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Exhibit 10.33
DISTRIBUTION AGREEMENT
This Agreement is made on the 12th day of November 2007 by and between Paradigm
Medical Industries, Inc., 2355 South 1070 West, Salt Xxxx Xxxx, Xxxx 00000, XXX,
x000-000-0000 (hereinafter referred to as Paradigm), and LACE Elettronica srl,
Xxx Xxx Xxxxxxx, 000 X0, Xxxx 00000, Xxxxx, x00-000-000-0000 (hereinafter,
together with its subsidiaries and representative offices referred to as LACE).
The effective date of this Agreement shall be 1 January 2008, or the date when
the product is fully completed, with all accessories and consumables, to be sold
into the North American markets, whichever comes first. The effective date for
Canada shall be effective once CSA regulatory approval is obtained from the
Canadian governmental regulatory body.
Paradigm and LACE wish to enter into a Distribution trade agreement for the
purpose of supplying product(s) modified or unmodified, in accordance with
Appendix 1, to Paradigm for the purpose of resale under tl the Paradignibrand
and through the Paradigm distribution channels in the USA and any other agreed
countries. The LACE Glaid brand, in addition to the Paradigm brand name will
appear on the product. Product branding and brand positioning will need to be
determined prior to product being brought into field.
1 Definitions
1.1 LACE products shall mean the products as defined in Appendix 1,
which will be supplied by LACE to Paradigm and by Paradigm to its
customers/distributors in the agreed countries under thec0-brand
of LACE Glaid brand and labeled as a Paradigm with an equal size
font in the following format: PARADIGM - GLAID by LACE.
1.2 Other products and territories can be included and/or added under
the terms of this agreement by means of appending to the items
listed in Appendix 1.
2 Liaison
2.1 Paradigm and LACE will each appoint a primary representative who
shall be responsible for co-coordinating the activities of the
parties.
2.2 The initial primary representatives shall be:
LACE - Mr. Gualtiero Regini Paradigm - Xx. Xxxxxxx Xxxxxxxx
3 Responsibilities of the parties
3.1 In the interests of promoting LACE products as part of Paradigm
product range, the parties agree to: a. Participate in regularly
scheduled periodic meetings to monitor the results of this
agreement; b. To jointly develop and collaborate in the
improvement and enhancement of the current product; c. To develop
enhanced versions of the current product, or to develop new
products.
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3.2 This agreement may not be modified except by agreement of both
parties in a written document signed by both parties and appended
to this agreement and shall not be unreasonably denied.
3.3 FDA 510(k) approval has been filed and obtained by LACE. If so
determined as necessary and beneficial, LACE will arrange for
Paradigm to also be named on FDA documents.
3.4 Copies of all FDA and CE regulatory documents will be provided
the Paradigm. Regulatory document updates will be provided to
Paradigm as soon as such are available and presented to LACE.
3.5 LACE will maintain patent integrity on the product(s) throughout
the life of this agreement.
3.6 Paradigm agrees to maintain individual product repair/history
files and notify LACE per FDA requirement of any adverse events
and report such to the appropriate regulatory body within the
required time frames.
4 Maintenance and installation
4.1 Warranty: LACE will provide twelve (12) months warranty from the
date of delivery to end user (purchaser) for all the LACE
products supplied to Paradigm. If faults cannot be corrected at
Paradigm's facilities or at the facilities of trained Paradigm
repair centers, the product then must be returned to LACE for
repair with freight costs being the burden of LACE. LACE will
carry out such repairs as required and return the goods to
Paradigm or to their designated agent or distributor within ten
(10) working days from the date of receiving such goods, at no
cost to Paradigm and will pay return freight costs.
4.2 LACE will provide technical and product maintenance training to
Paradigm in order for Paradigm to be able to repair products at
Paradigm's U.S.A. facility down to the individual component
level.
4.3 LACE will provide an extended cost of warranty for a second or
subsequent years to Paradigm at the initiation of this agreement.
5 Performance
5.1 The performance specification for the products as described in
Product Manuals and promotional printed material shall be the
only performance guarantee offered by Paradigm and shall be the
same performance specifications provided by LACE.
