Master Purchase Agreement - CTI PET Systems Inc. and Photonis
MASTER PURCHASE AGREEMENT
This Agreement effective as of this first day of September 1999, by and
between CTI PET SYSTEMS, INC., a Tennessee Corporation with offices at 810
Innovation Drive, Knoxville, TN 37932-2571, USA (hereinafter "Buyer") and
PHOTONIS with offices at Avenue Roger Roncier, BP520, 19106 BRIVE Cedex, FRANCE
(hereinafter "Seller").
WITNESSETH:
WHEREAS, Buyer desires to purchase and Seller desires to sell certain
products either distributed by or for Seller or designated or manufactured by or
for the Seller as of the date hereof, or developed for manufacture or sale by or
for Seller in the future, and all supplies and services necessary in relation
hereto as set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements set forth herein, the parties agree as follows:
1. EFFECTIVE DATE AND CONTRACT TERM.
This Agreement shall be effective on the day and year first above
written and shall continue until September 1, 2004.
1.1. SUPERCESSION OF PREVIOUS AGREEMENT.
None.
1.2. PRODUCTS
Subject to the terms and conditions hereof, Buyer from time to
time may purchase and Seller agrees to sell such products as
are identified in Exhibit A attached hereto.
1.3. SPECIFICATIONS FOR PRODUCTS.
All products supplied by Seller here under shall be furnished
in accordance with all terms and conditions of this agreement,
as well as all specifications set forth in Exhibit A attached
hereto or any subsequent engineering change orders relating
thereto and approved by Buyer consistent with the terms and
conditions of the Agreement.
2. PURCHASE OF PRODUCTS.
2.1. EXCLUSIVE METHOD.
No products shall be purchased or sold by virtue of execution
of this Agreement alone, but shall require the issuance of one
or more purchase orders by the Buyer's Purchasing Department.
Such purchase orders shall reference this Agreement and shall
make it a part thereof.
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2.2. DELIVERY DATE.
On each purchase order submitted to Seller, Buyer shall
specify one or more delivery dates. The parties shall agree on
such delivery dates in advance of Buyer's issuance of such
purchase orders. Seller agrees to ship all products ordered
here under, so that such products will be delivered to Buyer's
specified location on the delivery dates specified in Buyer's
purchase orders indicated as PTA (Promised to Arrive Date -
(-5, +2 days)). Delivery shall not be accelerated or delayed
by Seller without the prior written consent of Buyer's
Purchasing Department.
2.2.1 LATE DELIVERY
If Seller fails to meet the scheduled date of delivery and
such failure is not cured within ten (10) business days, Buyer
may, in lieu of actual damages, require Seller to pay to Buyer
as liquidated damages the amount of one percent (1 %) of the
value of the delayed order for each calendar day of delay, up
to a maximum aggregated payment per order of ten percent (10
%) of the value of the delayed order.
If more than fifty percent (50%) of PMTs delivered during one
calendar quarter are more than ten (10) business days late in
meeting the scheduled PTA, then, notwithstanding the above
liquidated damages, Buyer may elect to:
1. cancel, the order(s) experiencing the delay as well
as any other pending order(s).
2. terminate this Agreement for Default,
3. claim for damages suffered.
3. PRICE AND PAYMENT TERMS.
3.1. PRICES
Prices for the products are set forth in Exhibit "B" of this
Agreement.
3.2. NO ADDITIONAL CHARGES
Unless otherwise expressly provided herein, Buyer shall not be
responsible for any additional charges of any kind, unless
Buyer's Purchasing Department specifically agrees in writing
and in advance to incur liability for any such additional
charges.
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3.3. INVOICING AND PAYMENT
Seller will issue an invoice for each shipment on or after the
day of shipment. Each invoice shall reference the applicable
Purchase Order number. Invoices shall be mailed to: CTI Inc.,
Accounts Payable Department, 810 Innovation Drive, Knoxville,
TN 37932.
Unless otherwise agreed in writing, all payments due hereunder
shall be due net (30) thirty days from invoice date.
Credits due to rejection of product within 30 days of receipt,
or discrepancies on payment shall be deducted from subsequent
payments.
