EXHIBIT 10.7
SALES AGREEMENT
BETWEEN
XXXXXX TECHNOLOGIES, INC.
AND
NORLAND MEDICAL SYSTEMS, INC.
This Sales Agreement (the 'Agreement') is entered into as of the 12th day of
May, 1997 by and between:
Xxxxxx Technologics, Inc.
00-00 00xx Xxxxxx
Xxxx Xxxxxx Xxxx, XX 00000
(hereinafter referred to as STI) and
Norland Medical Systems, Inc.
000 Xxxxxxxxx Xxxx Xxxxx
Xxxxx 000
Xxxxx Xxxxxx, XX 00000
(hereinafter referred to as Norland)
(Throughout the Agreement, STI and Norland are collectively referred to as the
'parties.')
RECITALS
WHEREAS, STI is engaged in the production and sale of digital imaging equipment,
including a bone mineral densitometry testing device, to be marketed under the
tradename 'accuDEXA(Trademark).'
WHEREAS, the parties desire that Norland shall purchase from STI, promote and
sell accuDEXA(Trademark) on an 'OEM' basis.
NOW THEREFORE, for and in consideration of the foregoing, of the mutual
covenants and undertakings contained herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties, intending to be legally bound, hereby agree as follows:
1. DEFINITIONS
As used in this Agreement, the following terms shall have the following
respective meanings:
1.1 'Product(s)' means and is limited to the accuDEXA(Trademark)
device.
1.2 'End-User(s)' means any customer(s) to whom Norland sells Product.
2. PRICE, PURCHASE TERMS, ORDERS AND SHIPMENT
2.1 Price and Other Terms
The purchase price and purchase terms set forth in Exhibit A shall apply to all
purchases of Product by Norland from STI during the effectiveness of this
Agreement.
2.2 Customizing Fee
Norland shall pay to STI a one-time fee (the 'Customizing Fee') of thirty
thousand dollars ($30,000) in connection with STI's fabrication of
accuDEXA(Trademark) devices bearing Norland's logo and/or brandname on the
device. In the event that Norland purchases from STI one hundred (100)
accuDEXA(Trademark) devices within six months of the Effective Date of this
Agreement, the Customizing Fee will be refunded by STI to Norland in the form of
a credit to be applied towards Norland's future purchases of accuDEXA(Trademark)
devices.
2.3 Placement of Orders
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Orders for Product may be placed by Norland with STI by mail or by facsimile,
and STI may reasonably rely upon the authenticity of any order so received.
For STI's administrative and Product Warranty purposes, Norland shall provide to
STI each End-User's name, address, telephone number, fax number and Product
shipment date within seven days of the shipment of a Product to the respective
End-User.
2.4 Product Shipment and Handling
STI shall use its best efforts to ship all Products ordered by Norland by the
requested shipment date, provided such requested shipment date is at least
twenty-one (21) days following the date STI receives the order.
3. DUTIES OF NORLAND
3.1 Payment for Products
Norland agrees to pay for the Product at the Purchase Price and on the Purchase
Terms set forth in Exhibit A.
3.2 Laws and regulations
Norland shall comply with all applicable laws, rules and regulations with
respect to its marketing and sale of the Product. STI shall furnish Norland
with such assistance and cooperation as may reasonably be requested in
connection with compliance with such requirements.
3.3 Technical Support and Training
Norland will provide its customers with all 'first-line' technical support
relating to the Product. Such 'first-line' support shall consist of, but is not
limited to, all Product installation, training of End-Users, receipt of End-User
telephone inquiries and on-site support.
4. DUTIES OF STI
4.1 Technical Assistance
STI shall train Norland staff to provide End-Users with first-line technical
support for the accuDEXA(Trademark). STI shall provide End-Users with
'second-line' technical assistance, which shall consist of technical assistance
by telephone. To obtain this service, End-Users must call STI at 0-000-000-0000
between the hours of 8:30 a.m. and 6:30 p.m. EST, Monday through Friday,
excluding holidays. In the event that STI personnel are not available to provide
assistance at the time of the call, STI will endeavor to return the call within
a twenty-four (24) hour period. STI assumes no obligation or liability
whatsoever for any support or advice it provides, or fails to provide, or for
any results thereof, including, but not limited to, loss of business profits and
business interruption.
4.2 Laws and Regulations
STI shall comply with all applicable laws, rules and regulations with respect to
its manufacture and sale of the Product to Norland. Norland shall furnish STI
with such assistance and cooperation as may reasonably be requested in
connection with compliance with such requirements.
