EXCLUSIVE DISTRIBUTION AGREEMENT
AGREEMENT dated as of this 15th day of
September, 2008 ("Agreement") by and between NeuroMed Devices, Inc.,
("MANUFACTURER"), a Nevada corporation with principal offices at Oakley, Utah
and Laguna Niguel, California, USA, and Biofield, Inc., Delaware corporation
with offices in Philadelphia and Hong Kong, ("DISTRIBUTOR").
RECITALS
WHEREAS, MANUFACTURER owns all patent
rights and formulations in and to certain products/medical devices described
more fully herein, (the “Product”);
WHEREAS, MANUFACTURER has agreed to
authorize DISTRIBUTOR to promote and distribute the Products on an exclusive
worldwide basis (subject to the Performance Minimums terms contained herein)
including but not limited to professional, clinical, commercial, retail and
direct response television and other all forms of marketing
NOW, THEREFORE, for good and valuable
consideration, the receipt and adequacy of which is hereby acknowledged, and in
consideration of the Recitals, covenants and agreements contained herein,
DISTRIBUTOR and MANUFACTURER hereby agree as follows:
Section 1. Term.
The term of this Agreement shall
commence as of the date first set forth above and (subject to the Performance
Minimums terms contained herein) shall continue for a period of three (3) years
unless previously terminated as set forth herein (the "Initial
Term").
Section 2. Products.
(a) The
Product to be advertised and sold is listed on Exhibit A attached
hereto on the terms contained therein, as may be mutually revised from
time-to-time, and each individual set of the Products is herein referred to as a
"Product Unit."
(b)(i) MANUFACTURER
hereby represents that the Product currently exists and is
available
for delivery to DISTRIBUTOR in accordance with the terms of this
Agreement.
(ii) The
Product shall be sold under the name or names chosen by MANUFACTURER and
DISTRIBUTOR shall not remove any proprietary marks of the MANUFACTURER from the
Product(s).
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(iii)
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DISTRIBUTOR
shall own all right and title to any trade dress which it creates for the
Product.
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(c) Upon
execution of this Agreement (and as a condition to DISTRIBUTOR'S execution
thereon), MANUFACTURER shall provide DISTRIBUTOR with copies of any patent,
copyright, trademark, trade name and service xxxx registrations, worldwide
governmental/regulatory approvals including but not limited to the FDA (and
similar agencies worldwide), CE relating to the
Product (all of which are listed on Exhibit B) and all
such other documentation which shall in any way affect the legal and effective
distribution, promotion and sale of the Product. The information contained in
Exhibit A and
on Exhibit B
and any other information delivered by MANUFACTURER are collectively referred to
herein as the "Product Information." DISTRIBUTOR is hereby granted the license
to duplicate and use the Product Information as contemplated by and in
accordance with the terms of this Agreement. MANUFACTURER shall provide
DISTRIBUTOR with any new Product Information as it is developed. Product
Information shall also include and any related packaging material or
accompanying printed material to be used in the sale and delivery of the
Products. MANUFACTURER shall consult with DISTRIBUTOR as reasonably required by
DISTRIBUTOR regarding the correct form for duplicating, manufacturing or
producing the Products (and any related packaging material or accompanying
printed material)
(d)(i) MANUFACTURER hereby represents that the
lead time for supplying Products to DISTRIBUTOR is one (1) month after
DISTRIBUTOR's (and/or its licensees) order date for orders up to two hundred
thousand (200,000) units at current capacity, and MANUFACTURER hereby agrees to
use its best efforts to deliver Products to DISTRIBUTOR (and/or its licensees)
within such time-frame after its receipt of said purchase orders. MANUFACTURER
hereby represents that it has the capability to increase monthly capacity upon
reasonable notice. MANUFACTURER shall credit DISTRIBUTOR, its licensees and/or
other purchasers of the Products, in full, for any defective Product Unit
returned to MANUFACTURER. A Product Unit shall be deemed to be defective if any
component of that Product Unit is defective. The DISTRIBUTOR agrees to establish a
new sales quota every year and shall be presented to the MANUFACTURER 90 days
before the end of each sales year. The sales may expand at an accelerated rate
and the MANUFACTURER may not be able to meet the requirements of DISTRIBUTOR, in
that case the MANUFACTURER will come up with a plan in 30 days to meet
DISTRIBUTOR’s needs.
(ii) MANUFACTURER
shall assure that its manufacturers maintain a quality control program and
product quality standards consistent with industry standards.
Section
3 Terms Of
Sale To Customer Base Of Products By DISTRIBUTOR.
(a) Terms and
Conditions. All sales of Products by DISTRIBUTOR from
Manufacturer to DISTRIBUTOR’s customer base of healthcare service provider
offices (clinics), during the term of this Agreement, shall be subject to the
terms and conditions of this Agreement.
