EXHIBIT 10.6
AGREEMENT
THIS AGREEMENT is made and entered into this 21 day of
October, 1996, by and between Volu-Sol., Inc, a Utah Corporation
having a place of business at 0000 Xxxx 0000 Xxxxx, Xxxx Xxxx
Xxxx, Xxxx 00000 (hereinafter "Volu-Sol"); and GG&B Engineering,
Inc., a Texas corporation having a principal place of business at
0000 Xxxx XxXxxx Xxxxxxxxx, Xxxxx 000, Xxxxxxx Xxxxx, Xxxxx 00000
(hereinafter "GG&B").
Recitals
WHEREAS, GG&B is the sole owner of certain technology
related to a device commonly known as the automated slide stainer
(hereinafter "Stainer") and is the sole and exclusive
manufacturer of that device;
WHEREAS, Volu-Sol desires to obtain an exclusive, worldwide
license in the technology and an exclusive worldwide
distributorship for the purpose of marketing and selling Stainers
manufactured and provided by GG&B;
WHEREAS, GG&B is interested in granting such a license and
distributorship to Volu-Sol;
NOW THEREFORE, in consideration of the mutual promises and
covenants contained herein, the parties hereto agree as follows:
I. Definitions
1.1 LICENSED PRODUCTS - means the Stainers manufactured by
GG&B.
1.2 COMPONENT PARTS - means the Stain Packs used in
connection with Stainers. It is acknowledged that Volu-Sol will
manufacture all of the Stain Packs except for the memory module.
The memory module will be programmed as to the operating codes
for the operation of the machines by GG&B at its expense. The
memory module will be programmed as to the lot number, expiration
date, product number, number of tests available and similar
matters by Volu-Sol at its expense.
1.3 NET SALES PRICE - means the gross sales price of
COMPONENT PARTS, less:
(a) discounts allowed in amounts customary in the
trade;
(b) sales or use taxes, tariff duties, import and
export taxes, and other sales and excise taxes
customary in the trade;
(c) insurance and transportation costs from the place
of manufacture or distribution to the customer's
premises or next point of distribution or sale if
paid by Volu-Sol;
(d) bone fide returns or credits.
1.4 TECHNOLOGY - means all technology which relates to
Stainers or their manufacture or operation. The parties
acknowledge that there is presently no patent or other
proprietary information related to the Stainer technology. The
only protected material will be the copyright protection on the
software.
1.5 CONFIDENTIAL INFORMATION - means any confidential
documentary or oral communications provided or communicated from
one party to the other, and which refers or relates to the
TECHNOLOGY, LICENSED PRODUCTS, or COMPONENT PARTS. The term
CONFIDENTIAL INFORMATION shall specifically include, but not be
limited to, all samples, reports, research notebooks, drawings,
test results, business or technical information and research, or
correspondence referring to or incorporating any portion of the
TECHNOLOGY.
II. Grant
2.1 GG&B hereby grants to Volu-Sol a worldwide, license in
and exclusive distributorship to market and sell LICENSED
PRODUCTS and the Memory Module portion of the COMPONENT PARTS.
GG&B further grants to Volu-Sol an exclusive, worldwide license
in the TECHNOLOGY, subject only to GG&B's exclusive right to
manufacture Stainers employing the TECHNOLOGY. The license
hereby granted does not include any right for Volu-Sol to
manufacture Stainers or to authorize anyone else to manufacture
Stainers.
2.2 In order to fully implement the license granted above,
GG&B agrees to provide Volu-Sol with full disclosure of all
TECHNOLOGY in its possession or reasonable control within thirty
(30) days following completion of the final design of the
Stainer. During the entire term of this Agreement, GG&B agrees
to provide Volu-Sol with a best efforts level of training and
support sufficient to enable Volu-Sol to effectively understand
the TECHNOLOGY and to sell and distribute LICENSED PRODUCTS and
COMPONENT PARTS.
2.3 In consideration for the grant of an exclusive
distributorship as provided herein, Volu-Sol agrees to use its
best efforts to promote the sale and distribution of LICENSED
PRODUCTS and COMPONENT PARTS. GG&B agrees to provide Volu-Sol
with all its requirements for Stainers and memory modules
throughout the term of this Agreement.