5. LIMITATION OF LIABILITY AND WARRANTY
5.1 Product Warranty
STI warrants that the Product will perform substantially in accordance with the
official standard published specifications of STI.
STI warrants that, under normal and reasonable use and maintenance, the Product
shall be free from defects in materials and workmanship for (a) eighteen (18)
months from the date STI ships the Product or (b) one (1) year from the receipt
of the Product by the End-User, whichever is shorter, in accordance with STI's
then-current written Warranty.
5.2 Extended Warranty
STI's Product warranty may be extended on an annual basis, for an additional two
(2) years beyond the expiration date of the initial warranty period set forth in
Section 5.1 above, upon the payment of the sum of $545.00 per year per
accuDEXA(Trademark) device, which amount must be paid to STI within 30 days of
the expiration date of the initial warranty period.
The complete terms and conditions of STI's then-current written Warranty shall
apply and have full force and effect during the extended warranty period.
5.4 STI Option
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STI shall replace or repair any defective Product that is covered under the STI
Warranty. STI will not accept the return of any Product.
5.5 Exclusive Remedy
In the event of breach of the warranties contained in Section 5.1 above, STI's
sole liability shall be as set forth in Section 5.3 above. All repaired or
replaced Products shall be warranted for the remainder of their original
warranty periods or ninety (90) days, whichever is longer.
5.5 Limitation
STI's Warranty will not apply to a Product if its correction, repair or
replacement is required due to extrinsic causes, including, but not limited to:
(i) natural disasters, including fire, smoke, water, wind, earthquakes,
lightning, (ii) electric power failures or (iii) the neglect, misuse or other
than ordinary use of the Product; nor will STI's Warranty apply where attempted
repairs or alterations have been made to the Product by persons other than those
employed or authorized by STI.
5.6 NO CONSEQUENTIAL DAMAGES
NEITHER PARTY WILL BE LIABLE TO THE OTHER FOR ANY CONSEQUENTIAL, INDIRECT,
PUNITIVE, SPECIAL OR INCIDENTAL DAMAGES, WHETHER FORESEEABLE OR UNFORSEEABLE
BASED UPON THIS AGREEMENT (INCLUDING, BUT NOT LIMITED TO, CLAIMS FOR LOSS OF
GOODWILL, PROFITS, INVESTMENTS, USE OF MONEY OR USE OF STI'S PRODUCTS;
INTERRUPTION IN USE, STOPPAGE OF OTHER WORK OR IMPAIRMENT OF OTHER ASSETS; OR
LABOR CLAIMS), ARISING OUT OF BREACH OF EXPRESS OR IMPLIED WARRANTY, BREACH OF
CONTRACT, MISREPRESENTATION, NEGLIGENCE, STRICT LIABILITY IN TORT OR OTHERWISE,
EXCEPT ONLY IN THE CASE OF DEATH OR PERSONAL INJURY WHERE AND SOLELY TO THE
EXTENT THAT APPLICABLE LAW REQUIRES SUCH LIABILITY.
6. PROPRIETARY RIGHTS
6.1 Patents, Trademarks, Trade Names and Copyrights
STI retains all proprietary rights, patents, and trademarks for the Product.
During the term of this Agreement, Norland has the right to use all trademarks
which are or may be owned by STI in connection with the Product for the
exclusive purpose of advertising and promoting the Product. Nothing contained
herein shall be construed as a right or license, express or implied, under any
patent or copyright, or application therefor, of either party by or to the other
party. Nothing contained herein shall be construed as a waiver by Norland of its
right to enforce its pDEXA(Trademark) trademark.
6.2 Confidentiality
Norland and STI agree that all verbal and written confidential and proprietary
information regarding the other party (including, without limitation, technical
and business information) ('Confidential Information') shall be treated as
confidential, in accordance with the terms of this Section 6.3.
6.2.1 Nondisclosure
While this Agreement is in effect, and for a period of three (3) years from the
date of receipt of any Confidential Information, the receiving party shall not
use or disclose Confidential Information for any purpose whatsoever except as
may be necessary to fulfill the purpose of this Agreement and only for the
benefit of the disclosing party, and shall restrict the dissemination of such
Confidential Information to those employees and persons in the receiving party's
organization with a need to know in order to perform services to fulfill the
purposes of this Agreement, shall notify such employees and persons of the
proprietary nature of such Confidential Information, and shall not disclose to
any other person, firm, corporation or entity such Confidential Information.