(b) Prices. All
prices are “cost, insurance and freight” the DISTRIBUTOR’s destination Port of
Entry; e.g., Shenzhen Bay, Port of Hong Kong, etc. ("C.I.F."). The discounted
price offered to DISTRIBUTOR for each of the Products ("Sale Price") shall be as
set forth in Exhibit C attached hereto. The Price to DISTRIBUTOR
for spare parts for the Products shall be as set forth in Exhibit D
attached hereto. The difference between DISTRIBUTOR's Price and
DISTRIBUTOR's selling price to its customers shall be DISTRIBUTOR's profit and
sole remuneration for sale of the Products. Manufacturer has the
right at any time to revise the prices in Exhibits C and D
with one
hundred and twenty (120) days' advance written notice to
DISTRIBUTOR. Such revisions shall apply to all orders received after
the effective date of revision. Price increases shall not affect
unfulfilled purchase orders accepted by Manufacturer prior to the effective date
of the price increase. Price decreases shall apply to pending
purchase orders accepted by Manufacturer prior to the effective date of the
decrease, but not yet shipped.
(c) Taxes, Tariffs, Duties and
Fees. DISTRIBUTOR's Price does not include any value added
tax, national or local taxes, tariffs, duties or fees from the port of entry
that may be applicable to the Products. When Manufacturer has the
legal obligation to collect such amounts, the appropriate amount shall be added
to DISTRIBUTOR's invoice and paid by DISTRIBUTOR unless DISTRIBUTOR provides
Manufacturer with a valid tax exemption certificate authorized by the
appropriate taxing authority.
(d) Order and
Acceptance. All orders for Products submitted by DISTRIBUTOR
shall be initiated as written purchase order requests sent to Manufacturer. Each
Purchase Order should be accompanied by a request for a delivery date, provided,
however, that an order may initially be placed orally if a confirming written
non-cancelable purchase order request is received by fax or via the internet
(email) at the Manufacturer within 24 hours after said oral order was placed. No
order shall be binding upon Manufacturer until accepted by the Manufacturer in
writing, and Manufacturer shall have no liability to DISTRIBUTOR with
respect to purchase order requests that are not
accepted. Manufacturer shall use its reasonable best efforts to
notify DISTRIBUTOR of the acceptance or rejection of an order and of the
assigned delivery date for accepted orders within two working (2) days
after receipt of the purchase order request. No partial shipment of a
purchase order shall constitute the acceptance of the entire order, absent the
written acceptance of such entire order. Manufacturer shall use its
reasonable best efforts to deliver Products at the times specified either in its
quotation or in its written acceptance of DISTRIBUTOR's purchase orders.
Delivery in a timely fashion by Manufacturer assumes that the DISTRIBUTOR has
provided all quarterly forecasts as required herein, and Manufacturer has been
properly notified of pending sales orders to DISTRIBUTOR’s customers in a timely
fashion so adequate inventory could be manufactured to fulfill said purchase
orders placed by the DISTRIBUTOR.
(e) Terms of Sales-Purchase
Order Requests. DISTRIBUTOR's sales-purchase order request
submitted to Manufacturer with respect to Products to be delivered to
DISTRIBUTOR’s customers, shall be governed by the terms of this Agreement.
Nothing contained in any sales-purchase order request shall in any way modify
such terms of the sale to the DISTRIBUTOR’s customer, or add any additional
terms or conditions.
(f) Payment. Full
payment of DISTRIBUTOR Price for the Products (including any freight, taxes or
other applicable costs initially paid by Manufacturer but to be borne by
DISTRIBUTOR) shall be made by DISTRIBUTOR to Manufacturer at the time of
shipment to either the DISTRIBUTOR or (in special circumstances) the
DISTRIBUTOR’s customer(s). Payment shall be in U.S. dollars and shall
be effected by means of credit card or wire
transfer. Payment by
credit card or wire transfer shall allow for partial shipments, and shall be in
an amount equal to DISTRIBUTOR's Purchase Price for the Products plus all
applicable taxes, shipping charges, and other charges
to be
borne by DISTRIBUTOR. All exchange, interest, banking, collection,
and other charges shall be at DISTRIBUTOR's expense. DISTRIBUTOR
shall pay all of Manufacturer's costs and expenses (including reasonable
attorneys' fees) to enforce and preserve Manufacturer's rights under this
Subsection 3(f).
(g) Shipping. All
Products delivered pursuant to the terms of this Agreement shall be suitably
packed for shipment in Manufacturer's standard shipping cartons, marked for
shipment at DISTRIBUTOR's address set forth above, and delivered to DISTRIBUTOR
C.I.F., at which time (subject to Subsection 3(l) below, Rejection of
Products) responsibility for such Products and risk of loss shall pass to
DISTRIBUTOR. Unless otherwise agreed upon in writing, Manufacturer
shall select the carrier. All freight, insurance, and other shipping
expenses, as well as any special packing expense, shall be paid by
Manufacturer. DISTRIBUTOR shall bear all applicable taxes, duties,
and similar charges that may be assessed against the Products after delivery to
the port of entry.