2.4 In consideration for the license and distributorship
granted herein, Volu-Sol agrees to purchase from GG&B a minimum
of six hundred (600) Stainers per calendar year. The purchase
price for such stainers shall not exceed $750 per Stainer,
through December 31, 1997. Volu-Sol and GG&B agree to negotiate
annually, in good faith, all price increases and decreases based
on volume of purchases and costs of manufacturing effective
January 1, 1998 and each January 1 thereafter during the term of
this Agreement. In the event Volu-Sol purchases fewer than six
hundred (600) stainers in any year, GG&B shall have the option to
convert the license and distributorship granted herein to a
nonexclusive license and nonexclusive distributorships, upon
written notice to Volu-Sol.
III. Royalties and Payments
3.1 In consideration for the license and distributorship
granted in paragraph 2.1 above, Volu-Sol has previously paid to
GG&B a partial licensing and distributorship fee of Ten Thousand
dollars ($10,000). Volu-Sol agrees to pay GG&B Fifteen Thousand
dollars ($15,000) upon approval by Volu-Sol of Cuvette size and
design, over-lay design, tubing design and programming of memory
module. Volu-Sol agrees to pay GG&B an additional Fifteen
Thousand ($15,000.00) on delivery of three (3) finished
prototypes to Volu-Sol. These prototypes must be delivered to
Volu-Sol by October 14, 1996.
3.2 Volu-Sol shall pay to GG&B an additional fee in the
amount of Twenty-five Thousand dollars ($25,000.00) upon initial
order of Stainers from GG&B. This initial order will occur no
later than November 1, 1996.
3.3 Volu-Sol shall pay to GG&B a royalty of three percent
(3%) of the NET SALES PRICES for all COMPONENT PARTS which Volu-
Sol actually sells. Both parties acknowledge that there shall be
no royalty payment for the Stainers which are the LICENSED
PRODUCTS, it being recognized that total consideration to GG&B
for such shall be the purchase price per Stainer set out in
Section 2.4 hereof. The terms of all orders of Stainers shall be
net 30 from shipping date.
3.4 Royalties shall accrue when payment for COMPONENT PARTS
is actually received by Volu-Sol. Royalty payments shall be made
within ninety (90) days following the end of the calendar quarter
in which they accrue. All royalty payments and purchase price
payments shall be made in United States dollars and shall be
directed to the address specified by GG&B. In the event GG&B
fails to specify an address for the payment, royalties shall be
forwarded to GG&B's address as set forth in paragraph 12.1 below.
IV. Records
4.1 Volu-Sol shall keep proper books of account with
reference to all LICENSED PRODUCTS and COMPONENT PARTS which
sells. When requested by GG&B, such books of account shall be
open at reasonable times for GG&B, through a certified public
accountant, to inspect such books of account and to make
abstracts therefrom for the purpose of verifying the royalties
due or paid.
V. Improvements
5.1 In the event GG&B makes improvements in the design of
the Stainer, it shall incorporate those improvements into the
Stainer with the permission of Volu-Sol. It is acknowledged that
this Agreement is limited to the Stainer that is currently being
developed and does not extend to any additional products that
GG&B may develop. However, if this Agreement is still in full
force and effect at the time GG&B develops a new product, GG&B
agrees to give Volu-Sol the first right of refusal to participate
with GG&B on that product.
VI. Confidential Disclosure
6.1 The parties acknowledge that, from time to time during
the relationship between the parties, it will be necessary for
CONFIDENTIAL INFORMATION to be disclosed by one party to the
other in order to promote the business of both parties and to
implement the provisions of this Agreement. The parties
acknowledge that the provisions of this Agreement are necessary
in order to protect the confidentiality, value, and secrecy of
the TECHNOLOGY and the CONFIDENTIAL INFORMATION.
