Exhibit 10.1
[Confidential price and quantity information has been redacted]
DISTRIBUTION AGREEMENT
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This DISTRIBUTION AGREEMENT ("Agreement"), effective as of February 24, 2009
("Effective Date"), is entered into by and between Competitive Technologies,
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Inc. ("CTT"), a Delaware corporation having a place of business at:
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Competitive Technologies, Inc.
000 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
And Xx. Xxxxxxxx Xxxxxxxx of Life Episteme srl ("Distributor"), an Italian
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corporation with its principal place of business at:
Xx. Xxxxxxxx Xxxxxxxx
Life Episteme srl
Xxx Xxxxxxx 00
00000 Xxxx RM ,Italy
CTT and Distributor may each be referred to as a "Party" and collectively as the
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"Parties".
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Witnesseth
WHEREAS, CTT wishes to appoint Distributor as the exclusive sales agent for
certain identified products, and Distributor desires to provide such services to
CTT, in each case, on the terms and conditions set forth herein.
NOW THEREFORE, in consideration of the mutual promises and covenants set forth
herein, the Parties agree as follows:
1.0 RIGHT TO DISTRIBUTE OR SUB DISTRIBUTE
1.1 CTT hereby grants Distributor the right to purchase from CTT, and
the exclusive right to distribute or sub-distribute solely within the
Territory (as defined hereinafter), the products identified on
Schedule 1 hereto (the "Product(s)"). "Territory" shall mean the
countries identified on Schedule 3.
1.2 Distributor shall purchase the Product(s) for resale from CTT at
the price set forth on Schedule 1 hereto, as such Schedule may be
amended after two (2) years of the effective date of this Agreement in
accordance with the terms hereof.
1.3 All orders for Product(s) by Distributor shall be Ex Works
Manufacturer. GEOMC Co. Ltd. of Korea (formerly Daeyang E&C)
("Manufacturer") in Seoul, South Korea is the Manufacturer.
1.4 CTT's and Manufacturer's replacement warranty for normal use with
no physical damage to the unit will be for a period of 12 months.
EXCEPT FOR THE FOREGOING, CTT MAKES NO REPRESENTATIONS OR WARRANTIES
WITH RESPECT TO ANY PRODUCTS, EXPRESS, IMPLIED OR STATUTORY, INCLUDING
WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY, NON-INFRINGMENT OR
FITNESS FOR A PARTICULAR PURPOSE. All purchases of the Product(s) by
Distributor from CTT shall be paid in US Dollars (USD) by wire
transfer of immediately available funds due to CTT at Bank of America,
with the purchase price due at the time of order by Distributor.
1.5 All sales to Distributor are final. Any damaged Product(s) with
the Manufacturer's defects must be returned to the Manufacturer, with
any such return being subject to the terms of the applicable one year
product warranty.
1.6 Distributor agrees to (i) actively and continually market and
promote the Product(s) to appropriate potential customers; (ii) use
best efforts to promote the sale of the maximum amount of Product(s);
and (iii) accurately advise potential customers of the selection, use
and functionality of the Product(s). Distributor will keep CTT
informed as to conditions that might affect the sale of the Product(s)
in the marketplace.
1.7 Distributor will refrain from taking actions that may tarnish or
cause people to hold in poor regard CTT or the Product(s). Distributor
shall establish and maintain a marketing program and a sales force,
customer training and technical service representatives, who are
properly trained in all aspects of the distributed Product. CTT shall
have the right to review and discuss with Distributor at reasonable
times and with reasonable frequency all aspects of the marketing and
service program. Distributor shall be solely responsible for
establishing the terms of sale (subject to any limitations set forth
herein) including, without limitation, the sale price of the
Product(s), consummating the sale of any Product(s), collecting the
sale price, and for providing any post-sale service that may be
necessary with the exception of manufacturer warranty claims, which
shall be handled by the Manufacturer.
1.8 To assist Distributor in marketing the Product(s), CTT shall
provide the Distributor with all the technical, medical and economical
information regarding the MC-5A and assist the Distributor in the
drafting of a comprehensive business model. CTT warrants that any
scientific, medical and clinical information provided by CTT to the
Distributor regarding the pain management device is accurate. CTT may
provide Distributor with such marketing materials as CTT may deem
appropriate. CTT shall have the right to revise such marketing
materials in its sole discretion at any time and to provide such
revised marketing materials to Distributor for all future use.