6.2.2 Exclusions
The parties shall have no obligation or restriction on use with respect to any
Confidential Information which has been or is:
(A) developed by the receiving party independently and without the benefit of
Confidential Information disclosed by the disclosing party, as evidenced
by the receiving party's prior written records; or
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(B) lawfully obtained by the receiving party from a third party without
restriction and without breach of this Agreement; or
(C) generally available to the public through no fault of the receiving party;
or
(D) known to the receiving party prior to its receipt from the disclosing party,
as evidenced by the receiving party's prior written records; or
(E) approved for release by written authorization of the disclosing party; or
(F) disclosed as required or permitted by operation of law.
6.2.3 Degree of Care
Each party shall use the same degree of care to prevent disclosure of
Confidential Information received from the other party which it uses to prevent
disclosure of its own information of like character, but in no event less than a
reasonable degree of care.
6.2.4 Return of Materials
All Confidential Information shall remain the property of the disclosing
party. Upon request of the disclosing party, to be made within the period set
forth in Section 6.2.1 above, the receiving party agrees to return to the
disclosing party all documentation, regardless of form, containing any
Confidential Information received from the disclosing party, including all
copies thereof. The receiving party shall certify that it has destroyed or
returned all copies of the Confidential Information it possessed.
6.2.5 Remedies for Breach
Each party recognizes that its breach of this Agreement would cause
irreparable harm to the other party for which monetary damages would be
inadequate and that, in the event of such breach, the other party shall have, in
addition to any and all remedies at law, the right to an injunction, specific
performance or other equitable relief to prevent or redress the violation of any
obligations hereunder.
7. TERM OF AGREEMENT AND TERMINATION
7.1 Term
The 'Effective Date' of this Agreement shall be the date STI receives
approval from the Food and Drug Administration to manufacture and market the
Product. This Agreement shall continue in effect for a period of one (1) year
from the Effective Date unless terminated earlier by mutual agreement of the
parties or pursuant to the terms thereof. This Agreement shall be automatically
and successively renewed for an indefinite number of successive one-year terms,
provided that either party may terminate this Agreement effective at the end of
any one-year term by written notice to the other not less than 90 days nor more
than 180 days prior to the end of such term.
7.2 Termination
In the event that Norland does not order sixty (60) accuDEXA(Trademark)
devices within any single calendar quarter commencing after the first
anniversary of the Effective Date, STI may terminate this Agreement by sending
to Norland, within thirty (30) days of the end of the relevant calendar quarter,
60-day prior written notice of termination. For the purposes of this Section
7.2, 'calendar quarter' shall refer to the periods of January-March, April-June,
July-September and October-December.
7.3 Terminable Events
Notwithstanding the termination provisions stated in Sections 7.1 and 7.2
above, either party shall be entitled to terminate this Agreement forthwith by
notice in writing to the other party in the event that any of the following
occurs:
(A) If either party enters into bankruptcy or debt reorganization proceedings.
(B) If a receiver is appointed over any of the other party's property.
(C) If either party discontinues conducting business.
7.4 Termination Rights and Obligations
7.4.1 Payments and Unfilled Orders. If this Agreement expires or is terminated
pursuant to Section 7.2 above, all amounts owed by Norland to STI shall continue
to be due, all unfilled orders for Products by Norland specifying shipment dates
within sixty (60)
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days after termination shall be filled, and STI, at its sale option, may select
whether or not to fill any outstanding orders of Norland which specify shipment
dates beyond sixty (60) days after termination, without any damage claim by
Norland in the event STI selects not to fill any such orders.
7.4.2 STI's Option. If this agreement is terminated pursuant to Section 7.3
above, all amounts owed by Norland to STI shall continue to be due, and STI, at
its sole option, may select whether or not to fill any outstanding orders of
Norland, without any damage claim by Norland in the event STI selects not to
fill any or all outstanding orders.
7.4.3 Proprietary Rights. The expiration or termination of this Agreement does
not terminate any confidentiality provisions set forth herein, or arising
hereunder. Furthermore, upon such event, Norland agrees to immediately
discontinue use of any STI trademarks, trade names, advertising materials, sales
literature, operating and service manuals, work products or other materials and
will promptly return to STI any such materials in its possession.
7.4.4 No Liability. Neither party, by reason of the termination or expiration
of this Agreement, shall be liable to the other because of any loss of
anticipated sales or prospective profits or because of expenditures or
investments relating to the performance of this Agreement or the goodwill
created in the course of performance of this Agreement.
7.4.5 Survival. The provisions of Sections 5, 6 and 7 and 8.9 of the Agreement
survive the expiration or termination of this Agreement.
8. MISCELLANEOUS
8.1 STI Identification on Product
All accuDEXA(Trademark) devices sold by Norland pursuant to the terms of
this Agreement shall bear the following on the exterior of the Product: STI's
logo and the words, 'Made for Norland Medical Systems, Inc. by Xxxxxx
Technologies, Inc.'
