Exhibit 10.2
*CONFIDENTIAL
TREATMENT REQUESTED.
CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY
WITH
THE SECURITIES AND EXCHANGE COMMISSION.
MTS ONDEMAND®
SALES AND LICENSE AGREEMENT
|
|
| Between: |
And: |
| MTS Medication Technologies, Inc. |
Omnicare, Inc. |
| a Delaware corporation |
a Delaware corporation |
| ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ |
1600 RiverCenter II, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇. |
| ▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ |
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ |
| Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇ |
Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇ |
| Hereinafter referred to as "MTS" |
Hereinafter referred to as "Customer" |
| 1. |
TERMS
AND CONDITIONS. In consideration of the mutual covenants and agreements hereinafter set
forth, MTS and Customer agree that MTS shall sell to Customer the OnDemand Express II and
OnDemand AccuFlex machines (“Machines”), and MTS shall license to Customer the
related systems (“Licensed Technology”) and certain software (“Licensed
Software”) (collectively, the Licensed Technology and Licensed Software, the “Licensed
Products”), including components and related items set forth on Addendum A
(collectively, the Machines and all Licensed Products are separately defined in Addendum
A as the “ODE II System” and as the “AccuFlex System” and are
collectively referred to as the “OnDemand System” or as the “OnDemand
Systems”), subject to the terms and conditions set forth in this Sales and License
Agreement, Addendum A (Pricing and Payment Terms), Addendum B (Maintenance Terms and
Conditions), Addendum C (Performance Objectives and Specifications), Addendum D
(Installation and Training), and Addendum E (Delivery Schedule) (collectively, the “Agreement”). |
| 2. |
PRICING
AND PAYMENT TERMS. See Addendum A for pricing and payment terms.
Notwithstanding Addendum A, if, at any time prior to the one (1) year
anniversary after the date on which the last ODE II System is delivered to
Customer, MTS enters into a binding commitment to sell an ODE II System (or any
replacement, variant or subsequent version thereof) to another customer for
less than Purchase Price (as hereinafter defined) (taking into account similar
volumes, length of commitment, terms and conditions, mix of products and
services and installation costs) in Addendum A, MTS shall notify
Customer in writing of such fact including the details of such more favorable
pricing and this Agreement shall be deemed automatically modified to reduce the
price of all ODE II Systems Customer purchases or has purchased hereunder to
the more favorable price, and within thirty (30) days of the date of the
binding commitment by MTS to sell such system(s) on more favorable pricing, MTS
shall pay a refund to Customer in the amount of the price differential for each
ODE II System to the extent that the Customer has already paid MTS for such
systems, but this Agreement will otherwise be unchanged. |
| 3. |
DELIVERY.
MTS shall deliver the OnDemand Systems to Customer on a priority basis and no later
than the dates specified in the Delivery Schedule set forth in Addendum E.
Notwithstanding the Delivery Schedule, MTS shall make reasonable efforts to
deliver the OnDemand Systems earlier than the delivery dates listed in Addendum
E, where possible provided that the foregoing shall not require MTS to
incur any material additional costs in order to do so. MTS shall not deliver
any ODE II Systems (or any replacement, variant or subsequent versions thereof)
to other customers until all of the ODE II Systems being purchased by Customer
hereunder have been delivered to Customer. For each ODE II System that is
delivered by MTS more that two (2) weeks after the delivery date designated in
Addendum E, MTS will pay to Customer a late delivery fee equal to the
sum of [*]% of the Purchase Price of the delayed system for each week
after the designated delivery date, as may be revised in accordance with this
Agreement, until the ODE II System is delivered to Customer in accordance with
the terms of this Agreement. The late fee set forth above shall not be payable
by MTS as a result of delays in delivery of a system that are caused by Customer’s
failure to meet its obligations under this Agreement and through no fault of
MTS. This late delivery fee shall constitute Customer’s sole remedy and MTS’ exclusive
liability with respect to a late delivery and will be capped at [*]%of
the Purchase Price for each late ODE II System, and payment shall be made to
Customer within thirty (30) days following the date MTS incurs such fee. In the
event delivery, installation or training for any ODE II System is delayed as a
result of Customer’s failure to meet its obligations under this Agreement
and through no fault of MTS and such delay will impact MTS’s ability to
meet future delivery deadlines, the parties shall mutually revise the delivery
schedule for future deliveries of ODE II Systems in a manner which reasonably
takes into account such delay. |
| 4. |
DEPOSIT.
In accordance with Addendum A, Customer shall pay to MTS (i) within 30 days of the
Agreement Date, a deposit in the amount of 33% of the Purchase Price for the first five
(5) ODE II Systems and for the first three (3) AccuFlex Systems (the “First
Deposit”), (ii) (A) within 30 days after MTS delivers to Customer the fifth
(5th) ODE II System, a deposit in the amount of 33% of the Purchase Price for the next
five (5) ODE II Systems, and (B) within 30 days after MTS delivers to Customer the third
(3rd) AccuFlex System, a deposit in the amount of 33% of the Purchase Price for the next
three (3) AccuFlex Systems (the “Second Deposit”), and (iii) (A) within
30 days after MTS delivers to Customer the tenth (10th) ODE II System, a deposit in the
amount of 33% of the Purchase Price for the remaining six (6) ODE II Systems, and (B)
within 30 days after MTS delivers to Customer the sixth (6th) AccuFlex System, a deposit
in the amount of 33% of the Purchase Price for the remaining two (2) AccuFlex Systems
(the “Third Deposit”and, together with the First Deposit and the Second
Deposit, collectively, the “Deposit”). The Deposit will be applied
towards the payments required under the Agreement. MTS shall maintain the Deposit in a
segregated, interest-bearing account, and shall only use the Deposit to cover
out-of-pocket expenses incurred in connection with production of the OnDemand Systems for
Customer. All accrued interest in such account shall be paid to Customer on a quarterly
basis. In the event delivery, installation or training for any OnDemand System is delayed
as a result of Customer’s failure to meet its obligations under this Agreement and
through no fault of MTS, then payments will be based on the original delivery schedule in
Addendum E and the payment schedule in Addendum A. |
| 5. |
SYSTEM
MAINTENANCE. MTS shall provide maintenance services for each OnDemand
System in accordance with Addendum B starting on the date of Acceptance
(as defined in Section 6.3), provided that Customer timely pays
the maintenance fees specified in Addendum B during the Initial
Maintenance Term (as defined in Addendum B) and each Renewal Maintenance
Term (as defined in Addendum B). |
*CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
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| 6. |
PERFORMANCE
DEMONSTRATION; INSTALLATION AND TRAINING; ACCEPTANCE. |
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6.1 |
Performance
Demonstration. Prior to the delivery of the first ODE II System and the first
AccuFlex System, MTS shall conduct a performance test of each system at its facility at a
mutually agreed upon time on a day not less than five (5) days after MTS provides written
notice to Customer (unless Customer agrees to an earlier date), which test shall consist
of thirty (30) consecutive minutes of running time. During the performance test, (i) the
ODE II System must accurately fill cards at a rate of at least [*] cards per
minute, or at least [*] cards accurately produced in the 30 consecutive minute
period, and (ii) the AccuFlex System must accurately fill cards at a rate of at least [*] cards
per minute, or a total of at least [*] cards accurately produced in the 30
consecutive minute period. A representative of Customer will observe each performance
test and validate that each of the first ODE II System and AccuFlex System has met the
minimum performance standards set forth in this Section 6.1 prior to MTS delivering the
OnDemand Systems to Customer; provided, however, if Customer elects not to
observe said testing, or is not present at the MTS facility at the mutually agreed
testing time, then Customer shall be deemed to have waived its observation right, in
which case MTS shall certify the test results and deliver to Customer such results (which
must meet the minimum performance standards set forth in this Section 6.1) prior to MTS
delivering the OnDemand Systems to Customer. |
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6.2 |
Installation
and Training. MTS shall install the OnDemand Systems and provide training in the use
and operation of the OnDemand Systems in accordance with Addendum D. See Addendum
D for the terms and conditions regarding the installation of the OnDemand Systems and
training. MTS shall commence installation and training of each OnDemand System promptly
following delivery, but in any event within fifteen (15) days of delivery, unless
Customer requests in writing otherwise. |
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6.3 |
Acceptance
of the OnDemand Systems. |
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(i) |
sixty
(60) days after the conclusion of the installation and training for each of the
first three (3) ODE II Systems delivered to Customer (the sixty (60) day period
shall be referred to as the “First Phase” and together with
the two thirty (30) day cure periods described below shall be defined as the
“First Acceptance Period”), or |
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(ii) |
forty-five
(45) days after the conclusion of the installation and training for the next
(7) ODE II Systems and for the first four (4) AccuFlex Systems delivered to
Customer (the forty-five (45) day period shall also be referred to as the “First
Phase” and together with the thirty (30) and fifteen (15) day cure
periods described below shall be defined as the “Second Acceptance
Period”), or |
*CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
3
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(iii) |
thirty
(30) days after the conclusion of the installation and training for the last
six (6) ODE II Systems and for the last four (4) AccuFlex Systems delivered to
Customer (the thirty (30) day period shall also be referred to as the “First Phase” and
together with the two fifteen (15) day cure periods described below shall be
defined as the “Third Acceptance Period” and, together with the
First Acceptance Period and the Second Acceptance Period, collectively, the “Acceptance
Period”), each respective OnDemand System meets the Material
Specifications (as defined in Section 1 of Addendum B)
applicable to such system, as reasonably determined by Customer, Customer shall
accept each such respective OnDemand System and promptly communicate its
acceptance thereof to MTS in writing (“Acceptance”). |
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b. |
If,
by the end of the applicable First Phase, Customer reasonably determines
that an OnDemand System fails to meet the Material Specifications
applicable to such system, Customer shall (1) promptly notify MTS in
writing of such failure, and (2) specify in reasonable detail the nature
and extent of such failure (a “Non-Performance Notice”).
MTS shall have an additional thirty (30) day period to repair or modify
such non-performing OnDemand System for any OnDemand Systems subject to
the First Acceptance Period and the Second Acceptance Period and an
additional fifteen (15) day period to repair or modify such non-performing
OnDemand System for any OnDemand Systems subject to the Third Acceptance
Period (the “First Cure Period”). If, within the
applicable First Cure Period, a non-performing OnDemand System is repaired
or modified so that it meets the Material Specifications applicable to
such system, as reasonably determined by Customer, Customer shall accept
each such respective OnDemand System and promptly communicate its
acceptance thereof to MTS in writing (also “Acceptance”). |
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c. |
If,
by the end of the applicable First Cure Period, Customer has not Accepted
the OnDemand System, Customer and MTS may agree to extend the Acceptance
Period for an additional thirty (30) day period to repair or modify such
non-performing OnDemand System for any OnDemand Systems subject to the
First Acceptance Period, and an additional fifteen (15) day period to
repair or modify such non-performing OnDemand System for any OnDemand
Systems subject to the Second Acceptance Period or the Third Acceptance
Period (the “Second Cure Period”). If Customer and MTS do
not agree to a Second Cure Period within five (5) days after the end of
the applicable First Cure Period, then within ten (10) days after the end
of the applicable First Cure Period, Customer may, as its sole remedy,
elect to either (i) by written notice to MTS, reject such OnDemand System
and thereafter receive a full refund of the Purchase Price (including any
Deposits held by MTS), or (ii) by written notice to MTS, communicate its
Acceptance of such OnDemand System (as it is then-operating); provided, however,
if the parties do not agree to a Second Cure Period and Customer has not
properly rejected it, an OnDemand System shall be deemed to be “Accepted” if
Customer does not provide written notice within ten (10) days after the
end of the applicable First Cure Period. If, within the Second Cure
Period, a non-performing OnDemand System is repaired or modified so that
it meets the Material Specifications applicable to such system, as
reasonably determined by Customer, Customer shall accept each such
respective OnDemand System and promptly communicate its acceptance thereof
to MTS in writing (also “Acceptance”). |
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d. |
If,
at the end of any agreed to Second Cure Period, Customer has not Accepted
the OnDemand System, Customer may, as its sole remedy, elect to either (i)
by written notice to MTS, reject such OnDemand System and thereafter
receive a full refund of the Purchase Price (including any Deposits held
by MTS), or (ii) by written notice to MTS, communicate its Acceptance of
such OnDemand System (as it is then-operating). An OnDemand System shall
be deemed to be “Accepted” effective upon the last day of
the applicable Acceptance Period if Customer has not previously: (A)
Accepted the OnDemand System in accordance with this Agreement; or (B)
rejected the OnDemand System in accordance with Section 6.3(d)(i) above.