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5.2 If the performance specifications change, it will be the
responsibility of LACE to notify Paradigm of the change to
specification to any product, providing specific details
regarding the change and the impact this change will have on the
product as well as the impact this change will have on the users
of the products and their patients and in compliance with FDA
regulations and insure the product is approved by the FDA prior
to releasing the product for sale.
5.3 Paradigm, having global distribution, shall be given
consideration for product placement into countries where
Paradigm's current distribution channels express an interest in
the product. Paradigm shall have the first right of refusal for
distribution to any other country where Lace is not currently
selling or marketing the LACE Glaid product. Distribution for
additional (new) territories will be subject to reasonable new
minimum quotas. Paradigm, when granted extended distribution,
shall be allowed exclusive product distribution to Paradigm
ophthalmic and optometric product distributors in order to
provide for product consistency of Paradigm products sold by
these distributors. The Authorized Territories are indicated on
Appendix I.
5.4 LACE will provide necessary product to the regulatory agencies of
countries that require product testing by their own regulatory
bodies, at no cost to Paradigm. Such countries include China,
North Korea, Japan and others that are not specified in this
agreement.
6 Scope of Supply, Delivery, Pricing and Packaging
6.1 The standard conditions of purchase of LACE products shall apply
to all sales of all LACE products to Paradigm.
6.2 LACE will make every effort to deliver products within the
delivery times stated in Appendix 3 of this agreement. LACE will
make Paradigm aware of any problem that may cause late delivery
of the products as soon as possible and as far in advance as
possible. Paradigm will make LACE aware in advance of any
significant expected increase or decrease in product order
demand. Paradigm will notify LACE as far as possible of any
fluctuation of the estimated product delivery requirement and
LACE will use all reasonable endeavors to accommodate such
requirements. Paradigm will provide to LACE on a monthly basis a
30-day rolling forecast.
6.3 Paradigm agrees to purchase the products from LACE at the price
as specified in Appendix 2.
6.4 LACE will acknowledge all purchase orders from Paradigi i three
(3) working days from receipt of the order.
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6.5 LACE will be entitled to invoice on shipping of the products,
which will be paid by Paradigm prior to shipping. Payment to LACE
by Paradigm shall be as follows: An initial payment of fifty (50)
percent will be paid to LACE at time of delivery of product (COD)
with the fifty (50) percent balance due to LACE thirty (30) days
when product is received at Paradigm or at the designated
shipping location with proper acceptance of receipt.
6.6 Prices set out in Appendix 2 will be valid for twelve months from
the effective date. LACE will notify Paradigm six months in
advance of any price increase and will supply a new price-list at
this time. The product prices set out in Appendix 2 are in US
Dollars and are based on an established global banking exchange
in effect on January I, 2008. Pricing adjustments that may need
to be made in case of a change in competitive elements or a
change in COG are defined in Appendix 2.
6.7 Installation of the product(s) will be arranged by Paradigm its
nominated subsidiary, distributor, representative or agent, at no
cost to LACE. LACE may be contacted during product installation
to answer any questions that are unique and have not been
previously addressed. A specific contact for this purpose will be
provided by LACE.
6.8 LACE will provide the product to Paradigm as defined in Appendix
1, fully tested and fit for purpose and immediate use, wrapped in
a sealed plastic bag, supported inside a sealed cardboard box,
with the English operator's manual approved by Paradigm, suitable
for airfreight and include all parts, components and accessories
that comprise each product.
6.9 LACE will ship product directly to Paradigm international
customers when requested in order to improve delivery time and
aid cost control as well as deal with regulatory issues. Paradigm
may provide LACE with special shipping material to be used in
such shipments such as Paradigm branded packing tape and possibly
Paradigm branded boxing. If agreed to, Paradigm will provide
Paradigm brand specific labeling to be applied to LACE products
shipped directly to Paradigm customers or distributors. Paradigm
will provide instruction regarding the placement of the Paradigm
specific product labels.
6.10 LACE and Paradigm will absorb the cost of demonstration devices
that both parties agree are necessary for the proper marketing
and sales efforts of the LACE Glaid device. LACE will provide
special discounts for demonstration units at fifty (50%) percent
of regular price, $6,000, with special net-90 payment terms. It
is agreed that demo units are not to be sold for a period of one
year after receipt of the demo unit unless otherwise negotiated
and a written modification to this Agreement is provided.
