Distributor Agreement
THIS
DISTRIBUTOR AGREEMENT (hereinafter "Agreement") is entered into this 10th day of
November, 2009, by and between:
IsoRay Medical, Inc., a
Delaware corporation with its principal office at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (hereinafter the
"Company"),
and
Inter V Medical Inc., a
Canadian Company with its principal office at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ (hereinafter the "Distributor").
RECITALS
WHEREAS,
The Company is a corporation duly organized, validly existing, and in good
standing under the laws of the State of Delaware;
WHEREAS,
The Distributor is a company duly organized, validly existing, and in good
standing under the laws of Canada;
WHEREAS,
The Company manufactures or produces certain products or performs certain
services or owns certain licenses or patents to procedures, processes or tests
with medical applications, described on Exhibit A attached
hereto (collectively, the "Products");
WHEREAS,
The Company and the Distributor wish to enter into an agreement whereby the
Distributor will become the exclusive distributor of the Products and will
market the Products, and will promote and sell the Products in the "Territory"
as defined hereinafter in Exhibit B on the
terms and conditions set forth herein;
WHEREAS,
The Company from time to time may have products in development or clinical
trials which are pending marketing clearances and may require clinical trials or
governmental filings before full license approval is achievable in the
Territory, and Distributor shall not have the right to distribute Products for
any such trials, distribution rights for which shall be retained exclusively by
the Company until each trial is fully completed and paid for;
WHEREAS,
The
Distributor is willing to work with the Company to take the necessary steps in
order to gain such license approvals for the Products in the
Territory.
NOW,
THEREFORE, the parties hereto agree as follows:
Section
1. Appointment of
Distributor. The Company appoints the Distributor, and the Distributor
accepts appointment, as the exclusive distributor of the Products in the
Territory, excluding all Products distributed for clinical trials and protocol
studies in the Territory, distribution rights for which shall be retained
exclusively by the Company until each trial is fully completed and paid for. The
Distributor may sell the Products of the Company covered by this Agreement as
defined in Exhibit
A, only within the Territory as defined in Exhibit B attached to
this Agreement. Exhibit A shall
further include a description of users, purpose, features and usage associated
with the Products. In exchange for this right of exclusive
distribution of the Products, Distributor agrees that it shall not sell,
represent or accept appointment as distributor for products having similar
users, isotopes, purpose, features and usage as the Products described in Exhibit A, in
accordance with Section 14.3 herein.
Section
2. Products Covered. The
Products covered by this Agreement are listed on Exhibit A. Each
Product is subject, at the Company's sole discretion, to modification or change
in the part number, design or specification.
Section
3. Duration of
Agreement. This Agreement shall become effective on the date first-above
written and shall continue for a period of two (2) years from said date unless
earlier terminated pursuant to Section 14 hereof. The Agreement may
be renewed in its then-current form only if the parties mutually agree to
renewal in writing at least sixty (60) days prior to the expiration of the term
of the Agreement.
Section
4. Price List. The
current price list and terms are attached to this Agreement as Exhibit D. The
Company reserves the right to change the price list or terms at its sole
discretion with 30 days written notice to the Distributor. Documented orders
placed prior to the notification of price changes will be honored by the Company
at the original prices.
Section
5. Purchase and Sale of the
Products.
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5.1
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Purchase
Quantities. The Distributor shall be responsible for maintaining
any minimum purchase quantities or performance requirements shown in Exhibit C
during the time periods specified (collectively, the "Minimum Performance
Requirements"). In the event that the Minimum Performance
Requirements shown on Exhibit C are
not met, the Company shall have the right, but not the obligation, to
convert this Agreement into a nonexclusive agreement effective the first
day of the second calendar month following the end of any quarter in which
Distributor fails to meet any of the Minimum Performance
Requirements. To exercise this right, the Company shall provide
Distributor with written notice of the loss of its exclusive rights on or
before the tenth day of the first month following the end of the quarter
in which Distributor failed to meet a Minimum Performance
Requirement. In the event that Distributor fails to meet the
Minimum Performance Requirements, the Company may choose, in its sole
discretion, to offer the Distributor the option of removing certain
Products from this Agreement or may choose to terminate the entire
Agreement for cause as provided in Section 14.4. If the Company
provides Distributor with written notice of the loss of its exclusive
rights pursuant to this Section 5.1, the Company shall no longer have the
right to terminate the entire Agreement for cause for failure to meet the
Minimum Performance
Requirements.
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P.
2
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5.2
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Purchase
Orders. Orders for the Products shall be submitted on the Company's
written Purchase Order Form and must be received by the Company not less
than ten days prior to the ship date specified on the Purchase Order. All
Purchase Orders shall be consistent with the provisions of this Agreement
and any inconsistent terms shall be deemed stricken. All Purchase Orders
are subject to acceptance or rejection by the Company at its sole and
absolute discretion.
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5.3
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Order
Cancellation. The Company may cancel any accepted orders or refuse
or delay shipment of any orders if the Distributor fails to meet any
obligation arising under this Agreement including the failure of the
Distributor to pay for invoices within the period specified in Section
5.6.
