(Distribution Agreement between SHP and New Alliance
of Independent Medical Distributors, Inc.)
NEW ALLIANCE OF INDEPENDENT MEDICAL DISTRIBUTORS, INC.
d.b.a. Alliance Medical
DISTRIBUTION AGREEMENT
PARTIES
This Distribution Agreement is made and entered into by and between New Alliance
of Independent Medical Distributors, Inc., a Texas corporation having its
principal offices at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇., #▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
(hereinafter referred to as: "Alliance"), and Specialized Health Products, Inc.,
a Utah corporation having its principal offices at ▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereinafter referred to as: "SHP").
PREAMBLE
WHEREAS, Alliance acts as a centralized purchasing agent for its member-owners
who are distributors of medical products in the US, and
WHEREAS, Alliance desires to appoint SHP as a manufacturer of products to
Alliance for sale through Alliance's members on the terms and conditions set
forth below and SHP desires to accept the appointment;
RECITATION
NOW, THEREFORE, in consideration of the premises and the mutual covenants
hereinafter set forth, Alliance and SHP agree as follows:
1 DEFINITIONS
1.1 "Agreement" means this contract and all of the exhibits
annexed hereto, as may be modified from time to time during
the Term of this Agreement.
1.2 "Members" means the member-owners of Alliance (presently Amtec
Medical, Inc.; Bio-Medical Resources, Inc.; Capitol Medical,
Inc.; Clinical Technology, Inc.; ▇▇▇▇▇ Enterprises; ▇▇▇▇▇
Medical, Inc.; IMS, Inc; Medical Marketing, Inc.; Medspec
Inc.; Medtec Medical, Inc.; New England Medical Specialties;
and Westcon Medical Industries, Inc.), and each such member or
new member, for so long as each is a member of Alliance.
1.3 "Product(s)" means those products listed in Exhibit A
including Alliance or SHP labeled products and other Products
added to this Agreement from time to time.
1.4 "Territory" shall mean the United States and shall include all
hospital markets, consumer product markets, and alternate site
markets e.g. homecare markets, same day surgery facilities,
physician offices, plasma collection facilities, blood banks
and independent laboratories.
1.5 "Term" means that period of time or periods of time set forth
in Section 6 of this Agreement. 1.6 "Sales Minimums" means
minimum Product purchases by the Alliance during the Term of
this Agreement as listed in Exhibit B of this agreement.
1.7 "Sub-Distributors" means non-Alliance distributor.
1.8 "Confidential Information" means any data or information, oral
or written, treated as confidential that relates to either
party's (or, if either party is bound to protect the
confidentiality of any other person's information, such other
person's) past, present, or future research, development or
business activities, including any unannounced products(s) and
service(s), and including any information relating to
services, developments, inventions, processes, plans,
financial information, customer and SHP lists, forecasts, and
projections. Notwithstanding the foregoing, Confidential
Information shall not be deemed to include information that
(1) is publicly available or in the public domain at the time
disclosed; (2) is or becomes publicly available or enters the
public domain through no fault of the party receiving such
information; (3) is rightfully communicated to the recipient
by persons not bound by confidentiality obligations with
respect thereto; (4) is already in the recipient's possession
free of any confidentiality obligations with respect thereto
at the time of disclosure; (5) is independently developed by
the recipient; (6) is, in the opinion of counsel to a party
hereto, is required by law to be disclosed, or (7) is approved
for release or disclosure by the disclosing party without
restriction.
1.9 "Intellectual Property Rights" means the legal rights or
interests relating to the Products evidenced by or embodied in
(1) any idea, design, concept, technique, invention,
discovery, or improvement, regardless of patentability, but
including patents, patent applications, trade secrets, and
know-how; (2) any work of authorship, regardless of
copyrightability, but including copyrights and any moral
rights recognized by law; and (3) any other similar rights, in
each case on a worldwide basis.
2 APPOINTMENT OF DISTRIBUTOR
2.1 SHP appoints Alliance as SHP's distributor for sale and
support of SHP Products in the Territory. Alliance will be the
exclusive hospital, alternate-site (e.g. homecare, plasma
centers, blood banks, same day surgery center, physician
office) and consumer market distributor for Products in the
Territory. If Alliance fails to purchase the Sales Minimums of
SHP Products as set forth in Exhibit B herein, then, at the
option of SHP (which election can be made any time during the
remaining term of this Agreement), (i) any exclusive
distribution rights Alliance may possess shall be converted
into a nonexclusive right to sell SHP Products; or (ii) this
Agreement shall be terminated.