4. SCHEDULING AND RESCHEDULING OF ORDERS
4.1. PROCEDURE.
The Buyer will purchase PMTs from the Seller upon
qualification of the product over the period set by this
contract (see Exhibit B). These tubes will be released under
separate purchase orders according to this Master Purchase
Agreement. Buyer reserves the option to reschedule quantities
of any products on order. Buyer shall give Seller sixty (60)
days written notice prior to the Promise to Arrive Date (PTA).
5. LIMITATIONS OF LIABILITY.
5.1.a. SELLER WILL NOT UNDER ANY CIRCUMSTANCES, WHETHER AS A RESULT OF
BREACH OF CONTRACT, BREACH OF WARRANTY, TORT OR OTHERWISE BE LIABLE FOR
CONSEQUENTIAL, INCIDENTAL, SPECIAL, OR EXEMPLARY DAMAGES INCLUDED, BUT
NOT LIMITED TO, LOSS OF PROFITS OR REVENUES, LOSS OF USE OR DAMAGE TO
ANY ASSOCIATED EQUIPMENT, COST OF CAPITAL, COST OF SUBSTITUTE PRODUCTS,
FACILITIES OR SERVICES, DOWNTIME COSTS, OR CLAIMS OF BUYER'S CUSTOMERS.
5.1.b. SELLER'S LIABILITY ON ANY CLAIM OF ANY KIND FOR ANY LOSS OR
DAMAGE ARISING OUT OF, RESULTING FROM, OR CONCERNING ANY ASPECT OF THIS
AGREEMENT OR FROM THE GOODS OR SERVICES FURNISHED TO BUYER SHALL NOT
EXCEED THE PRICE OF THE SPECIFIC PRODUCT WHICH GIVES RISE TO THE CLAIM.
5.1.c. SELLER WILL NOT BE SUBJECTED TO ANY LIABILITY, WHETHER IN
CONTRACT, WARRANTY, TORT OR OTHERWISE, ON ANY CLAIM FOR LOSS OR DAMAGE
CONCERNING PRODUCTS, PARTS, ADVICE, ASSISTANCE OR SERVICE WHICH SELLER
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FURNISHED TO BUYER AS A BUSINESS COURTESY, BUT ARE NOT REQUIRED HERE
UNDER.
5.1.d. THE WARRANTIES AND REMEDIES SET FORTH HEREIN DO NOT APPLY TO
GOODS WHICH HAVE BEEN MISUSED, INADEQUATELY MAINTAINED OR STORED, OR
INCORRECTLY OR NEGLIGENTLY INSTALLED OR SERVICED.
5.2. IN NO EVENT SHALL BUYER BE LIABLE FOR ANTICIPATED PROFITS
INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES. BUYERS
LIABILITY ON ANY CLAIM OF ANY KIND FOR ANY LOSS OR DAMAGE ARISING OUT
OF THIS AGREEMENT OR ANY PERFORMANCE HERE UNDER, SHALL IN NO CASE
EXCEED THE PRICE ALLOCABLE TO THE GOODS OR SERVICES OR UNIT THEREOF
WHICH GIVES RISE TO THE CLAIM.
6. CHANGES
6.1. BUYER CHANGES.
Upon written notice to Seller, Buyer from time to time may
direct changes in design specifications, or manufacturing
processes relating to any order for product(s) placed
thereunder. Within 30 days of receipt of Buyer's change
notice, Seller shall deliver to Buyer a quotation (or a
request for an extension beyond 30 days) detailing the impact
of such change, if any, on price, lead-times, and ability to
manufacture the product (s). Buyer retains the right to accept
or reject any such quotation. Rejection of any such quotation
shall have the effect of suspending Buyer's change notice. All
quotations required of Seller under this paragraph 6.1 shall
include only those net cost increases made necessary because
of Buyer's changes. All cost savings resulting from buyer's
changes shall be shared equally by Buyer and Seller for 12
months. After 12 months all cost savings resulting from
Buyer's changes will be passed on to the Buyer.
6.2. SELLER CHANGES.
Seller hereby represents and warrants that it shall not change
the design of the product(s) affecting form, fit, function,
spares, specifications, or manufacturing processes specified
with respect to the manufacture of any product(s), which
changes shall or may have an adverse impact on the
manufacturing or performance specifications for the
product(s), without the prior written consent of the
Purchasing Department of Buyer.