Once accepted, an OnDemand System may not be subsequently rejected. |
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6.4 |
Replaced
Components. Any of the Licensed Product components which are replaced will be subject
to the same terms and conditions, including, but not limited to the terms and conditions
specified in Section 10, as the original Licensed Products, and any repaired or
replacement part of the OnDemand Systems shall be warranted on the terms and conditions
in this Agreement. |
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6.5 |
Returns.
Disassembly, packing and shipping of all OnDemand Systems (or portions thereof) properly
rejected and returned to MTS pursuant to the terms of this Agreement, shall be the
responsibility of MTS. Customer shall make access to any such OnDemand System reasonably
available to MTS during the normal business hours of Customer. All such disassembly,
packing and shipping shall be at the sole cost and expense of MTS. |
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6.6 |
Purchase
Price Defined. The “Purchase Price” is defined as the ODE Per Unit
Price or the AccuFlex Per Unit Price, as the case may be (each as defined in Addendum A).
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| 7. |
RISK
OF LOSS; TITLE. Other than damage or loss caused by MTS during installation
of each OnDemand System, risk of damage to, or loss of, each OnDemand System
shall pass to Customer upon delivery. Title to the Machines shall not pass to
Customer until Customer’s Acceptance of the OnDemand System. Ownership of
and Customer’s right to use the Licensed Products are specified in Section
10. |
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8.1 |
Representations
and Warranties. Each party hereby represents and warrants to the other party that
such party has all requisite power and authority to carry on its business as it is
presently being conducted, to enter into this Agreement, and to carry out and perform the
terms and provisions of this Agreement. MTS hereby represents and warrants to Customer
that MTS (i) is the owner and has good and valid title or is the authorized licensee of
improved and proprietary know-how for filling and sealing medication into single and
multi-dose blister packs (punch cards) (“Technology”), and (ii) has good
and valid title to or has the right to license the Licensed Products to Customer and sell
the OnDemand Systems. Furthermore, MTS hereby represents and warrants to Customer as of
the Agreement Date that (a) there is no action, suit or legal proceeding with respect to
the intellectual property relating to the OnDemand System (collectively, “Litigation”)
presently pending to which MTS is a party (either as a plaintiff or defendant), nor has
any such Litigation been pending at any time during the past five (5) years, before any
court or governmental agency, authority or body or arbitrator except as described in
Exhibit 1 to this Agreement, and (b) to the best knowledge of MTS, there is no Litigation
threatened against MTS involving the OnDemand Systems. These representations and
warranties shall survive the execution of this Agreement and the consummation of the
transactions contemplated herein until such time as this Agreement or the licenses
granted herein are terminated or expire. |
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8.2 |
Warranty
Disclaimer. THE WARRANTIES SET FORTH IN THIS AGREEMENT ARE THE SOLE AND EXCLUSIVE
WARRANTIES FOR THE ONDEMAND SYSTEMS AND NO OTHER WARRANTY, EXPRESS OR IMPLIED, WILL
APPLY. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED FOR IN THE AGREEMENT, MTS SPECIFICALLY
DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. Without limiting the generality of
the foregoing, MTS shall have no responsibility for the adequacy or performance, or the
failure to perform, of any third party hardware, software, disposables or services not
procured, authorized or installed by MTS, and MTS makes no representation or warranty
hereunder with respect to any such hardware, software, disposables or services. The
warranties set forth in this Agreement are valid only in the continental United States. |
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8.3 |
Limitations
on Liability of MTS. MTS’s total liability in contract, tort (including
negligence or breach of statutory duty) or otherwise, arising in connection with the
performance or contemplated performance of this Agreement shall be limited to an amount
equal to the sum of the Purchase Price paid to and retained by Customer for the OnDemand
Systems. MTS shall not be liable to Customer for any special, indirect, incidental,
punitive, reliance, exemplary or consequential loss or damage or for loss of profit, loss
of business, depletion of goodwill or similar loss or costs, expenses or other claims for
any such loss whatsoever (whether or not caused by the negligence of MTS, its employees,
agents or sub-contractors) which arise out of or in connection with this Agreement.
Notwithstanding anything to the contrary set forth in this Section 8.3, MTS’s
liability shall not be limited with respect to (i) any breach of the representations and
warranties set forth in Section 8.1 hereof, (ii) any act of fraud or willful misconduct
related to, arising out of, and/or connected with the Agreement by MTS, its directors,
officers, agents or employees, or (iii) any claim for which Customer seeks
indemnification pursuant to Section 15. |
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9.1 |
MTS
Confidential Information. Customer represents that (i) the OnDemand System is covered
by the patents and/or pending patent applications set forth on Exhibit 2 attached hereto,
(ii) such patents and/or applications are either owned by, or licensed (with full right
to sublicense hereunder) to, MTS, and (iii) MTS is the owner or licensee (with full right
to sublicense hereunder) of the Technology, as defined in Section 8.1. Customer
agrees that it will not take any action or knowingly assist others in any action that
could constitute an infringement of any of these patents or any patent applications
depending therefrom. Customer acknowledges that MTS may disclose such Technology and
other confidential and proprietary information of MTS marked as “confidential” or
“proprietary” to Customer or such other MTS information that should reasonably
be understood, under the circumstances, to be confidential or proprietary (the “MTS
Confidential Information”). |
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9.2 |
Customer
Obligations. Customer agrees that it will not disclose any MTS
Confidential Information it has received from, or has been given access to, by MTS, to
any third parties, except to the extent such third parties have a need to know such MTS
Confidential Information in order for Customer to maintain the OnDemand Systems in
accordance with this Agreement; provided, however, Customer shall ensure
that any third parties to whom Customer discloses any MTS Confidential Information shall
have a legal duty to protect the MTS Confidential Information on terms at least as
stringent as those set forth herein. Customer assumes full responsibility for the acts or
omissions of its subcontractors and agents with respect to such MTS Confidential
Information. In consideration of the disclosure to it by MTS of MTS Confidential
Information, Customer shall keep the MTS Confidential Information confidential and only
disclose the MTS Confidential Information to employees of Customer or Customer’s
Affiliates who need to know it in order to use the OnDemand System (the “Purpose”).
Customer shall use efforts at least equivalent to those used for its Customer
Confidential Information (as hereinafter defined) to ensure that its and its Affiliates’ respective
employees keep the MTS Confidential Information confidential in accordance with this
Agreement. Customer’s obligations under this Agreement shall not extend to MTS
Confidential Information that Customer can reasonably demonstrate (i) has ceased to be
secret without breach hereof by Customer, (ii) was already in Customer’s possession
prior to disclosure by MTS, or (iii) has been received from a third party, unless such
third party acquired it from MTS and Customer was aware of such source. The obligations
in this Section 9.2 shall not apply to the extent any MTS Confidential information
is required to be disclosed by law or stock exchange rule. For the purpose of this
Agreement, an “Affiliate” shall mean, with respect to any entity, any
other entity that controls, is controlled by, or is under common control with, such
entity. |
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9.3 |
Customer
Confidential Information. MTS agrees that it will not disclose any
Customer Confidential Information (as hereinafter defined) it has received from, or has
been given access to, by Customer (or Customer’s Affiliates), to any third parties.
MTS shall only disclose Customer’s Confidential Information to the employees of MTS
(and MTS’s Affiliates) who need to know it in order to install and/or service the
OnDemand System. MTS shall use efforts at least equivalent to those used for the MTS
Confidential Information to ensure that its employees keep Customer Confidential
Information confidential in accordance with this Agreement. MTS’s obligations under
this Agreement shall not extend to Customer Confidential Information that MTS can
reasonably demonstrate (i) has ceased to be secret without breach hereof by MTS, (ii) was
already in MTS’s possession prior to disclosure by Customer, or (iii) has been
received from a third party, unless such third party acquired it from Customer and MTS
was aware of such source. The obligations in this Section 9.3 shall not apply to
the extent any Customer Confidential Information is required to be disclosed by law or
stock exchange rules. As used herein, “Customer Confidential Information” shall
mean any Customer information marked as “confidential” or “proprietary” or
Customer information that should reasonably be understood, under the circumstances, to be
confidential or proprietary. |
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9.4 |
Public
Disclosure. MTS and Customer shall agree with each other as to the form and substance
of any press release or other public notice related to this Agreement or the transactions
contemplated hereby, and shall consult with each other as to the form and substance of
other public disclosures related thereto; provided, however, that nothing
contained herein shall prohibit MTS or Customer from making any disclosure which it deems
necessary in light of applicable laws, regulations or stock exchange rules after the
disclosing party provides advance notice to the other party with the opportunity to
comment on such disclosure to the extent that such opportunity to comment does not
unreasonably delay such required disclosure. |
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10.1 |
Modifications.
MTS may from time to time provide shuttle system components, software enhancements and
software upgrades to Customer (“Upgrades”) in accordance with Addendum
B. Any such Upgrades will be deemed to be part of the Licensed Products. The parties
agree that the Licensed Products, and any and all U.S. and non-U.S. patents,
applications, copyrights, and registrations for any of the foregoing related to, or
useful in connection with, the Licensed Products and the Licensed Technology which are
owned by MTS, are licensed to Customer in accordance with Section 10.2. Customer
covenants that neither it nor its successors or assigns will alter or modify any Licensed
Products except upon prior written notice to, and after receipt of express written
consent from, MTS, which consent may be granted or withheld in the sole discretion of
MTS. |
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10.2 |
License;
Restrictions. MTS hereby grants to Customer a non-exclusive, non-
transferable (except pursuant to Section 16.1) license to use, install, update,
modify and improve the Licensed Products, any related documentation, the Licensed
Technology, and any and all U.S. and non-U.S. patents, copyrights, or applications or
registrations for any of the foregoing related to, or useful in connection with, such
Licensed Products, related documentation or Licensed Technology for the use of Customer,
Customer’s Affiliates, successors and assigns, with the OnDemand Systems and for the
life of said OnDemand Systems. Without limiting the generality of this Section 10.2,
Customer shall be entitled to make an unlimited number of backup copies of the Licensed
Software provided that all of MTS’s copyright notices or other proprietary or
restrictive legends or notices are reproduced on such copies. For avoidance of any doubt,
subject to this Agreement including this Section 10, MTS shall, as between Customer and
MTS, retain ownership in the Licensed Products and all intellectual property rights
therein; and MTS reserves all rights regarding the creation, licensing, distribution,
reproduction and creation of derivative works based on the Licensed Products. Further to
the foregoing, Customer may, upon prior written notice to MTS, transfer, in whole, the
license set forth in this Section 10.2 (a) to any of its Affiliates, or in
connection with the sale or other transfer of all or substantially all of Customer’s
related business assets, without MTS’s consent, or (b) in connection with Customer’s
sale or transfer of the OnDemand System, provided that in each of (a) or (b), the
transferee agrees in writing to be bound by the terms and conditions of this Agreement,
and further provided that (1) Customer’s license is terminated and (2) MTS’s
obligations to Customer are novated, in each case as of the effective date of such
transfer. Except as permitted pursuant to the preceding sentence, Customer shall not
deliver, distribute, sell, rent, lease or sublicense any Licensed Products to any third
party for any purpose. Customer agrees and certifies that the Licensed Products and
related documentation shall not be used in any manner or exported outside the United
States, except as authorized in advance by MTS in writing and as permitted by the
applicable laws and regulations of the United States. Except as expressly provided
herein, Customer shall not, directly or indirectly, copy, modify, translate, reverse
compile, disassemble, reverse engineer or otherwise determine or attempt to determine the
source code of the Licensed Software or to create any derivative works based on the
Licensed Software or documentation. Customer shall not have any rights to the Licensed
Products other than the rights expressly and unambiguously set forth herein and all such
rights are reserved by MTS. |
| 11. |
TERMINATION
OF LICENSE TO LICENSED PRODUCTS. |
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11.1 |
Termination
by MTS. MTS may, by notice in writing served on Customer, terminate this Agreement,
including Customer’s license to use the Licensed Products and any associated
intellectual property, if Customer is in material breach of any of the material terms of
this Agreement, and such breach is not cured within thirty (30) days after Customer’s
receipt of written notice thereof. |
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11.2 |
Termination
by Customer. Customer may, by notice in writing served on MTS, terminate this
Agreement if MTS is in material breach of any of the material terms of this Agreement
(including without limitation, the delivery and installation obligations of MTS under
this Agreement), and such breach is not cured within thirty (30) days after MTS’s
receipt of written notice thereof. Customer may, by notice in writing served on MTS,
terminate this Agreement within fifteen (15) days after the date Customer elects to
reject any of the first five (5) ODE II Systems pursuant to Section 6.3. Not later
than thirty (30) days following termination, in addition to all other remedies available
to Customer under this Agreement, MTS shall promptly refund to Customer all Deposits and
unpaid interest maintained in the segregated account. |
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11.3 |
Injunctive
Relief. Customer agrees that in the event of Customer’s breach of the
confidentiality obligations set forth in this Agreement or Customer’s violation of
the terms of the license with respect to the Licensed Products, MTS will be irreparably
harmed, the damages sustained by MTS will be difficult, if not impossible, to ascertain,
and that MTS shall, therefore, be entitled to obtain injunctive relief to prevent any
further violations without proof of actual damages or need to post bond. MTS agrees that
in the event of MTS’s breach of the confidentiality obligations set forth in this
Agreement, Customer will be irreparably harmed, the damages sustained by Customer will be
difficult, if not impossible, to ascertain, and that Customer shall, therefore, be
entitled to obtain injunctive relief to prevent any further violations without proof of
actual damages or need to post bond. |
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11.4 |
Software
Source Code. If MTS is in material breach of any of the maintenance and warranty
services pursuant to Addendum B (after the expiration of any applicable cure periods) and
such breach is reasonably related to Customer’s inability to operate the OnDemand
System in accordance with this Agreement, or MTS otherwise ceases to sell and service the
OnDemand System (or systems similar in function) and Customer is, at such time, in
rightful possession of the OnDemand System and is not in material breach of this
Agreement (after the expiration of any applicable cure periods) except for a material
breach by Customer that is in response or related to a prior material breach of this
Agreement by MTS, MTS shall provide Customer a license to use and maintain the Licensed
Products solely for Customer’s internal business purposes. In addition, in such
event, MTS shall provide Customer the source code for the Licensed Software and a license
to use such source code solely in connection with the use and maintenance of Customer’s
OnDemand System in accordance with the following sentence. Within thirty (30) days after
the Acceptance of the first ODE II System , MTS shall escrow with a reputable escrow
company reasonably acceptable to MTS and Customer, all source code and related
documentation (including programmer’s notes, to the extent embedded in such source
code) for the Licensed Software (the “Source Code”). The escrow
agreement will provide for the release of the escrowed Licensed Software to Customer
under the scenarios described in the first sentence of this Section 11.4 if
Customer is then in rightful possession of the OnDemand System, and shall further provide
that Customer and MTS shall share equally the fees associated with the initial
establishment of the escrow and the annual beneficiary fees. MTS grants Customer a
non-exclusive, non-transferable (except as provided in Section 16.1 below),
limited license to use, modify and create derivative works based on the Source Code, in
order to use, maintain and improve the Licensed Products solely for Customer’s
internal business purposes. Customer covenants and agrees that it will not exercise its
rights under the foregoing license until it obtains possession of the Source Code in
accordance with the provisions of the escrow agreement described above. |
9
| 12. |
PAYMENTS.