2.2 All rights not specifically granted to Alliance hereunder are
reserved by SHP. Except as expressly provided hereunder in
connection with the distribution of the SHP Products, SHP does
not convey any Intellectual Property Rights to Alliance
hereunder.
2.3 SHP agrees to comply with the terms of this Agreement and with
all existing sales policies of Alliance that Alliance has
given SHP notice of prior to the date hereof in writing and
other policies that SHP may agree to in writing from time to
time.
2.4 Alliance shall be entitled to appoint such sub-distributors,
including its Members that may be necessary to ensure the
effective distribution and support of the Products in the
Territory. The legal relationship between Alliance and
sub-distributors is independent of any relationship between
Alliance and SHP, and no legally binding relationship shall be
deemed to exist between SHP and any such sub-distributors
unless SHP enters into a binding written agreement with such
sub-distributors.
2.5 Nothing in this Agreement shall be construed to constitute
either party the agent or employee of the other party for any
purpose whatsoever. All sales to Alliance under this Agreement
are and shall be sales between Alliance as Agent-Buyer, and
SHP as Seller.
3 OBLIGATIONS OF ALLIANCE
In addition to all other obligations of Alliance set forth in this
Agreement, including any and all Exhibits expressly incorporated herein by
reference, Alliance expressly agrees on behalf of its Members, officers,
directors, managers, employees and sub-distributors, if any, during the
Term, as follows:
3.1 Alliance shall use commercially reasonable efforts to sell and
promote the use of Product in the Territory.
3.2 Alliance shall provide Product and such services to Alliance's
customers as is customary in the trade in the Territory of
of Alliance and as necessary to reasonably meet the needs of
a customer.
3.3 Alliance shall train, develop and maintain customer service
and sales support capable of providing prompt and effective
technical services to users of Product in the Territory.
3.4 Alliance shall maintain such inventories of equipment, tools,
literature and technical documentation that are adequate to
support the sales and service of Product.
3.5 Alliance shall permit SHP to inspect Alliance's facilities,
from time to time, and shall arrange for SHP to inspect the
Members facilities.
3.6 Upon specific requests by SHP, Alliance shall provide SHP with
written reports about competitive products and other relevant
data affecting SHP's business in the Territory. SHP may supply
Alliance with appropriate forms for this purpose.
3.7 Alliance shall have in effect all licenses, permits and
authorizations from all governmental agencies within the
Territory necessary to the performance of its obligations and
shall comply with all applicable laws, rules and regulations
affecting its activities including, but not limited to FDA,
product tracking, forwarding product complaints to SHP and
other regulatory requirements.
3.8 Alliance may not use the name "Specialized Health Product" in
its corporate name. Alliance is hereby granted, during the
Term of this Agreement or until withdrawn in writing by SHP,
2
whichever comes first, authority to use the name "Specialized
Health Products, Inc." in literature, advertising, promoting
and/or merchandising SHP Product. Alliance agrees to follow
current SHP's requests with regard to the form and style of
its name when and if used by Alliance.
3.9 Alliance shall in all cases order from SHP at least the number
of Products each equal to the Sales Minimums as listed in
Exhibit B and will begin effective the 1st day of the month
following availability of product from automated assembly
equipment
3.10 Alliance shall distribute SHP Products with all packaging,
warranties, disclaimers, and agreements intact as shipped by
SHP.
4 OBLIGATIONS OF SHP
4.1 SHP shall use its commercially reasonable efforts to obtain
the best available shipping dates and to ship in accordance
with Alliance's shipping requests. SHP shall use commercially
reasonable efforts to maintain an "adequate" stocking
inventory of all Product at its corporate warehouse. Should
orders for SHP Products exceed SHP's available inventory, SHP
will allocate its available inventory and make deliveries on a
basis SHP deems equitable, in its sole discretion, and without
liability to Alliance or Alliance members on account of the
method of allocation chosen or its implementation.
