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EXHIBIT 10.26
DISTRIBUTION AGREEMENT
This AGREEMENT ("Agreement") is made and entered into this 19th day of
December 1996, (this "Effective Date") by and between
BioLase Technology, Inc., with its principal place of business at 000 Xxxxx
Xxxxxxxx, Xxx Xxxxxxxx, Xxxxxxxxxx 00000, U.S.A., a Delaware corporation
hereinafter referred to as "BioLase"
and
Orbis High Tech Dental GmbH, with its principal place of business at Xxxxxxxxx
00, 00000 Xxxxxxxxx, Xxxxxxx, a German company with limited liability
hereinafter referred to as "OHT"
Whereas, BioLase has developed laser systems and accessories, and
desires to market said products in the Federal Republic of Germany
("Territory").
Whereas, OHT has experience in marketing Dental products and desires to
be a distributor of BioLase products for dentistry in the Territory.
Now, therefore, in consideration of the foregoing recitals and of the
mutual covenants and conditions contained herein, the parties agree as follows:
1. PRODUCTS AND SUBJECT-MATTER OF THE AGREEMENT
The products, accessories and parts covered by this Agreement are
listed in Exhibit A to this Agreement as it may be amended from time to time at
the mutual con-
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The Registrant considers certain portions of this Agreement to be confidential
and has omitted them pursuant to Rule 24b-2 promulgated under the Securities
Exchange Act of 1934. The confidential portion has been filed with the
Securities Exchange Commission pursuant to Rule 24b-2.
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sent of the parties (the "Covered Products"). BioLase shall furthermore grant a
first option to OHT to distribute within the Territory any new Dentistry
products which may be developed or distributed by BioLase at similar or more
favorable conditions as those granted to other distributors of the new Dentistry
products. Should BioLase have a valid opportunity to distribute new Dentistry
products in the Territory, it will notify OHT and within thirty (30) days of
such notice OHT will notify BioLase of its intention.
2. TERM
The term of this Agreement shall commence on the Effective Date and
shall end upon expiry of the three years period beginning with the first order
of OHT, however, not later than on 1 February 1997. The Agreement may be renewed
by mutual consent of the parties.
3. OBLIGATIONS OF THE PARTIES
(1) During the term of this Agreement OHT undertakes
a) to arrange for the import of the Covered Products into the Territory
and to bear any and all expenses relating thereto, e.g. customs,
duties, tariffs, import taxes or other amounts, charges, costs or
expenses payable on account of transportation or handling (F.O.B. San
Clemente); OHT shall bear any amounts, charges, costs, expenses, fees
or taxes due on account of any income of OHT pursuant to this
Agreement;
b) to accept the Covered Products according to its Orders as well as to
perform an initial inspection and if appropriate calibrations and/or
adaptations as well as repair works; OHT shall bear any costs or other
expenses caused by the return transport of Covered Products that have
been unduly rejected by OHT for alleged defects;
c) to immediately inform BioLase as soon as OHT becomes aware of any
change relating to statutory and/or regulatory requirements for the
distribution of the Covered Products in Germany so as to enable BioLase
to comply with
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pertinent legal requirements (e.g. permits relating to the type of
construction (Bauartzulassungen) etc.);
d) to perform all necessary repair and adaptation work related to
warranty claims;
e) to provide Biolase with a report as specified by Exhibit B about the
installation of each laser;
f) to ensure training of the dentists for the use of the Covered
Products;
g) to provide prompt warranty and out of warranty repair and
maintenance services to the end users and to send at OHT's expense and
option repair technicians as required to such location within Germany
as designated by BioLase for training in service and repair of Covered
Products; BioLase will at its own expense regularly, however, not more
than twice a year send an experienced repair and maintenance trainer to
Germany;
h) to exhibit the Covered Products at major trade shows within the
Territory;
i) to have on stock and distribute literature, technical manuals,
clinical research, procedural guidelines and other materials regarding
the Covered Products and specifications which are reasonably necessary
to develop and maintain effective distribution of the Covered Products
and customer service and support programs as supplied from time to time
by BioLase pursuant to section 3(2)f) hereof;
j) to translate literature and marketing material pertaining to the
Covered Products into the German language.