6.3 NEW PRODUCTS
If Seller starts marketing new generation products which are
to replace products hereunder, Buyer shall have the right to
either
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replace products by such new products or add such new products
to this Agreement
7. SHIPPING
All prices are DDP Shipping Point. Seller shall ensure product
is shipped on a timely basis to meet all Promise to Arrive
commitments. Should Seller fail to ship on said basis, Seller
shall bear the cost of all premium freight required to meet
Buyer's immediate delivery requirements.
8. WARRANTY.
Seller's Standard Warranty applies. See Exhibit C.
8.1. TERMS OF WARRANTY.
The warranty period for newly manufactured items shall extend
fifteen (15) months from the actual date of delivery or twelve
(12) months from the date of installation at Buyer's customer,
whichever is earlier. All warranty periods identified in this
Paragraph 8.1 shall be suspended in the event of downtime
caused by or relating to defects in the products or component
parts thereof and such warranty periods shall resume only upon
repair or replacement of such products or component parts
thereof. Suspension of the warranty period will only become
effective upon return of the defective item to Seller.
8.2. INVENTORY.
Seller agrees to maintain a target minimum finished goods
inventory of 3 weeks for the product identified in Exhibit A
based on the forecasted delivery rate at that time. Such
material may be used to temporarily replace defective product
or to support accelerated production requirements. The amount
so quoted is a target, which Seller will use reasonable
efforts to meet. Failure to meet these targets during any
period of the contract shall not constitute a basis for
termination of contract.
9. PATENT AND OTHER PROPRIETARY RIGHTS INDEMNIFICATION.
Seller will defend, indemnify and hold Buyer and its customers harmless
against all liability and expenses arising from actual or claimed
infringement of any domestic or foreign patent, trademark copyright or
other rights, misappropriation of trade secrets or breach of
confidential relationship with respect to the goods or services covered
by this Agreement. If use of product sold here under is enjoined as a
result of any claimed infringement, Seller will, without in any way
limiting the foregoing, and at its expense,
(a) procure for Buyer the right to continue using the product;
or,
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(b) replace or modify the product so that it becomes
non-infringing; or
(c) remove the product and refund the Buyer all monies paid
therefore and release Buyer from any further liability under this
Agreement.
To the extent that the items ordered are manufactured to designs,
drawings and specifications or instructions furnished by Buyer, Buyer
agrees to indemnify and hold the Seller harmless from any expense,
loss, cost, damage or liability of any kind which may be incurred
because of any infringement or alleged infringement of domestic and
foreign patent rights with respect to such items of the use of such
items in combination with other items and to defend, as its own cost
and expense, any action or claim in which such infringement is alleged.
Buyer shall promptly notify Seller of any such action and shall provide
Seller an opportunity, at Seller's option, to participate in any
defense of such action or claim at Seller's own expense. The terms of
this section shall survive the termination of this Agreement for a
period of ten (10) years.
10. INDEMNITIES.
10.1. INDEMNITY. (Products and Completed Operations).
Seller agrees to indemnify, hold harmless and defend Buyer,
its successors and assigns for all losses, claims, and defense
costs for injury, death, or property damage to the extent
caused by the negligence or strict liability of Seller in the
manufacture or design of products supplied to Buyer's selling
chain. The terms of this paragraph shall survive the
expiration or termination of this Agreement.
10.2. INDEMNITY. (Products and Completed Operations).
Buyer agrees to indemnify, hold harmless and defend Seller,
its successors and assigns for all losses, claims, and defense
costs for injury, death, or property damage to the extent
caused by the negligence or strict liability of Buyer in the
manufacture or design of products supplied to Buyer's selling
chain. The terms of this paragraph shall survive the
expiration or termination of this Agreement.
11. TERMINATION.
Each of the following events shall constitute a default hereunder and
either party may terminate this Agreement if the other Party defaults
in any obligation hereunder for a period of 30 days following written
notice and failure to correct that default;
1.) Files a voluntary petition in bankruptcy, which is not
discharged within 90 days;
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2.) Is adjudged bankrupt;
3.) Has a court assume jurisdiction of its assets under a
Federal Reorganization Act;
4.) Has a trustee or receiver appointed by court for all or a
substantial portion of its assets;
5.) Becomes insolvent or suspends business; or
6.) Makes an assignment of its assets for the benefit of its
creditors.
