master engineering and medical device files.
7. Quality Control. Manufacturer will perform product
testing, burn-in, calibration and quality assurance inspections
for the System to comply with regulatory standards and product
performance specifications prescribed by Paradigm. Manufacturer
will keep accurate records that comply with regulatory standards
of the Food, Drug and Cosmetics Act for each System or other
product manufactured and make copies of the same available to
Paradigm for its product history and reporting records. Paradigm
shall be entitled to integrate Manufacturer's Quality Manual or
portions thereof into its own Quality Manual.
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8. Regulatory Approval. Paradigm shall perform or be
responsible for all clinical evaluations, testing and
documentation related to regulatory approvals as may be required
to market the Repackaged System in the United States.
Notwithstanding the foregoing, Manufacturer will make available
to authorized representatives of the United States Food and Drug
Administration ("FDA"), all documents reasonably necessary to
demonstrate FDA Good Manufacturing Practice ("GMP") requirements
and will make all reasonable efforts to comply with FDA GMP
requirements. Paradigm shall also be permitted to seek
regulatory approval from authorized representatives of any other
governmental or regulatory body which may oversee or control the
sell of the Repackaged System. Manufacturer shall make available
all documents reasonably necessary to satisfy the requirements of
such body and obtain marketing approval for the Repackaged
System. Manufacturer will also make any and all other testing
records and documents pertaining to the System or any
subarrangement thereof, available for their inspection and
copying.
9. Service and Training. Paradigm shall be responsible
for performing field service and maintenance of the Repackaged
System. Manufacturer shall train Paradigm's designated service
technicians and sales personnel in training classes at Paradigm's
offices in Salt Lake City, Utah and pursuant to terms mutually
agreed to by both parties.
10. Price & Purchase Requirements.
10.1 Systems. For a period of one year from the
date Paradigm shall purchase at least 12 Systems by January 31,
1998; an additional 24 Systems by January 31, 1999; and an
additional 24 Systems by January 31, 2000. Notwithstanding the
foregoing, there is no limit to the number of Systems Paradigm
may purchase. Paradigm shall purchase each completed System for
$4,700 (the "Fixed Purchase Price"). Paradigm shall pay the
Fixed Purchase Price of each System within thirty (30) days after
receipt of an invoice.
10.2 Beta Tonometers. Paradigm shall purchase two
(2) Tonometers within thirty (30) days from the Effective Date of
this Agreement for evaluation and engineering and design
purposes. Manufacturer shall sell the two Tonometers, including
the tonometer probes, all accessories, manuals and four (4) cases
of Disposable Tips, to Paradigm for $13,200.
11. Disposable Tip Resales. Manufacturer hereby grants
Paradigm a license to sell the Disposable Tip in any country
throughout the world and agrees to sell the Disposable Tip to
Paradigm at Manufacturer's usual and customary, wholesale prices
during the Term and any Renewed Terms of this Agreement (as
defined in paragraph 13 below) and for at least two (2) years
following the termination or expiration of this Agreement.
Manufacturer further agrees not sell the Disposable Tip to
purchasers or owners of the Repackaged System and to restrict any
and all licensees from
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selling the Disposable Tip to purchasers or owners of the
Repackaged System.
12. Warranty and Service.
12.1 Warranty. For a period of one year from the
date of purchase of the Repackaged System by a Paradigm customer,
Manufacturer shall provide replacement parts or replace defective
parts or components of the System only at no cost to Paradigm or
the purchaser of the Repackaged System within ten (10) days after
notification by Paradigm. Manufacturer's warranties shall
include the implied warranty of merchantability and fitness for
a particular purpose.
12.2 Field Service. Paradigm will coordinate all
customer service communications, product delivery to and from
customers, field service and service billing (post-warranty where
available).
12.3 Parts. Manufacturer will make System parts
available to Paradigm at Manufacturer's usual and customary,
wholesale prices for distribution to field service organizations
and Paradigm's dealers or representatives during the Term and any
Renewed Terms of this Agreement (as defined in paragraph 13
below) and for at least two (2) years following the termination
or expiration of this Agreement.
13. Term. The term of this Agreement shall commence on
the date first above written and shall expire at midnight, United
States Mountain Daylight Time, December 31, 2000 (the "Term").