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5.4
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Product
Delivery. Within fifteen days from acceptance by the Company of
Distributor's valid Purchase Order, the Products purchased by the
Distributor hereunder are quoted, and shall be shipped FOB point of
origin, using a carrier mutually acceptable to the Company and
Distributor, directly to Distributor's end user
customer. Distributor shall notify Company of the means of
shipping required and shall pay costs of shipping and any other related
expenses from point of origin. The Company shall not be
responsible for any failure of a carrier to meet its delivery
schedule.
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5.5
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Title and Risk
of
Loss. The Distributor shall take title to the Products upon
shipment from the point of origin as defined in Section 5.4 hereof and all
risks of loss and expenses in connection with the Products shall
thereafter rest upon the Distributor including storage, cartage and
transportation of the Products as well as all insurance, fees, charges,
and taxes. Any such expenses paid for by the Company to expedite the
delivery of the Products will be invoiced to the
Distributor.
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5.6
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Payment Terms.
The Distributor shall be extended terms of net 30 days from the invoice
date. Distributor shall make all payments required under this Agreement in
U.S. Dollars. The Company reserves the right to delay shipment
of orders, or make partial shipment of orders, to ensure that the account
balance does not exceed the maximum dollar limit or the payment terms are
not met. If Distributor is delinquent, without basis or without
prior written mutual agreement that such delinquency is acceptable to
Company, and payment is not received within 35 days of invoice or shipment
date, whichever is later, Company may ship subsequent shipments on a
pre-pay basis until Distributor has made payments to cure such
delinquency; further, Company may charge, and Distributor shall timely
pay, a late fee in the amount of 1.5% of the delinquent balance per month
for amounts over forty-five (45) days. Delinquency shall be
cause for termination of this Agreement by the Company as provided in
Section 14.4.
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5.7
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Records
Retention. Distributor shall maintain complete and
accurate records pertaining to the purchase of the Products for a period
of three calendar years after the year in which such purchases occurred,
and in sufficient detail to permit the Company to confirm the accuracy of
each of the foregoing.
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P.
3
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5.8
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Taxes. In
the event that Distributor is required to withhold any tax to the tax or
revenue authorities in any country or other governmental division in the
Territory regarding any payment to the Company due to the laws of such
governmental division, such amount shall be deducted from the payment to
be made and Distributor shall promptly notify the Company of such
withholding and, within a reasonable amount of time after making such
deduction, shall furnish the Company with copies of any tax certificate or
other documentation evidencing such withholding. Each party
agrees to cooperate with the other party in claiming exemptions from such
deductions or withholdings under any agreement or treaty from time to time
in effect. Regardless of the withholding requirements imposed
by authorities in the Territory, Distributor shall be solely responsible
for all currency conversions taxes and border crossing fees incurred.
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Section
6. Design Changes. The
Company shall advise the Distributor of all major contemplated changes of design
in the Products with thirty (30) days prior written notice to the date such
redesigned product is first shipped to the Distributor.
Section
7. General Obligations of the
Company. As an inducement to the Distributor to enter into this Agreement
and to consummate the transactions contemplated hereby, the Company hereby
represents, warrants, and covenants to the Distributor as
follows:
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7.1
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The
Company has the full right, title and in some cases, proprietary interest
in, and to, the Products; and the consummation of the transactions
contemplated herein and the granting by the Company to the Distributor of
the right to sell the Products does not require the consent, waiver,
approval, or authorization of any person or authority and, to the
Company's knowledge, does not violate any other agreements, instruments,
patents, or rights of any third
party.
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7.2
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The
Company shall provide the English language artwork for sales and
promotional materials; as well as technical sales support by Company
personnel in the Territory on at least an annual basis, but such technical
sales support shall not exceed three eight-hour days per year without the
mutual consent of the
parties.
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7.3
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The
Company shall provide technical information as reasonably required by the
Distributor for marketing or regulatory purposes. The Company reserves the
right to require the Distributor to sign a specific and redundant
Nondisclosure Agreement for any specific technical information requested
if such requested information is deemed by the Company to be so sensitive
that additional safeguards are
warranted.
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7.4
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The
Company shall be solely responsible for its expenses and those of its
staff and agents unless otherwise agreed to by the
parties.
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Section
8. General Obligations of
Distributor. As an inducement to the Company to enter into
this Agreement and to consummate the transactions contemplated hereby, the
Distributor hereby represents, warrants, and covenants to the Company as
follows:
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8.1
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The
Distributor represents that it has experience and expertise in marketing
and selling products similar to the Products, as well as the financial
resources to market the Products, and shall use its reasonable best
efforts to market and sell the Products in the Territory and to achieve
the maximum sales potential of the Territory. Distributor
agrees to diligently and continuously promote the sale of the Products and
shall: (i) avoid deceptive, unfair, misleading, or unethical trade
practices that are or might be detrimental to the Company, the Products,
its customers, or the public, including any disparagement of the Company
or the Products; (ii) make no false or misleading representations with
regard to the Company or the Products; (iii) refrain from publishing or
employing any misleading or deceptive advertising material; (iv) refrain
from disparaging the Company or the Products, or from otherwise injuring
the reputation and good standing of the Company; and (v) conduct its
business in a professional manner which will reflect positively upon the
Company and its business.