Distributor shall have no obligation to use such materials and any use
of such materials is at Distributor's own risk.
1.9 Distributor shall provide a written sales summary of actual and
forecasted sales quarterly to CTT (each a "Quarterly Report"). Each
Quarterly Report shall be provided to CTT on or before the fifteenth
(15th) calendar day of the next quarter.
1.10 The authority granted to Distributor is to distribute or
sub-distribute those Product(s) it has purchased from CTT solely
within the Territory. Moreover, Distributor shall not sell Product(s)
to purchasers outside the Territory or to purchasers inside or outside
the Territory that Distributor believes or has reason to believe are
primarily intended for use or distribution outside the Territory
without written permission from CTT. Distributor shall not have, nor
shall it hold itself out as having, either express or implied
authority to accept orders for the Product(s) on behalf of CTT or to
make contracts in the name of CTT or any other party.
1.11 Distributor is not an employee of CTT or any subsidiary of CTT,
and shall not represent himself to be, nor permit himself to be
represented as, anything other than a Distributor of the Product(s).
Distributor does not and shall not have any power to, nor shall it
represent that it has any power to, bind CTT or create or assume any
obligation on behalf of CTT.
1.12 Distributor shall not make any representations or warranties with
respect to the Product(s) beyond the product warranties given by the
Manufacturer of the Product(s). Distributor will comply, at all times,
with all foreign, federal, state and local laws and regulations
applicable to it, including without limitation, all applicable laws
relating to the marketing, sale and distribution of medical devices
within the Territory. At no time shall Distributor engage in any
high-pressure or unethical sales techniques.
2.0 TERM OF AGREEMENT
2.1 Subject to the other provisions of this Agreement, the term of
this Agreement shall be for an initial period of three (3) years from
the Effective Date (the "Initial Term"); provided, that the term shall
be automatically extended for additional twelve month periods (each a
"Renewal Term," and, collectively with the Initial Term, the "Term")
so long as Distributor has purchased from CTT (and not returned)
Product(s) equal to or in excess of the applicable Product Minimums,
as set forth in Schedule 2 hereto, during each Contract Year for the
just ended Contract Year (i.e., the Initial Term or Renewal Term, as
applicable). Once given, a continuation notice shall become an
irrevocable obligation of Distributor. Each of the Initial Term and
each Renewal Term may be referred to as a "Contract Year." For
clarity, each Contract Year will correspond with an identical period
referred to as either the Initial Term or a Renewal Term.
Notwithstanding the foregoing, Distributor may prevent any
auto-renewal of the Term by providing CTT with written notice of its
intent to terminate this Agreement at least ninety (90) days prior to
the end of the then-current Term.
2.2 Either Distributor or CTT may terminate this Agreement at any
time if the other Party shall breach its obligations hereunder;
provided, however, that the non-breaching Party shall give the
breaching Party written notice of such breach, and the breaching Party
shall have thirty (30) calendar days after receipt of such notice to
cure such breach. If such breach is cured to the reasonable
satisfaction of the non-breaching party during such period, then this
Agreement shall continue in full force and effect. If such breach is
not cured to the reasonable satisfaction of the non-breaching party
during such period, then this Agreement shall terminate effective upon
the close of business on the last day of such period.
2.3 In the event CTT ceases to have the right to sell any of the
Product(s), either in whole or in part, Distributor's right to sell
such Product(s) shall immediately cease, and CTT shall have no
liability whatsoever to Distributor arising from such cessation of
sales. To the extent such cessation is to less than all of the
Product(s), this Agreement shall continue with respect to the
remaining Product(s) in accordance with its terms.
3.0 MINIMUM SALES OBLIGATIONS
3.1 Distributor shall be obligated to purchase from CTT that number
of Product(s) during each Contract Year as is set forth in Schedule 2
hereto (for each such Contract Year, the "Product Minimums"). The
Product Minimums for each of the first three (3) Contract Years are
set forth in Schedule 2 hereto. The Product Minimums for Contract Year
3 and beyond shall be set by CTT in good faith taking into account the
number of sales and the Quarterly Product Minimums (on both a
quarterly and annual basis) for the prior Contract Year and shall be
provided to Distributor at least ninety (90) days prior to the
beginning of such new Contract Year.