This Agreement shall be automatically renewed thereafter for
successive one (1) year additional terms (each, a "Renewed Term")
unless either party gives written notice to the other party at
least ninety (90) days prior to the expiration of the Term or
Renewed Term that the Agreement shall not be renewed.
14. Confidentiality; Proprietary Rights.
14.1 Definition of Confidential Information. For
purposes of this Agreement, "Confidential Information" means any
customer lists, information, materials, technical data, know-how,
or trade secrets of either party, which is disclosed to or
learned by or otherwise acquired by the other party prior to or
during the Term or any Renewed Term of this Agreement or in the
course of the business discussions contemplated hereby.
14.2 Non-Disclosure of Confidential Information.
The parties agree not to use the Confidential Information for
their own use or for any purpose except as provided for in this
Agreement. The parties agree not to disclose Confidential
Information to any third party. The parties agree that they will
protect the confidentiality of, and take all reasonable steps to
prevent unauthorized disclosure or use of, the Confidential
Information to prevent it from falling into the public domain or
the public
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literature or to prevent it from falling into the possession of
unauthorized persons or entities. Without limiting the
generality of the foregoing, the parties agree to take the same
steps and use the same methods to prevent the unauthorized use or
disclosure of the Confidential Information as the other party
takes to protect its secret, confidential, or proprietary
information and data, including causing their employees, agents,
consultants and representatives to agree to abide by the
conditions and promises made in this Agreement. Each party will
promptly notify the other party in writing of any
misappropriation or misuse by any person or entity of the
Confidential Information that comes to either party's attention.
14.3 Return of Materials. Any Confidential
information or other information, materials, or documents of
either party that are furnished to the other party hereunder or
were derived from the Confidential Information or such
information or materials will be promptly returned to the other
party, accompanied by all copies of such Confidential Information
or such other information, materials, or documents made by the
party or in the party's possession or under the party's control,
at the earlier of the other party's request for return of the
same or the termination of this Agreement excluding any documents
required to be maintained by any regulatory agency.
14.4 Legal Remedies. It is understood and agreed
that no failure or delay by any party in exercising any right,
power, or privilege hereunder will operate as a waiver thereof,
nor will any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other
right, power, or privilege hereunder. It is further understood
and agreed that money damages will not be a sufficient remedy for
any breach of this Section 13 by either party or any employees,
agents, consultants or representatives of that party and that the
other party will be entitled to equitable relief, including
injunctive relief and specific performance, as a remedy for any
such breach of this Agreement.
15. Miscellaneous.
15.1 Entire Agreement. This Agreement constitutes
the entire agreement and understanding of the parties with
respect to the subject matter hereof, and supersedes all prior
agreements, arrangements and understandings related to the
subject matter hereof. No representation, promise, inducement or
statement of intention has been made by either of the parties
that is not embodied in this Agreement or in the documents
referred to herein, and neither of the parties shall be bound by
or be liable for any alleged representation, promise, inducement
or statement of intention not set forth or referred to herein.
15.2 Governing Law. This Agreement shall be
governed by and construed and enforced in accordance with the
laws of the United States and the state of Utah.
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15.3 Amendments; Waiver. This Agreement may not be
amended, modified, superseded or canceled, nor may any of the
terms, covenants, representations, warranties, conditions or
agreements herein be waived, except by a written instrument
executed by the party against whom such amendment, modification,
supersedure, cancellation or waiver is charged. The failure of
either of the parties at any time or times to require performance
of any provision hereof shall in no manner affect the right at a
later time to enforce the same. No waiver by either of the
parties of any condition, or of any breach of any term, covenant,
representation, warranty, condition or agreement contained
herein, shall be deemed to be or shall be construed to be a
waiver or continuing waiver of any such condition or breach or a
waiver of any other condition or of the breach of any other term,
covenant, representation, warranty, condition or agreement
hereof.
15.4 Headings; Construction. The captions and
headings contained herein are for convenience of reference only,
and shall not in any way affect the meaning or interpretation of
this Agreement. Notwithstanding any rule or maxim of construction
to the contrary, any ambiguity or uncertainty in this Agreement
shall not be construed against either of the parties based upon
authorship of any of the provisions hereof.