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P.
4
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8.2
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The
Distributor will maintain the Minimum Performance Requirements listed in
Exhibit C
hereto. The failure to meet Minimum Performance Requirements shall be a
breach of this Agreement and may result in loss of exclusivity as provided
in Section 5.1 or the Company's termination of this Agreement for cause as
provided in Section 14.4.
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8.3
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The
Distributor shall maintain an active, direct sales organization of a size
that can fully exploit the potential of the Territory and keep the
prospective customers informed of the availability of the Products and
that is knowledgeable with respect to the clinical procedures in which the
Products are used as well as the sales features and benefits of the
Products and their correct operation and use. Distributor shall
ensure that the members of its sales organization maintain the skill
levels, and product and clinical knowledge required to properly sell and
service the Products.
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8.4
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The
Distributor shall not promote or sell any of the Products outside the
Territory and Distributor may not undertake distribution of or accept
appointment as distributor for products having similar customers uses,
purpose, features and usage as the Products set forth in Exhibit A, as
amended from time to time as long as this Agreement has not been
terminated.
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8.5
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No
less than annually during the Term of this Agreement, the Distributor
shall provide to the Company forecasts of anticipated Product
requirements. The initial forecast is due within 30 days of execution of
this Agreement. The Distributor acknowledges that Purchase Orders in
excess of the quantities set forth in the most recent forecast may require
additional delivery time as may be mutually acceptable to the
parties.
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8.6
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The
Distributor shall cooperate with the Company to implement any marketing,
promotion or sales strategies in the
Territory.
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8.7
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In
the event that any documentation related to the Products, including
without limitation the promotional materials, the technical sales support
materials or any technical documents, to be printed or not, shall be
translated into the French language in order to comply with the applicable
legislation in the Territory or in order to effectively promote the
Products in the Territory, the Distributor shall be responsible, at its
own expense, for translation of the above-mentioned documentation and
shall provide copies of all such translated documentation to the
Company.
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P.
5
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8.8
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The
Distributor shall, at its own discretion, use reasonable means to promote
the Products in the Territory including, but not limited to: direct sales
contact with customers, attendance at trade shows and clinical
conferences, advertisements in professional publications,
etc.
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8.9
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The
Distributor shall take all measures necessary to ensure that the Products
are handled and stored in an environment that will maintain the quality
and cleanliness of the
Products.
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8.10
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In
the possible event of any clinical complications involving the use of the
Products, adverse reaction, malfunction, injury or other similar claims
with respect to the Products, the Distributor will promptly gather as much
information regarding the incident as possible (including the name and
contact information of the doctor, the hospital, the patient, the
circumstances, the factors contributing to the incident, and any other
information reasonably requested by the Company) and report the matter to
the Company and the local authorities within 24 hours of becoming aware of
the incident. Distributor will permit the Company's quality
assurance personnel full access to all of Distributor's information and
correspondence concerning the incident at all
times.
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8.11
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As
soon as practicable after receiving notice of any claim, action or inquiry
by any applicable regulatory authority or court of law relating to alleged
non-compliance with the Products' warranty or any notice with respect to
any alleged violation of any law on the part of the Products, and of any
adverse incidents or customer or patient complaints regarding the Products
of which Distributor becomes aware — Distributor shall notify the Company
as in writing, and shall consult with the Company regarding responses to
such claims, actions or inquiries and shall also provide the Company with
copies of all correspondence in response to such claims, actions or
inquiries.
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8.12
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The
Distributor will take all measures reasonably possible to ensure that its
customers are educated as to the proper use of the Products and that they
understand the recommendations, precautions and contraindications shown on
all package inserts and labeling. Distributor
acknowledges that the Products are medical devices regulated by the FDA
and Health Canada and agrees to represent the Products in accordance with
their labeling, manuals, and applicable
regulations. Distributor agrees that its sales representatives
will instruct customers regarding the Products in accordance with the
Product labeling. All of the duties of Distributor set forth in this
paragraph shall be accomplished in conformance with usual and customary
standards generally accepted in the medical device
industry. Distributor agrees to refrain from making any claims
about the Products which do not conform to the specifications for the
Products provided by the Company, directions for use, product labeling,
and applicable governmental registrations for such
Products. Distributor further agrees to immediately cease,
following written notice from the Company, making any claims which the
Company reasonably objects to with respect to the
Products.
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8.13
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The
parties agree, warrant and represent that they will each comply with all
applicable laws, regulations, rules, requirements and ordinances of all
governmental authorities, including but not limited to ISO requirements,
applicable to the use, re-use, manufacture, sale, distribution,
transportation, exportation or importation of Products for their
particular roles and responsibilities hereunder. All medical device
licenses and future applications to distribute the Product in Canada are
solely the responsibility of the Company pursuant to the Therapeutic
Products Program (TPP) regulated under the laws of Canada. Distributor is
solely and exclusively responsible for complying with all regulatory
obligations for sale and/or use of Products in the Territory prior to the
sale of Products by Distributor in the Territory. Each party agrees,
warrants and represents that, with respect to the activities to be
conducted by such party hereunder, it will maintain all licenses, permits
and other approvals necessary to sell, manufacture, distribute, transport,
export, import and ship Products. Upon written request by the
other party, each party agrees to provide the other party with copies of
all appropriate documentation for confirmation of said authority to sell,
manufacture, distribute, transport, export, import and ship
Products.