IF EITHER MTS OR CUSTOMER FAILS TO MAKE ANY PAYMENT UNDER THIS AGREEMENT BY
THE DUE DATE (WITHOUT PREJUDICE TO ITS OTHER RIGHTS AND REMEDIES), THEN THE
OTHER PARTY MAY CHARGE THE DELINQUENT PARTY INTEREST (BOTH BEFORE AND AFTER
JUDGMENT) ON THE AMOUNT UNPAID, AT THE ANNUAL RATE OF SEVEN PERCENT (7%) OR THE
MAXIMUM RATE PERMITTED BY LAW, WHICHEVER IS LESS, FROM TIME SUCH PAYMENT IS DUE
UNTIL PAYMENT IS MADE IN FULL. |
| 13. |
TAXES.
CUSTOMER SHALL BE RESPONSIBLE FOR ALL FEDERAL, STATE, PROVINCIAL, MUNICIPAL
AND VALUE ADDED OR OTHER TAXES (EXCEPT FOR INCOME AND GROSS RECEIPTS BASED
TAXES LEVIED IN LIEU OF INCOME TAXES) WHICH ARE NOW OR MAY HEREAFTER BE
REQUIRED IN CONNECTION WITH OR IMPOSED UPON OR ARE IN RELATION TO THE PRICE
PAYABLE IN CONNECTION WITH THE OWNERSHIP, LEASE, LICENSE, BAILMENT, RENTAL OR
USE OF THE ONDEMAND SYSTEM OR ANY COMPONENT THEREOF. |
| 14. |
CUSTOMER
RESPONSIBILITIES. |
| |
14.1 |
Site
Preparation. Customer shall be responsible for all site preparation in
accordance with Addendum D including, but not limited to, supplying electrical,
compressed air, space, lighting, utilities, air conditioning and other environmental
requirements for the OnDemand System. MTS will perform site surveys for Customer,
provided that the first site survey will be performed at no cost to Omnicare and any fees
and expenses incurred by MTS to travel to Customer sites in connection with future site
surveys shall be paid for by Customer on an hourly basis at $[*] per hour plus any
reasonable and necessary travel and lodging expenses. MTS will advise Customer in advance
if additional site preparation is necessary to complete the installation of the OnDemand
System. If it is necessary for MTS to engage in site preparation, Customer will pay MTS
on an hourly basis at $[*] per hour plus any reasonable and necessary travel and
lodging expenses for such site preparation. When MTS personnel shall be on Customer’s
site, Customer shall also provide adequate working space within a reasonable distance of
the OnDemand System. |
| |
14.2 |
Data
Conversion. Customer shall be solely responsible for conversion of its current
software data to the format required by the OnDemand System as described in the interface
specifications provided in the documentation manual provided with the OnDemand System. If
Customer requests that MTS provide data conversion services or to reprogram, modify or
alter MTS’s standard interface software package so that it can operate with Customer’s
existing computer system(s), Customer will be charged on a hourly basis at MTS’s
then-current rates plus reasonable expenses for such programming services. In addition,
in the event that Customer desires to make minor modifications to the standard OnDemand
System interface, which include label layout and design, Customer will not incur any
charges for such minor modifications for sixty (60) days after the completion of the
training period specified in Addendum D. Thereafter, Customer will incur fees for any and
all modifications to the OnDemand System software or the interface, including any label
changes, at MTS’s then-current rates. MTS will advise Customer in advance if additional
programming services are necessary to complete the initial installation of the OnDemand System. |
*CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
10
| |
14.3 |
Phone
Line. Customer shall maintain, at Customer’s cost, a high-speed data connection
(or, if the parties mutually agree, a dedicated phone line) for any modem required by the
OnDemand System per Addendum D. |
| |
14.4 |
Drug
List. Within thirty (30) days after the Agreement Date (defined below), MTS and
Customer will prepare a mutually agreeable list of drugs to be dispensed using the
OnDemand System (the “Drug List”). The Drug List shall include information and
specifications sufficient to permit dispensing through cassettes designed specifically to
work with the OnDemand System. If necessary, Customer agrees to supply MTS with drug
samples (up to 50/each drug) for calibration purposes. Customer may elect to provide MTS
with information regarding Customer’s monthly medication usages and Customer’s
filling patterns by day or week to allow optimization of the OnDemand System load
balance. Customer may provide updated Drug Lists to MTS from time to time, and MTS shall
recalibrate or provide additional cassettes (as necessary) in accordance with applicable
terms set forth in Addendum A. |
| |
14.5 |
Inventory.
Customer shall maintain an adequate inventory of medications to fill the cassettes and
maintain ongoing OnDemand System operations. Customer hereby acknowledges that a change
in generic supplier of a medication may require the re-calibration of a cassette or
acquisition of a new cassette, resulting in a delay in use of such new supplier’s
medication. |
| |
14.6 |
Training.
Customer shall make the individuals specified in Addendum D available for OnDemand
System training in accordance with Addendum D. |
| |
14.7 |
Staffing.
Customer shall provide the staffing specified in Addendum D in connection with the
installation, operation and maintenance of the OnDemand System. |
| |
14.8 |
Parallel
Operation. Customer shall maintain the ability to run its existing packaging
processes in parallel with the implementation of the OnDemand System (to accommodate
Downtime, as defined in Addendum C, and other production interruptions) during the
Acceptance Period. Customer acknowledges that the installation of the OnDemand System is
complicated, entails an operational transition for Customer’s pharmacy and that
Downtime, both scheduled and unscheduled, may occur. |
| |
14.9 |
Operation
of OnDemand System. The OnDemand System is designed to meet the Performance
Objectives and/or Performance Specifications provided that Customer operates the OnDemand
System substantially in accordance with MTS specifications and procedures set forth in
documentation provided to Customer by MTS which documentation is generally applicable to
MTS customers. |
11
| 15. |
INDEMNIFICATION.
MTS shall defend, indemnify and hold harmless Customer and its officers,
directors, employees, shareholders, successors and assigns from and against any
and all loss, damage, settlement or expense (including reasonable legal
expenses), as incurred, resulting from or arising out of any claim of a third
party which alleges that any Machine, Licensed Software, Licensed Technology,
Licensed Products, or OnDemand System provided to Customer hereunder or the use
thereof in accordance with this Agreement infringes upon, misappropriates or
violates any patents, copyrights, trademarks or trade secret rights or other
proprietary rights of such third party persons, firms or entities. As a
condition to such defense and indemnification, Customer will provide MTS with
reasonably prompt written notice of the claim and permit MTS to control the
defense, settlement, adjustment or compromise of any such claim. Customer may
employ counsel at its own expense (such expense not being indemnified by MTS)
to participate with MTS with respect to the defense of any such claim); provided,
however, that if such counsel is necessary because MTS does not assume
control within a reasonable period following MTS’s receipt of notice of a
claim, MTS will bear the reasonable expense of Customer’s counsel until
MTS assumes control of such defense by written notice to Customer; provided
that no settlement that imposes any liability or obligation on MTS shall be
made by Customer without the prior written consent of MTS, which consent shall
not be unreasonably withheld or delayed. If the use of any Machine, Licensed
Software, Licensed Technology, Licensed Products, or OnDemand System is
enjoined because such item is declared by a court of competent jurisdiction to
infringe a valid patent or copyright or other intellectual property right, MTS
shall obtain such licenses, or make such replacements or modifications, as are
necessary to the continued use of the Machine, Licensed Software, Licensed
Technology, Licensed Products, or OnDemand System without infringement and in
compliance with the applicable Specifications. If MTS is unable to obtain such
licenses, or make such replacements or modifications after using its best
efforts to do so: (i) MTS may require Customer to return the infringing item
for a full refund; and (ii) notwithstanding anything in this Agreement to the
contrary (including the limitation on liability in Section 8.3), MTS shall also
be liable to Customer for any special, indirect, exemplary or consequential
losses or damages or for loss of profit, loss of business or similar losses or
costs, expenses or other claims which arise from infringement of the Licensed
Software, Licensed Technology, Licensed Products, or OnDemand System, to the
extent a court of competent jurisdiction includes such damages in its order or
as may otherwise agreed to by the parties in writing; provided, however,
Customer will use commercially reasonable efforts to mitigate such damages. MTS
shall have no obligation to Customer under this Section 15 to the extent
the alleged infringement or violation is based upon: (a) Customer’s use of
any Machine, Licensed Software, Licensed Technology, Licensed Products, or
OnDemand System other than as authorized by MTS or in this Agreement or the
documentation provided therewith; or (b) any material modification or
alteration to or of any Machine, Licensed Software, Licensed Technology,
Licensed Products, or OnDemand System or any creation of derivative works of
such items, performed by anyone other than MTS or its subcontractors, agents or
assignees; or (c) MTS’s compliance with Customer’s explicit designs,
specifications or instructions with respect to the infringing Machine, Licensed
Software, Licensed Technology, Licensed Products, or OnDemand System. The
indemnity obligations of MTS under this Section shall be the sole and exclusive
remedy of Customer with respect to third party infringement claims. |
| |
16.1 |
Assignment.
This Agreement is binding on Customer, its successors and permitted assigns. Customer
shall not assign any of its rights or obligations under this Agreement without MTS’s
prior written consent, which shall not be unreasonably withheld or delayed; provided,
however, that Customer may assign this Agreement to any of its Affiliates or in
connection with the sale or other transfer of all or substantially all of Customer’s
related business assets, provided that the transferee agrees in writing to be bound by
the terms and conditions of this Agreement. This Agreement is binding on MTS, its
successors and permitted assigns. MTS shall not assign any of its rights or obligations
under this Agreement without Customer’s prior written consent, which shall not be
unreasonably withheld or delayed; provided, however, that MTS may assign
this Agreement to any of its Affiliates or in connection with the sale or other transfer
of all or substantially all of MTS’s related business assets, provided that
the transferee agrees in writing to be bound by the terms and conditions of this
Agreement. |
12
| |
16.2 |
Modification.
This Agreement may be modified only expressly and in writing signed by an authorized
representative of each party. |
| |
16.3 |
Force
Majeure. Performance by MTS or Customer of any obligation hereunder shall be excused
if such failure to perform is caused by an act of God or other event or circumstance
beyond MTS’s or Customer’s reasonable control including, without limitation,
natural disasters, fires, floods, shortage of materials or transportation, government
acts or acts of terrorism, and prompt notice thereof has been given to the other party.