4.2 SHP shall acknowledge Alliance orders promptly and provide
timely shipping information. Timely shall mean notice within
one (1) business day to the Alliance Member of any backorders,
including an expected ship date.
4.3 SHP shall, as promptly as practicable, give Alliance notice
of any elimination, addition, alteration in design or
discontinuation of any SHP or Alliance labeled Product. SHP
shall be free to make any of the foregoing changes, and
Alliance shall have no claim against SHP for its failure to
furnish to Alliance product of a design or type previously
sold but discontinued or changed by SHP.
4.4 SHP shall make available to Alliance, for use by Alliance
only for purposes of this Agreement, such technical
information, data, technology, analyses, laboratory reports
and other information in respect of Product for Alliance to
fulfill its obligation.
4.5 SHP will provide Alliance technical and practical training as
needed. SHP shall endeavor to provide such training regionally
at an Alliance facility.
4.6 SHP shall supply, at its cost, reasonable quantities of
product literature in the English language, as well as samples
of advertising materials, color separations, and English
language text.
4.7 SHP shall have in effect all licenses, permits and
authorizations from all governmental agencies within the
Territory necessary to the performance of its obligations and
shall comply with all applicable laws, rules and regulations
affecting its activities including, but not limited to FDA,
product tracking and other regulatory requirements.
4.8 SHP may not use the name "Alliance" in its corporate name. SHP
is hereby granted, during the Term of this Agreement or until
withdrawn in writing by Alliance, whichever comes first,
authority to use the name "Alliance Medical" in literature,
advertising, promoting and/or merchandising the Product. SHP
agrees to follow current Alliance "Corporate Style Guide"
in using Alliance name in advertising and promotion. Alliance
will provide to SHP the official "Corporate Style Guide" upon
acceptance of this Agreement.
4.9 SHP shall permit Alliance to inspect SHP's facilities, from
time to time.
4.10 Upon notification from Alliance to SHP regarding defective
Product, SHP will respond directly to the Alliance Customer of
such defective Product within two (2) business days of
notification by Alliance. An explanatory, written response
shall be provided by SHP to the Alliance Customer with a copy
submitted to Alliance.
5 PRICE, TERMS OF SALE, and REBATES
Price
5.1 Alliance's purchase price shall be in accordance with prices
established in Exhibit A. SHP will protect all pricing for
twelve (12) months from date of signed agreement. SHP may
change the Alliance Price Schedule after the twelve months
3
upon giving Alliance written notice at least ninety (90) days
in advance of the effective date of any such price change. Any
new prices will be effective for all orders accepted by SHP
after the effective date as specified in such notice.
5.2 Prices set forth in Exhibit "A" do not include taxes of any
nature. Alliance shall pay such sales taxes when invoiced by
SHP or will supply appropriate tax exemption certificates in a
form reasonably satisfactory to SHP.
Terms of Sale
5.3 Upon acceptance by SHP of orders from Alliance Members, SHP
shall sell to Alliance, and Alliance shall purchase from SHP,
the Product ordered at the sale prices in effect at time of
acceptance of order.
5.4 Alliance shall place firm, written purchase orders for the
Product (at SHP's address written above, or at an address of
SHP as subsequently designated in writing by SHP) specifying
the types and quantities of Product desired and the required
dates of delivery if different from SHP's established shipping
schedule. All orders shall be subject to acceptance or
rejection by SHP and shall comply with Exhibit A of the
Agreement. SHP shall not unreasonably reject an order. Unless
Alliance clearly advises SHP to the contrary in writing, SHP
may make partial shipments of Alliance's orders, to be
separately invoiced and paid for when due. Delay in delivery
of any installment shall not relieve Alliance of its
obligation to accept the remaining deliveries, unless canceled
pursuant to this Agreement.
5.5 It is understood that Alliance Members may use their normal
purchase order forms with respect to their purchase of
Products. Purchase orders may specify, among other things, the
description and quantities of the products ordered, the method
of shipment, the requested shipment dates, and the destination
to which products shall be shipped. The terms of such purchase
orders shall not conflict with the terms of this Agreement.
5.6 SHP will invoice Alliance upon shipment of Products ordered
by Alliance Members. Payment shall be due thirty (30) days
after the date of invoice. SHP reserves the right, upon
written notice to Alliance, to declare all sums immediately
due and payable in the event of a breach by Alliance of any of
its obligations to SHP.