(i) Rejection of
Products. DISTRIBUTOR shall inspect all Products promptly upon
receipt thereof and may reject and return any Product that fails in any material
way to meet the specifications set forth in Manufacturer's current brochure for
that Product. To reject a Product, DISTRIBUTOR shall notify
Manufacturer in writing (or by facsimile/email notification) of its rejection
and request a Material Return Authorization ("MRA")
number. Manufacturer shall use its best efforts to provide the
MRA number in writing or by facsimile/email to DISTRIBUTOR within twenty four
(24) hours after receipt of the request. Within ten (10) days after
receipt of the MRA number, DISTRIBUTOR shall return to Manufacturer the rejected
Product, freight prepaid, in its original shipping carton with the MRA number
displayed on the outside of the carton. Provided that Manufacturer
has complied with its obligations in this agreement, Manufacturer 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 thirty (30) working days after receipt by Manufacturer of properly rejected
Products, Manufacturer shall, at its option and expense, either repair or
replace the Products. Manufacturer shall pay the shipping
charges back to DISTRIBUTOR for properly rejected Products that have been
repaired or replaced to meet or exceed factory specifications prior to return to
DISTRIBUTOR.
(k) Reservation of
Title. Transfer of title for each Product shipped to
DISTRIBUTOR or its’ customers under special circumstances, shall be subject to
full payment of the Sales-Purchase Order Price prior to
shipment. Until such full payment is complete, the Product shall
remain the property of Manufacturer. For all Products to which
Manufacturer retains title, such as demo units, DISTRIBUTOR shall (i) carry
full insurance on the Products throughout the time they are in DISTRIBUTOR’s
possession and (ii) segregate those Products from other products in
DISTRIBUTOR's consignment, demo or regular product inventory of other,
non-competitive products.
(l) Training. Manufacturer
shall provide sales training to DISTRIBUTOR's personnel initially and then at
periodic intervals at rates of cost to be mutually agreed upon by Manufacturer
and DISTRIBUTOR, with the frequency and training content to be determined by the
Manufacturer. Training will be made available by Manufacturer in a format that
is easy to facilitate and yet provides vital information to the DISTRIBUTOR's
sales force. Manufacture will decide by what methodology training will be made
available to DISTRIBUTOR.
(m) Repairs. Repairs
shall be provided by Manufacturer at Manufacturer's authorized repair center in
Penang, Malaysia, unless and until other repair facilities are established, or
Product will be replaced at the Manufacturer's discretion
Section
4 Exclusivity.
(a) Subject
to all of the terms and conditions of this Agreement, MANUFACTURER hereby grants
to DISTRIBUTOR the exclusive worldwide ("Territory") license to sell or to
otherwise distribute the Products (and to license others to air and/or sell)
through broadcast and cable television media via telemarketing, direct mail,
package inserts, syndication and any other direct response marketing media and
via catalogue, retail sales and any other means. MANUFACTURER hereby grants to
DISTRIBUTOR the exclusive worldwide license to use the patents and copyrights
held by MANUFACTURER relating to the Products in connection with DISTRIBUTOR's
sales of the Product in the manner described above. DISTRIBUTOR in its sole and
complete discretion, shall decide the price at which the Products are to be sold
by DISTRIBUTOR.
(b) During
the term of this Agreement, neither MANUFACTURER nor its principals or
affiliates shall sell, distribute, promote or market (x) the Product under any
name (whether or not used by DISTRIBUTOR) via cable or broadcast television,
telemarketing, direct mail, package inserts, syndication, catalogue or retail
sales or any other means.
(c) Notwithstanding
the provisions of subsections (a) and (b) above, DISTRIBUTOR shall lose its
exclusive rights to sell the Product if, beginning six (6) months after the
execution of this Agreement (the “Ramp-Up Period”), it does not issue and pay
for (directly and/or indirectly through a licensee(s)) purchase orders for a
minimum of either two hundred thousand (200,000) Product Units (total) or pay
MANUFACTURER a minimum of Ten Million ($10,000,000) dollars for purchase of the
Product(s), (collectively the “Performance Minimums”) in the twelve (12) month
period following the Ramp-Up Period. Thereafter in order to retain exclusive
rights, DISTRIBUTOR’s the Performance Minimums shall increase a minimum of ten
(10%) percent during the succeeding twelve (12) month period and for
each succeeding twelve (12) month period thereafter. DISTRIBUTOR shall be
permitted to carry-over any excess in purchase order amounts and apply the
excess against the applicable minimums. If DISTRIBUTOR fails to meet
such performance minimums, its rights under subsection (a) above shall become
non-exclusive, and MANUFACTURER shall no longer be subject to the restrictions
of subsection (b) above. Notwithstanding the foregoing, DISTRIBUTOR
shall retain its exclusive rights if and for so long as DISTRIBUTOR's failure to
meet such goals set forth herein is due to the unavailability of Product, the
breach of this Agreement by MANUFACTURER or force majeure, or is due to the
unavailability of Product for reasons beyond DISTRIBUTOR's reasonable control or
action taken or threatened by any governmental authority that restricts or
impairs the unimpeded sale of the Products by DISTRIBUTOR. DISTRIBUOR shall have
thirty (30) days to cure a failure in performance under this section by issuing
to MANUFACTURER, a purchase order in the amount required to offset the
shortfall.
(d) Ownership.