6.2 The party receiving CONFIDENTIAL INFORMATION agrees to
take all precautions necessary to maintain the confidential
nature of the CONFIDENTIAL INFORMATION. The receiving party
further agrees not to disclose such CONFIDENTIAL INFORMATION to
any third party except to those full-time employees in its
organization who have a need to know. The receiving party agrees
to take all appropriate action by instruction and agreement with
its full-time employees so that such persons shall be bound by
all of the same obligations as is said receiving party with
respect to all CONFIDENTIAL INFORMATION.
6.3 Any CONFIDENTIAL INFORMATION provided by one party to
another shall be treated by the receiving party with at least the
same degree of secrecy or confidentiality as would similar
information of the receiving party. The receiving party agrees
to specifically notify its employees that CONFIDENTIAL
INFORMATION is to be treated in the same manner as receiving
Party's own secret and Confidential Information.
6.4 In the event the receiving party deems it necessary to
convey any portion of the CONFIDENTIAL INFORMATION to any person
or entity which is not one of its full-time employees, it shall
not do so without the express written consent of the other party
and then only after that person or entity has signed a
Confidential Disclosure Agreement containing terms similar to
those contained in this Agreement.
6.5 All written documents containing CONFIDENTIAL
INFORMATION shall, prior to disclosure to the party, be
conspicuously marked as confidential or proprietary information.
If such disclosure is oral, within thirty (30) days following the
oral disclosure, the contents of the oral communication shall be
reduced to writing and appropriately marked as confidential or
proprietary.
VII. Warranties
7.1 GG&B hereby warrants that it is the sole and exclusive
owner and assignee of the TECHNOLOGY and that it has the right
and ability to enter into this Agreement and to grant the license
and distributorship as defined above.
7.2 The parties hereby warrant that they have full
corporate authority to enter into this Agreement and that the
individual signing on behalf of each party has full authority to
enter into this Agreement and to bind the corporation.
7.3 GG&B states that to the best of its knowledge and
belief practicing the TECHNOLOGY does not constitute an
infringement of the claims of any United States or foreign
patents held by any third parties.
7.4 GG&B DOES NOT MAKE ANY WARRANTIES EXPRESS OR IMPLIED,
INCLUDING ANY WARRANTIES OR MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE. THE PARTIES ACKNOWLEDGE THAT BEFORE THE
STAINERS AND THE STAIN PACKS ARE SOLD, THEY WILL NEED TO DRAFT A
LIMITED WARRANTY THAT WOULD BE APPROPRIATE FOR THESE TYPES OF
PRODUCTS. THEY AGREE THAT SUCH WARRANTIES WILL BE ONLY SO GREAT
AS IS NECESSARY IN ORDER TO SUCCESSFULLY MARKET THE PRODUCTS. AT
THAT TIME, THEY WILL AGREE UPON HOW TO SHARE THE COST OF ANY
WARRANTY CLAIMS.
7.5 GG&B will perform service work on the Stainers upon
such terms that it shall set from time to time.
7.6 GG&B will provide Volu-Sol and Volu-Sol will provide
customers a twelve (12) month limited warranty of Stainer to be
free from defects in materials, workmanship and assembly.
VIII. Term and Termination
8.1 Unless this Agreement is terminated earlier as provided
herein, the TERM of this Agreement shall be perpetual.
8.2 In the event that either party defaults or breaches any
of the provisions of this Agreement, or fails to account for or
pay any of the purchase prices or royalties that become due and
payable, the other party shall have the right to terminate this
Agreement upon thirty (30) days advance written notice; unless
within said thirty (30) day notice period the party in breach or
default cures the default or breach.
8.3 In the event of any termination of this Agreement,
Volu-Sol shall not be relieved of the duty and obligation to pay
the full purchase prices and royalties that have accrued at the
effective date of such termination. Thereafter, Volu-Sol shall
have no further rights under this Agreement and shall immediately
return to GG&B all Stainers in its possession which have not been
sold. The parties agree to return all CONFIDENTIAL INFORMATION.
8.4 This Agreement may be immediately terminated upon
giving notice to the other party in the event that:
(a) either party undergoes a dissolution;
(b) either party makes an assignment for the benefit
of creditors;
(c) either party files a petition in bankruptcy
(including a petition for reorganization under the
United States Bankruptcy Code or similar law) or
has such a petition filed and granted against it;
(d) either party has an order of receivership issued
against it; or
(e) either party becomes insolvent.