If MTS or Customer should fail to perform any obligation hereunder as a result of an
event or circumstance beyond its control, it shall meet its obligations hereunder within
a reasonable time after the cause of the failure has been removed. |
| |
16.4 |
Access.
Customer grants MTS, its agents and employees a right to enter Customer’s premises
where the OnDemand System is located or may be stored in order to inspect or provide
service for the OnDemand System, or, where Customer’s right to possession has
terminated, to recover the OnDemand System. Such access shall be during Customer’s
normal business hours (in connection with routine maintenance and any removal of the
OnDemand System) and at any time (in connection with emergency maintenance) and, except
to the extent necessary to provide emergency maintenance services, on at least
twenty-four (24) hours advance notice to Customer. |
| |
16.5 |
No
Third Party Beneficiaries. This Agreement is entered solely by and between, and
may be enforced only by, MTS and Customer and shall not be deemed to create any rights
in or obligations to any third parties. |
| |
16.6 |
Location.
Customer shall not change the location of any OnDemand System without the express written
consent of MTS, which consent shall not be unreasonably withheld or delayed. |
| |
16.7 |
Notice.
All notices, requests, demands, claims, and other communications under this Agreement
will be in writing. Any notice, request, demand, claim, or other communication under this
Agreement shall be deemed duly given when sent by overnight delivery service or facsimile
(with confirmation of receipt), addressed to the intended recipient as set forth below: |
| |
If to MTS:
▇▇▇▇ ▇. ▇▇▇▇▇▇
President and Chief Executive Officer
MTS Medication Technologies, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇
▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone:
(▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ |
13
| |
with
a copy to:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇ & Maw LLP
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ |
| |
If to Customer:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Executive Vice President and
Chief Operating Officer
Omnicare, Inc.
1600 RiverCenter
II, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ |
| |
and:
General Counsel
Omnicare, Inc.
1600 RiverCenter II, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ |
| |
with
a copy to:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇ & ▇▇▇▇▇, LLP
▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ |
| |
16.8 |
Entire
Agreement. This Agreement (including its Addendums and schedules attached hereto) is
the sole and complete statement of the rights and obligations of the parties hereto, and
except as specifically set forth herein, supersedes all previous understandings,
negotiations, letter of intent, proposals or orders pertaining to the OnDemand System. |
| |
16.9 |
Governing
Law; Venue. This Agreement shall be performed and interpreted in accordance with the
laws of the State of Florida without reference to its choice of law rules. Further, the
parties hereby consent to the exclusive personal jurisdiction of the state and federal
courts within Pinellas or Hillsborough County, Florida. In the event either party shall
be required to take legal action to enforce this Agreement, the prevailing party shall be
entitled to reasonable attorney’s fees and costs, including such fees and costs on
appeal. |
14
| |
16.10 |
Term.
This Agreement shall remain in full force and effect for the life of the Machines. |
| |
16.11 |
Survival.
Any provision of this Agreement which contemplates performance or observance subsequent
to any termination or expiration of this Agreement shall survive any termination or
expiration of this Agreement and continue in full force and effect. |
| |
16.12 |
Severability.
If any provision of this Agreement is deemed to be invalid or unenforceable or is
prohibited by law, the remaining provisions shall be valid and binding as though such
provision were not included. |
| |
16.13 |
No
Waiver. No failure or delay by any party to exercise any right, power or remedy will
operate as a waiver of it nor will any partial exercise preclude any further exercise of
the same, or of some other right, power or remedy. |
| |
16.14 |
Construction.
If there is any conflict or inconsistency between the provisions of this Agreement and
any of its addenda, exhibits, schedules or other ancillary documents, the provisions of
this Agreement shall control. |
| |
16.15 |
Public
Disclosures. MTS and Customer shall agree with each other as to the form and
substance of any press release or other public notice related to this Agreement or the
transactions contemplated hereby, and shall consult with each other as to the form and
substance of other public disclosures related to this Agreement or the transactions
contemplated hereby. |
[Signature page
follows.]
15
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their
duly authorized representatives as of the date written below (the latest such date, the
“Agreement Date”):
|
|
|
|
| MTS: |
MTS MEDICATION TECHNOLOGIES, INC. |
Customer: |
OMNICARE, INC. |
| By: |
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ |
By: |
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ |
| Name: |
▇▇▇▇ ▇. ▇▇▇▇▇▇ |
Name: |
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ |
| Title: |
President and CEO |
Title: |
Vice President-General Counsel |
| Date: |
May 7, 2007 |
Date: |
May 7, 2007 |
16
EXHIBIT 1
LITIGATION
MTS
Medication Technologies, Inc. vs. QEM, Inc. and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ - Case number
05-4426-CI-15. Filed in the Circuit Court of the Sixth Judicial Circuit Pinellas
County, Florida. Dismissed without prejudice January 17, 2007.
EXHIBIT 2
U.S.
PATENTS AND PATENT APPLICATIONS PENDING IN THE U.S. PTO AND COVERING THE
ONDEMAND SYSTEMS
MTS Patents Issues
|
|
| Patent Name |
Patent Issue Number |
|
|
| Automated Solid Pharmaceutical Product Packaging Machine |
7,185,476 B1 |
|
|
| Compact Structure for Automatically Filling Solid Pharmaceutical Product Packages |
6,925,774 B2 |
|
|
| Automated Solid Pharmaceutical Packaging Machine Utilizing Robotic Drive |
7,182,105 B1 |
|
|
MTS Pending Patents
|
|
| Patent Name |
Patent Issue Number |
|
|
| Automated Solid Pharmaceutical Product Packaging Machine |
09/704,134 |
|
|
| Automated Solid Pharmaceutical Product Packaging Machine |
11/399,566 |
|
|
| Automated Solid Pharmaceutical Product Packaging Machine |
11/616,227 |
|
|
| Automated Solid Pharmaceutical Packaging Machine Utilizing Robotic Drive |
11/613,890 |
|
|
MTS Registered Trademarks
|
|
| Trademark Name |
Registration Number |
|
|
| OnDemand |
2,789,198 |
|
|
MTS Pending Trademarks
|
|
| Trademark Name |
Serial Number |
|
|
| AccuFlex |
78/813,706 |
|
|
17
ADDENDUM A
Pricing and Payment
Terms
This
Addendum A is attached to and made a part of the MTS Sales and License Agreement by
and between MTS Medication Technologies, Inc. and Omnicare, Inc. dated May 7, 2007
(the “Agreement”). Capitalized terms not otherwise defined in this
Addendum A will have the meaning given in the Agreement.
| I. |
OnDemand
Express II (“ODE II System”) – Sixteen (16) Units Each ODE
II System consists of: |
| |
1. |
ODE
II Machine Description |
| |
• |
2
carousals each containing 150 cassettes for a total of 300 calibrated cassettes |
| |
• |
Server
and required computer hardware |
| |
• |
8-station
Rotary Packaging System |
| |
• |
1
Label Printer/Applicator with Barcode Reader |
| |
2. |
ODE
II Vision System Description (optional) |
| |
• |
Optional
Vision System — will identify size and color (except white tablets of similar size
of product and blister content. Notwithstanding anything in this Agreement to the
contrary, Customer, in its sole discretion, may elect (i) not to buy the ODE II Vision
System from MTS, and (ii) to purchase a vision inspection system from a vendor other than
MTS (a “Third-Party Vision System”). If Customer elects to purchase and
integrate a Third-Party Vision System into the OnDemand System, such system may be
integrated within the OnDemand System’s Machine either before (space allowing) or
after the card is sealed. MTS shall work with Customer, without charge, for up to fifty
(50) hours of engineering time to integrate the Third-Party Vision System into the
OnDemand Systems. Customer will be charged at the rate of $[*] per hour for
engineering over fifty (50) hours and $[*] per hour for any programming required.
Following Customer’s selection of a Third-Party Vision System, MTS shall not
thereafter, without the express written consent of Customer, integrate or resell to any
other party (including working as a partner, developer or any such associated
relationship with the manufacturer or reseller of the Third-Party Vision System) the
Third-Party Vision System, either independently or in combination with any MTS system,
unless such system is generally available to MTS’s other customers, competitive
industry machine manufacturers or drug repackaging companies. |
*CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
A-1
| |
• |
2
linear robotic pick-and-place servo drives |
| |
• |
8
cassette motor bases attached to X - Y actuators |
| |
• |
8
variable diameter upper delivery trays positioned below X - Y actuators and cassette
motor bases |
| |
• |
8
variable diameter lower delivery trays positioned below upper delivery trays |
| |
• |
2
Z actuator and variable diameter transfer trays positioned below delivery trays |
| |
• |
A
two-stationed MedLoad station with two variable diameter delivery trays mounted on two
two-position rotary cam |
| |
Consists of the object code versions of the software programs titled “OnDemand®Software” described
in the specifications provided with such software (“Software Specifications”)
and additional software programs, if necessary and provided by Licensor hereunder, to
perform the functions set forth in the Software Specifications. |
| |
Installation and Training |
| |
Customer shall pay MTS’s Dead Net Costs (as defined below) for rendering the installation and
training services in accordance with Addendum D. “Dead Net Costs”are
defined to be the hourly base wage plus benefits MTS pays to each employee for each hour
such employee is utilized in the on-site installation and training which the parties
agree shall be equal to $[*] per hour plus any reasonable and necessary travel and
lodging expenses incurred by such employees; provided, however, Dead Net
Costs shall not include any overhead or indirect expenses of MTS. If MTS uses a third
party to install the OnDemand System, the hourly charge will be $[*] per hour plus
any reasonable and necessary travel and lodging expenses incurred by such third party
employee. |
| |
$[*] per year for each ODE II System during the Initial Maintenance Term, payable
pursuant to Section 3(a) of Addendum B. |
| II. |
OnDemand
AccuFlex – Eight (8) Units (“AccuFlex System”). |
*CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
A-2
| |
• |
1
Fanuc Robotic Arm with 130-Cassette Coliseum (with 121 active cassettes) |
| |
• |
Server
and required computer hardware |
| |
• |
Label
Printer/Applicator with Conveyor and Barcode Reader |
| |
• |
Components
for a 30/31 single dose punch card |
| |
• |
2
independent X - Y actuators |
| |
• |
2
delivery trays each attached to an X — Y actuator |
| |
• |
2
delivery trays positioned below X — Y actuators |
| |
• |
Z
actuator and transfer tray positioned below delivery trays |
| |
Consists of the object code versions of the software programs titled “OnDemand®Software” described
in the Software Specifications. |
| |
Installation and Training |
| |
Customer shall pay MTS’s Dead Net Costs (as defined below) for rendering the installation and
training services in accordance with Addendum D. “Dead Net Costs”are
defined to be the hourly base wage plus benefits MTS pays to each employee for each hour
such employee is utilized in the on-site installation and training which the parties
agree shall be equal to $[*] per hour plus any reasonable and necessary travel and
lodging expenses incurred by such employees; provided, however, Dead Net
Costs shall not include any overhead or indirect expenses of MTS. If MTS uses a third
party to install the OnDemand System, the hourly charge will be $[*] per hour plus
any reasonable and necessary travel and lodging expenses incurred by such third party
employee. |
| |
$[*] per year for each AccuFlex System during the Initial Maintenance Term, payable
pursuant to Section 3(a) of Addendum B. |
*CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
A-3
| III. |
Pricing
and Payment Terms |
| |
MTS will use its commercially reasonable efforts to minimize the costs associated with the
production of each ODE II System taking into consideration the quality standards set
forth in this Agreement. |
| |
On
or before the commencement of the Acceptance Period for each ODE II System, MTS shall
provide Customer with a detailed cost analysis that sets forth the Direct Costs (as
defined below) of each ODE II System (such cost analysis shall include MTS’s work
papers and the underlying source materials, including its invoices and the invoices of
its equipment subcontractor as provided to MTS, utilized in calculating the Direct Costs)
and its calculation of the ODE Per Unit Price for such ODE II System. For each ODE II
System, the “Direct Costs” as used herein, means the sum of the dead net
costs of: (1) MTS’s subcontracted manufacturing with [*], Inc. (or another
subcontractor agreed to in advance by Customer); plus (2) MTS’s direct material
costs, less related contractual allowances, credits and other adjustments incurred in the
production of each such ODE II System (and excluding all MTS labor, overhead costs,
non-recurring engineering and any other costs). |
| |
During
the Acceptance Period, Customer shall review MTS’s calculation of the Direct Costs
and Customer shall, upon written notice to MTS prior to the end of each Acceptance
Period, have the right, in its sole discretion, to elect to cause (directly or through
its outside accountants) a review and audit (at MTS’s offices), of all of the
pertinent portions of relevant financial, accounting and other books and business records
of MTS which are directly related to the Direct Costs and which Customer (or its
accountants) believes are reasonably necessary in order to calculate and verify MTS’s
calculation of the Direct Costs (a “Cost Review”). Promptly following
the conclusion of a Cost Review, Customer, in conjunction with its accountant, shall
prepare and present to MTS its computation of the Direct Costs for the applicable ODE II
System. MTS shall have the right to review the work papers of Customer and its accountant
utilized in its calculation of the Direct Costs for such ODE II System for the purpose of
verifying the accuracy of such calculation. MTS shall notify Customer of any dispute with
Customer’s calculation of the Direct Costs promptly, but not more than fifteen (15)
business days after its receipt by MTS. Failure to give such timely dispute notice shall
constitute acceptance and approval of Customer’s calculation of the Direct Costs and
shall be final and binding upon the parties hereto. Customer’s failure to send
timely notice to MTS prior to the end of each Acceptance Period requesting a Cost Review
shall constitute acceptance and approval of MTS’s calculation of the Direct Costs
and shall be final and binding upon the parties hereto. If the parties cannot agree on
the calculation of the Direct Costs for such ODE II System within twenty (20) days after Customer
provides its calculation of Direct Cost to MTS, the parties shall submit the dispute to a
mutually acceptable, independent “Big Four” accounting firm, whose determination
shall be binding on the parties. The fees of such accounting firm shall be divided equally
between Customer and MTS. |
*CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
A-4
| |
Additional cassettes can be purchased for $[*]. |
| |
For 30 days from the date of installation, cassettes can be recalibrated for $[*].