(2) During the term of this Agreement BioLase undertakes
a) to inform OHT about any intention to introduce a new dental product
in Germany, to negotiate in good faith with OHT on the terms and
conditions of a distribution arrangement for any such product in the
Territory;
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b) [*];
c) to give thirty (30) days notice to OHT on any price changes. Such
price changes do not apply to orders dispatched by OHT prior to the
above notification. Such price changes may not be made prior to the
first anniversary of the agreement;
d) to make mutually agreeable available research equipment and an
annual research budget not to exceed [*] to participate in not more
than four (4) universities selected by Biolase after consultation with
OHT. The parties have to agree upon the research projects to be
financed by means of the above research budget;
e) to offer technical and personal support for selected trade shows.
Each party is, however, obliged to bear the costs relating to its own
staff. Biolase will attend in joint efforts every two (2) years at the
IDS for the purpose of marketing its products with OHT. The
contribution of BioLase for the booth at the IDS will not exceed [*].
f) to make available to OHT all of BioLase's documents - literature,
technical manuals, clinical research, procedural guidelines - which
might support OHT's marketing efforts.
4. DISTRIBUTION
(1) BioLase hereby grants to OHT the exclusive rights, subject to the provisions
of Section 5 below, to distribute the Covered Products in the Territory during
the term of this Agreement.
(2) OHT is authorized to establish sub-distributors or sell to persons other
than end users; the parties understand and agree that the minimum purchase
requirements shall be an obligation of OHT and if not satisfied, BioLase shall
have the option to terminate
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* The Registrant considers this portion of the Agreement to be confidential and
has omitted it pursuant to Rule 24b-2 promulgated under the Securities
Exchange Act of 1934. The confidential portion has been filed separately
with the Securities Exchange Commission pursuant to Rule 24b-2.
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exclusivity in which event the exclusive rights of sub-distributors hereunder
shall also be terminated.
(3) Nothing in this Agreement shall be construed to preclude BioLase from
selling, leasing or otherwise marketing any of the Covered Products to any
customer, including but not limited to end users, original equipment
manufacturers and other distributors outside the Territory. OHT shall refrain,
outside the Territory and in relation to the Covered Products, from seeking
customers, from establishing any branch, and from maintaining any distribution
depot.
(4) BioLase grants OHT a right of first refusal to acquire exclusive
distribution in the following countries: Switzerland, Benelux and Austria. It is
understood that BioLase will pursue distribution opportunities in these
countries and, should BioLase have a valid opportunity to grant distribution to
another dealer, BioLase will notify OHT and within thirty (30) days of notice
OHT will notify BioLase of its intention. Should OHT elect exclusivity, the
country will be added to this Agreement as Addendum with all terms and
conditions of this Agreement applicable.
5. ORDERS/MINIMUM PURCHASE REQUIREMENTS
(1) During the first week of each calendar month OHT will communicate to BioLase
its business plan and place its orders for the calendar month after next (e.g.
in January for March). The first order will be placed by OHT in January 1997.
(2) The minimum purchase requirements to be fulfilled by OHT are set forth in
paragraph 4 of Exhibit A to this Agreement. BioLase has the right to terminate
the agreement with immediate effect once OHT has failed to order the minimum in
a respective year within the first week of the following year, with no
obligations to OHT or any of its sub-distributors, contractors and successors.
(3) BIOLASE shall be obliged to make sure and to notify OHT that the Covered
Products ordered by OHT pursuant to sub-section (1) hereof are ready for
shipment not later than at the end of the respective calendar month for which
the order has been placed. [*]
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* The Registrant considers this portion of the Agreement to be confidential and
has omitted it pursuant to Rule 24b-2 promulgated under the Securities
Exchange Act of 1934. The confidential portion has been filed separately
with the Securities Exchange Commission pursuant to Rule 24b-2.
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6. TERMS OF PAYMENT
(1) Payment by OHT is to be made in US$ either by 30-day irrevocable Letter of
Credit or by direct wire transfer to a bank account indicated by BioLase upon
notification made by BioLase to OHT that the ordered Covered Products are ready
for shipment. OHT shall bear all banking charges connected with the payments
made in respect of the Covered Products.
(2) The transfer price per unit is set forth in Paragraph 3 of Exhibit A to this
Agreement.
7. TECHNICAL SERVICE/SPARE PARTS
(1) OHT shall make available maintenance technicians who shall be trained for
after sales services of the Covered Products. With regard to costs and expenses
Section 3(1)f) applies.