15.5 Counterparts. This Agreement may be executed
by facsimile and may be executed in one or more counterparts,
each of which shall be deemed an original, and all of which, when
taken together, shall constitute one and the same instrument.
15.6 Attorneys' Fees. In the event either of the
parties shall bring an action in connection with the performance,
breach or interpretation of this Agreement, or in any action
related to the subject matter hereof, the prevailing party in
such action shall be entitled to recover from the non-prevailing
party in such action all reasonable costs and expenses of such
action, including, without limitation, attorneys' fees, costs of
investigation, accounting and other costs reasonably incurred or
related to such action, in such amount as may be determined in
the discretion of the arbitrator(s).
15.7 Severability. In the event any provision
hereof is determined to be illegal or unenforceable for any
reason whatsoever, such determination shall not affect the
validity or enforceability of the remaining provisions hereof,
all of which shall remain in full force and effect.
15.8 Further Assurances. The parties each hereby
covenant and agree that, from time to time, after the date
hereof, at the reasonable request of either party, and without
further consideration, they will execute and deliver such other
documents and instruments and take such other action as may be
reasonably required to carry out in all respects the subject
matter hereof and the intent of this Agreement.
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15.9 Notices. All notices, demands and other
communications required or permitted to be given hereunder shall
be in writing and shall be deemed to have been duly given and
received (a) immediately if delivered personally, (b) upon
completed transmission, if faxed, (c) the following business day,
if sent by overnight courier, or (d) upon receipt if mailed. All
such notices shall be addressed to the parties at the addresses
and/or fax numbers listed below. Either party may change the
address and/or the fax number to which communications are to be
directed by giving written notice to the other party in the
manner provided herein.
TO PARADIGM: PARADIGM MEDICAL INDUSTRIES, INC.
0000 Xxxx 0000 Xxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Attn: Xxxxxx X. Xxxxxx, President
Fax No. (000) 000-0000
With a copy to: Xxxxxxx X. Xxxxxx, Esq.
Mackey Price & Xxxxxxxx
000 Xxxxx Xxxxxxxxxx Xxxxx
000 Xxxxx Xxxx Xxxxxx
Xxxx Xxxx Xxxx, Xxxx 00000-0000
Fax No. (000) 000-0000
TO MANUFACTURER: Xxxxx Xxxxxx, Director
O.B.F. Labs (UF) Ltd.
Xxxx 0, Xxxxxxxxxx Xxxxxxxx Xxxx
Xxxxxxx Way
Malmesbury, Wiltshire SN165JU ENGLAND
Fax No. 00 (0) 0000 000000
15.10 No Third-Party Beneficiaries. Nothing in this
Agreement, whether express or implied, is intended to confer any
rights or remedies under or by reason of this Agreement on any
person other than the parties and their respective successors or
permitted assigns, nor is anything in this Agreement intended to
relieve or discharge the obligation or liability of any third
person to either of the parties, nor shall any provision hereof
give any third person any right of subrogation or action over or
against either of the parties.
15.11 Force Majeure. Neither party shall be
responsible or liable to the other hereunder for failure or delay
in performance of the Agreement due to any war, fire, accident or
other casualty, or any labor disturbance or act of God or the
public enemy, or any other contingency beyond such party's
reasonable control. In addition, in the event of the
applicability of this Section 14.11, the party failing or
delaying performance shall use its best efforts to expeditiously
eliminate, cure and overcome any of such causes and resume
performance of its obligations.
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15.12 Relationship of the Parties. Notwithstanding
any provision hereof, for all purposes of this Agreement, each
party shall be and act as an independent contractor and not as a
partner, joint venturer or agent of the other party and shall not
bind nor attempt to bind the other party to any contract or
agreement.
15.13 Successors and Assigns. This agreement shall
be binding on all successors and assigns of the parties.
IN WITNESS WHEREOF, the parties have caused this Agreement
to be duly executed as of the day and year first above written.
PARADIGM MEDICAL INDUSTRIES, INC.,
a Delaware corporation
By: Xxxxxx X. Xxxxxx
Title: Vice President
O.B.F. LABS, LTD., a United Kingdom
corporation
By: A. D. Xxxxxx
Title: Director_