From day 31 to 180 days from date of installation, cassettes can be recalibrated for $[*].
Thereafter, the price will be $[*], subject to future price adjustments agreed to
by both parties. |
| |
Credits of MTS-350™ Machines |
| |
For MTS-350 machines at least two (2) years old but less than three (3) years old and in a
condition acceptable to MTS, MTS will repurchase said machine at 30% of its original
purchase price. MTS-350 machines at least one (1) year old but less than two years old
and in a condition acceptable to MTS will be repurchased at 40% of its original purchase
price, and MTS-350 machines one year old or less and in a condition acceptable to MTS
will be repurchased at 50% of its original purchase price. This provision will terminate
upon the Acceptance of the last OnDemand System purchased under this Agreement. |
| |
The price that Customer shall pay MTS for punch cards, blisters, labels, ribbons and other
consumables (collectively, “Disposables”) is set forth on Schedule 1 to
this Addendum A. The prices on Schedule 1 will remain in effect until April 1, 2008 and
will increase [*]% per year thereafter unless the increase in the cost of MTS’s
raw materials (paper and plastic) exceeds 4%, in which case the pricing increase will be
[*]%. Customer will be responsible for freight charges FOB St. Petersburg,
Florida. Rebates will continue at the current rate of $[*] per [*] items
ordered. |
| |
Customer shall be responsible for freight charges and the cost of insurance for the delivery of
the OnDemand System and any components thereof, which will be shipped to Customer F.O.B.
shipping point. The estimated freight charges are $[*] — $[*]. MTS will
advise Customer if actual charges will be materially different from the estimated charges. |
*CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
A-5
SCHEDULE 1
Disposable Pricing
MTS Disposables Pricing
| |
|
(1) |
|
(2) |
|
(4) |
| |
|
|
|
|
|
Card and Blister Prices |
| |
|
Item Number |
|
Item Description |
|
Do Not Reflect Rebate $[*] |
| |
|
|
|
|
|
|
| 1 |
|
315-09 |
|
Omnicare 30 O/B 9in (Teal) |
|
$[*] |
| 2 |
|
201-10 | |
Blisters 32 Unit Dose Medium Nesting | |
$[*] |
| 3 |
|
315-17 | |
Omnicare Select Seal Cards 30 O/B 9in (Teal) | |
$[*] |
| 4 |
|
200-28 | |
Blisters 30 9in (Medium) | |
$[*] |
| 5 |
|
202-28OV | |
Blisters 30 9in (Med Oval) OnDemand | |
$[*] |
| 6 |
|
200-27 | |
Blisters 30 9in (Small) | |
$[*] |
| 7 |
|
200-31 | |
Blisters 31 9in (Small) | |
$[*] |
| 8 |
|
300-07 | |
MTS Cards 30 O/B 9in | |
$[*] |
| 9 |
|
300-25 | |
MTS Cards 31 O/B 9in | |
$[*] |
| 10 |
|
315-02 | |
Omnicare OnDemand Cards 30 O/b 9in | |
$[*] |
| 11 |
|
201-13 | |
Blisters 32 Unit Dose Large Nesting | |
$[*] |
| 12 |
|
200-30 | |
Blisters 30 9in (Large Oval) | |
$[*] |
| 13 |
|
203-31 | |
Blisters North 30/31 Medium Amber 9in | |
$[*] |
| 14 |
|
200-32 | |
Blisters 31 9in (Medium) | |
$[*] |
| 15 |
|
300-05A | |
MTS OnDemand Cards 30 O/B 9in | |
$[*] |
| 16 |
|
315-07 | |
Omnicare/JCAHO Select Seal 30 O/B 9in | |
$[*] |
| 17 |
|
201-11 | |
Blisters 32 Unit Dose Medium Nesting | |
$[*] |
| 18 |
|
315-28 | |
Omnicare Minnesota Select Seal 32 O/B | |
$[*] |
| 19 |
|
315-10 | |
MTS Select Seal Cards 32 O/B 9 in | |
$[*] |
| 20 |
|
203-30 | |
Blisters North 30/31 Small Amber 9in | |
$[*] |
| 21 |
|
200-34 | |
BLISTERS 31 9in (LARGE OVAL) | |
$[*] |
| 22 |
|
300-15 | |
MTS SELECT SEAL CARDS 32 O/B 9in | |
$[*] |
| 23 |
|
300-39 | |
MTS P/S 30 O/B 9in (M2/250 PK) | |
$[*] |
| 24 |
|
300-28 | |
BLANK CARDS 30 O/B 9in | |
$[*] |
| 25 |
|
201-16 | |
BLISTERS 32 UNIT DOSE LARGE AMBER NESTING | |
$[*] |
| 26 |
|
315-18 | |
OMNICARE SELECT SEAL CARDS 31 O/B 9in (TEAL) | |
$[*] |
| 27 |
|
200-22 | |
BLISTERS MINI 30 DOSE (BLUE) | |
$[*] |
| 28 |
|
300-16 | |
MTS CARDS 31 (#1) O/B 9in | |
$[*] |
| 29 |
|
300-67 | |
MTS MINI 30 PUNCH CARD | |
$[*] |
| 30 |
|
200-29 | |
BLISTERS 30 9in (LARGE) | |
$[*] |
*CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
Schedule 1-1
| |
|
(1) |
|
(2) |
|
(4) |
| |
|
|
|
|
|
Card and Blister Prices |
| |
|
Item Number |
|
Item Description |
|
Do Not Reflect Rebate $[*] |
| |
|
|
|
|
|
|
| 31 |
|
300-13 |
|
MTS SELECT SEAL CARDS 30 O/B 9in |
|
$[*] |
| 32 |
|
201-13-30DOSE | |
BLISTERS 30 UNIT DOSE LARGE NESTING | |
$[*] |
| 33 |
|
354-13 | |
NEIGHBORCARE SELECT SEAL CARDS 30 O/B 9m Item No Longer Used | |
$[*] |
| 34 |
|
201-10-30DOSE | |
BLISTERS 30 UNIT DOSE SMALL NESTING | |
$[*] |
| 35 |
|
203-33 | |
BLISTERS NORTH 30/31 OVAL AMBER 9in | |
$[*] |
| 36 |
|
315-08 | |
OMNICARE/JCAHO (RED) SELECT SEAL 30 O/B 9in | |
$[*] |
| 37 |
|
200-32OV | |
BLISTERS 31 9in (MEDIUM OVAL) | |
$[*] |
| 38 |
|
315-09-B30MOV | |
OMNICARE 30 1-PC. PUNCH / MEDIUM OVAL BLISTER CARD | |
$[*] |
| 39 |
|
315-09-B30SOV | |
OMNICARE 30 1-PC.PUNCH/SMALL OVAL BLISTER CARD | |
$[*] |
| 40 |
|
300-14 | |
MTS SELECT SEAL CARDS 31 O/B 9in | |
$[*] |
| 41 |
|
315-05 | |
OMNICARE P/S MED CARD 30 (W/O FOIL) | |
$[*] |
| 42 |
|
315-11 | |
OMNICARE 32 O/B 9in (TEAL) | |
$[*] |
| 43 |
|
200-33 | |
BLISTERS 31 9in (LARGE) | |
$[*] |
| 44 |
|
201-1 1-30DOSE | |
BLISTERS 30 UNIT DOSE MEDIUM NESTING | |
$[*] |
| 45 |
|
339-15 | |
NEIGHBORCARE 30 O/B 9in No Longer In Use | |
$[*] |
| 46 |
|
201-13XL | |
BLISTERS 32 UNIT DOSE EXTRA LARGE | |
$[*] |
| 47 |
|
204-08 | |
OPTIPAK 8/16 DOSE BLISTER | |
$[*] |
| 48 |
|
300-17 | |
MTS PLUS PAK 31 O/B 9in | |
$[*] |
| 49 |
|
300-61 | |
MTS RED CARDS 30 T/D 9in | |
$[*] |
| 50 |
|
301-09 | |
OPTIPAK PRN 8/16 DOSE TRI-FOLD H/S CARD | |
$[*] |
| 51 |
|
315-09-B30OV | |
OMNICARE 30 1-PC. PUNCH / OVAL BLISTER CARD | |
$[*] |
| 52 |
|
200-60 | |
BLISTERS 60 9in | |
$[*] |
| 53 |
|
200-19 | |
BLISTERS 31 9in (PLUS PAK) | |
$[*] |
| 54 |
|
200-25 | |
Not Applicable | |
$[*] |
| 55 |
|
302-14 | |
MTS CARDS S-31 O/B 9in | |
$[*] |
| 56 |
|
200-17 | |
BLISTERS 28 9in (LARGE) | |
$[*] |
| 57 |
|
200-23 | |
BLISTERS 60/62 9in | |
$[*] |
| ▇▇ |
|
▇▇▇-▇▇-▇▇ DOSE | |
BUSTERS 31 UNIT DOSE LARGE NESTING | |
$[*] |
| 59 |
|
203-32 | |
BLISTERS NORTH 30/31 LARGE AMBER 9in | |
$[*] |
| 60 |
|
300-09 | |
MTS CARDS 60 O/B 9in | |
$[*] |
| 61 |
|
300-19 | |
MTS 14 DAY CARD (3 7/16in X 9in) | |
$[*] |
| 62 |
|
315-13 | |
OMNICARE 62 O/B 9in (TEAL) | |
$[*] |
| 63 |
|
670-06 | |
PATIENT DIVIDER CARDS 9.5in EACH | |
$[*] |
| 64 |
|
200-36 | |
BLISTERS 32 9in (MEDIUM) | |
$[*] |
| 65 |
|
300-43 | |
MTS MORNING CARDS 31 (#1) O/B 9in | |
$[*] |
| 66 |
|
300-11 | |
MTS CARDS 90 O/B 9in | |
$[*] |
| 67 |
|
300-46 | |
MTS BEDTIME CARDS 31 (#1) O/B 9in | |
$[*] |
| 68 |
|
300-45 | |
MTS EVENING CARDS 31 (#1) O/B 9in | |
$[*] |
| 69 |
|
300-73 | |
MTS/MED CARD 30 | |
$[*] |
| 70 |
|
300-37 | |
MTS COMPLIANCE CARDS 28 O/B 9in | |
$[*] |
| 71 |
|
315-06 | |
OMNICARE/HEARTLAND P/S MED CARD 31 (W/O FOIL) | |
$[*] |
| 72 |
|
315-12 | |
OMNICARE 60 O/B 9in (TEAL) | |
$[*] |
| 73 |
|
315-14 | |
OMNICARE 90 O/B 9in (TEAL) | |
$[*] |
*CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
Schedule 1-2
| |
|
(1) |
|
(2) |
|
(4) |
| |
|
|
|
|
|
Card and Blister Prices |
| |
|
Item Number |
|
Item Description |
|
Do Not Reflect Rebate $[*] |
| |
|
|
|
|
|
|
| 74 |
|
670-01 |
|
PRODUCT INVENTORY CARDS |
|
$[*] |
| 75 |
|
671-01 | |
OPTIPAK TRAY (LARGE) 5.500inW X 3in D X 8.500inL | |
$[*] |
| 76 |
|
200-46 | |
BLISTERS 28 9in (5/8in TRI-FOLD/250 PK) | |
$[*] |
| 77 |
|
301 -21 | |
MTS TRI-FOLD MULTIDOSE CARD 10in (28) | |
$[*] |
| 78 |
|
680-11 | |
THERMAL TRANSFER LIDDING STOCK (6in/l,000) | |
$[*] |
| 79 |
|
301-B1 | |
Not Applicable | |
$[*] |
| 80 |
|
680-10 | |
PERF. LIDDING STOCK (6in/l,000) | |
$[*] |
| 81 |
|
W-B4 | |
Not Applicable | |
$[*] |
| 82 |
|
301-B5 | |
Not Applicable | |
$[*] |
| 83 |
|
200-24 | |
BLISTERS 90 9in | |
$[*] |
| 84 |
|
Labels | |
Omnicare - AJ | |
$[*] |
| 85 |
|
Labels | |
Omnicare - Lodi | |
$[*] |
| 86 |
|
Labels | |
Omnicare of Connecticut | |
$[*] |
| ▇▇ |
|
▇▇▇▇▇▇ | |
▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ | |
$[*] |
| 88 |
|
Labels | |
Roeschen’s Omnicare Pharmacy |
|
$[*] |
| 21 |
|
Total (including all 83 SKUs): |
*CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
Schedule 1-3
ADDENDUM B
Maintenance Terms and
Conditions
This
Addendum B is attached to and made a part of the MTS Sales and License Agreement by
and between MTS Medication Technologies, Inc. and Omnicare, Inc. dated May 7, 2007
(the “Agreement”). Capitalized terms not otherwise defined in this
Addendum B will have the meaning given in the Agreement.