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P.
6
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8.14
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Distributor
shall submit for approval by the Company all promotional literature, ad
copy, and marketing collateral items to be used by Distributor with
respect to the promotion of Products, including all such items that use
any of the Company's trademarks or logos for the Products, and shall
obtain the Company's approval prior to dissemination or use of such
items. The Company shall approve or disapprove, in writing, all
items submitted pursuant to the preceding sentence within fifteen (15)
days after receipt, and shall not unreasonably withhold said
approval. Distributor shall provide the Company with at least
three (3) copies of all approved materials concurrent with their
deployment by Distributor.
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8.15
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The
Distributor is a company duly organized, validly existing, and in good
standing under the laws of Canada and Distributor has full corporate power
and authority to enter into this Agreement and to carry out the provisions
hereof. Distributor shall provide all sales force (including,
without limitation, sales administration and training), order entry,
customer service, reimbursement management, medical affairs, medical
information, marketing (including all advertising and promotional
expenditures), warehousing, physical distribution, invoicing, credit and
collections, production forecasting and other related facilities and
services necessary or desirable for Distributor's distribution, marketing
and sales of the Products in the
Territory.
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The
Distributor is a company duly organized, validly existing, and in good standing
under the laws of Canada and Distributor has full corporate power and authority
to enter into this Agreement and to carry out the provisions
hereof.
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8.16
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Distributor
has taken all corporate action necessary to authorize the execution and
delivery of this Agreement and the performance of its obligations under
this Agreement.
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Section
9. Additional Rights and Duties
of the Company and the Distributor.
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9.1
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Each
of the parties hereto acknowledges that, from time to time during the term
of this Agreement, the parties hereto may come into the possession of
confidential information of the other party relating to such party's
customers, operations, activities, intellectual property (including,
without limitation, trade secrets and know-how), products and/or services,
(collectively, the "Confidential Information"), and that such information
is property valuable to the party that has developed it, and that the
party that has developed it desires to retain it in confidence and
withhold it from publication to others, and that such Party has a
legitimate business interest in such intent. The Distributor
and the Company shall, to the best of their ability, maintain in strict
confidence and duly safeguard any and all Confidential Information of the
other party and shall not use or disclose said information to others. Each
party shall be entitled, in addition to any other right or remedy it may
have, at law or in equity, to an injunction, without the posting of any
bond or other security, enjoining or restraining the disclosing party and
its affiliates from any violation or threatened violation of this Section
9.1. In no event shall a party be entitled to use any of the
other's Confidential Information, or any derivatives thereof, in
connection with the sale or production of any products or services that
are competitive with (direct or indirect) or similar to those products and
services sold, produced, manufactured, offered for sale, designed or
developed by the disclosing party or any of its affiliates or parent. Each
party agrees to refrain from knowingly infringing, in any manner, directly
or indirectly, on any Confidential Information of the other party (or any
of its affiliates or parent), regardless of whether such Confidential
Information has been registered, filed or recorded with the United States
Patent and Trademark Office, or any similar federal, state or
international agency or regulatory body. Each party further
agrees that it shall comply with all obligations imposed on it by the
United States Patent and Trademark Office or any similar federal, state or
international agency or regulatory body with respect to
the other party's intellectual property rights. The obligations
of this provision shall survive the termination of this Agreement (a) for
the life of the relevant intellectual property rights, in the case of
patents and trademarks, and (b) for the applicable period described in
Section 15.3, in the case of Confidential
Information.
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P.
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9.2
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The
Distributor and the Company shall be solely responsible for their
respective expenses and those of their staff and agents as well as for any
commitments made directly to customers by either party without the prior
consent of the other.
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9.3
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The
Company will supply the Distributor with technical and scientific
materials and references sufficient to allow the Distributor to describe
the Products, their correct clinical handling and use and the merits of
the techniques proposed by the Company. The Company agrees, upon request
by Distributor, to assist Distributor in ensuring that all technical and
sales staff of the Distributor are fully educated as to the merits,
correct use, limitations and contraindications for the use of the
Products, provided that the Company shall not be obligated to provide
greater than three eight-hour days of sales support or training to
Distributor's staff in any twelve-month
period.
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9.4
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The
Distributor shall use its reasonable efforts to cooperate with the Company
to meet requests of the Company to participate in, or be present at, any
procedure involving the Products in the
Territory.
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9.5
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The
Distributor acknowledges that in some cases there may be Products
available for use or sale in the Territory on a "clinical evaluation"
basis pending formal marketing approval. In such cases, at the Company's
request, the Distributor will use its best effort to cooperate with the
Company's regulatory strategy while meeting all required guidelines and
regulations set forth by the responsible governing body in the Territory.