8.2 Notice
Except as specifically provided otherwise in this Agreement, all notices to
be given hereunder shall be in writing, given either by personal delivery, by
first class mail, or by facsmile transmission, and sent to the respective
parties at the addresses and/or facsimile numbers set forth in this Section 8.2.
The date on which any such notice is personally delivered or, if such
communication is transmitted by first-class mail or by facsimile transmission,
the date on which it is received by the addressee shall be deemed to be the
effective date of such communication. Each party shall promptly advise the
other, in writing, of any changes in its address or facsimile number.
All such communications to STI shall be addressed to:
Xxxxxx Technologies, Inc.
00-00 00xx Xxxxxx
Xxxx Xxxxxx Xxxx, Xxx Xxxx 00000
Att: Director of Sales & Marketing
Fax: (000) 000-0000
All such communications to Norland shall be addressed to:
Norland Medical Systems, Inc.
000 Xxxxxxxxx Xxxx Xxxxx
Xxxxx 000
Xxxxx Xxxxxx, XX 00000
Att: President
Fax: (000) 000-0000
8.3 Complete Agreement
This Agreement contains the entire understanding among and between the
parties and supersedes any prior written or oral agreements between them
respecting the subject matter contained herein. There are no representations,
agreements, arrangements, or understandings, oral or written, between the
parties relating to the subject matter of this Agreement that are not fully
expressed herein.
8.4 Attorney's Fees
The prevailing party in any action to enforce or interpret or relating to
this Agreement shall be entitled to recover, from the other party, reasonable
attorney's fees, costs and necessary expenses.
8.5 Amendment or Alteration
This Agreement may not be altered or amended except in writing signed by
both parties.
8.6 Severability
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If any provisions of this Agreement shall be declared to be invalid, void,
or unenforceable by a properly appointed or selected arbitrator or by a court of
competent jurisdiction, the remaining provisions shall continue in full force
and effect.
8.7 Governing Law: Jurisdiction and Venue
This Agreement shall be construed and governed by the laws of the State of
New York, and any or all disputes arising hereunder shall be adjudicated in the
State and City of New York. The parties irrevocably and unconditionally agree to
invoke and/or submit to the exclusive jurisdiction of any United States federal
or New York state court sitting in New York City in any action or proceeding
relating to this Agreement. The parties further irrevocably and unconditionally
agree to waive any objections to venue of any such action or proceeding brought
in such court or the fact that such court is an inconvenient forum.
8.8 Place of Agreement
This Agreement is deemed to be entered into in the State of New York and
City of New York.
8.9 Indemnification and Insurance
Norland shall indemnify and hold STI harmless from any and all claims,
demands, actions, liabilities, damages or expenses (including, without
limitation, reasonable attorney's fees and expenses) arising from or relating to
(i) an inaccurate or misleading advertisement or other representation by Norland
or Norland's agent not authorized by STI, (ii) any inaccurate or misleading
advice regarding the use or maintenance of the Product by Norland or Norland's
agent not authorized by STI, (iii) any negligent handling or installation of the
Product by Norland, (iv) any alterations of any kind made to the Product by
Norland or Norland's agent, or (v) any material breach by Norland of any of its
obligations hereunder.
STI shall indemnify and hold Norland harmless from any and all claims,
demands, actions, liabilities, damages or expenses (including without
limitation, reasonable attorney's fees and expenses) arising from or relating to
patent infringement, product liability, failure of STI's products to perform as
specified, or any material breach by STI of any of its obligations hereunder.
STI acknowledges that it maintains insurance coverage related to product
liability claims (the 'Policy') in the amount of $1 million per occurrence,
annual aggregate maximum coverage in the amount of $2 million, and umbrella
coverage in the amount of $10 million, and that, as a distributor of the
Product, Norland is covered under the Policy.
8.10 Assignment
This Agreement may not be assigned by either party without the prior
written consent of the other.
8.11 Successors
This Agreement and all of its terms are fully effective and binding, to the
extent permitted by law, on the successors and permitted assigns of both
parties.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their duly authorized officers as of the date first written above.
XXXXXX TECHNOLOGIES, INC.
By: /s/ Xxxxx Xxxxxx
...................................
Xxxxx Xxxxxx
President & C.E.O.
00-00 00xx Xxxxxx
Xxxx Xxxxxx Xxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
NORLAND MEDICAL SYSTEMS, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
...................................
Xxxxxxx X. Xxxxxxx
President & Chairman
000 Xxxxxxxxx Xxxx Xxxxx
Xxxxx 000
Xxxxx Xxxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
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