| 1. |
OnDemand
System Maintenance Services. |
| |
a. |
Warranty
of Maintenance Services. MTS warrants that during the Initial Maintenance Term and
each Renewal Maintenance Term (as such terms are defined below), (i) each respective
OnDemand System shall operate in accordance with the Material Specifications (as defined
below) applicable to such system, including (a) the documentation provided to Customer by
MTS at the time of delivery, and (b) each of the performance objectives specified in Addendum
C applicable to such system (the “Performance Specifications”) ((a)
and (b) collectively, the “Specifications”), (ii) each respective
OnDemand System (including non-consumable components and parts) shall remain fully
serviceable and continue to operate in accordance with the Material Specifications, and
(iii) MTS will render its maintenance services hereunder in a good and workmanlike
manner. In addition, MTS shall provide preventative maintenance to maintain the Machines
and Licensed Technology in good operating condition so that they operate in accordance
with all applicable Material Specifications, including preventative maintenance provided
on a regularly scheduled monthly basis during hours to be agreed on by the parties. If,
during the Initial Maintenance Term or any Renewal Maintenance Term, the warranty set
forth in this Section 1(a) is not satisfied by MTS, Customer’s exclusive
remedy and MTS’s sole obligation shall be to perform remedial maintenance services
in accordance with this Addendum B to modify, repair or replace the non-conforming
OnDemand System (including its non-consumable components and parts) so that it operates
in accordance with all applicable Material Specifications. Any claim by Customer under
the warranty provided in this Addendum B must be delivered to MTS in writing as
soon as reasonably possible; provided, however, Customer’s failure to
deliver a claim as soon as reasonably possible shall not relieve MTS of its warranty and
maintenance obligations. In any event, all such claims must be submitted to MTS prior to
the later of the expiration or termination of the Initial Maintenance Term or a Renewal
Maintenance Term, as applicable. In order to provide warranty or other service, Customer
will allow MTS and its authorized service provider access to the OnDemand System. If MTS
complies with its obligations set forth in Section l(a). it shall have no further
liability for a breach of such warranties in respect of the OnDemand System. For purposes
of this Agreement, “Material Specifications” means (a) if a
Specification is specifically quantifiable or objective, then MTS shall be required to
fully and completely meet such Specification, and (b) if a Specification is not
specifically quantifiable or objective, then for all other Specifications, MTS shall be
required to meet such Specification in all material respects. |
| |
b. |
Requests
For Maintenance Services. MTS will use commercially reasonable efforts
to respond to Customer’s requests for maintenance services: (i) by
telephone within two (2) hours of MTS’s receipt of Customer’s
initial request for maintenance services, or (ii) if MTS reasonably
determines that on-site service is required, have service technicians at
Customer’s location within four (4) hours of MTS’s initiating
the call to deploy onsite service. MTS agrees to make maintenance services
available on a twenty-four (24) hours per day basis, with the
understanding that Customer’s production facilities will be running
three (3) shifts per day. MTS shall deliver to Customer a recommended
maintenance schedule (i.e. weekly, monthly, quarterly) detailing the maintenance
needs of each OnDemand system. |
B-1
| |
c. |
Access
to the OnDemand Systems. In order to provide maintenance services,
Customer will allow MTS and its authorized service providers access to the
OnDemand Systems. Customer agrees to provide MTS with sufficient support
and test time on the OnDemand Systems to identify and duplicate any defect
or error, verify the source or nature of the defect or error, and verify
that the defect or error has been corrected. |
| |
d. |
Exclusions
From Warranted Maintenance Services. The maintenance services that MTS
is required to provide and warrant pursuant to this Addendum B does not
include maintenance services or other support to the extent such services
are required as a result of any of the following; provided, however,
to the extent Customer requests, MTS agrees to provide repairs, services,
parts, accessories or supplies at MTS’s then-current rates plus
reasonable expenses as agreed to by the parties: |
| |
i. |
Customer’s
error, neglect, or abuse in the use or operation of the OnDemand System;
Customer’s use of the OnDemand System for a purpose other than the purpose
for which it was designed; Customer’s failure to provide proper electrical
power, air conditioning, dry compressed air, vacuum and humidity control;
Customer’s failure to maintain the OnDemand System in accordance with the
reasonable, routine maintenance requirements set forth in any manuals covering
the OnDemand System provided to Customer from time to time; Customer’s use
of disposable supplies (e.g., punch cards, blisters, labels and ribbons) with
the OnDemand System other than the Disposables unless (1) the required supply
of Disposables is not reasonably available to Customer, or (2) MTS has
reasonably determined that there are quality issues with the Disposables; or |
| |
ii. |
Repair
or service made or attempted by any parties (other than MTS or its authorized
service provider) without MTS’s prior written consent, which shall not be
unreasonably withheld or delayed; or |
| |
iii. |
Machine
alterations (other than alterations made by or for MTS) which shall include,
but not be limited to, any deviations from the original physical, mechanical or
electrical design of the Machine; or |
| |
iv. |
Attachments
to the OnDemand System (other than attachments made by or for MTS), such as
devices or software programs which MTS has not specifically designated as
compatible with the OnDemand System, but which are nevertheless mechanically,
electrically or electronically connected to the OnDemand System; or |
| |
v. |
Repair
or damage caused by accidents or disasters (other than accidents directly and
proximately caused by MTS or its authorized agents), including, but not limited
to, fire, flood, water, wind, lightening and termination or surge in electrical
current; or |
B-2
| |
vi. |
Relocations
or attempts to relocate or move the OnDemand System to a new site not
supervised or authorized in writing in advance by MTS, which shall not be
unreasonably withheld or delayed. |
| |
e. |
Additional
Exclusions From Maintenance. Maintenance and support services provided
under this Addendum B do not include the following: |
| |
i. |
Furnishing
frequently replaced supplies (including Disposables), accessories and items;
painting, refinishing or refurbishing the OnDemand System or furnishing
material therefore; inspecting alterations to the Machine not made by MTS or
its authorized service provider; making specification changes to the OnDemand
System; performing services in connection with relocating the Machine; or
adding or removing accessories, attachments or other devices to the OnDemand
System; or |
| |
ii. |
Electrical
work external to the Machine; maintenance of accessories, alterations,
attachments or other devices not furnished by MTS; or |
| |
iii. |
Repair
service, replacement of parts or repetitive service calls due to wear or
malfunction caused by fluids or operational supplies used by or with the
Machine other than fluids or operational supplies provided or approved by MTS
or its authorized service provider; or |
| |
iv. |
Service
on the interface hardware attached to the Machine, such as emulation boards,
modems, connector boxes and other communications equipment not provided or
authorized by MTS; or |
| |
v. |
Modifications
to drug cassettes or the Drug List requested by Customer or required by a
change of drug manufacturer or drug specifications. |
| 2. |
Licensed
Software Upgrades And Enhancements; New Technology. |
| |
a. |
MTS
may, from time to time, in its sole discretion, modify, upgrade or enhance any
version(s) of the Licensed Software for the purpose of allowing the OnDemand
System to perform new or substantially different functions, to increase the
capacity of the Licensed Software to process information, or any other reason
deemed necessary or appropriate by MTS (each such modified, upgraded or
enhanced version, a “Release”). Any Release that MTS makes
generally available to all MTS end users will be made available at the same
time to Customer (i) at no additional cost to Customer during the Initial
Maintenance Term and any Renewal Maintenance Term (as defined in Section 4(a))
that, pursuant to Section 3(a), Customer is paying an annual maintenance
fee or (ii) for a commercially reasonable fee during any Renewal Maintenance
Term that Customer, pursuant to Section 3(a), is paying for maintenance
on a time and materials basis. In addition, MTS may introduce other new
technology with substantially new functionality (each such new technology or
new functionality an “Improvement”), and Customer as well as
MTS’s other customers will, for a commercially reasonable fee, have the
option to purchase or license such Improvement. (An example of such new
technology could include a vision identification system.) |
B-3
| |
b. |
Any
Release or Improvement, when delivered, shall become part of the Licensed
Software or Licensed Technology (as applicable), shall be maintained in
accordance with this Addendum B, and shall otherwise be subject to all
of the terms of the Agreement. |
| |
c. |
MTS
will continue to provide maintenance services on Customer’s current
Release of the Licensed Software should Customer elect not to purchase an
Improvement as long as such Improvement is not required by MTS to be purchased
because of changes in technology that affect MTS’s ability to provide
maintenance services for the OnDemand System. (For example, if a database
provider went out of business or stopped supporting the current version of
database software and MTS selected a new database provider that required an
update to hardware and software licenses and additional software, MTS would
require Customer to pay the cost of such Improvement in order to continue to
provide maintenance service for the OnDemand System. |
| |
d. |
In
order to satisfy any obligation hereunder, MTS may, with Customer’s
agreement, send Customer a single copy in magnetic form of any modification,
upgrade, enhancement, error correction, bug fix or Release to the Licensed
Software, together with instructions for Customer’s installation and
implementation thereof. |
| |
e. |
Any
new Release or Improvement made to the Licensed Software or the OnDemand
System, including all intellectual property rights therein or associated
therewith, made or provided by MTS or its authorized service provider, whether
alone or with any contribution from Customer or its personnel, shall be owned
exclusively by MTS. To the extent Customer or its personnel may acquire any
right, title or interest therein or thereto by operation of law, Customer
hereby irrevocably assigns all such right, title and interest exclusively to
MTS. Customer shall maintain and enforce agreements and policies with its
personnel sufficient to give effect to the provisions of this Section 2(e). |
| 3. |
Maintenance
Fees And Charges. |
| |
a. |
On
the date of Acceptance for each OnDemand System, Customer shall commence paying
MTS the maintenance fee designated in Addendum A in equal monthly,
quarterly or annual installments, at Customer’s election, except as
specified in Sections 3(b) and 3(e) below. During any Renewal
Maintenance Term (as defined in Section 4(a)), the maintenance fee shall
be mutually agreed upon by the parties. If Customer and MTS cannot agree on the
maintenance fee for any Renewal Maintenance Term, MTS shall perform the
services specified in this Addendum B (subject to the terms and
conditions specified in the Agreement and this Addendum B) on a time and
materials basis at MTS’s then-current hourly |
B-4
| |
rates. During any Renewal
Maintenance Term, Customer is not required to utilize the maintenance services
of MTS and Customer can elect to perform such services internally or through
other third parties subject to the following: in the event that Customer elects
to perform any maintenance services internally, or has such services performed
through a third party, and in either case such election is not authorized in
writing in advance by MTS, which authorization for routine maintenance shall
not be unreasonably withheld or delayed, (i) all warranties in this Agreement
shall be voided and hereinafter invalid, (ii) MTS shall have no liability or
obligations whatsoever, in each case with respect to any OnDemand Systems on or