In such cases the Distributor may be asked to, and will be responsible
for, assisting with the accumulation of data and the communication of such
data to the appropriate personnel at the Company. Distributor
acknowledges that it does not have distribution rights with respect to
Products available for use or sale in the Territory on a "clinical
evaluation" basis pending formal marketing approval and such distribution
rights shall be retained by the
Company.
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P.
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9.8
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Both
parties to this Agreement will make available to the other such records or
inspections as are necessary to ensure the compliance of the terms binding
each party under this
Agreement.
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9.9
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Each
party agrees that during the term of this Agreement, and for two (2) years
thereafter, it shall not: (i) employ or retain on an
independent contractor basis; or (ii) solicit for employment or for an
independent contracting basis any person who was, at any time during the
immediately preceding twelve (12) month period, employed by the other
party or any of its
affiliates.
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9.10
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Distributor
and the Company shall each shall continue to own all of their respective
intellectual property in any form ("IP"), including IP developed or
acquired by that party after the date hereof, and nothing in this
Agreement shall be construed as transferring any IP of a
party. Nor shall this Agreement be construed to grant any
license to any such IP, except as expressly provided for herein during the
term hereof. Any derivative work, as relates to copyright, or improvement
of a party's IP created by the other party pursuant to this Agreement,
shall be the property of the party who owns the IP on which the derivative
work or improvement is based, unless otherwise specifically agreed in
advance.
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Section
10. Health Canada Requirements
and Approval.
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10.1
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The
Company shall work in good faith and shall use its best efforts to
promptly obtain and maintain Marketing Clearance by Health Canada of any
new Products.
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10.2
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The
Distributor will use its best efforts to assist the Company in obtaining
the approval for the Products in the Territory whether or not Health
Canada has cleared the Products for
marketing.
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10.3
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The
Distributor will use its best efforts to assist the Company in meeting any
requirements set forth by Health Canada pursuant to the gathering of
information related to any incident or pursuant to any recall of any
Product mandated by Health Canada or related to the accumulation and
reporting of clinical data relating to the use of the
Products.
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Section
11. Product Warranty and
Limitations of Liability.
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11.1
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The
Company warrants to Distributor only that the Products, when delivered to
Distributor's end user customers pursuant to this Agreement, shall be in
accordance with their specifications as reflected on the labeling
accompanying each unit of Product shipped, and shall be free of defect in
materials or workmanship as specified in any applicable Warranty
Statement.
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P.
9
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11.2
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The
Company will replace at no charge any Product claimed by Distributor to be
defective in which the Company is able to verify the reported defect, and
the Company shall assume all costs and expenses related to the shipping
back to the Company of defective Products by
Distributor.
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11.3
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Non-defective
Product is not eligible for return unless agreed to in writing by an
authorized Company representative. Any non-defective Product which the
Company may agree to take back will be subjected to a restocking fee of
15% and must be received by the Company in a condition suitable for
re-sale.
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11.4
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Other
than the indemnity provisions in Section 13 below and the warranty and
other remedies expressly specified herein, the Company's and its
affiliates' entire and collective liability arising out of or relating to
this Agreement, including without limitation on account of performance or
nonperformance of obligations hereunder, regardless of the form of the
cause of action, whether in contract, tort (including without limitation
gross negligence but not including intentional torts, fraud or bad faith),
statute or otherwise, shall in no event exceed the amounts paid to the
Company under this Agreement for the Products. EXCEPT AS
SPECIFIED IN THIS AGREEMENT, NEITHER PARTY NOR ITS AFFILIATES OR PARENTS
SHALL, UNDER ANY CIRCUMSTANCES, BE LIABLE TO THE OTHER PARTY OR ITS
AFFILIATES OR PARENTS FOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT,
PUNITIVE, EXEMPLARY OR SPECIAL DAMAGES OF ANY NATURE WHATSOEVER, OR FOR
ANY DAMAGES ARISING OUT OF OR IN CONNECTION WITH ANY DELAYS, LOSS OF
PROFIT, INTERRUPTION OF SERVICE OR LOSS OF BUSINESS OR ANTICIPATORY
PROFITS, EVEN IF A PARTY OR ITS AFFILIATES HAVE BEEN APPRISED OF THE
LIKELIHOOD OF SUCH DAMAGES OCCURRING. No action, regardless of
form, arising out of this Agreement may be brought by either party more
than two (2) years after the cause of action has
accrued.
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Section
12.
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Insurance.
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12.1
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The
Company and Distributor each agree to carry general product liability
insurance in the minimum amount of $2 million per occurrence with a $2
million aggregate limit
annually.
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Section
13.
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Indemnification
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13.1
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The
Company shall indemnify and hold the Distributor harmless from and against
all costs, claims and damages, which are the result of negligence or
willful misconduct of the Company in connection with the fulfillment of
the Company's rights or obligations under this Agreement, with the
exclusion of defense costs, as determined in a final and non-appealable
judgment or a settlement agreement which the Company approved. However,
the Company shall not be obligated to indemnify the Distributor
unless:
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(a)
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the
Distributor gives the Company prompt written notice of any claim for which
it seeks indemnification;
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P.