Buyer may by 90 days written notice of default to Seller
terminate this Agreement, or any purchase order placed here
under, if Seller:
1.) consistently fails to deliver in accordance with the
delivery dates specified in any order placed hereunder, or
2.) consistently fails to replace or correct defective or
non-conforming product in accordance with the terms and
requirements of this Agreement, or
3.) consistently fails to perform any of the other significant
obligations of this Agreement, and does not correct such
failure within a commercially reasonable time after receipt of
written notice from Buyer specifying such failure. Said notice
shall include a reasonably detailed description of any such
failures.
4.) Failure by Seller to meet required FDA Good Manufacturing
Practices may constitute cause for default if Seller does not
implement mutually agreed upon and verified corrective action
within a reasonable amount of time (30 days unless otherwise
agreed to by the parties).
12. SPARE AND REPLACEMENT PARTS.
12.1. AVAILABILITY OF PARTS.
For a period of two (2) years from the date of the last
delivery of products under this Agreement, Seller shall
maintain in inventory a sufficient stock of spare and
replacement parts and accessories to permit complete, prompt,
competent and efficient repair and maintenance of the
products. In the event Seller or its suppliers, or both,
should stop doing business or should terminate the manufacture
or distribution of such components, subassemblies, spare
parts, or replacement parts, Seller will notify Buyer with 12
months notice of termination or obsolescence of the product
and offer the Buyer the right to make a reasonable all-time
final purchase.
12.2. DELIVERY OF SPARE AND REPLACEMENT PARTS.
Seller shall fill Buyer's orders for spare and replacement
parts and shall ship the same to Buyer within ten (10) working
days of receiving Buyer's order. In the event Seller is unable
to ship
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ten (10) working days, both parties shall mutually agree to
negotiate new ship dates.
12.3. MAINTENANCE AND REPAIR.
Repairs and replacements provided by Seller are to be
completed by Seller and returned to Buyer within forty (40)
working days of receipt of product by Seller.
12.3. REPAIRS/REVISION LEVEL.
All Seller repairs will be completed to the revision level
currently on order unless that revision level makes the part
incompatible with lower revision. Any questions associated
with revisions will be addressed in writing to the Buyer's
representative as shown in section 17.
13. QUALITY ASSURANCE
It is understood and agreed that the quality of all items to
be delivered under Buyer's Purchase Orders shall be in
conformance with the standards set forth in Buyer's product
specifications. Seller is responsible, and will ensure that
all Products conform to such quality standards. Buyer retains
the right to inspect items to be purchased hereunder to assure
conformance with such Product specification.
Seller shall have and maintain ISO 9001 certification and
agrees to notify Buyer promptly (within 15 calendar days) and
in writing in the event of any change in Seller's status as it
relates to quality assurance such as, but not limited to, ISO
certification, FDA audit, or items of a similar nature.
All work performed in conjunction with this Agreement shall be
in compliance with the most current and relevant ISO 9001 as
it pertains to suppliers. Specifically that (a) Seller
documents and is able to verify that it follows its own
manufacturing, test, and inspection processes; (b) that any
discrepancies to these processes are identified, corrected,
and verified; (c) that all required manufacturing test and
inspection records, complaints, RMAs, corrective actions, and
variance reports are retained for a minimum of 10 years and
made readily available to Buyer for review during that period;
(d) that all manufacturing test and inspection equipment is
maintained properly and calibrated as required; and (e) that
the manufacturing, test, and inspection processes are adequate
to ensure that all product specifications provided by Buyer
are met. Seller's Quality Assurance shall maintain compliance
of final production through vigilant monitoring of all phases
of production.
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Seller shall utilize statistical process control (SPC)
throughout the production cycle as verification of process
control. The resultant data shall be made available to Buyer
upon request.
During Seller's performance of any Purchase Order or contract
which incorporates this Agreement, Seller agrees to allow and
to cooperate with Buyer to periodically review, verify, and
perform analysis of Seller's quality control and assurance
systems and manufacturing processes for the purpose of
confirming compliance to the ISO 9001.
Workmanship standards, in order of precedence, shall be: (1)
Buyer product specifications and purchase order; (2) Seller
specifications, (3) Seller workmanship standards.
Seller agrees to notify Buyer promptly and in writing if
Seller determines or has any reason to believe it has
delivered a defective product to Buyer and to identify that
product to the maximum practical extent.