5.7 Alliance, upon written notice, may authorize SHP to suspend
Product shipment to any Member (under terms of this Agreement)
as a result of Member resignation, of Member non-payment of
invoice(s), or other circumstances deemed appropriate by
Alliance. SHP will allow Alliance ninety (90) days to remedy a
Member non-payment situation. As long as payment remains
delinquent by the individual Alliance Member, SHP may, in
addition to any other right or remedy provided by law or this
Agreement, require any further shipment to delinquent Member
to be prepaid.
5.8 SHP reserves the right to cancel or suspend any orders placed
by Alliance or Alliance members and accepted by SHP, or refuse
or delay shipment thereof, if Alliance fails (1) to make any
payment as provided herein or in any invoice; or (2) otherwise
to comply with the terms and conditions of this Agreement.
5.9 Interest shall accrue on any delinquent amounts owed to
SHP by Alliance hereunder at the rate of 1.5 percent (1.5%)
per month, or the maximum rate permitted by applicable law,
whichever is less.
5.10 SHP Products shall be shipped by SHP F.O.B. point of shipment.
Alliance or the Alliance member shall be responsible for and
shall pay all shipping, freight, and insurance charges, which
charges SHP may require be paid in advance. All risk of loss
or damage for any SHP Product shall pass from SHP upon
delivery by SHP to the freight carrier, or Alliance's agent
for delivery, whichever first occurs.
5.11 Alliance Members must obtain an RGA (Returned Goods
Authorization) from an authorized SHP Customer Service
Representative to return Product. Product in new and original
condition, in unopened cases, may be returned to SHP , freight
pre-paid, and will be subject to 10% re-stocking fee. If
opened, SHP Product may not be returned for refund. Defective
Product returned to SHP shall not be subject to any
re-stocking fee as warranted in section 8.2.
4
Rebates
5.12 On a quarterly basis SHP will rebate to Alliance 5% of the
total SHP Product sales on all SHP Product paid for by
Alliance. On a quarterly basis SHP will rebate an additional
1% to Alliance on paid Product sales exceeding agreed upon
Sales Minimums for the first year as also outlined in Exhibit
B and then will be paid annually for succeeding years.
Alliance will invoice SHP quarterly for the 5% rebate.
5.13 SHP reserves the right to discontinue or reduce the number of
Products supplied to Alliance or Alliance members in the event
of a materials shortage, and any such action shall not be
deemed a breach of this Agreement. In addition, the number of
SHP Products that can be shipped during an initial period will
be limited until SHP's automated equipment comes on line in
the fourth quarter of 1997. Until the automated equipment is
operational, SHP's ability to ship limited numbers of SHP
Product will not be deemed to be a breach of this Agreement.
6 TERM OF AGREEMENT
6.1 The term of this Agreement is three (3) years, September 1,
1997 to August 31, 2000, unless terminated earlier pursuant to
its terms. This Agreement shall automatically renew for twelve
(12) month periods, if not otherwise terminated, unless either
party notifies the other in writing of its intentions not to
renew. Such notice, to be effective, must be given no later
than sixty (60) days before the Term is due to expire. In the
event that the Agreement is automatically renewed, Sales
Minimums shall be increased by a mutually agreed upon number.
6.2 In the event of a material default by either party in the
performance of its duties, obligations, or undertakings under
this Agreement, the other party shall have the right to give
written notice to the defaulting party advising such party of
the specific default involved. A material default hereunder
shall include, but not be limited to, Alliance's failure to
perform its obligations set forth in paragraphs 3.2 and 3.3
herein. If within thirty (30) days after such notice, the
defaulting party has not remedied such default, the other
party shall have the right to terminate this Agreement
immediately upon giving written notice of termination to the
defaulting party.
6.3 Either party may immediately terminate this Agreement at any
time by giving written notice of such termination in the event
the other party (i) becomes insolvent, institutes or permits
to be instituted against it any proceedings seeking
receivership, trusteeship, bankruptcy, reorganization,
arrangement, readjusting of debt, assignment for the benefit
of creditors, or other similar proceedings under any
applicable law; or (ii) becomes involved in a merger, is
acquired by another party, sells substantially all of its
assets, or is involved in a similar transaction. In the event
of such, Alliance and Members will assume responsibility for
paying all outstanding Alliance and Members invoices.