3.2 The first Contract Year will start after this Agreement is signed
and at the expiration of the XX day ramp up period following the
effective date of the Agreement. Following this event, the "Selling
Clock Starts Ticking" for the minimums required in the Contract Years.
Immediately after this Agreement is signed within XX days and after
the import license approval is released to the Distributor from the
concerned authorities the Distributor will pre-pay for XX units from
CTT at XX (USD) per unit.
The Distributor shall submit to CTT for approval a XX years
comprehensive business plan within XX months from the effective date
of the Agreement, which will then indicate the targeted sales for Year
1, 2, 3, 4, 5. The Distributor shall anyway agree to purchase XX
devices within 12 months from the approval to import and sell in the
concerned territories and XX devices within the end of Year
3 from that approval to import and sell. All the details will be
displayed in the business plan.
3.3 For continued exclusivity, the annual minimums will have a
tolerance factor of XX of the Contract Year minimum units. For
example; Contract Year 1 must be at least XX units to maintain
exclusivity.
3.4 This Agreement and Exclusive Distributor status shall be
automatically extended for additional XX month period so long as the
Yearly Product Minimums as set forth in Schedule 2 are achieved.
4.0 COMPENSATION
4.1 As between CTT and Distributor, subject only to CTT's right to
its purchase price from Distributor, Distributor shall be entitled to
retain one hundred percent (100%) of all amounts received from the
purchaser or sub-distributor of a Product. The Distributor shall
organize, through its sub-distributors too, at its own expenses and
within the end of Year 1, a roll out and marketing conference in each
selected territory in order to present and launch the MC-5A, at which
the presence of Xxxx. Xxxxxxx and CTT's top official shall be
required. All travel, promotional, entertainment, taxes and other
expenses incurred by Distributor in its efforts to market and promote
the Product(s) will be the sole obligation of Distributor, and
Distributor will not be entitled to reimbursement of any kind from
CTT.
5.0 CONFIDENTIALITY; NON-DISPARAGEMENT
5.1 Confidentiality.
A. As used herein, "Confidential Information" means private,
confidential, trade secret or other proprietary information
(whether or not embodied or contained in some tangible form)
relating to any actual or anticipated business of CTT or its
clients, including, without limitation, any information which, if
kept secret, will provide CTT or its clients with an actual or
potential economic advantage over others in the relevant trade or
industry, such as, but not limited to: business data (including
cost data), price lists, strategies and compensation.
Confidential Information shall not include information that: (i)
at the time of first disclosure by CTT to Distributor was already
in the possession of Distributor, as shown by written records
existing at such time; (ii) is independently made available to
Distributor on a non-confidential basis by an unrelated and
independent third party whose disclosure does not constitute a
breach of any duty of
confidentiality owed to CTT or its clients; or (iii) is generally
available to the public in a readily-available document.
B. Except as required in considering a potential business
relationship with CTT or its clients, in connection with an
actual business relationship with CTT or its clients, or with the
prior written authorization of CTT, Distributor shall not
directly or indirectly use, disclose, disseminate, publish or
otherwise reveal any Confidential Information for the benefit of
any party other than CTT or its clients. In the event that
Distributor is required by legal process (court order, subpoena,
etc.) to disclose Confidential Information, Distributor shall
first (unless expressly prohibited by law) provide CTT with
notice and the opportunity to take appropriate action to preserve
the confidential nature of the information; provided, that in the
event CTT elects not to seek an order securing, or is
unsuccessful, in whole or in part, in securing, the
confidentiality of the information to be disclosed, Distributor
shall limit such disclosure to the minimum amount of Confidential
Information necessary to comply with the applicable legal process
as established by the written opinion of Distributor's counsel.
C. Upon termination of Distributor's discussions with CTT
concerning a potential business relationship or the termination
of any actual business relationship, in either case, for any
reason, or upon CTT's earlier request, Distributor shall return
to CTT or destroy all Confidential Information and any and all
copies or reproductions thereof, and any documents or materials
containing Confidential Information, in any case, whether
tangible or intangible, in Distributor's possession or control.