10
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(b)
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the
Company has been offered the possibility of intervention in a lawsuit
between Distributor and a third party in connection with the Products at
its own cost or has approved a settlement releasing both
Parties.
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13.2
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In
no event will the Company have any obligation or liability to Distributor
under Section 13.1 for any of the
following:
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(a)
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costs,
claims and damages due to the Distributor's own negligence, recklessness,
wrongful intentional acts or omissions, or
intent;
|
|
|
(b)
|
use
of the Products or promotion of the Products not in conformity with such
Product's labeling by Distributor or Distributor's
customers;
|
|
|
(c)
|
breach
of any of Distributor's representations or warranties contained in this
Agreement; or
|
|
|
(d)
|
improper
storage, handling, or transportation of a Product by the Distributor or
its agents or customers, including, but not limited to, repackaging or
removal of a Product from its original
packaging.
|
|
13.3
|
In
all of the above circumstances, Distributor and Manufacturer shall
indemnify, defend and save each other hold harmless the Company from all
loss, damage, cost or expense of any nature, arising from or in any way
connected with any injury to persons or property caused by or resulting
from any act of negligence of the other, or its agents, in the use of the
Products and against any and all liabilities, damages, losses, costs and
expenses (including the reasonable fees of attorneys and other
professionals) to the extent arising out of or resulting from any of the
items specified in Section 13.2(a) through
(d).
|
Section
14. Termination.
|
14.1
|
Either
party may terminate this Agreement by giving written notice to such effect
to the other party if bankruptcy, insolvency or reorganization
proceedings, or other proceedings analogous in nature or effect, are
instituted by or against the other party, or if the other party is
dissolved or liquidated or acquired due to insolvency or reorganization
proceedings, whether voluntarily or involuntarily, or if a receiver or
trustee is appointed for all, or a substantial part of, the assets of the
other party or the other party makes an assignment for the benefit of
creditors.
|
|
14.2
|
Either
party may terminate this Agreement for cause, by giving written
termination notice to the other party of breach of any term or condition
contained in this Agreement in accordance with the provisions of this
Section 14. The terminating party shall provide the other party
an opportunity to cure the breach, and where such cure can be demonstrated
to both parties' satisfaction within thirty (30) days of the written
termination notice, termination shall not occur. In the event of the
termination of this Agreement, the Distributor shall have thirty (30) days
to close any pending business during which time the company shall honor
the terms of this Distributor Agreement.
|
P.
11
|
14.3
|
Company
may terminate this Agreement for cause in the event that Distributor sells
products having similar users, purpose, features and usage as the Products
described in Exhibit A,
subsequent to the date of this Agreement in accordance with Section 1
above.
|
|
14.4
|
Company
may terminate this Agreement for cause in the event that: (i) Distributor
fails to meet the Minimum Performance Requirements as described in Exhibit C of
the Agreement; or, (ii) Distributor has payments to Company that are
delinquent for a period of more than sixty (60)
days.
|
|
14.5
|
Either
party may terminate this Agreement in the event of a Change in Control of
the other party. "Change in
Control" means the
acquisition by any person or group of persons acting jointly or in concert
of more than 50% of the issued and outstanding voting securities of the
Company, where such acquisition is not due to insolvency or liquidation
proceedings.
|
|
14.6
|
In
the event Distributor terminates the Agreement without cause, or if
Company terminates the Agreement for cause, Distributor may not undertake
distribution of or accept appointment as distributor for products having
similar customers, users, purpose, features and usage as the Products
described in Exhibit A for a
period of twenty-four (24) months following termination
date. Distributor shall also, within thirty (30) days of
termination date, provide to Company a list of customers who have
purchased any of the Products in the Territory during the thirty-six (36)
months preceding termination
date.
|
Section
15. Rights and Obligations After
Termination or Expiration.
|
15.1
|
In
the event of the termination or expiration of this Agreement for any
reason, Distributor shall immediately cease selling the
Products. For a period of not more than thirty days following
termination or expiration, the Company shall complete shipments for orders
placed prior to termination or expiration, but shall not be obligated to
accept any new orders from Distributor. Distributor agrees that
the payment and other terms of this Agreement shall apply to orders placed
prior to termination or expiration but shipped after termination or
expiration.
|
|
15.2
|
In
the event of the termination or expiration of this Agreement for any
reason, Distributor will, within thirty (30) days, remove the Company's
logos, trademarks or other markings from any printed material, or other
property which links the Company to the
Distributor.
|
|
15.3
|
In
the event of the termination or expiration of this Agreement for any
reason, the confidentiality provisions herein, including those specified
in Sections 9.1 and 21, shall continue to be in force for a period of
three (3) years following termination
date.
|
|
15.4
|
Upon
termination or expiration of this Agreement for any reason, Distributor
shall promptly return to the Company copies of all data, reports, records
and materials in its possession or control that relate to the Products and
return to the Company all relevant records and materials in its possession
or control containing any Confidential Information of the Company
(provided that Distributor may keep one copy of such Confidential
Information of the Company for archival purposes only); and Distributor
shall transfer to the Company ownership of all registration applications,
registrations and other regulatory filings made or filed for any of the
Products (to the extent that any are held in Distributor's name), if
permitted by applicable laws and
regulations.
|
P.