6.4 Right on Termination. Upon termination of this agreement, the
parties shall be bound by the following provision:
6.4.1 No Release from Obligations. Any termination of this
Agreement shall not relieve or release either party
from obligations which shall have accrued under this
Agreement prior to termination. No termination shall
release any party from liability to the other arising
out of or in connection with a party's breach of, or
failure to perform any covenant, agreement, duty or
obligation contained herein.
6.4.2 No Right to Damages or Indemnification. In the event
of proper termination of this Agreement, neither
Alliance nor SHP shall have any right to damages or
indemnification of any nature arising from such
termination, whether for the loss of future profits
or an account of expenditures, investments, leases
or commitments made in connection with business or
goodwill.
6.4.3 Except to the extent of selling its remaining
inventory of Product, Alliance shall not thereafter
represent or hold itself out as being an authorized
distributor or sales representative for SHP's
Products or engage in any practices which might make
it appear that Alliance or its sub-distributors are
still authorized to distribute Product.
5
6.4.4 Any acceptance by SHP of an order after notice of
termination is given shall be separate transactions
and shall not operate as a renewal or revival of this
Agreement or as a waiver of any rights or provision
hereof.
6.4.5 No termination of this Agreement shall in any manner
whatsoever release, or be construed as releasing, any
party from any liability to the other arising out of
or in connection with a party's breach of, or failure
to perform, any covenant, agreement, duty or
obligation contained herein.
7 INTELLECTUAL PROPERTY
7.1 SHP shall have and retain sole ownership of the patents and
trademarks relating to the SHP Products, including the
goodwill pertaining thereto. Alliance acknowledges that it has
no right in any patents, trademarks or trade names used by SHP
or SHP's suppliers anywhere in the world, whether or not
registered in the Territory. Alliance undertakes that it will
not assert, and will not allow any of its sub-distributors to
assert any rights in any such properties arising by reason of
Alliance's appointment or the use of any such properties. SHP
hereby grants to Alliance the right to use and display the
Trademarks solely in connection with and solely to the extent
reasonably necessary for the marketing, distribution, and
support of the SHP Products within the Territory in accordance
with the terms and conditions of this Agreement. Alliance
shall market, distribute, and support the SHP Products only
under the Trademarks, and not any other trademark or logo.
Alliance shall not use the Trademarks or any other trademarks
or trade names of SHP or any word, symbol, or design
confusingly similar thereto, as part of its corporate name, or
as part of the name of any SHP Products. Alliance shall not
remove or alter the SHP Products' copyright notices,
trademarks, patent notices, and logs, or packaging. To protect
and preserve the goodwill and image of the SHP Products,
Alliance shall (1) conduct business in a manner that reflects
favorably at all times on the SHP Products and the reputation
of SHP; (2) avoid deceptive, misleading, or unethical
practices that are or might be detrimental to SHP and/or the
SHP Products, including any disparagement of SHP or the SHP
Products; (3) make no false or misleading representations with
regard to SHP or the SHP Products; (4) refrain from publishing
or employing any misleading or deceptive advertising material;
and (5) refrain from making any representations, warranties,
or guarantees to purchasers with respect to the
specifications, features, or capabilities of SHP Products that
are inconsistent with the literature distributed by SHP,
including all warranties and disclaimers contained in such
literature.
7.2 During the course of performance of this Agreement, the
parties hereto may disclose certain Confidential Information
to the other party solely to permit the other party to perform
its obligations under this Agreement. The parties hereto shall
use commercially reasonable efforts to maintain the secrecy of
all such Confidential Information. The parties shall refrain
from using, disclosing, or otherwise exploiting any
Confidential Information for any purpose not specifically
authorized by the disclosing party in this Agreement. All
files, lists, records, documents, drawings, specifications
and equipment that incorporate or refer to any Confidential
Information shall be returned or destroyed promptly upon
termination of this Agreement. Either party may identify
Confidential Information by marking it as "confidential". Oral
communications may be identified as Confidential Information
by reducing the confidential portions f the communication
to writing and marking it as "confidential."