6.11 Consumables - to be defined further as development is completed.
The consumables are anticipated to consist of electrodes, and/or
electrodes with wiring harness, and/or a wiring harness. Also
included in this consumable will be skin cleansing cream/lotion
and other necessary components for the LACE Glaid instrument to
be used on patients. Consumables are designed to be a package
that is used by the individual conducting the PERG exam on each
individual patient given the exam.
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6.12 Consumables - Product sales for quota requirements of the LACE
Glaid shall commence as soon as the consumable package is
completed and ready for delivery. Until the consumable package is
complete, Paradigm will make a best effort to place as many
devices as possible, providing the purchaser of the Glaid
assurance that the consumable packages will be available within a
reasonable time frame of four months or less.
7 Training
7.1 LACE shall endeavor to answer as soon as is practicable any
technical enquiries concerning the products. LACE will train
Paradigm Technical Services engineers and Paradigm designated
International Distributors, if so determined, within an agreed to
time frame of this agreement and as the need arises LACE may
determine and request needs for future training on new products
when such is necessary. Training is at no charge to Paradigm.
This training will also be made available to Paradigm's
designated repair agencies in order to provide service and repair
on a global basis. These agencies will be considered authorized
repair facilities for LACE products marketed under the
Paradigm/Dicon brand name and/or sold by Paradigm under the LACE
brand name.
7.2 Paradigm shall provide sales training on an annual basis on its
products. Such sales training may be conducted at the LACE or
Paradigm facilities or in conjunction with a trade-show or
Ophthalmic Congress where LACE will have a presence. Sales
training conducted by LACE will be at no charge to Paradigm. When
training is conducted in conjunction with a trade-show or
ophthalmic congress and both parties are participating in the
congress, the expenses of traveling, living and hotel expenses
shall be the responsibility of the individual respective parties.
8 Testing and Quality
8.1 LACE will allow Paradigm access to observe the manufacturing
process of the products relevant to this agreement. LACE will
endeavor to implement measures, procedures and tests to meet the
quality standards required by Paradigm., TUV (CE) and/or FDA
within one month of receiving written notification.
8.2 LACE will provide Paradigm with copies of all TUV Regulatory (CE)
Certificates. In addition, LACE will provide copies of all FDA
510(k) Registration certificates when they are obtained from the
U.S. Food and Drug Administration.
8.3 LACE may engage Paradigm to assist in the FDA registration
process of its products in the United States of America. When
such FDA 510(k) Registration is performed by Paradigm, all of the
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related testing results required for TUV CE certification will be
made available to Paradigm and LACE. Other required testing
results performed by Paradigm will be made available to LACE.
Cost of FDA 510(k) registration for LACE products shall be paid
by LACE to Paradigm on a per product basis and as necessary
testing and document fees are due.
8.4 Both parties agree to immediately inform the other in the event
that their ISO9001 & ISO13485 & MDD93/42/EEC 'Certification
accreditation status changes and both parties will provide each
other copies of the ISO9001 & ISO 13485 & MDD93/42/EEC
certificates.
8.5 Paradigm shall be authorized to visit the LACE facility at least
two times each year. LACE shall be authorized to visit the
Paradigm facility at least two times each year. Adequate advance
notice from either party shall be given to assure all vital
parties to these meetings will be present.
9 Terms of Termination
9.1 This agreement will last for five (5) years from the effective
date. At the end of the five (5) years representatives of the
parties will discuss the matter of continuation of the agreement
and if mutual agreement for continuation is not reached within
one hundred twenty (120) days after the passage of the above
referenced five (5) years, then the agreement is deemed
terminated. If within the aforesaid one hundred twenty (120) days
the parties mutually agree to continue the agreement, then
thereafter either party may terminate the agreement by giving
twelve months notice in writing. All outstanding orders at the
time of notification will be supplied under the terms of this
agreement and LACE will continue to fulfill all orders from
Paradigm until the aforesaid twelve month notice period has
expired. Notwithstanding anything which may be to the contrary,
the provisions of this clause 9.1 are subject to the provisions
of clause 9.2.
9.2 Either party shall be entitled forthwith to terminate this
agreement by written notice to the other if:
9.2.1 The other party commits any breach of any of the provisions
of this agreement and in the case of a breach capable of
remedy fails to remedy the same within thirty (30) days
after receipt of a written notice giving full particulars
of the breach and requiring it to be remedied.