(2) Upon signature of this Agreement, OHT shall to the extent not yet available
purchase a repair kit and a set of repair instruments for the Covered Products
as well as those spare parts which are necessary for the maintenance of the
Covered Products in the Territory.
(3) [*]
(4) [*]
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* The Registrant considers this portion of the Agreement to be confidential and
has omitted it pursuant to Rule 24b-2 promulgated under the Securities
Exchange Act of 1934. The confidential portion has been filed separately
with the Securities Exchange Commission pursuant to Rule 24b-2.
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8. WARRANTIES
(1) The warranty period for Covered Products is one year from the date of the
installation of the Covered Products at the dentist's practice but in no event
longer than [*] from the date of shipment of the Covered Products by BioLase to
OHT. Spare parts are to be delivered to OHT in a timely manner and either free
of cost by BioLase if the defective Covered Product falls within the scope of
the warranty clause, or, if the warranty clause does not apply, at the customary
sales prices for distributors or at the current prices for spare parts. This
warranty clause only applies to cases of substantial defect in material or
workmanship of the Covered Products and in no event to cases of non-compliance
with statutory or other local requirements affecting the use of the product by
OHT's customers. BioLase shall have no service obligations of any kind under
this Agreement.
(2) During the warranty period, OHT may charge BioLase with the costs incurred
for repairing any Covered Products as well as any parts made available to its
customers which are covered by a BioLase warranty, provided that it forwards its
corresponding invoice to BioLase. Such invoice pertaining to a warranty claim
must be received by BioLase Technology, Inc., 000 Xxxxx Xxxxxxxx, Xxx Xxxxxxxx,
XX 00000, XXX, Tel. 000 000 000 0000, Fax 000 000 000 0000 within sixty (60)
days upon the date of performance of the repair works. Notwithstanding the
foregoing, BioLase shall not be responsible for OHT's warranty related labor
costs, except in the event that excessive repairs (100% more than usually
required for BioLase products) are necessary for a Covered Product. Regarding
all works not falling within the scope of the warranty, OHT will charge the
customer directly for its services and spare parts. Only parts delivered by
BioLase shall be used in connection with Covered Products.
(3) All parts which are the object of a warranty claim shall be returned to
BioLase in a packaging appropriate for reducing the risk of any damage during
the transport. OHT is entitled to collectively ship all such defective parts
substituted prior to the eleventh calendar day of the last month of the
respective calendar quarter to BioLase not later than on the last day of such
calendar quarter (e.g. defective parts substituted during the period from 11
December until 10 March shall be collectively shipped to BioLase not later than
on 31 March, etc.). OHT is then obliged to identify the date of the repair work,
its respective invoice number and the respective serial number of the Covered
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* The Registrant considers this portion of the Agreement to be confidential and
has omitted it pursuant to Rule 24b-2 promulgated under the Securities
Exchange Act of 1934. The confidential portion has been filed separately
with the Securities Exchange Commission pursuant to Rule 24b-2.
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Product. If such parts are not shipped as outlined above and subsequently
received by BioLase and if the aforementioned invoices are not received by
BioLase within sixty (60) days upon performance of the repair works undertaken
pursuant to the warranty clause, BioLase may freely decide whether it makes
corresponding payments. If returned parts are damaged due to inadequate
packaging, OHT shall indemnify BioLase against all costs resulting from such
damage. OHT has to return the above parts to the after-sales manager of BioLase.
(4) If Covered Products show severe defects, OHT is entitled to return these to
BioLase on BioLase's expense and BioLase will repay to OHT the original sales
price plus all costs and expenses as listed in section 3(1)a).
9. PRODUCT LIABILITY
BioLase shall hold harmless OHT against all product liability claims unless they
are caused by conduct of OHT. BioLase undertakes to underwrite a reasonable
product liability insurance and will provide OHT upon request with copies of
such insurance policy. BioLase currently maintains a product liability insurance
covering damages of up to [*] per individual case with [*] for the purpose of
covering product liability in the Territory.
10. TERMINATION OF THE AGREEMENT
(1) This Agreement terminates upon expiry of the term set forth in section 2 (1)
if no consent as to its renewal has been reached.