IX. Independence of the Parties
9.1 This Agreement shall not constitute the designation of
either party as the representative or agent of the other, nor
shall either party by this Agreement have the right or authority
to make any promise, guarantee, warranty, or representation, or
to assume, create, or incur any liability or other obligation of
any kind, express or implied, against or in the name of or on
behalf of the other.
X. Arbitration and Applicable Law
10.1 Any controversy or claim arising out of or relating to
this Agreement or the breach thereof shall be settled by
arbitration in accordance with the Commercial Arbitration Rules
of the American Arbitration Association, and judgment upon the
award rendered by the arbitrator(s) may be entered in any Court
having jurisdiction thereof.
10.2 In the event Volu-Sol believes that GG&B has violated
the terms of this Agreement, Volu-Sol shall have the right to
have the Arbitration take place in the state of Utah and Utah Law
will apply. In the event GG&B believes that Volu-Sol has
violated the terms of this Agreement, GG&B shall have the right
to have the Arbitration take place in Wichita Falls, Texas and
Texas law will apply.
XI. Assignment
11.1 Volu-Sol shall have the right to assign or otherwise
transfer this Agreement and the license and distributorship
granted hereby and the rights acquired by it hereunder without
the prior written consent of GG&B to any corporations under the
direct or indirect control of Volu-Sol, its parent company
Biomune Systems, Inc., or their successors in interest. Volu-Sol
shall have the right to assign or otherwise transfer the license
and distributorship granted herein to other parties upon the
prior written consent of GG&B, which consent shall not be
unreasonably withheld.
11.2 Upon such assignment or transfer of this agreement to
any assignee or transferee, the term "Volu-Sol" as used herein
shall include such assignee or transferee.
11.3 GG&B shall have the right to delegate the manufacturing
and repair obligations to others upon the prior written consent
of Volu-Sol, which consent shall not be unreasonably withheld.
XII. Notices
12.1 Any written notice required or permitted by this
Agreement shall be given by registered or certified mail, postage
prepaid, and shall be effective upon proper mailing. The
addresses of the parties for communication and notice, unless
subsequently changed by written notice to the other, shall be:
Volu-Sol, Inc.
0000 Xxxx 0000 Xxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
GG&B Engineering, Inc
0000 Xxxx XxXxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxx Xxxxx, Xxxxx 00000
XIII. General Provisions
13.1 The parties agree that this Agreement shall constitute
the complete and exclusive statement of the Agreement between
them and supersedes all proposals, oral or written, and all other
communications between them relating to the Technology.
13.2 No agreement changing, modifying, amending, extending,
superseding, discharging, or terminating this Agreement or any
provisions hereof shall be valid unless it is in writing and is
dated and signed by duly authorized representatives of the party
or parties to be charged.
13.3 The provisions of this Agreement are severable, and in
the event that any provisions of this Agreement shall be held to
be invalid, illegal or unenforceable, the validity, legality, and
enforceability of the remaining provisions shall not in any way
be affected or impaired thereby.
13.4 Failure of any of the parties to enforce any of the
provisions of this Agreement or any rights with respect thereto
or failure to exercise any election provided for herein, shall in
no way be considered a waiver of such provisions, rights, or
elections or in any way to affect the validity of this Agreement.
No term or provision of this Agreement shall be deemed waived and
no breach excused, unless such waiver or consent shall be in
writing and signed by the party claimed to have waived or
consented. Any consent by any party to, or waiver of, a breach
by the other, whether expressed or implied, shall not constitute
a consent to, waiver of, or excuse for any other different or
substitute breach.
13.5 Headings used in this Agreement are for reference
purposed only and shall not be deemed part of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and witnessed as of the date first
mentioned above.
GG&B Engineering, Inc.
By: /s/ Xxxx Xxxxx
Its: President
Volu-Sol, Inc.
By: /s/ Xxxxxxx X. Xxxxx
Its: President