12
Section
16. Notices. All notices,
requests or other communications required or permitted hereunder shall be deemed
officially sent when delivered by certified airmail letter postage prepaid, or
by facsimile transmission with documentation of successful transmission to the
address or facsimile number set forth below:
| Company: |
IsoRay
Medical, Inc.
|
|
▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
|
|
▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
|
|
Tel:
|
▇▇▇-▇▇▇-▇▇▇▇
|
|
Fax:
|
▇▇▇-▇▇▇-▇▇▇▇
|
|
Email:
|
_____________
|
|
Attn:
|
_____________
|
| Distributor: | Inter V medical, Inc. |
|
▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
|
|
▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
|
|
Tel:
|
▇▇▇-▇▇▇-▇▇▇▇
|
|
Fax:
|
▇▇▇-▇▇▇-▇▇▇▇
|
|
Email:
▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
|
|
Attn:
|
▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
|
Section
17. Distributor Not an
Agent. This Agreement does not establish the Distributor as the agent or
legal representative of the Company, nor the Company as the agent or
representative of the Distributor for any purpose whatsoever. Neither party is
granted any express or implied right or authority by the other party to assume
or to create any obligation or responsibility on behalf of or in the name of the
other party, or to bind the other party in any manner or thing
whatsoever.
Section
18. Jurisdiction. This
Agreement and the rights, obligations and relations of the parties shall be
governed by and construed in accordance with the laws of the State of Washington
and the laws of the United States applicable therein. The parties agree that the
courts of the State of Washington located in ▇▇▇▇▇▇ County shall have
jurisdiction to entertain any action or other legal proceedings based on any
provision of this Agreement.
Section
19. Entire Agreement.
This Agreement constitutes the entire agreement between the parties hereto and
wholly cancels, terminates and supersedes all previous negotiations, agreements
and commitments, whether formal or informal, oral or written, with respect to
the subject matter hereof. All of the terms, provisions, and conditions agreed
on by the parties hereto are expressed herein and except as contained in this
instrument, there are no other further understandings. Any terms stated on any
Purchase Order which conflict with the terms of this Agreement shall be deemed
void and the terms of this Agreement shall prevail.
P.
13
Section
20. Distributor
Compensation. The Distributor's sole compensation under this Agreement
shall be derived by marking up the price of the products and re-selling them for
a profit, unless otherwise provided for in a written document from the
Company.
Section
21. Non-applicability.
The obligations set forth in Section 9.1 above shall not apply to any
Confidential Information disclosed hereunder which:
|
(a)
|
at
the time of disclosure, was generally available to the public or has
become, after the time of disclosure, part of the public domain by
publication or otherwise through no fault of the party to which the
information was disclosed, and is thus communicated to the party who
disclosed the information;
|
|
(b)
|
is
demonstrated by the party, at the time of disclosure, to already be known
to the party and not acquired, directly or indirectly from the other
party;
|
|
(c)
|
is
demonstrated, at the time of disclosure, to have been pre-existing
information already independently developed by the party and not as a
result of disclosure of the Confidential Information by a party to the
other;
|
|
(d)
|
is
demonstrated by the party, after the time of disclosure, to have been
acquired in good faith without any restriction of confidentiality from a
third party who is under no secrecy obligation to the other party with
respect thereto, or
|
|
(e)
|
is
no longer treated as confidential by the party and such treatment has been
confirmed in writing.
|
Section
22. No Waiver. No failure
to exercise or delay in exercising any right or remedy under this Agreement by
either party shall operate as a waiver thereof or of any other right or remedy
which such party may have hereunder, nor shall any single or partial exercise of
such right or remedy preclude any further exercise thereof or of any other right
or remedy which such party may have hereunder. The rights and remedies provided
herein are cumulative and not exclusive of any rights and remedies provided by
law, in equity or otherwise.
Section
23. Severability. In the
event that any provision or any portion of any provision of this Agreement is
adjudged, by a court of competent jurisdiction, to be invalid, illegal or
unenforceable under any applicable law, such provision or portion thereof shall
be deemed to be deleted from this Agreement and the validity of the remainder of
this Agreement shall remain unaffected thereby.
Section
24. Headings. The
descriptive headings of this Agreement have been inserted for convenience and
shall not be deemed to limit or otherwise affect the construction of any
provision hereof.
Section
25. Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original and all of which together shall constitute but one and the
same instrument.
P.