(2) Each party has the right to terminate the Agreement with immediate effect if
composition or bankruptcy proceedings are commenced with respect to the other
party's assets or if the other party stops its payments. In such events all
outstanding orders may be cancelled by either party.
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* The Registrant considers this portion of the Agreement to be confidential and
has omitted it pursuant to Rule 24b-2 promulgated under the Securities
Exchange Act of 1934. The confidential portion has been filed separately
with the Securities Exchange Commission pursuant to Rule 24b-2.
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11. POST-CONTRACTUAL OBLIGATIONS
(1) Notwithstanding section 10(2), all obligations arising under this Agreement
which are due to the other party and not yet performed survive this Agreement
until being performed irrespective of any termination or renewal of this
Agreement.
(2) BioLase is under an obligation to deliver spare parts to OHT for warranty
purposes for a period of [*]. The conditions of this Agreement shall apply to
such deliveries.
12. CONFIDENTIALITY
During the duration of this Agreement as well as after its termination, the
parties undertake to keep secret vis-a-vis any third party any circumstance
concerning the business or the business partners of the parties as well as any
technical or commercial information of which they shall have become aware in
connection with the performance of this Agreement.
13. TRADEMARKS: PROPRIETARY RIGHTS
BioLase hereby grants and OHT hereby accepts, a non-exclusive, non-transferable,
non-assignable, terminable and royalty-free license to use BioLase's name,
trademark(s), and logo (collectively "Proprietary Marks") solely to perform its
obligations hereunder subject to the conditions of this Agreement and solely in
connection with the Covered Products. OHT shall immediately provide BioLase with
samples of its current use of the Proprietary Marks in marketing and on the
Covered Products if BioLase so requires. OHT shall refrain from using the
Proprietary Marks if BioLase informs OHT that any actual or proposed use is, or
may be, detrimental to BioLase's investment in such Proprietary Marks or
otherwise is not approved by BioLase, in its sole discretion. All price lists,
sales, or promotional literature and other materials prepared by OHT with
respect to the Covered Products shall bear appropriate copyright and/or
trademark notices as prescribed by BioLase. OHT shall promptly inform BioLase in
writing of any known or reasonably suspected violation or infringement of
BioLase's trademark(s) or copyright(s). OHT agrees that it will not use,
register, or otherwise appropriate any name, xxxx, or logo which is similar to
or may be confused with any name,
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* The Registrant considers this portion of the Agreement to be confidential and
has omitted it pursuant to Rule 24b-2 promulgated under the Securities
Exchange Act of 1934. The confidential portion has been filed separately
with the Securities Exchange Commission pursuant to Rule 24b-2.
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xxxx, or logo licensed by BioLase hereunder. The license granted to OHT
constitutes OHT's exclusive right to use BioLase's Proprietary Marks, and OHT is
not granted a license to use any other proprietary rights of BioLase. OHT shall
at all times take all reasonable actions to protect the good name and reputation
of BioLase, the Covered Products and the Proprietary Marks. OHT shall not
change, alter, cover or remove the name, trademarks, logos, nomenclature or
instructions of any type appearing on, or that are originally shipped with or as
part of, the Covered Products. OHT may not affix any marks other than the
Proprietary Marks to the Covered Products.
14. DISPUTES, GOVERNING LAW AND VENUE
(1) The parties shall use their best endeavours to amicably settle any disputes,
controversies and claims arising under or in connection with or due to an
infringement of this Agreement. If such disputes, controversies or claims cannot
be amicably settled after consultation of the parties' managements, the courts
of Frankfurt a. M., Germany, shall have exclusive jurisdiction for all claims of
BioLase against OHT and the courts of San Clemente, California, U.S.A. shall
have exclusive jurisdiction for all claims of OHT against BioLase.
(2) The law of the Federal Republic of Germany shall apply to the validity,
construction and performance of this Agreement.
(3) Any failure of one of the parties to claim at any time from the other party
performance of the provisions of this Agreement shall not be construed as a
waiver of such party to claim performance of such provision. In the event of a
breach of any provision of this Agreement, any waiver shall be made in writing
in order to be effective and shall not be construed as a waiver of any right
arising from any future or continuing breach of such provision, of such
provision itself or of any other right resulting from this Agreement.