for which such maintenance services have been performed, and (iii) such
OnDemand Systems shall thereinafter be deemed to have been provided on AS-IS
basis, without warranty of any kind, unless otherwise expressly agreed in
writing by MTS . |
| |
b. |
MTS
shall invoice Customer (i) in advance for maintenance fees during the Initial
Maintenance Term and any Renewal Maintenance Term for which the parties agree
on a maintenance fee, and (ii) within thirty (30) days after the end of each
month during any Renewal Maintenance Term for which Customer will be charged on
a time and materials basis. |
| |
c. |
Maintenance
fees do not include, and Customer specifically assumes the cost of, the
following: |
| |
i. |
Disposables,
drugs and cleaning supplies; |
| |
ii. |
re-training
of Customer or third party personnel or training of new Customer or third party
personnel (after initial installation/implementation training) by MTS to
operate the OnDemand System; |
| |
iii. |
installation
or moving of any component of the OnDemand System; |
| |
v. |
any
repair or maintenance services not expressly included in this Addendum B or
any services specified in this Addendum B as being excluded from the
maintenance services; |
| |
vi. |
back-up
or restoration of Customer data, information or computer programs, whether or
not used in conjunction with the OnDemand System, except if the data loss is
caused by an error of the OnDemand System; |
| |
vii. |
specific
requests by Customer for maintenance outside the scope of this Addendum B; and |
| |
viii. |
recalibration
of drug cassettes. |
| |
d. |
In
addition to the maintenance fee and all other fees for services, Customer shall
be invoiced for and pay all applicable sales and use taxes on all services,
repair and replacement parts, and supplies furnished under this Addendum B. |
B-5
| |
e. |
To
the extent Customer requests, MTS agrees to provide repairs, services, parts,
accessories or supplies other than those expressly specified as services and
materials to be provided by MTS pursuant to this Addendum B, and MTS
shall charge Customer, and Customer shall pay, MTS’s then-current rates
plus reasonable expenses as agreed to by the parties. |
| |
f. |
Customer
shall pay all invoiced amounts under this Addendum B within forty-five
(45) days of the applicable invoice date. Any late payments shall be subject to
interest charges in accordance with Section 12 of the Agreement. |
| |
g. |
MTS
may suspend services following thirty (30) days’ written notice to
Customer if payment of fees due and owing pursuant to this Addendum B is
not received by MTS when due. |
| |
h. |
MTS
may, at its option, revise its maintenance fees by providing Customer sixty
(60) days’ written notice prior to the start of the Renewal Maintenance
Term for which the revised maintenance fees shall apply, provided that
the amount of any single annual increase in such fees shall not exceed five
percent (5%) of the previous year’s maintenance fees. Notwithstanding the
foregoing, after the Initial Maintenance Term (as hereinafter defined), MTS may
increase Customer’s maintenance fees by more than five percent (5%) of the
previous year’s maintenance fees, but not to exceed ten percent (10%)
thereof, in any given year if MTS reasonably determines that such increase is
warranted due to substantial increases in MTS’s labor and/or materials
charges. MTS shall provide Customer documentation in reasonable detail to
substantiate such increases. |
| |
a. |
MTS
shall provide maintenance services for each OnDemand System in accordance with
this Addendum B starting on the Acceptance Date for each OnDemand System
and continuing in effect for three (3) years (the “Initial Maintenance
Term”) from such Acceptance Date, and thereafter shall automatically
renew, either (i) on the then-current terms of this Agreement or (ii) on a time
and materials basis pursuant to Section 3(a), for successive additional
terms of one (1) year each (each, a “Renewal Maintenance Term”),
unless terminated as provided herein. |
| |
b. |
Termination
of Customer’s license to the Licensed Products under Section 11.1 or
termination under Section 11.2 of the Agreement shall automatically terminate
this Addendum B. MTS may terminate this Addendum B by giving
thirty (30) days’ written notice of termination to Customer upon the
occurrence of any of the following events: |
| |
i. |
Customer
defaults in the performance of any material requirement or obligation created
by this Addendum B or the Agreement, including Customer’s use of
Disposables other than the Disposables provided by MTS (unless such use is
authorized in writing by MTS or because (1) the required supply of Disposables
is not reasonably available to Customer or (2) MTS has determined that there
are quality issues with the Disposables), and such default continues for a
period of thirty (30) days after written notice of such default is received by
Customer; |
B-6
| |
ii. |
Customer
fails to make any payment to MTS within forty-five (45) days of its due date,
whether under this Addendum B or the Agreement, and such default
continues for a period of thirty (30) days after written notice of such default
is received by Customer; |
| |
iii. |
Customer
ceases doing business; |
| |
iv. |
Customer
is the subject of any state or federal bankruptcy, insolvency or similar
proceeding, becomes insolvent or makes an assignment for the benefit of
creditors; |
| |
v. |
a
receiver is appointed for a substantial part of Customer’s assets; |
| |
vi. |
Customer
becomes unable to pay its debts as they become due; or |
| |
vii. |
any
action is taken toward the liquidation or winding up of Customer’s
business. |
| |
c. |
Customer
may terminate this Addendum B at any time by giving MTS thirty (30) days’ advance
written notice of termination upon the occurrence of any of the following
events: |
| |
i. |
MTS
defaults in the performance of any material requirement or obligation created
by this Addendum B or the Agreement), and such default continues for a period
of thirty (30) days after written notice of such default is received by MTS; |
| |
ii. |
MTS
ceases doing business; |
| |
iii. |
MTS
is the subject of any state or federal bankruptcy, insolvency or similar
proceeding, becomes insolvent or makes an assignment for the benefit of
creditors; |
| |
iv. |
a
receiver is appointed for a substantial part of MTS’s assets; or |
| |
v. |
any
action is taken toward the liquidation or winding up of MTS’s business. |
| |
d. |
Termination
of this Addendum B shall not release Customer from any obligation to pay
MTS any amount that has accrued or become payable at or prior to the date of
termination or release MTS from any obligation to pay Customer any amount that
has accrued or become payable at or prior to the date of termination. |
B-7
ADDENDUM C
Performance Objectives
and Specifications
This
Addendum C is attached to and made a part of the Sales and License Agreement
by and between MTS Medication Technologies, Inc. and Omnicare, Inc. dated May 7,
2007 (the "Agreement"). Capitalized terms not otherwise defined in this Addendum C will
have the meaning given in the Agreement.
| 1) |
Production
Rates. Other than during Downtime (as defined in Section 2 below)
and to the extent not adversely affected by Human Factors (as defined in
Section 3 below), the ODE II System will accurately fill, seal, and
label at least [*] dose packages per minute. The ODE II System’s
output will be at the Run Rate of at least [*] cards per eight (8)
hour shift when the system is filling from all zones and the AccuFlex
System will accurately fill, seal, and label at least [*] dose
packages per minute. The AccuFlex System’s output will be at the Run
Rate of at least [*] cards per eight (8) hour shift when the system
is filling from all zones. During the Acceptance Period, Customer and MTS
will identify performance tolerances for the ODE II System’s output
which shall be utilized for determining Acceptance and included in the
Specifications. The Run Rate (as hereinafter defined) shall be calculated
as follows: |
| |
“Run Rate” is defined as the rate equal to Cards Per Minute multiplied by 480 minutes
per eight (8) hour shift, where “Cards Per Minute” is defined as
the total number of cards produced by the OnDemand System out of all zones during a
measured period of time, divided by the number of minutes in such measurement period that
the OnDemand System is operating and producing cards, minus the number of minutes of
Downtime during such measurement period. |
| 2) |
Downtime.
During the Acceptance Period, total Downtime should not exceed [*] of the
total production time scheduled during the Acceptance Period. Total
Downtime over any four (4) month period after the Acceptance Period should
not exceed [*] of total production time scheduled over any such
four (4) month period. As used herein, “Downtime” shall
mean any period of time, other than routine or scheduled maintenance, that
the OnDemand System is not available or not operating substantially in
accordance with the Specifications due to mechanical or electrical
failures, or software errors and not Human Factors. |
| 3) |
“Human
Factors” are defined as Customer issues, out of MTS’s
control, with respect to the operation of the OnDemand System that effect
productivity and include, but are not limited to, the following: |
| |
i. |
Maintaining
adequate levels of trained staff to operate the OnDemand System. Operators are
diligently engaged in production activities and operating the machine. |
*CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
C-1
| |
ii. |
Maintaining
adequate drug inventory both in bulk stock and in the rotary cassettes of the
OnDemand System. |
| |
iii. |
Managing
the OnDemand System operating functions in accordance with operator handbook
and established pharmacy procedures. |
| |
iv. |
Making
minor operator adjustments to card and blister pull stations, label applicator
and conveyor stacker. |
| |
v. |
Maintaining
card and blister and label inventory levels and proper management of stacker. |
| |
vi. |
Ensuring
appropriate prescription batching and cassette placement to manage load
balance. Optimum Run Rate can only be achieved when all eight (8) zones are
filling simultaneously for the ODE II System or two (2) zones for the AccuFlex
System. |
| |
vii. |
Troubleshooting
and recovering from minor errors, such as missed card, blister, label, etc. |
| |
viii. |
Maintaining
the correct drug in the correct cassette. |
| |
ix. |
Maintaining
the correct cassette in the correct location in the OnDemand System. |
| |
x. |
Placing
only clean and unbroken drugs into the rotary cassettes. Optimum Run Rates
cannot be achieved if cassettes are not operating in accordance with
specifications or are jamming or timing-out due to drug product issues. |
| |
xi. |
Having
an adequate number of cassettes available for production (minimum of 300 for
the ODE II System, 130 for the AccuFlex System). |
| |
The formatting of the patient labels that will be printed and applied by the ODE II System
and the AccuFlex System will need to be customized in order to meet each pharmacy’s
and the applicable State Board of Pharmacy’s requirements, MTS shall provide, at no
additional cost to Customer, the necessary resources required to configure and format the
patient labels based on the requirements of the site. Customer will provide an example to
MTS thirty (30) days in advance of the shipment of the OnDemand Systems. After Acceptance
of the OnDemand System, services for configuring and/or formatting patient labels will be
charged on an hourly basis at MTS’s then-current rate for programming services. |
C-2
ADDENDUM D
Installation and
Training
This
Addendum D is attached to and made a part of the Sales and License Agreement
by and between MTS Medication Technologies, Inc. and Omnicare, Inc. dated May 7,
2007 (the "Agreement"). Capitalized terms not otherwise defined in this Addendum D will
have the meaning given in the Agreement.
ODE II SYSTEM
| |
a) |
MTS
personnel will perform a complete site survey to determine appropriate space
availability, recommended modifications and utility installation
requirements. MTS personnel will return to the site at least one week
prior to installation to ensure that the location is ready for install. |
| |
b) |
Customer
must provide a minimum 20’ x 30’ clear space with minimum of 9’ ceiling
available for the ODE II System. This will only provide clear space around
this Machine. Additional work space must be large enough for a desktop
computer, report printer and secondary label printer. This area must also
be large enough to maintain inventory and perform maintenance on dispensing
cassettes. Additional space will be required to provide storage of
materials and finished goods. Space requirements will be fully identified
in the site survey. |
| |
c) |
Installation
will require some carpentry, plumbing and electrical modification by
Customer at Customer’s expense to accommodate the ODE II System.