14
Section
26. Company Trademarks and
Logos. The Company hereby grants Distributor the non-exclusive right to
use the Company's trademarks and logos related to the Products in the Territory
solely in connection with the promotion and sale of the Products, subject to the
provisions of this Agreement and for the term hereof. In the event
that this Agreement expires or is terminated for any reason, Distributor's
rights to use the Company's trademarks and logos pursuant to this Section 26
shall terminate as well. Whenever Distributor uses the Company's
trademarks or logos in advertising or in any other manner in connection with the
marketing and sale of the Products, Distributor shall clearly indicate the
Company's ownership of the trademarks and logos. When using the Company's
trademarks or logos under this Agreement, Distributor agrees to comply with all
laws pertaining to trademarks in force at any time in the
Territory. Distributor acknowledges that the Company is the owner of
the Company's trademarks and logos. Distributor shall not at any time
do, cause to be done, or permit any act or thing inconsistent with, contesting
or in any way impairing or tending to impair such
ownership.
Section
27. Force
Majeure. Neither party shall be held liable or responsible to
the other party nor be deemed to be in default under, or in breach of any
provision of, this Agreement for failure or delay in fulfilling or performing
any obligation of this Agreement when such failure or delay is due to force
majeure, and without the fault or negligence of the party so failing or
delaying. For purposes of this Agreement, force majeure is defined as causes
beyond the control of the party, including, without limitation, acts of God;
acts, regulations, or laws of any government; war; civil commotion; destruction
of production facilities or materials by fire, flood, earthquake, explosion or
storm; labor disturbances; epidemic; and failure of public utilities or common
carriers. In such event Distributor or the Company, as the case may be, shall
immediately notify the other party of such inability and of the period for which
such inability is expected to continue. The party giving such notice shall
thereupon be excused from such of its obligations under this Agreement as it is
thereby disabled from performing for so long as it is so disabled and the 30
days thereafter. To the extent possible, each party shall use reasonable efforts
to minimize the duration of any force majeure.
[Signature
Page Follows]
P.
15
IN
WITNESS WHEREOF, the parties hereto, hereby execute this Agreement as of the
date set forth above
IsoRay
Medical, Inc., a Delaware corporation
| By: | /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | Date: Nov. 13, 2009 | ||
| ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | ||||
|
|
CEO, IsoRay Medical, Inc. |
|
Distributor:
Inter V médical,
Inc.
A Canadian Company
| By: | /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ | Date: Nov. 10th, 2009 | ||
| ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ | ||||
|
|
President |
|
P.
16
EXHIBIT
A
PRODUCTS
|
Product Code
|
Description
|
Per Seed
|
|
CS1LNN
|
Cesium131 Loose
Seed
|
[**]
|
|
Shipped
non sterile
|
||
|
CS1LCS
|
Cesium131 Loose
Seed
|
[**]
|
|
Shipped
sterile w/confirmation
assay
|
||
|
CS1MNN
|
Cesium131
Seed pre-loaded in Disposable
|
[**]
|
| ▇▇▇▇▇ Cartridge | ||
|
Shipped
non sterile
|
||
|
CS1MCN
|
Cesium131 Seed
pre-loaded in Disposable
|
[**]
|
|
▇▇▇▇▇
Cartridge
|
||
|
Shipped
sterile
|
||
|
CS1MNS
|
Cesium131 Seed
pre-loaded in Disposable
|
[**]
|
|
▇▇▇▇▇
Cartridge
|
||
|
Shipped
non-sterile w/confirmation assay
|
||
|
CS1MCS
|
Cesium131 Seed
pre-loaded in Disposable
|
[**]
|
|
▇▇▇▇▇
Cartridge
|
||
|
Shipped
sterile w/confirmation assay
|
||
|
CSPCS
|
Cesium131 Seed pre-loaded in
Needle
|
[**]
|
|
Shipped
sterile w/confirmation assay
|
||
|
CS1SCS
|
Cesium131 Seed Stranded and pre-loaded in
Needle
|
[**]
|
|
Shipped
sterile w/confirmation assay
|
||
|
CS1CNN
|
Cesium131 Calibration
Seed
|
[**]
|
|
CS131SH
|
Cesium131 Handling and
Shipping
|
[**]
|
|
XXXX
|
Iodine-125
seeds in any configuration
|
[**]
|
EXHIBIT B
TERRITORY
All
provinces and territories of Canada
EXHIBIT
C
MINIMUM PERFORMANCE REQUIREMENTS
Sales
volume of the Products sold by Distributor pursuant to this Agreement during the
quarter ending December 31, 2009 (the "Trial Period Target") must equal or
exceed [**]
cases.
Future
minimum sales volumes shall be as follows (the "Initial Sales
Targets"):
|
Quarter
Ending
|
Number of
Cases
|
|
March
31, 2010
|
[**]
|
|
June
30, 2010
|
[**]
|
|
September
30, 2010
|
[**]
|
|
December
31, 2010
|
[**]
|
|
March
31, 2011
|
[**]
|
|
June
30, 2011
|
[**]
|
|
September
30, 2011
|
[**]
|
If the
Agreement is renewed, during each subsequent quarter following the quarter ended
September 30, 2011, the number of cases sold will be subject to a new
addendum as mutually agreed to by the parties (the "Subsequent Sales
Targets"). The Trial Period Target, Initial Sales Targets and
Subsequent Sales Targets shall together be referred to in the Agreement as the
"Minimum Performance Requirements."
EXHIBIT
D
DISTRIBUTOR
PRICE LIST
[intentionally
omitted]