9.2.2 Any action that is taken that is equivalent in the United
States of a receiver being appointed for the other party or
an assignment made for the benefit of creditors, or if a
petition under the equivalent of Federal bankruptcy or
reorganization action in the United States shall be filed
by or against the other party and is not dismissed within
sixty (60) days of such filing or appointment.
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9.2.2 An encumbrance takes possessions or a receiver is appointed
over any of the property or assets of that other party;
that other party goes into liquidation (except for the
purposes of amalgamation or reconstruction and in such
manner that the company resulting therefore effectively
agrees to be bound by or assume the obligations imposed on
that other party under this agreement): or that other party
ceases or threatens to cease to carry on business.
9.3 Upon termination of this agreement, each party shall promptly
return to the other all materials and other items furnished to it
by the other party before and during this agreement unless such
materials and items were purchased and paid in full.
9.4 Both parties agree to a 12-month non-compete clause that Paradigm
will abide. Paradigm agrees not to sell any other visual
electrophysiology system in competition with the LACE Glaid
device during the contract duration. LACE will provide
proprietary technical documents and technical know how to the
Paradigm in the course of the collaboration. This training
activity is provided by LACE free of charge in the perspective of
long-term business development. Therefore Paradigm shall not be
involved either directly or indirectly in development,
production, sale or advertisement of any ocular electrophysiology
product in competition with Lace Elettronica for the 12 months
following the termination of the present distribution agreement.
10 Warranty of Title
10.1 Both parties warrant that it has the right to enter into this
agreement and has sufficient right, title and interest in its
products and related documentation to make the grants and the
commitments made herein, and shall not make any commitments to
the other inconsistent herewith.
11 Relationships of the parties
11.1 Both parties are independent contractors acting for their own
accounts and are not authorized to make any commitment or
representation on the other's behalf unless authorized in writing
by the named representative.
11.2 LACE is responsible for supplying products to Paradigm are fully
compliant with all the European legislation and directives
required for CE labeling and with FDA Regulations.
11.3 LACE agrees to provide Paradigm with copies of all regulatory
documents related to Glaid including the FDA 510(k) and the CE
regulatory certificates.
11.4 LACE with the aid of Paradigm will Copyright or Trademark the
output of the Glaid device in order to provide additional
protection against unauthorized competitive product entries.
Copyright and/or Trademark will be under LACE.
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11.5 LACE is responsible for the performance and safe operation of its
products supplied to Paradigm, Paradigm's customers, Paradigm's
distributors and Paradigm's representatives.
11.6 During the course of this agreement, should the terms "partner",
"marketing partner" or "partnership" be used to describe the
cooperative trading relationship, both parties shall make clear
to third parties that these terms refer only to the spirit of
cooperation which exists between LACE and Paradigm and do not
expressly or otherwise imply partnership in the legal sense of
this term.
11.7 LACE and Paradigm shall collaborate on the marketing and product
launch costs and strategy when the Product is introduced into the
North American markets and when the product is introduced into
other markets. The level of collaboration and cost sharing shall
be determined by the needs of both parties, which may change, but
will initially include a division costs related to product
introduction, marketing and promotion. This division of cost
shall be accomplished by LACE providing a supply of low cost
Glaid instruments that can be provided to thought-leaders in the
field of glaucoma who agree to provide research and documentation
of merit on the Glaid product at extra-preferential.
11.8 It is agreed that the LACE Glaid devices currently in use at
reference sites will be allowed to remain at these reference
sites in exchange for endorsement, validation and the ability for
the Glaid product to gain greater exposure and credibility
through the use of this device by these reference sites. Should a
current reference site decide that their study and research with
the Glaid device has been concluded and that there is no longer a
need for the Glaid device, it is agreed that the device from
these specific reference sites will be provided to other
potential reference sites.
11.9 LACE agrees to provide a technical representative, at special
meetings, trade shows, product training and in other cases where
the ongoing sale and marketing of the LACE Glaid device will
benefit from the presence of a technical representative. The
expense for such will be the responsibility of LACE. The need for
a technical representative will not be unreasonably denied.
11.10 Should LACE develop or co-develop with Paradigm new and different
technology for use with Glaid or other products, the parties
would negotiation, in good faith, a new agreement for sales
volume and territory distribution for the new device.