5.2 Non-Disparagement. Distributor acknowledges that any disparaging
comments by Distributor or its principals, employees or agent against
CTT or the Product(s) is likely to substantially harm the business
reputation of, and depreciate the value of, CTT. As such Distributor
agrees to act in good faith so as not to harm the business reputation
of CTT or the Product(s) in any way, which includes, Distributor's
agreement not to defame or publicly criticize the services, business,
integrity, veracity or reputation of the Product(s) or CTT, its
officers, directors, managers, members, employees, affiliates or
agents thereof, in either a professional or personal manner. The
provisions of this Section shall survive any termination or expiration
of this Agreement for a period of five (5) years.
CTT acknowledges that any disparaging comments by CTT or its
principals, employees or agent against Distributor or the Product(s)
is likely to substantially harm the business reputation of, and
depreciate the value of, Distributor. As such CTT agrees to act in
good faith so as not to harm the business reputation of Distributor or
the Product(s) in any way, which includes, CTT's agreement not to
defame or publicly criticize the services, business, integrity,
veracity or reputation
of the Product(s) or Distributor, its officers, directors, managers,
members, employees, affiliates or agents thereof, in either a
professional or personal manner. The provisions of this Section shall
survive any termination or expiration of this Agreement for a period
of five (5) years.
6.0 CONFLICT OF INTEREST
6.1 Distributor shall not hire any officer or employee of CTT to
perform any service covered under this Agreement.
6.2 Distributor shall not sell or distribute identical products in
the territories and listed in Schedule 1 under this Agreement.
7.0 ASSIGNMENT OR SUBCONTRACTING
7.1 Distributor may assign or transfer this Agreement or any interest
therein or claim hereunder, or subcontract any rights hereunder, with
the prior written approval of CTT. CTT will not unreasonably withhold
consent to such assignment or transfer, the terms and conditions of
this Agreement shall be binding upon any assignee or transferee
8.0 INDEMNIFICATION; LIMITATION OF LIABILITY
8.1 CTT shall provide compensation given proper use of the device and
evidence that so far all the treated patients did not suffer from any
collateral damage. Distributor will defend, indemnify, reimburse and
hold CTT harmless from and against any and all liabilities, losses,
damages and costs, including reasonable attorneys' fees (collectively,
"Losses"), resulting from or arising out of, or resulting from or
arising out of third party claims based upon, (a) the grossly
negligent, intentionally wrongful or illegal acts or omissions of
Distributor; or (b) any actions of Distributor beyond its authority
granted hereby including the making of any representations with
respect to Product(s).
8.2 EXCEPT AS PROVIDED UNDER SECTION 8.1 OR WITH RESPECT TO BREACHES
OF THE CONFIDENTIALITY PROVISIONS OR SCOPE OF DISTRIBUTOR GRANT, IN NO
EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY INCIDENTAL,
INDIRECT, PUNITIVE, CONSEQUENTIAL OR SPECIAL DAMAGES ARISING OUT OF OR
IN CONNECTION WITH THE AGREEMENT REGARDLESS OF WHETHER SUCH CLAIMS ARE
ASSERTED IN CONTRACT, TORT, WARRANTY, STRICT LIABILITY, NEGLIGENCE, OR
OTHERWISE, EVEN IF ADVISED
OF THE POSSIBILITIES OF SUCH DAMAGES. IN NO EVENT SHALL THE AGGREGATE
LIABILITY OF CTT ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT
(OR ANY BREACH OR VIOLATION HEREOF) EXCEED THE AMOUNT PAID BY
DISTRIBUTOR TO CTT UNDER THIS AGREEMENT. SUCH LIMITATION IS AN
ESSENTIAL PROVISION OF THIS AGREEMENT AND WAS A CONDITION UPON WHICH
THE TERMS AND PRICING WERE BASED.
9.0 MISCELLANEOUS
9.1 AMENDMENT AND WAIVER. Any provision of this Agreement may be
amended or waived only with the written and signed consent of both
Parties.
9.2 SEVERABILITY. If any provision of this Agreement shall be held to
be illegal, invalid, or unenforceable, such provision will be enforced
to the maximum extent permissible so as to effect the intent of the
parties, and the validity, legality, and enforceability of the
remaining provisions shall not in any way be affected or impaired
thereby.