15. SEVERABILITY
This Agreement shall be performed and executed in its entirety. If one or more
of the provisions or parts thereof contained in this Agreement shall for any
reason be held to be invalid or unenforceable or excessively broad as to scope,
activity or subjects so as to
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be unenforceable, this Agreement shall remain in force and such provision or
parts of such provision and such other relevant terms of the Agreement shall be
changed or amended so as to achieve the utmost compliance with applicable
statutory provisions. If such provision or parts of such provision and such
other relevant terms of the Agreement cannot be changed or amended so as to
comply with the statutory provisions, it/they shall be struck from this
Agreement and this Agreement shall remain in force unless the rights of either
party are unreasonably adversely affected by the elimination of such provision
or parts of such provision and such other relevant terms of the Agreement.
16. FINAL PROVISIONS
(1) This is the entire Agreement concluded between the parties. There are no
verbal collateral agreements that are not contained in either this Agreement or
in the Exhibit 1 attached thereto. This Agreement may be changed or modified
only by an agreement in writing signed by the parties hereto.
(2) No provision of this Agreement shall be construed so as to create a
partnership, agency or fiduciary relationship between the parties.
(3) Any notice of termination or other notifications under this Agreement shall
be made in writing and may be communicated either by personal delivery,
registered mail return receipt requested, via telefax, messenger or telex and
has to be addressed to either the parties' business address or any other address
as has been notified in writing by the parties. The above notices and
notifications shall be deemed to have been made on the date of service as
established by written confirmation of receipt or other confirmation.
(4) This Agreement shall be legally binding upon the parties and their
successors and/or assigns. Any assignment of this Agreement by one party is,
however, subject to the prior written approval by the other party.
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BioLase Technology, INC Orbis High Tech Dental GmbH
San Clemente, this Oldenburg, den 6 - January, 1997
/s/ Xxxxxx X. XxXxxxx /s/ Xxxxxxxx Xxxx
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Xxxxxx X. XxXxxxx Xxxxxxxx Xxxx
CEO Geschaftsfuhrer
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EXHIBIT A
1. Covered Product
MILLENNIUM(R) BioLase's actual Er,Cr:YSGG Dental Laser
including its further modifications, e.g.
changes of components aiming at reducing
weight and/or increasing portability etc.
2. Statutory Provisions
Subject to section 3, (1) c) of this Agreement, the Covered Product will bear
the CE seal and will comply with all statutory and regulatory requirements
relating to its distribution in Germany.
3. Transfer Price of the Covered Product:
MILLENNIUM(R)
[*]
(All prices on invoices or payments are shown in US$.)
4. Minimum Purchase Requirement
[*]
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* The Registrant considers this portion of the Agreement to be confidential and
has omitted it pursuant to Rule 24b-2 promulgated under the Securities
Exchange Act of 1934. The confidential portion has been filed separately
with the Securities Exchange Commission pursuant to Rule 24b-2.
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5. [*]
6. Further Support by BioLase
From time to time, however not less than twice a year, BioLase will provide OHT
with information on research projects and newly published literature in order to
assist the mutual marketing efforts. This applies also to any description of new
clinical applications of the Covered Product to which BioLase has access. Basic
advertising material and pictures of the Covered Products will be made available
upon request.
BioLase Technology, INC Orbis High Tech Dental GmbH
San Clemente, this Oldenburg, den 6 - January, 1997
/s/ Xxxxxx X. XxXxxxx /s/ Xxxxxxxx Xxxx
---------------------------- ----------------------------------
Xxxxxx X. XxXxxxx Xxxxxxxx Xxxx
CEO Geschaftsfuhrer
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* The Registrant considers this portion of the Agreement to be confidential and
has omitted it pursuant to Rule 24b-2 promulgated under the Securities
Exchange Act of 1934. The confidential portion has been filed separately
with the Securities Exchange Commission pursuant to Rule 24b-2.
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EXHIBIT B
INSTALLATION TRACKING FORM
Customer: Millennium serial number:
Address: Date of installation:
Address: Name of installer:
Telephone:
FAX:
Primary user:
Names and positions of those receiving on-site training:
Handpiece serial number(s):
Power setting [W] Power measured [W]
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0.25
0.50
0.75
1.0
2.0
3.0
4.0
5.0
6.0
Verified spray adjustability:
Comments:
Installer signature:____________________ Date:__________