11.11 Paradigm will continue to work with the various institutions and
doctors who are conducting research and clinical studies with the
LACE Glaid device in order to remain current with all development
and scientific progress being made to the product. The sites
where this is taking place are referred to in this Agreement, in
11.7, as reference sites.
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11.12 Paradigm agrees to have a company representative visit the
current reference sites and meet with the doctors and other
professionals conducting research, clinical studies and using the
LACE Glaid device. A reasonable effort will be made to meet with
the thought-leaders at the current reference sites prior to the
introduction of the Glaid device into the North American markets.
11.13 Cost of Goods (COG). The cost of goods are defined in Appendix 2.
11.14 Competitive Pricing: Annual review and adjustments defined in
Appendix 2.
11.15 Regulatory parts supply requirements: LACE will agree to supply
Paradigm with repair and replacement parts for a period of five
years past the term of this Agreement or the termination of the
Agreement in order to comply with the FDA regulations of medical
product maintenance.
11.16 Thought Leaders: Paradigm and LACE will agree to contact and
present the Glaid device to thought leaders, defined as noted
authority of accepted peer review publications or two or more
podium presentations at medical conferences per year, in the
field of Glaucoma. The objective will be to meet with a minimum
of one recognized thought leader per quarter with the intent of
gaining recognition and acceptance of the Glaid device.
11.17 LACE and Paradigm will agree to develop a program of "loaner"
Glaid devices to be used by industry thought leaders as the
market for the Glaid product is developed and expanded. In
addition to "loaner" Glaid devices, LACE agrees to provide
extra-preferential pricing, negotiated in good faith, to those
individuals deemed to be thought leaders and who agree to provide
research and documentation of merit on the Glaid product. This
extrapreferential pricing will be provided to Paradigm for
specific use purpose Glaid devices and will be negotiated in good
faith on a -case-by-case basis. This extra-special product
pricing shall also include pricing for at least one device,
referred to as a "loaner" that will be available, from Paradigm,
for use in case of product failure and/or for short term research
projects.
11.18 LACE shall provide Paradigm with at least one (1) loaner Glaid
device in order to support the customers who experience
out-of-box (baby) failures or product failures during the
warranty period. Paradigm has already purchased and received
delivery of two Glaid devices that are intended to be used for
demonstration and exhibit purposes. When available and not in use
for demonstrations or at exhibits, Paradigm will make these
devices available for use in case of out-of-box (baby) failures.
LACE will make available to Paradigm one (1) loaner Glaid device
after the sale of the first ten (10) Glaid devices.
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12 Miscellaneous
12.1 The parties shall inform their respective parent or controlling
companies, prior to execution hereof, of the existence, terms and
conditions of this agreement.
12.2 Neither party may assign, transfer or delegate any of the rights
or obligations set forth in this agreement without the prior
written consent of the duly authorized representative of the
other party which will not be unreasonably denied.
12.3 The failure of either party to enforce, in any one or more
instance, any of the terms or conditions of this agreement shall
not be construed as a waiver of the future performance of any
such term or condition.
12.4 Disputes arising in connection with this agreement shall be
mediated.
Any disputes arising in connection with this agreement shall be settled under
the United Nations Convention on Contracts for the International Sale of Goods
(1980) in the United Kingdom.
In witness whereof LACE and Paradigm Medical Industries, Inc. have caused this
agreement to be executed in its names by it's duly authorized representatives as
of the Effective date.
FOR AND ON BEHALF OF FOR AND BEHALF OF
Paradigm Medical Industries, Inc. LACE Elettronica
Signature:/s/ Xxxxxxx X.X. Xxxxxxxx Signature: /s/ Xxxxxxx Xxxxxx
Name: Xxxxxxx X.X. Xxxxxxxx Name: Xxxxxxx Xxxxxx
Title: President & Chief Executive Officer Title: President & Chief
Executive Officer
Date: 24 January 2007 Date: 16 /Gen/ 08
Witness: Xxxxx Xxxxxxxxx Witness: Xxxxxx Xxxxx
Sales Administrator Sales Assistant
Signature: /s/ Xxxxx XxxXxxxxx Signature: /s/ Xxxxxx Xxxxx
Sales Assistant
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