9.3 APPLICABLE LAW. This Agreement shall be governed by the laws of
the State of Connecticut in the United States or as an option to both
parties, arbitration according to international standards such as the
International Chamber of Commerce (ICC), Commission on Arbitration
9.4 NOTICE. Any payment, notice, or other communication required or
permitted to be made to either Party hereunder shall be sufficiently
made or given (i) on the second business day after mailing if sent to
such Party by internationally recognized overnight courier, (ii) in
the next business day after receipt of confirmation of successful
transmission if sent by facsimile, and (iii) upon receipt if sent by
hand delivery, in each case, at its address given below, or such other
address as it shall hereafter designate to the other Party in writing:
IN THE CASE OF COMPETITIVE TECHNOLOGIES, INC.:
Xxxx X. Nano
Chairman, President and CEO
Competitive Technologies, Inc.
000 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
203.368.6044
WITH A COPY TO (WHICH SHALL NOT CONSTITUTE NOTICE):
Edwards, Angell, Xxxxxx & Dodge, LLP
000 Xxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attn: Xxxx X. Xxxxxxxx, Esq.
203.353.6800
IN THE CASE OF DISTRIBUTOR:
Xx. Xxxxxxxx Xxxxxxxx
Life Episteme srl
Xxx Xxxxxxx 00
00000 Xxxx XX, Xxxxx
9.5 INTEGRATION. This Agreement expresses the full contract between
the Parties, and all other prior or contemporaneous oral or written
representations with regard to the subject matter hereof shall be of
no effect.
9.6 INTERPRETATION, HEADINGS, NUMBER AND GENDER. The Parties
acknowledge and agree that this Agreement has been freely negotiated
and shall be deemed to have been drafted by the Parties jointly.
Accordingly, no court should construe any provision for or against any
Party as a result of such Party being involved in the drafting of this
Agreement. The headings of the several sections are inserted for
convenience of reference only, and are not intended to be part of or
to affect the meaning or interpretation of this Agreement. In this
Agreement, where the context so permits, the singular shall include
the plural, and vice versa, and references to a particular gender
shall include the other genders. The words "include," "includes" and
"including" are not limiting and shall be interpreted as if followed
by the phase "without limitation." Unless the context indicates
otherwise, the term "or" shall be deemed to include the term "and."
9.7 FORCE MAJEURE. No Party hereto shall be liable in damages or have
the right to cancel this Agreement for any delay or default in
performing hereunder if such delay or default is caused by conditions
beyond its control, including but not limited to acts of God,
government restrictions, wars, or insurrections.
9.8 EXECUTION. This Agreement will not be binding upon the Parties
until it has been duly executed by or on behalf of each Party, in
which event it shall be effective on the Effective Date.
9.9 COUNTERPARTS. This Agreement may be executed in two (2) or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. Delivery
of an executed counterpart of this Agreement by facsimile shall be
equally effective as delivery of an original executed counterpart of
this Agreement.
9.10 AUTHORIZED SIGNATORIES. The undersigned individuals each
represent and warrant that they have the authority to execute this
Agreement on behalf of their respective companies or in their
individual capacities, as the case may be.
[Signature page follows]
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the
dates shown below.
COMPETITIVE TECHNOLOGIES, INC. Life Episteme srl
BY: \s\ Xxxx X. Nano BY: \s\ Xx. Xxxxxxxx Xxxxxxxx
NAME: XXXX X. NANO NAME: XX. XXXXXXXX XXXXXXXX
TITLE: CHAIRMAN, PRESIDENT & CEO TITLE: CHIEF OPERATING OFFICER
DATE: February 24, 2009 DATE: February 24, 2009
SCHEDULE 1
PRODUCT(S)
PER UNIT
PRODUCT PURCHASE PRICE
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PAIN SCRAMBLER DEVICE $ XX (USD)
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SCHEDULE 2
PRODUCT MINIMUMS
I. For Pain Scrambler Device:
CONTRACT YEAR CONTRACT YEAR MINIMUMS
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1 XX
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2 AND 3 XX UNITS CUMULATIVE
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SCHEDULE 3
TERRITORY
Italy
France
Spain
Germany
Switzerland
United Kingdom
Croatia
Russia
Poland
Turkey
Israel
Egypt
Kuwait
United Arab Emirates
Qatar
Saudi Arabia
Morocco
Libya
Algeria
Pakistan
Thailand
Philippines
Singapore
Indonesia
Vietnam
South Africa
Brazil
Argentina
Australia