(Customer will need a 72” W x 96” H opening for ingress of this
Machine.) These requirements will be fully outlined in the site survey. |
| |
d) |
The
area around the ODE II System must be air conditioned and maintained at a
temperature not to exceed 25°C. |
| |
e) |
Customer
will need a utility room or an area away from the ODE II System to install
the air compressor (supplied by Customer) and a vacuum pump (supplied by
MTS). Utility room requirements will be fully outlined in the site survey;
however, the following describes some of the general requirements for this
area: |
| |
i. |
The
utility room or area needs to be at least eight feet (8’) by eight feet (8’)
in size. |
| |
ii. |
The
utility room or area will need to be well ventilated. |
| |
f) |
Power
connections for the utility room and the ODE II System will be fully outlined
in the site survey. Your facility will require the services of a licensed
electrical contractor in order to complete the following: |
| |
i. |
Utility
Room Minimum Power Requirements: |
D-1
| |
• |
240
VAC, 40 amp, single phase, disconnect box mounted to the wall for the air compressor. |
| |
• |
240
VAC, 20 amp, single phase, disconnect box mounted to the wall for the vacuum pump |
| |
• |
Motor
Starter with Thermal Overload Protection mounted in the utility room for the vacuum pump. |
| |
ii. |
ODE
II System Minimum Power Requirements: |
| |
• |
208/240
VAC, 120 amp, single phase, receptacle mounted within ten feet (10’) of the ODE II
System. |
| |
• |
120
VAC, 20 amp receptacle for computer and off-line printer |
| |
g) |
Air
compressor details will be fully outlined in the site survey. Your facility
will require the services of a licensed plumbing contractor in order to
complete the following. The air compressor operational requirements are 20 CFM
@ 100 PSI. MTS air compressor recommendation is as follows. |
| |
i. |
The
air compressor MUST have a refrigerated filter/dryer and a regulator (usually
supplied with the air compressor). |
| |
ii. |
Customer
MUST perform a weekly maintenance check on this unit including draining the
moisture from the air supply tank. MTS recommends that Customer have an
automatic drain valve installed for this purpose. A five-eights inch (5/8”)
or larger hard copper air supply line must be run from the air compressor
location to the ODE II System location. |
| |
h) |
Vacuum
Pump Details. Your facility will require the services of a licensed plumbing
contractor in order to complete the following: |
| |
i. |
MTS
will supply the vacuum pump. |
| |
ii. |
A
five-eights (5/8”) or larger hard copper vacuum supply line must be run
from the vacuum pump location to the ODE II System location. |
| |
i) |
Your
compressor installer/plumber and electrician are responsible for making
purchase recommendations to assure compliance with local building and
electrical codes. |
D-2
| |
j) |
System
Communication Details. The ODE II System requires the following data
connections: |
| |
i. |
A
dedicated high-speed data connection to the ODE II System, |
| |
ii. |
An
interface connection to the pharmacy network. |
| |
a) |
Upon
arrival at facility, Customer will make available, appropriate equipment
for unloading, movement and placement of the Machine in its proper
location. MTS personnel will be on site to assist. Equipment details will
be fully outlined in the site survey. |
| |
b) |
If
Customer does not have unloading equipment, such as an adequate size fork
lift, MTS will contract with a local rigging service to unload and place
the Machine in its proper location. |
| |
c) |
MTS
personnel will connect the Machine to Customer supplied utilities as
described in the facility requirements and site survey. |
| |
d) |
Customer
will supply a designated maintenance person to be present throughout the
installation process. |
| |
e) |
Each
ODE II System set-up will require 3 to 5 days to complete. |
| |
a) |
Training
is anticipated to require 2 to 3 weeks to complete: |
| |
i. |
During
the first week, training will include system security, cassette inventory and
maintenance (this will take 3 to 4 days depending on the size of the
formulary), card, blister and label inventory and general operation. |
| |
ii. |
During
the second week, training will include, daily operation, report generation,
system cleaning and general maintenance. |
| |
iii. |
System
reviews will be covered if after the second week of training it is determined
that a third week of training is required. |
| |
iv. |
MTS
will conduct four, 4 hour web-based classes a year for Customer’s
personnel to ensure that Customer’s personnel can remain fully trained and
current on the operation of the ODE II System. |
| |
v. |
MTS
will monitor ODE II System uptime and report such statistics to Customer on a
monthly basis. |
D-3
| |
i. |
Pharmacy
manager for detailed overview |
| |
ii. |
One
pharmacist per shift |
| |
iii. |
Two
technicians per shift |
| |
iv. |
One
person designated to perform routine maintenance |
| |
v. |
IS
system manager responsible for managing interface and pharmacy data. |
| |
c) |
Topics
to be covered in training. |
| |
i. |
Detailed
operation of system components including user interface software, pharmacy
system interface, system security, inventory management, prescription selection
process, packaging machine operation, cassette system operation, label
printer/applicator/stacker system. |
| |
ii. |
General
maintenance and troubleshooting |
| |
iii. |
Emergency
support procedures |
| |
a) |
Two
dedicated technicians per shift for routine operation. MTS is available to
assist Customer with appropriate job descriptions and evaluation forms to
help ensure the successful hiring or assignment of personnel; provided
that the decision to hire and assign such personnel is solely Customer’s
responsibility. |
| |
b) |
Available
persons designated for routine maintenance and minor
adjustments/troubleshooting |
| |
c) |
A
pharmacist responsible for managing assigned responsibilities, such as
inventory control. |
| |
The selection of personnel is a key element for a successful implementation of the ODE II
System. Customer’s identification of the proper personnel to operate the equipment
is crucial. It is imperative that the personnel who will be operating the equipment are
fully available and will provide the necessary dedicated time learning the operation of
this Machine. Customer is responsible for identifying and assigning interested and
qualified employees within the Customer organization who will ensure efficient operations
of the ODE II System. MTS will provide to management a list of recommended skill sets for
use in selecting a successful ODE II System operator. The Customer site manager must also
be involved in the installation, in-service training and ongoing review of the ODE II
System’s output. In order to fully realize the ODE II System’s benefits,
Customer hereby agrees as follows: |
D-4
| |
a) |
Customer
will review employee qualifications to ensure, to the best of its ability, that
appropriately qualified employees are matched to ODE II System operating
responsibilities. |
| |
b) |
Customer
specifically agrees that if the key designated person(s), identified to be
trained in the operation of the ODE II System are not fully available at the
time of in-service training, then MTS, in its sole and reasonable discretion,
may determine that an effective in-service training was not able to be
provided, and Customer will be responsible for the in-service training expenses
of $800 per MTS representative per day plus reasonable travel expenses. |
| |
c) |
MTS
will reschedule a new installation and training date when Customer has provided
MTS with assurances that the proper personnel will be available. In the event
that the personnel are not available for any future scheduled in-service
training, then Customer agrees to pay expenses as outlined in section 5(b)
above. |
D-5
ACCUFLEX SYSTEM
| |
a) |
MTS
personnel will perform a complete site survey to determine appropriate space
availability, recommended modifications and utility service requirements. MTS
personnel will return to the site at least one week prior to installation to
ensure that the location is ready for install. |
| |
b) |
Customer
must provide a minimum 15 ft. x 15 ft clear space with minimum of 8’ ceiling
available for the AccuFlex System. This will only provide clear space
around this Machine. Additional space will be required to provide storage
of materials and finished goods. Space requirements will be identified in
the site survey. |
| |
c) |
Site
preparation may require some carpentry, plumbing and electrical
modification by Customer at Customer’s expense to accommodate the
AccuFlex System. (Customer will need a 64” W x 84” H opening for
ingress of this Machine.) These requirements will be outlined in the site
survey. |
| |
d) |
Area
must be air conditioned and maintained at a temperature not to exceed 25°C
(77 degrees Fahrenheit). |
| |
e) |
Customer
will need a utility room or an area away from the AccuFlex System to
install the Air Compressor (supplied by the Customer). Utility room
requirements will be outlined in the site survey; provided, however some
of the following describes some of the general requirements for this area: |
| |
i. |
The
utility room or area needs to be at least eight feet (8’) by eight feet (8’)
in size. |
| |
ii. |
The
utility Room or area will need to be well ventilated. |
| |
f) |
Power
Connections for the utility room and the AccuFlex System will be outlined in
the site survey. Your facility will require the services of a licensed
electrical contractor in order to complete the following: |
| |
i. |
Utility
Room Minimum Power Requirements: |
| |
• |
A
240 VAC, 40 amp, single-phase, disconnect box mounted to the wall near the air compressor.” |
| |
ii. |
AccuFlex
System Minimum Power Requirements: |
| |
• |
A
208/230-volt, 3-wire, 60 amp, single-phase power disconnect box mounted within ten feet
(10’) of the AccuFlex System. (Your electrician will be able to determine if your
building uses 208V or 230V service.) |
D-6
| |
g) |
Air
compressor details will be outlined in the site survey. Your facility will
require the services of a licensed plumbing contractor in order to complete the
following. The air compressor operational requirements are 15 CFM @ 100 PSI.
MTS’s air compressor recommendation is as follows: |
| |
i. |
The
air compressor MUST have a refrigerated air dryer and regulator/filter.
An 110 VAC, 20 amp outlet is required for the dryer. |
| |
ii. |
Additional
required items include ball valve, flexible metal hose (1/2” by 12”),
startup kit and anti-vibration pads. |
| |
iii. |
Customer
MUST perform a weekly maintenance check on this unit including draining
the moisture from the air supply tank. MTS recommends that the Customer have an
automatic drain valve installed for this purpose. A five-eights inch (5/8”)
or larger hard copper air supply line must be run from the air compressor
location to the AccuFlex System location. |
| |
h) |
Your
compressor installer/plumber and electrician are responsible for making
purchase recommendations to assure compliance with local building and
electrical codes. |
| |
i) |
System
Communication Details. The AccuFlex System requires the following data
connections: |
| |
i. |
A
dedicated high-speed data connection to the AccuFlex System, |
| |
ii. |
A
network connection to the pharmacy operating system. |
| |
a) |
Two
dedicated technicians per shift for routine operation. MTS is available to
assist Customer with appropriate job descriptions and evaluation forms to
help facilitate the successful hiring or assignment of personnel. |
| |
b) |
Available
technicians designated for routine maintenance and minor
adjustments/troubleshooting |
| |
c) |
A
pharmacist responsible for managing assigned responsibilities, such as inventory control. |
| |
The selection of personnel is a key element for a successful implementation of the AccuFlex
System. Assigning the proper personnel to operate the AccuFlex System is crucial. It is
imperative that management dedicates personnel and uninterrupted training time for the
duration of the training process.” |
D-7
| |
Customer is responsible for identifying and assigning interested and qualified employees within
the organization who will ensure efficient operations of the AccuFlex System. The site
manager must also be involved in the installation, in-service training and ongoing review
of this Machine’s output. In order to fully realize the AccuFlex System’s
benefits, Customer hereby agrees as follows: |
| |
a) |
Customer
will review employee qualifications to ensure, to the best of its ability,
that appropriately qualified employees are matched to AccuFlex System
operating responsibilities. |
| |
b) |
The
Customer specifically agrees that if the key designated person(s),
identified to be trained in the operation of the AccuFlex System are not
fully available at the time of in-service training, then MTS, in its sole
and reasonable discretion, may determine that an effective in-service
training was not able to be provided, and the Customer will be responsible
for the in-service training expenses at $800 per MTS representative per
day plus travel expenses. |
| |
c) |
MTS
will reschedule a new installation and training date when the Customer has
provided MTS with assurances that the proper personnel will be available.
In the event that the personnel are not available for any future scheduled
in-service training, then the Customer agrees to pay expenses as outlined
in Section 3(b) above. |
| |
a) |
Training
is anticipated to require 2 weeks to complete: |
| |
i. |
During
the first week, training will include system security, cassette inventory and
maintenance (this will take 3 to 4 days depending on the size of the
formulary), card, blister and label inventory and general operation. |
| |
ii. |
During
the second week, training will include, daily operation, report generation,
system cleaning and general maintenance. |
| |
iii. |
System
reviews will be covered if after the second week of training it is determined
that a third week of training is required. |
| |
i. |
Pharmacy
manager for detailed overview |
| |
ii. |
One
pharmacist per shift |
| |
iii. |
Two
technicians per shift |
| |
iv. |
One
technician designated to perform routine maintenance |
| |
v. |
IS
system manager responsible for managing interface and pharmacy data. |
D-8
| |
c) |
Topics
to be covered in training |
| |
i. |
Detailed
operation of system components including user interface software, pharmacy
system interface, system security, inventory management, prescription selection
process, packaging machine operation, cassette system operation, label
printer/applicator/stacker system. |
| |
ii. |
General
maintenance and troubleshooting. |
| |
d) |
Emergency support
procedures |
D-9
ADDENDUM E
Delivery Schedule
This
Addendum E is attached to and made a part of the Sales and License Agreement
by and between MTS Medication Technologies, Inc. and Omnicare, Inc. dated May 7,
2007 (the "Agreement"). Capitalized terms not otherwise defined in this Addendum E will
have the meaning given in the Agreement.
|
|
| Hub |
ODE II Delivery Dates |
|
|
| [*] |
Week of 6/4/2007 |
|
|
| Hub 2 |
Week of 9/10/2007 |
|
|
| Hub 3 |
Week of 10/1/2007 |
|
|
| Hub 4 |
Week of 10/22/2007 |
|
|
| Hub 5 |
Week of 11/12/2007 |
|
|
| Hub 6 |
Week of 1/14/2008 |
|
|
| Hub 7 |
Week of 2/4/2008 |
|
|
| Hub 8 |
Week of 2/25/2008 |
|
|
| Hub 9 |
Week of 3/17/2008 |
|
|
| Hub 10 |
Week of 4/7/2008 |
|
|
| Hub 11 |
Week of 4/28/2008 |
|
|
| Hub 12 |
Week of 5/19/2008 |
|
|
| Hub 13 |
Week of 6/9/2008 |
|
|
| Hub 14 |
Week of 6/23/2008 |
|
|
| Hub 15 |
Week of 7/7/2008 |
|
|
| Hub 16 |
Week of 7/21/2008 |
|
|
|
|
| Hub |
AccuFlex Delivery Dates |
|
|
| [*] |
8/6/2007 |
|
|
| Hub 2 |
9/24/2007 |
|
|
| Hub 3 |
11/28/2007 |
|
|
| Hub 4 |
1/21/2008 |
|
|
| Hub 5 |
3/10/2008 |
|
|
| Hub 6 |
4/20/2008 |
|
|
| Hub 7 |
6/16/2008 |
|
|
| Hub 8 |
7/26/2008 |
|
|
E-1
*CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