In case of a serial defect in PMTs, Seller shall, at Buyer's
option, be obliged either to supply new PMTs free of such
serial defect or refund the full purchase price paid for such
defective PMTs. A serial defect shall be presumed if more than
five percent (5%) of the PMTs supplied under a single purchase
order show the same defect. In this case, the Buyer may elect
to return the entire lot to Seller for evaluation and
appropriate action(s). Notwithstanding the foregoing, if
Seller is unable to timely remedy the serial defect, by
supplying PMTs free of such defect, Buyer may terminate this
Agreement as per Section 11.
ANSI/ASQC Z1.4-1993 shall apply where sample auditing is
performed.
Seller is expected to deliver products with acceptance rates
of 99% or better. It is understood that there will be a
learning curve on new products; however, higher reject rates
will not be tolerated in the long term.
Seller shall conduct inspection and testing of the completed
product to assure compliance with all Buyer specifications.
Seller shall maintain inspection and test data for a minimum
period of 10 years.
Seller shall provide a Certificate of Conformance (C of C)
with each delivery, which includes the serial number of each
product in the shipment. The C of C shall warrant that the
product was produced in accordance with Seller's ISO 9001
Quality System, and that all
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Purchase Order requirements and Product Specifications have
been met. The C of C shall be signed by appropriate
individuals and dated.
At some point the Buyer may choose to "validate" the Seller
for a particular product. This internal process consists of
having the Seller submit a certain quantity of certified
product and verifying that all specifications have been met
and all documentation is in order. Once a product/supplier is
validated, that product is received directly into CPS
production with no incoming inspection required. It is
imperative that all incoming products and documentation are
100% correct for every shipment. Buyer's decision not to
inspect or test product at incoming does not release the
Seller of its responsibilities to deliver conforming product.
Seller is responsible for nonconforming product found in
process, at point of consumption, or at higher levels of
product completion.
14. FORCE MAJEURE.
Force Majeure shall mean act of God, acts, regulation or
decrees of any Government (de facto or de jure), natural
phenomena such as earthquake, floods, fires, riots, wars,
shipwrecks, strikes, freight embargoes, lockouts, and other
causes similar to the foregoing which are beyond the
reasonable control of the parties and which prevent either or
both parties from performing their respective obligations
under this Agreement in whole or in part. In the event of
force majeure, the party affected shall notify the other
within seven (7) days thereof, specifying the event and the
probable consequences thereof. In the event that performance
of substantially all obligations herein, cannot be restored
within a mutually agreeable time frame, then this Agreement
may be terminated by ten (10) days notice without further
liability of either party for damages on account of such
termination. In the event this Agreement is not terminated
under this Paragraph 16.2, the parties will cooperate with
each other to restore as promptly as possible full and
complete performance here under and all rights and obligations
of the parties shall remain in force and enforceable, with
reasonable revisions to delivery schedules as may be mutually
agreed.
15. PROPRIETARY INFORMATION
Buyer and Seller agree to keep in confidence and not disclose
to others all knowledge, information and data furnished to it
by the other and claimed by either to be proprietary, provided
such proprietary information is given in writing and such
writing is marked to indicate the confidential nature of the
information and the disclosing party's claim of ownership.
Buyer and Seller agree that
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neither shall use or reproduce for use in any way any
proprietary information of the other except in furtherance of
the relationship set forth in this Agreement. Buyer and Seller
agree to protect the proprietary information with the same
standard of care and procedures which each uses to protect its
own proprietary information. This paragraph shall not be
applicable and shall impose no obligation on either party with
respect to any portion of proprietary information which:
A.) Was at the time received or which thereafter becomes,
through no act or failure on the part of either party,
generally known or available to the public;
B.) Is known to either party at the time of receiving such
information as evidenced by documentation then rightfully in
the possession of either party;
C.) Is furnished by either party to a third party without
restriction by that third party on disclosure;
D.) Is thereafter rightfully furnished to either party by
third party without restriction by that third party on
disclosure; or
E.) Is released from restrictions imposed hereunder by written
release given by the owner of the information.
G.) In the event a dispute hereunder must be resolved by
litigation, the prevailing party shall be entitled to receive
reimbursement for all associated costs.
H.) This Agreement is intended for the benefit of the parties
hereto and their permitted assigns, and no other person shall
be entitled to rely upon this Agreement or be entitled to any
benefits under this Agreement. This Agreement shall not be
assignable by either Party without the prior written consent
of the other Party hereto.