7.3 Alliance shall promptly notify SHP of (1) any claims,
allegations, or notification that its marketing, licensing,
support, or service of the SHP Products may or will infringe
the Intellectual Property Rights of any other person or
entity; and (2) any determination, discovery, or notification
that any person or entity is or may be infringing the
Intellectual Property Rights of SHP. Alliance shall not take
any legal action relating to the protection or defense of any
Intellectual Property Rights pertaining to the SHP Products
without the prior written approval of SHP. SHP shall have no
obligation to take legal action relating to the protection or
defense of any Intellectual Property Rights.
6
8 WARRANTY
Warranty
8.1 SHP warrants that all Product will have been manufactured in
accordance with generally accepted good manufacturing
practices.
8.2 SHP warrants that the SHP Product, when used in accordance
with the directions on its labeling, is fit for the purposes
and the indications described in the labeling. SHP shall hold
Alliance harmless from and against all damages awarded plus
all costs and expenses related thereto arising from any
injuries caused by the use of a unit of the Product which is
proven to be defective when used in accordance with the
direction on the labeling. SHP's obligation under this
warranty are limited solely to Products which may be proven
defective. Alliance shall afford SHP prompt and reasonable
opportunity to inspect any product as to which any claim is
made.
8.3 SHP HEREBY DISCLAIMS ANY OTHER WARRANTY, EXPRESS OR IMPLIED,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE.
8.4 IN NO EVENT SHALL SHP BE LIABLE TO ALLIANCE FOR ANY INDIRECT,
SPECIAL, OR CONSEQUENTIAL DAMAGES, INCLUDING, WITHOUT
LIMITATION, LOST PROFITS, COSTS OF DELAY, AND ANY FAILURE OF
DELIVERY.
8.5 IN THE EVENT THAT, NOTWITHSTANDING SECTION 8.3 AND 8.4 HEREOF,
SHP IS FOUND LIABLE FOR DAMAGES BASED ON ANY DEFECT OF
NONCONFORMITY IN THE LANCETS, ITS TOTAL LIABILITY TO THE
ALLIANCE AND MEMBERS FOR EACH DEFECTIVE LANCETS SHALL NOT
EXCEED THE PRICE OF SUCH DEFECTIVE LANCETS.
Miscellaneous
8.6 Products found by Alliance to be defective prior to Alliance's
resale shall be promptly replaced by SHP without charge or
expense to Alliance. Defective Products found by Alliance
shall be, at SHP's election, either returned to SHP or
destroyed. Products reported by Alliance's customers to be
defective will be replaced by SHP in accordance with Sections
4.10, 5.13 and 8.8 of this Agreement.
8.7 At all times during the term of this Agreement, SHP will
maintain in full force and effect a policy or policies of
insurance issued by insurers of recognized responsibility,
insuring it against such losses and risks (including product
liability), and in such amounts, as SHP determines is prudent.
8.8 Alliance shall act as the intermediary between SHP and any
other persons or entities who receive Product from or through
Alliance and who have any Product complaint, including a
complaint of defective material or workmanship.
8.9 Alliance must advise SHP of any discrepancies in shipment or
invoice within thirty (30) days of accepting the merchandise.
Otherwise, it is assumed that Alliance has accepted both goods
and invoice as received.
8.10 Alliance Members shall request a Returned Goods Authorization
Number from SHP before merchandise is returned for credit or
adjustment. This Authorization Number will be obtained from
SHP's Customer Service Department.
8.11 Any returns, other than defective or non conforming Products,
to SHP shall be shipped freight prepaid. Where timely claim is
made, SHP will, at its option and expense, replace product
that is defective prior to leaving an SHP manufacturing
facility or non conforming Product under its warranty.
Allowance for, or replacement of, defective items will be made
following tests and inspection by SHP. Defective merchandise
and shipping errors and associated shipping costs will be
remedied at full credit.
8.12 Alliance shall hold SHP harmless from all claims arising from
the negligent acts of Alliance including any claims arising
from third parties in relation to Alliance's activities in
connection with Product.