All right, title and interest, including, without limitation, the Intellectual
Property Rights, in and to the MANUFACTURER Products and any and all
enhancements, improvements, modifications, alterations and derivative works
thereto and anything based thereon or derived there from (regardless of whether
separately and independently developed by MANUFACTURER or DISTRIBUTOR or
jointly-developed by MANUFACTURER and DISTRIBUTOR, including but not limited to
“look and feel” aspects thereof, shall at all times be owned by
MANUFACTURER. In furtherance thereof, DISTRIBUTOR hereby irrevocably,
unconditionally, fully and forever transfers, assigns and conveys to Licensor
all right, title and interest in or to any and all such enhancements,
improvements, modifications, alterations and derivative works and anything based
thereon or derived there from, including, without limitation, all Intellectual
Property Rights in and to MANUFACTURER’s technology and products. MANUFACTURER
shall have the sole and exclusive right to apply for, prosecute, obtain and
maintain patents, copyrights, trademarks and other intellectual property
protection with respect to the foregoing and DISTRIBUTOR agrees to sign any
additional document of assignment or other documents that MANUFACTURER deems
necessary or desirable, and otherwise cooperate and assist MANUFACTURER, to
separately confirm or more completely vest in MANUFACTURER the exclusive right
and title to any and all of the foregoing. DISTRIBUTOR shall not pursue any
claim or cause of action or otherwise dispute, contest or challenge in any
manner anywhere in the world, directly or indirectly, any Intellectual Property
Rights of MANUFACTURER in and to the MANUFACTURER‘S Intellectual Property and
any such enhancements, improvements, modifications, alterations and derivative
works and anything based thereon or derived there from DISTRIBUTOR shall not
undertake any development of any technology or pursue any protection of
Intellectual Property Rights that will or would be reasonably likely to
preclude, limit or impair to any extent anywhere in the world the enforcement,
use or exploitation by MANUFACTURER of any of its Intellectual Property Rights
or the enhancement, improvement, modification or alteration by Licensor of or
creation by MANUFACTURER of derivative works or anything based on or derived
from, the MANUFACTURER‘S Intellectual Property . This Agreement transfers
neither title nor any Intellectual Property Rights in any MANUFACTURER‘S
Intellectual Property or any such enhancements, improvements, modifications,
alterations or derivative works to DISTRIBUTOR. This license does not authorize
any use other than that which is expressly set out herein, and no other right or
license is granted, by implication, estoppels or otherwise under any
Intellectual Property Rights and/or Confidential Information. All rights not
expressly granted to DISTRIBUTOR are hereby retained by MANUFACTURER. If
DISTRIBUTOR provides comments, suggestions, feedback, test results or evaluation
results or provides oral or written observations or suggestions related to
MANUFACTURER‘S Intellectual Property or potential enhancements, improvements,
modifications, alterations or derivative works thereto or anything based thereon
or derived there from (collectively, the “Feedback”), DISTRIBUTOR grants to
MANUFACTURER a non-exclusive, royalty-free, irrevocable, worldwide right and
license to use and duplicate the Feedback in any manner and to any extent
MANUFACTURER determines. DISTRIBUTOR shall not provide to MANUFACTURER any
Feedback in which it or any third party asserts or may assert any proprietary
rights. Subject to the obligations of confidentiality herein, MANUFACTURER may
use any general learning, skills, know-how, or other Residual Information for
any purpose, provided that this right to Residual Information does not represent
a license under any patents, copyrights or other intellectual property of
DISTRIBUTOR. The term “Residual Information” means any information retained in
the unaided memory of a person who had access to DISTRIBUTOR’s Confidential
Information pursuant to the terms of this Agreement and does not include
information intentionally memorized for the purpose of creating Residual
Information.
(e) From
time-to-time during the term of this agreement, MANUFACTURER may deliver a
proposal to fund the research and development projects of MANUFACTURER, (the
“R&D Proposal”) to DISTRIBUTOR in sufficient detail regarding the project
and the funding required therefore. Within thirty (30) days of its receipt of
each such R&D Proposal, DISTRIBUTOR shall either agree to fund such proposal
in full or part, upon terms acceptable to the parties or pass. IT IS
DISTRIBUTOR’S AVOWED INTENTION TO USE ALL REASONABLE EFFORTS TO ACCEPT EACH SUCH
PROPOSAL AND TO FULLY FUND THE SAME DURING ITS PERIOD OF EXCLUSIVITY GRANTED IT
HEREUNDER; HOWEVER, MANUFACTURER IS NOT REQUIRED TO OFFER the R&D PROPOSAL
FIRST TO DISTRIBUTOR.
(f) Notwithstanding
anything to the contrary contained herein, for DISTRIBUTOR to retain the
exclusive rights granted herein, it must, at a minimum, secure funding in the
amount of three five million
($5,000,000) dollars within the one hundred eighty (180) twenty (120) days
immediately following the execution of this agreement. If it fails to do so,
then, the MANUFACTURER has the option to terminate this agreement as per the
terms of Section 5 below.
Section 5. Termination
(a) The
parties shall be permitted to terminate this Agreement on account of (i) the
breach by the other party of any material representation or warranty made by the
other party in this Agreement or, (ii) the failure of the other party
to comply with any of the material covenants of
the other party (other than in the case of clauses (i) and (ii) if such breach
or failure is the result of force majeure (a "Breach" ). Prior to such
termination, the non-breaching party shall give the other party
written notice of and thirty (30) days to cure, such Breach, and if the Breach
is cured within such thirty (30) day period, the non-breaching shall not be
permitted to terminate this agreement.