I.) Each party agrees that information to be furnished to the
other hereunder will, to the best of its knowledge and belief,
be correct. Each party agrees to notify the other promptly in
the event that information provided by the supplying party
contains an error or omission at such time that the furnishing
party modifies such information in any respect.
J.) Neither party shall, for any purpose, be deemed to be an
agent of the other party and the relationship between the
parties shall only be that of independent contractors.
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K.) Any tool or special equipment furnished by the Buyer to
Seller or acquired by Seller exclusively for use in connection
here with shall remain the property of the Buyer. All other
tooling remains the property of the Seller. Seller agrees to
use such tools and equipment only in the manufacture, testing,
or installation of the products for Buyer or for Buyer's
customers or end users, and Seller agrees to return such tools
and equipment to Buyer at Buyer's expense immediately upon any
request by Buyer to do so. If Buyer provides tooling, the
Buyer will mark it as their property.
L.) For this Agreement, "in writing" shall mean written either
on paper and faxed or mailed, or written electronically and
sent via e-mail.
M.) The headlines contained in this Agreement are for the
convenience of reference only and shall not be considered in
construing this Agreement.
N.) Seller shall not, and shall require that its
subcontractors and suppliers of any tier shall not cause or
permit to be released any publicity, advertisement, news
release, public announcement, or denial or confirmation of
same, in whatever form, regarding any aspect of this Agreement
or the products or program to which they pertain without
Buyer's prior written approval.
O.) Any notice in connection with this Agreement must be made
in writing and if by mail, by certified mail, return receipt
requested, and shall be deemed to be given and received on the
date of actual receipt by the addressee at the address listed
below:
All technical data, hardware, and intellectual property
including, but not limited to, designs, engineering and
manufacturing drawings, specifications, standards, process
information, manuals, technical reports, computer software and
related information, tooling, fixtures, test equipment and
other hardware purchased and/or furnished by Buyer and bills
of material first produced and/or uniquely resulting from the
performance of this Agreement shall be the sole property of
Buyer. Seller shall not use any such items for any purpose
other than the performance of this Agreement without express
written permission of Buyer.
16. GENERAL
A) This Agreement may be amended upon the mutual written
consent of the parties hereto. No modification, termination,
extension, renewal or waiver of any provision of this
Agreement
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shall be binding upon either party unless made in writing and
signed by an authorized officer of both parties.
B) This Agreement supersedes all proposals, oral or written,
and all negotiations, conversations or discussions heretofore
had between the parties hereto as to the subject matter
hereof.
C) This Agreement shall govern all Purchase Orders, which
contain a reference to this Agreement, and the terms, and
conditions herein shall take precedence over any conflicting
terms of any such Purchase Order. Any conflicts which might
exist between this Agreement and Purchase Order terms and
conditions referencing this Agreement shall be resolved in
this order: 1) this Agreement; 2) front side of Purchase
Order; 3) back side of Purchase Order; 4) Seller's proposal.
D) If any clause, term or provision of this Agreement shall be
judged invalid by any court or administrative agency having
jurisdiction over performance of the Agreement, such
invalidity shall not affect the validity or operation of any
other clause, term or provision; and such invalid clause, item
or provision shall be deemed to have been deleted from this
Agreement.
E) This Agreement and its performance shall be governed by,
subject to, and construed in accordance with the laws of the
State of Tennessee, U.S.A.
F) If a dispute arises out of or relates to this Agreement or
the breach thereof, the Parties agree that in the first
instance they shall enter into good faith negotiations to
resolve such dispute by mutual agreement.
P) The failure of any party hereto at any time to require
performance by the other party of any of its obligations
hereunder shall not in any way affect the full right to
require such performance at any time thereafter. The waiver by
either party of any remedy with respect to any breach of any
particular provision(s) does not constitute a waiver of any
other breach of other provisions.
17. NOTICES.
Any notice or other communication required or permitted to be
given hereunder shall be effective only when received and
shall be directed to the following parties:
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a. If to Buyer b. If to Seller
CTI PET Systems, Inc. PHOTONIS
810 Innovation Drive Avenue Roger Roncier
Knoxville, TN 37932-2571 BP520 - 19106 BRIVE Cedex
USA FRANCE
Attn: Mr. Juel Hensley Attn: Mr. Rene Dupont
Purchasing Manager General Manager
18. AUTHORITY TO EXECUTE AGREEMENT
In executing this Agreement, the undersigned hereby represents
that they have read carefully, the foregoing terms of this
Agreement on behalf of their respective interests, that they
have the authority to execute this Agreement and that they
have signed the same as their own respective free acts and
with the expressed authority to do so on behalf of their
respective interests.