7
9 INDEMNIFICATION
9.1 SHP shall indemnify, hold harmless and defend Alliance, its
directors, officers, agents and employees from and against any
and all claims, costs, demands, liabilities, losses, damages,
and expenses of whatever nature, including reasonable
attorney's fees, made against or sustained by Alliance, its
directors, officers, employees or agents with respect to any
breach of a warranty contained in Sections 8.1 or 8.2 hereof.
The provision of this Section 9.1 shall survive the term of
this Agreement.
9.2 Alliance shall indemnify, hold harmless and defend SHP, its
directors, officers, agents and employees from and against any
and all claims, costs, demands, liabilities, losses, damages,
and expenses of whatever nature, including reasonable
attorney's fees, made against or sustained by SHP, its
directors, officers, employees or agents with respect to any
negligent acts of Alliance or its sub-distributors including
any claims arising from third parties in relation to
Alliance's or its sub-distributors' activities in connection
with SHP Product. The provision of this Section 9.2 shall
survive the term of this Agreement.
10 NOTICES
10.1 All notices, requests, consents, demands and other
communications to be given or delivered under, or by any
reason of the provisions of this Agreement, shall be in
writing and shall be (a) personally delivered (including
courier), (b) sent by postage prepaid registered airmail or
(c) transmitted by facsimile transmission or other electronic
means, and shall be deemed to have been duly given when
received. Notices to SHP shall be sent to its address as set
forth below (Attention: President, SHP ) and to Alliance at
its address set forth below (Attention: Chief Operating
Officer, New Alliance of Independent Medical Distributors,
Inc.) or to such other address as the recipient shall have
last given notice.
11 ENTIRE AGREEMENT
11.1 The terms and conditions of this Agreement, including the
annexed Exhibits mentioned in the main body of this Agreement
and all documents identified as part of this Agreement,
together constitute the entire agreement between the parties
and supersede all prior or contemporaneous communications,
negotiations, representations, or agreements between the
parties with respect to the subject matter hereof.
12 AMENDMENTS
12.1 No modifications, or amendments to the Agreement shall be
binding upon either party unless specifically assented to in
writing by an authorized representative of both parties. No
waiver of any breach or of any term or condition of this
Agreement shall be deemed to be a waiver of any subsequent
similar breach or of the same or any other term or condition.
A failure at any time to enforce any rights by either party
under the terms of this Agreement shall not be considered a
waiver of such rights to enforce any proceeding or succeeding
breach of this Agreement or any rights under the terms of this
Agreement.
13 ASSIGNMENTS
13.1 This Agreement and the rights and duties of the parties hereto
shall be binding upon and inure to the benefit of the parties,
their successors and assigns, but this Agreement shall not be
assignable or delegated by a party hereto without the prior
written consent of the other party, except to a subsidiary or
parent of a party, which consent shall not be unreasonably
withheld.
14 COUNTERPARTS
14.1 This Agreement shall be executed in two or more counterparts,
each of which, when executed, shall be deemed to be an
original, and all of which when taken together shall
constitute but one and the same Agreement.
8
15 FORCE MAJEURE
15.1 If force majeure prevents SHP from filling any order from
Alliance or otherwise performing any obligation arising out of
this Agreement, SHP shall not be liable for any compensation,
reimbursement or damages. If force majeure prevents SHP from
achieving its obligations, under this Agreement, this
Agreement shall be automatically modified to allow for delays
caused by such force majeure circumstances, provided SHP
notified Alliance in writing of the invocation of force
majeure for this purpose. The term "force majeure" shall mean
labor disputes, flood, fire, rebellion, war, regulations,
requirements or acts of civil or military authorities,
unavailability of materials or finished goods and allocations
or priorities with respect thereto, civil disorder, acts of
God, delays of carriers and any other cause beyond the control
of the party invoking the provisions of this section.
15.2 If force majeure prevents Alliance from performing any
obligation arising out of this Agreement, Alliance shall not
be liable for any compensation, reimbursement or damages. If
force majeure prevents Alliance from achieving its
obligations, under this Agreement, this Agreement shall be
automatically modified to allow for delays caused by such
force majeure circumstances, provided Alliance notified SHP in
writing of the invocation of force majeure for this purpose.
16 GOVERNING LAW: FORUM
16.1 This Agreement shall in all respects be interpreted, construed
and governed by and in accordance with the Laws of the State
of Utah, USA without regard to its conflict of law previsions.