(b) This
Agreement shall terminate, without notice, (i) upon the institution
by DISTRIBUTOR of insolvency, receivership or bankruptcy proceedings
or any other proceedings for the settlement of DISTRIBUTOR's debts,
(ii) upon DISTRIBUTOR's making an assignment for the benefit of creditors,
or (iii) upon DISTRIBUTOR's dissolution or ceasing to do
business.
(c) In
the event of termination of this Agreement, the parties agree as
follows:
(i)
The six (6) month period following date of termination, is hereinafter referred
to as "Period of Termination". Except in the case where DISTRIBUTOR
has materially breached this Agreement causing its termination, then during the
Period of Termination, if any, all rights granted DISTRIBUTOR in this Agreement
shall automatically become non-exclusive without any further notice.
Notwithstanding anything to the contrary contained herein, upon termination of
this Agreement, DISTRIBUTOR shall retain the right to fulfill all orders
received by DISTRIBUTOR following such termination and to continue to market the
Products on a non-exclusive basis. Unless otherwise agreed to by MANUFACTURER,
after the
expiration of the Period of Termination, all rights granted DISTRIBUTOR in this
Agreement shall automatically terminate without any further notice.
Section 6. Representations. Warranties
and Covenants of MANUFACTURER to DISTRIBUTOR.
(a) MANUFACTURER
hereby represents and warrants to DISTRIBUTOR as follows:
(i) MANUFACTURER
is a corporation duly organized, validly existing and in good standing and has
the corporate power to own its assets and properties and to carry on its
business as now being and heretofore conducted;
(ii) The
execution, delivery and performance of this Agreement by MANUFACTURER has been
duly authorized by MANUFACTURER, does not violate its certificate of
incorporation. by-laws or similar governing instruments or applicable law and
does not, and with the passage of time will not, materially conflict with or
constitute a breach under any other agreement, judgment or instrument to which
MANUFACTURER is a party or by which it is bound;
(iii) This
Agreement is the legal, valid and binding obligation of MANUFACTURER,
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium and other laws now or hereafter in effect
relating to creditors' rights generally and by equitable principles of general
application (regardless of whether considered in a proceeding in equity or at
law) and the discretion of the court before which any such proceeding may be
brought;
(iv) MANUFACTURER
is authorized to permit DISTRIBUTOR to sell the Products and the sale of such
Products will neither infringe on nor violate the rights of any third party
relating to any patent and copyright used in connection with the
Product.
(v) MANUFACTURER
has not heretofore granted and will not grant, during the term of this
Agreement, any rights to any other parties which are inconsistent with the
rights granted to DISTRIBUTOR under this Agreement;
(vi) The
Product Information which has been heretofore been delivered, or will upon
execution will be delivered to DISTRIBUTOR is true and correct in all material
respects.
(viii) Other
than as set forth in this Agreement (or agreed to by DISTRIBUTOR), no payments
are due or will arise with respect to third parties for which DISTRIBUTOR shall
be liable on account of DISTRIBUTOR's sales of the Products;
(viii) MANUFACTURER
is the sole and exclusive owner in the Territory, of all patents, copyrights.
trademarks, trade names and service marks used in connection with the Products
and/or necessary in connection with the design. development, production,
manufacture, promotion and sale of the Product. MANUFACTURER shall,
upon execution of this Agreement, deliver to DISTRIBUTOR all appropriate U.S.,
UCC, Berne and other applicable intellectual property convention
language. MANUFACTURER has taken all appropriate steps to register
the patents related to the Products with the United States Patent and Trademark
Office and other
applicable
offices in other nations worldwide, as applicable.
(b) MANUFACTURER
hereby covenants to DISTRIBUTOR as follows:
(i) In
the event that MANUFACTURER is directly or indirectly selling the Products at
the same time as DISTRIBUTOR is permitted to sell the Products hereunder,
except as described in 5(c)(i) above, MANUFACTURER shall not sell or
authorize the sale of the Products at a manufacturer's suggested retail price
that is less than the price that DISTRIBUTOR sells the Products for at any time
in any media.
(ii) All
Product Information which will be delivered to DISTRIBUTOR during the term of
this Agreement will be true and correct in all material respects;
(iii) MANUFACTURER
shall indemnify, defend and hold harmless DISTRIBUTOR and its officers, directors,
employees, affiliates, licensees and agents from any and all costs (including
reasonable attorney's fees and expenses and other court costs), expenses,
damages, or other liabilities to third parties arising from (w) a
breach of MANUFACTURER's representations and warranties or covenants contained
herein, (x) actions by persons claiming ownership or other rights in the
Products or the infringement of any patents and copyrights relating to the
Products and any related packaging material and accompanying printed material
where the content thereof has been approved/authorized by MANUFACTURER, and (y)
claims in the nature of product liability or defects inherent in the
Products;
(iv) MANUFACTURER
shall cause to have any manufacturer from which MANUFACTURER is purchasing the
Products (or the MANUFACTURER itself as the case may be) for delivery to
DISTRIBUTOR, name DISTRIBUTOR as an additional named insured on any policy for
product liability insurance maintained by such manufacturer and, in the event
MANUFACTURER is itself manufacturing such Products, to itself arrange to have
DISTRIBUTOR named as such an additional insured and to maintain or arrange for
such manufacturer to maintain DISTRIBUTOR as an additional named insured on such
policy for as long as DISTRIBUTOR is selling the Products. MANUFACTURER shall
cause such insurer to deliver evidence to DISTRIBUTOR that it has been so named
as an additional insured. The amount of coverage and the limits shall be
mutually agreed upon by the parties prior to Product launch.