CTI PET Systems, Inc. PHOTONIS
/s/ Ronald Nutt /s/ Rene Dupont
------------------------------------ -------------------------------
By: Dr. Ronald Nutt By: Rene Dupont
Executive Vice President General Manager,
Date: Date:
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EXHIBIT A
PHOTONIS CTI
PART # PART # REVISION DESCRIPTION
-------- ------ -------- -----------
XP 1912/FLB 5410009-00 C C 19mm round fast PMT
XP3102/FLB To Be Determined 25mm round fast PMT
XP5292/SO To Be Determined 2" square assembly
For Pricing, see Exhibit B and Purchase Orders which reference this Agreement.
Rejection Criteria:
o PMT which fails to meet CTI or Photonis' specifications .
o Failure or intermittent failure due to internal shorts
o PMTs which are unfit for use due to failure to meet workmanship standards
of Seller. (e.g., tinned leads which snap off at the bulb as a result of
normal handling at CPS during the course of mounting bleeder networks.)
o Failure to meet CPS standard stability monitoring criteria
PMTs which are rejected by CPS shall be processed as follows:
o CPS purchasing will notify Seller of the quantity and cause of rejection
and request return authorization.
o Seller will issue a return authorization number to CPS
o CPS will return rejected PMTs to Seller at Seller's expense
o Seller will evaluate rejected PMTs, prepare a disposition and send report
along with corrective action as appropriate to Buyer's representative
within 30 days (see section 17) and issue appropriate credit
o Seller will replace PMTs on the appropriate purchase order and line and
re-invoice
o Any dispute regarding rejected PMTs will be resolved between CPS purchasing
and the Sellers designated representative.
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EXHIBIT C
WARRANTY FOR PHOTOMULTIPLIER TUBES
Unless otherwise agreed, the Seller (PHOTONIS) guarantees to the original Buyer
to refund the price paid for, or at the Seller's discretion, to repair or
replace, those tubes which proved to the Seller's reasonable satisfaction not to
conform to the published specifications at the time of receipt of materials by
the Buyer or to have failed by reason of faulty design or workmanship during a
period of twelve months.
This guarantee is subject to the following provisions:
1. Claims for damage in transit will be considered only if the Buyer
promptly notifies the Seller upon receipt of the tubes.
2. The guarantee shall not extend to failures by reason of defects which
ought reasonably to have been discovered by the Buyer upon inspection
and testing of the tubes and were not reported to the Seller within
thirty days.
3. The Buyer informs the Seller promptly on discovery of any alleged
defect and, if and when requested, returns the tubes, (cost of shipping
to be born by the Seller), as the Seller directs with a full written
report of the defect.
4. The tubes have been stored, installed, maintained, and used properly,
having regard in particular to the applicable specifications and
instructions for use as published by the Seller.
5. The Seller's liability in the case of tubes or components not of the
seller's manufacture shall in no circumstances extend beyond any
corresponding liability to the Seller of the manufacturer of such tubes
or components.
All expressed and implied conditions, warranties and other liabilities arising
under common law or status are expressly excluded.
<PAGE>
EXHIBIT B
PRICING FOR PHOTOMULTIPLIER TUBES
Pricing will be as shown below for the time period September 1, 1999 through
Aug. 31, 2001. Pricing for the three years beginning September 1, 2001 will be
the price from the previous year adjusted only * For example, if the volume of
19mm tubes in year two was * and in year three, the volume is *, the price will
be:
(*
. * The decrease in price due to volume factor
*
Pricing: * *
XP1912 (19mm) 5410009-00 * *
* *
* *
XP3102 (1") TBD * *
* *
* *
* *
XP5292 (2") TBD * *
* *
* *
* *
Note: the 2" pricing to be re-negotiated after production volumes reach *
pieces.
*Omitted information is the subject of a request for confidential treatment
pursuant to Rule 406 under the Securities Act of 1933 and has been filed
separately with the Securities and Exchange Commission.