All actions or proceedings arising directly or indirectly or
otherwise in connection with, out of, related to, or from this
Agreement may be litigated exclusively and only in courts with
the State of Utah, and the parties hereto hereby consent and
submit to the jurisdiction of any local, State or federal
court located in such State.
17 SEVERABILITY
17.1 In the event that any provision hereof is found invalid or
unenforceable pursuant to judicial decree or decision, the
remainder of this Agreement shall remain valid and enforceable
according to its terms. WITHOUT LIMITING THE FOREGOING, IT IS
EXPRESSLY UNDERSTOOD AND AGREED THAT EACH AND EVERY PROVISION
OF THIS AGREEMENT THAT PROVIDES FOR A LIMITATION OF LIABILITY,
DISCLAIMER OF WARRANTIES, OR EXCLUSION OF DAMAGES IS INTENDED
BY THE PARTIES TO BE SEVERABLE AND INDEPENDENT OF ANY OTHER
PROVISION AND TO BE ENFORCED AS SUCH. FURTHER, IT IS EXPRESSLY
UNDERSTOOD AND AGREED THAT IN THE EVENT ANY REMEDY HEREUNDER
IS DETERMINED TO HAVE FAILED OF ITS ESSENTIAL PURPOSE, ALL
OTHER LIMITATIONS OF LIABILITY AND EXCLUSION OF DAMAGES SET
FORTH HEREIN SHALL REMAIN IN FULL FORCE AND EFFECT.
18 NUMBERS AND HEADINGS
18.1 The numbering and titling of sections, paragraphs and
subparagraphs contained in this Agreement is done purely as a
matter of convenience and is not intended to have a
substantive effect upon any of the provisions contained
herein.
19 INTEGRATION
19.1 This Agreement supersedes and cancels any previous
distributorship agreement which may exist between Alliance,
its members and SHP.
20 COMPETITION
20.1 During the term of this Agreement, Alliance agrees not to sell
any products that compete with the SHP Products in the
Territory represented by Alliance without the written consent
of SHP.
9
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the 9th day of September, 1997.
New Alliance of Independent Medical
Distributors, Inc. Specialized Health Products, Inc.
d.b.a. Alliance Medical ▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇., #▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
By /s/ ▇▇▇▇ ▇▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------- --------------------------
Its: President Its: President
10
EXHIBIT A
PRICING
List # Product Description Price/case
------ ------------------- ----------
0034-001 ExtreSafe Lancet Strips 81.60
480 lancets and 4 carriers
0044-001 Carrier/Actuators (10) 14.90
EXHIBIT B
SALES MINIMUMS
* 10,550 cases (5,064,000 lancets total) during the first year of this
Agreement including quarterly minimums of:
* 500 cases (240,000 lancets) during the first quarter (the first 3
months) of this Agreement.
* 1,300 cases (624,000 lancets) during the second quarter (the
second 3 months) of this Agreement.
* 2,500 cases (1,200,000 lancets) during the third quarter (the
third 3 months) of this Agreement.
* 6,250 cases (3,000,000 lancets) during the fourth quarter (the
foruth 3 months) of this Agreement.
* 39,584 cases (19,000,320 lancets total) during the second year of this
Agreement including quarterly minimums of:
* 7,500 cases (3,600,000 lancets) during the first quarter (the
first three months of the second year) of this Agreement.
* 8,500 cases (4,080,000 lancets) during the second quarter (the
second three months of the second year) of this Agreement.
* 10,500 cases (4,080,000 lancets) during the third quarter (the
third three months of the second year) of this Agreement.
* 13,084 cases (5,040,000 lancets) during the fourth quarter (the
fourth three months of the second year of this Agreement.
* 64,000 cases (30,720,000 lancets total) during the third year of this
Agreement.
* 14,000 cases (6,720,000 lancets) during the first quarter (the
first three months of the second year) of this Agreement.
* 15,000 cases (7,200,000 lancets) during the second quarter (the
second three months of the second year) of this Agreement.
* 16,500 cases (7,920,000 lancets) during the third quarter (the
third three months of the second year) of this Agreement.
* 18,500 cases (8,880,000 lancets) during the fourth quarter (the
fourth three months of the second year) of this Agreement.