(c) Additional Obligations
Of MANUFACTURER
(i) Materials. Manufacturer
shall provide the DISTRIBUTOR with initial marketing and technical information
concerning the Products as well as reasonable initial quantities of brochures,
instructional material, advertising literature, and other Product data,
with all such material printed in the English language. In addition,
Manufacturer shall provide DISTRIBUTOR with Demonstration Units as
specified on Exhibit C for their sales agents and representatives at a cost
to the DISTRIBUTOR as indicated on Exhibit C. Such demonstration
products are not to be resold by DISTRIBUTOR under any circumstances without the
prior written consent of the Manufacturer.
(ii) Response to
Inquiries. Manufacturer shall promptly respond to all
inquiries from DISTRIBUTOR concerning matters pertaining to this Agreement.
DISTRIBUTOR is obligated to perform in the same manner if inquiries are made
from the Manufacturer to the DISTRIBUTOR.
(iii) Testing. Manufacturer
shall conduct product testing on the Products before shipment to
DISTRIBUTOR.
(iv) Delivery
Time. Manufacturer shall minimize delivery time as much as
possible and use its reasonable best efforts to fulfill delivery obligations to
the DISTRIBUTOR as quickly as is possible and in accordance with the committed
acceptances provided by this agreement. DISTRIBUTOR agrees to keep manufacturer
informed on a routine and timely basis of orders pending in DISTRIBUTOR’s
territory and any changes DISTRIBUTOR foresees in the marketplace that could
impact the quantity of sales-purchase orders placed by the DISTRIBUTOR with
Manufacturer.
Section 7. Representations, Warranties
and Covenants of DISTRIBUTOR to MANUFACTURER.
(a) DISTRIBUTOR
hereby represents and warrants to MANUFACTURER as follows:
(i) DISTRIBUTOR
is a corporation duly organized under the laws of the of Pennsylvania and
DISTRIBUTOR has the corporate power to own its assets and properties and to
carry on its business as now being and heretofore conducted;
(ii) The
execution, delivery and performance of this Agreement by DISTRIBUTOR has been
duly authorized by DISTRIBUTOR, does not violate its certificate of
incorporation, by-laws or similar governing instruments or applicable law and
does not, and with the passage of time will not, materially conflict with or
constitute a breach under any other agreement, judgment or instrument to which
DISTRIBUTOR is a party or by which it is bound; and
(iii) This
Agreement is the legal, valid and binding obligation of DISTRIBUTOR, enforceable
in accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium and other laws now or hereafter in effect relating to
creditors' rights generally and by equitable principles of general application
(regardless of whether considered in a proceeding in equity or at law) and the
discretion of the court before which any such proceeding may be
brought.
(b) DISTRIBUTOR
hereby covenants to MANUFACTURER as follows:
(i) DISTRIBUTOR
shall indemnify, defend and hold harmless MANUFACTURER and its officers,
directors, employees, affiliates and agents from any and all costs (including
reasonable attorney's fees and expenses and other court costs), expenses,
damages or other liabilities to third parties arising from a breach of
DISTRIBUTOR's representations and warranties or covenants contained
herein.
(c) Import and Export
Requirements. DISTRIBUTOR shall, at its own expense, pay all
import and export licenses and permits, pay customs charges and duty fees, and
take all other actions required to accomplish the export and import of the
Products sold to customers by DISTRIBUTOR. DISTRIBUTOR understands
that Manufacturer is subject to regulation by agencies of the U.S.
government, including the U.S. Department of Commerce, which prohibit export or
diversion of certain technical products to certain
countries. DISTRIBUTOR warrants that it will comply in all respects
with the export and re-export restrictions set forth in the export license for
every Product shipped to the DISTRIBUTOR.
(d) Limitation on DISTRIBUTOR's
Rights to the Products. DISTRIBUTOR shall have no right to
copy, modify, disassemble or remanufacture any Product or part thereof. Doing so
is grounds for immediate termination of this agreement.
Section 8. Independent Parties /
Taxes.
Each of DISTRIBUTOR and MANUFACTURER
are dealing with the other as independent contractors. This Agreement does not
create, nor is it intended in any way to create, a joint venture or partnership
between the parties hereto. Each of DISTRIBUTOR and MANUFACTURER
shall be responsible for all of its own Federal, State and local taxes of any
kind or nature whatsoever.
Section
9. Confidentiality.
(a) DISTRIBUTOR
and MANUFACTURER each agree to hold the terms and provisions of this Agreement
and all information received from the other party hereto in confidence;
provided, that this provision shall not apply with respect to information which
becomes generally available to the public or in the direct response and related
industries, other than as a result of disclosure by the party hereto that is
required to keep such information confidential.
(b) DISTRIBUTOR
and MANUFACTURER each agree that with respect to any breach by such party of the
provisions of subsection (a) above, the non-breaching party shall have the right
to obtain an injunction to be issued by any tribunal of competent jurisdiction
restricting DISTRIBUTOR or MANUFACTURER as the case may be, from continuing to
breach the provisions of subsection (a) above. The provisions of this Section
shall survive termination (for whatever reason) of this Agreement.
(c) Confidential
Information. A receiving party shall not use or disclose any
Confidential Information, including among other items Intellectual Property,
trade secrets and other materials identified as Confidential Information by the
disclosing party, except as expressly authorized by this Agreement, and shall
protect all such Confidential Information in a manner conforming to industry
standards using the same degree of care which it uses with respect to its own
proprietary information, but in no event with safeguards less than a reasonably
prudent business would exercise under similar circumstances. Each party
represents and warrants to the other that it has adopted policies and procedures
with respect to the receipt and disclosure of confidential or proprietary
information, including without limitation the Confidential Information of the
other party, with its employees, agents, representatives and subcontractors.
Neither party nor any of its directors, officers, employees, agents or
representatives receiving any Confidential Information of the other party shall
disclose any such information to any person who is not an employee of such party
without the prior written consent of a duly authorized representative of the
other party, which consent shall not be unreasonably withheld. Each party agrees
to use its best efforts to limit dissemination of and access to any Confidential
Information of the other party only to the persons within such party’s immediate
organization and then only to those persons who have a need for access to such
Confidential Information of the other party and who are subject to
confidentiality obligations in regard to such Confidential Information at least
as protective as those set forth herein. Prior to any permitted disclosure by a
party of Confidential Information of the other party to any person who is not an
employee of such party, such party shall obtain the written agreement of such
person to protect such Confidential Information to at least the same extent as
provided for herein, and shall promptly provide copies of any and all such
agreements to the other party upon the request of the other party. No party
shall make any tangible reproductions, copies or embodiments, in whole or in
part, of any Confidential Information of the other party without the consent of
the other party. All tangible reproductions, copies or embodiments, in whole or
in part, of any Confidential Information shall carry a confidential, proprietary
notice similar to that, if any, with which it was submitted. A receiving party’s
obligations regarding the protection of Confidential Information shall survive
any expiration or termination of the Agreement. A receiving party shall take
prompt and appropriate action to prevent unauthorized use or disclosure of the
Confidential Information. Without limiting the generality of the foregoing, all
humanly perceivable forms of the other party’s Intellectual Property are trade
secrets of the other party and may not be disclosed by the other party for any
reason or purpose.
Section
10. Notices.
Any
notice, request or other communication required or permitted under this
Agreement shall be in writing and shall be given or made by physical delivery or
by registered or certified mail, postage prepaid, return receipt requested or by
overnight carrier addressed to the appropriate party. All such notices shall be
addressed as follows:
|
If
to DISTRIBUTOR:
|
With
a copy to:
|
|
Xxxxxxxx
X. Xxxxxxx, CEO.
|
ATTN:
Chairman Xxxxx XxxXxx
|
(insert
address) The
MacKay Group
(insert
address) 3412,
China Merchants Tower,
(insert
address) 000-000
Xxxxxxxxx Xxxx,
(xxxxxx
xxxxxxx) Xxxxxx
Xxx, Xxxx Xxxx
xxxxx@xxxxxxxxxxxxxx.xxx
Phone No:
(000)
000-0000 Phone
No: (000) 0000-0000
|
Fax
No: (000) 000-0000
|
Fax
No: (000) 0000-0000
|
|
If
to MANUFACTURER:
|
With
a copy to:
|
|
(Address)
|
(Address)
|
Phone No:
(000)
000-0000
Phone No: (000) 000-0000
Fax No:
(000)
000-0000
Fax No: (000) 000-0000
Any party may change the persons and
addresses to which notices, requests or other communications are to be sent by
giving written notice of such change to the other party hereto in the manner
provided herein for giving notice. Notices shall be effective upon receipt in
the case of facsimile, physical delivery or overnight carrier and
three (3) business days after
deposit in the U.S. mails in the case of mailing.
Section
11. Miscellaneous.
(a) In
addition to the provisions specifically referred to herein, the provisions of
sections 2, 4, 5, 6, 8, 9, 10 and 11 shall also survive the fulfillment of the
parties' other obligations pursuant to this Agreement and/or termination of this
Agreement for any reason.
(b) MANUFACTURER
hereby consents to the assignment and/or sub-licensing of this Agreement by
DISTRIBUTOR. DISTRIBUTOR may not assign this Agreement to an unrelated party.
Other than as provided in this Agreement may not be assigned by any of the
parties hereto without the consent of the other party hereto. The Parties agree
that DISTRIBUTOR (and or other parties relevant to the services to be provided
hereunder) may, in its sole discretion, issue press releases and may also be
permitted to file any required SEC documents as required by applicable laws and
regulations relative to the rights, duties and obligations contained and arising
from this Agreement; PROVIDED
HOWEVER, that the initial press release announcing the execution of this
Agreement shall be mutually approved by the parties, which approval shall not be
unreasonably withheld.
(c) This
Agreement shall be governed by and construed under the laws of the State of
Delaware, U.S.A., except that perfection of the title reserved by Manufacturer
in Subsection 3(k) above shall be governed by the laws of Distributor's
jurisdiction. The federal and state courts within the State of
Delaware , U.S.A., shall have exclusive jurisdiction to adjudicate any dispute
arising out of this Agreement. Distributor hereby expressly
consents to (i) the personal jurisdiction of the federal and state courts
within Delaware , (ii) service of process being effected upon it
by registered mail sent to the address set forth at the beginning of this
Agreement, and (iii) the uncontested enforcement of a final judgment from
such court in any other jurisdiction wherein Distributor or any of its assets
are present.
(d) This
Agreement constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof and supersedes all prior letters and
agreements with respect to the subject matter hereof. Except as otherwise
provided herein, this Agreement may not be amended, supplemented, canceled or
discharged except by written instrument executed by each of the parties
hereto.
(e) If
any provision of this Agreement, as applied to any party or to any
circumstances, shall be finally determined by a court to be void or
unenforceable, the same shall be stricken from this Agreement and shall in no
way affect any other provision of this Agreement or the validity or
enforceability of this Agreement.
(f) The
waiver by any party to this Agreement of the breach of any provision of this
Agreement by the other party shall not operate or be construed as a waiver of
any subsequent breach by the other party.
(g) The
Section headings contained in this Agreement are for convenient reference only
and shall not affect the construction of any provision of this
Agreement.
(h) This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
(i) The
parties agree that all required Schedules and Exhibits shall be supplied within
thirty (30) days of the execution hereof, notwithstanding anything to the
contrary contained herein.
IN WITNESS WHEREOF, the parties hereto
have executed this Agreement as of the date and year first above
written.
MANUFACTURER DISTRIBUTOR
By:______________________ By:_________________________
XX. XXXX
XXXXXXXXXXX
XXXXXXXX X. XXXXXXX, CEO
EXHIBIT
A
PRODUCT DESCRIPTION AND
PURCHASE PRICE
DISTRIBUTOR's Purchase
Price
Product (U.S.
dollars)
OraCalm™ Market
Price (subject to mutual approval of the parties)
ViraCalm™ Market
Price (subject to mutual approval of the parties)
TERRITORY
DISTRIBUTOR's
Territory shall be all portions of the following:
WORLDWIDE
(MANUFACTURER) (DISTRIBUTOR)
____________________ ____________________
XX. XXXX
XXXXXXXXXXX XXXXXXXX
X. XXXXXXX, CEO
Title:_______________ Title:
______________
Date:
_______________ Date:________________
EXHIBIT
B
MANUFACTURER’S patents, copyrights,
trademarks, trade names and service marks registrations, worldwide
governmental/regulatory approvals including but not limited to the FDA (and
similar agencies worldwide), CE relating to the
Product (all of which are listed on Exhibit B)
TERRITORY
Regulatory
approvals. The Manufacture / Patent owner will supply to Distributor all FDA and
CE xxxx approvals for worldwide sales and it will be the Manufacture/ Patient
owner to keep the marks in effect for the full time of this
agreement.
(MANUFACTURER)
(DISTRIBUTOR)
____________________________ _____________________________
XX. XXXX
XXXXXXXXXXX
XXXXXXXX X. XXXXXXX, CEO
Title
_____________________ _____ Title
__________________________
Date
__________________________ Date
___________________________
EXHIBIT
C
DEMONSTRATION UNITS
Unit
/
Products Price to
DISTRIBUTOR
OraCalm™ Free
for first 100, then TBD
ViraCalm™ Free
for first 100, then TBD
(MANUFACTURER) (DISTRIBUTOR)
____________________ ____________________
XX. XXXX
XXXXXXXXXXX XXXXXXXX
X. XXXXXXX, CEO
Title:_______________
Title: ______________
Date:
_______________ Date:________________
EXHIBIT
D
SPARE PARTS LIST AND PRICE
SCHEDULE
| Description of Part | Number | (US dollars) |
[ALL
SPARE PARTS BY APPROPRIATE QUANTITIES WILL BE REPLACED ON A COST PLUS BASIS PER
THE CURRENT XXXX OF MATERIALS IN PLACE AT THE MANUFACTURER, AND MAY BE VERIFIED
BY MOST RECENT PURCHASE PRICES FROM APPROVED VENDORS OF THE
MANUFACTURER.]
(MANUFACTURER) (DISTRIBUTOR)
_____________________________ ______________________________
XX. XXXX
XXXXXXXXXXX XXXXXXXX
X. XXXXXXX, CEO
Title
_________________________ Title
___________________________
Date
_________________________ Date___________________________
EXHIBIT
E
WARRANTY PROVISIONS
Warranty period shall commence upon the
date of shipment of product to DISTRIBUTOR.
(MANUFACTURER) (DISTRIBUTOR)
____________________ ________________________
XX. XXXX
XXXXXXXXXXX XXXXXXXX
X. XXXXXXX, CEO
Title:________________ Title:
______________
Date:
_______________ Date:_______________
