Distribution Services Agreement - Apheresis Technologies Inc. and OccuLogix Corp.
DISTRIBUTION SERVICES AGREEMENT
THIS DISTRIBUTION SERVICES AGREEMENT is made and entered into this
_____ day of May, 2002, by and between Apheresis Technologies, Inc., a Florida
corporation located at 612 Florida Avenue, Palm Harbor Florida (the "Provider"),
and OccuLogix Corporation, a Florida corporation ("OccuLogix").
WITNESSETH:
WHEREAS, the Provider is a provider of customer service,
warehousing, order fulfillment, billing and shipping services; and
WHEREAS, OccuLogix is initiating marketing into Canada and Mexico
and is in the process of obtaining FDA approval for the sale and distribution of
its Rheopheresis product group, including certain disposable filters, tubing and
pump machines (the "Product'); and
WHEREAS, OccuLogix desires to obtain from the Provider certain
services; and
WHEREAS, the Provider desires to provide certain services to
OccuLogix.
NOW, THEREFORE, in consideration of the mutual obligations and
promises set forth herein, the Provider and OccuLogix agree as follows:
1. Term. The term of this Agreement shall commence on the date hereof and
shall continue until the date ten years subsequent to the "Approval Date."
For purposes of this Agreement, the term "Approval Date" shall mean the
date on which the FDA grants to OccuLogix PMA approval to sell the Product
in the US; provided, however, that if the Approval Date shall not have
occurred by May 1, 2012, this Agreement shall terminate.
2. Services. The parties agree that the Provider shall be the exclusive
provider to OccuLogix of warehousing, order fulfillment, shipping, billing
services and customer service related to shipping and billing all as
further provided herein.
3. Warehousing. OccuLogix, at its expense, shall ship a quantity of Product
inventory determined by OccuLogix to the premises of the Provider at 612
Florida Avenue, Palm Harbor Florida, or other such facility as deemed
necessary or appropriate by the Provider. The Provider shall store,
maintain, manage and account for such inventory in accordance with
warehouse procedures to be agreed upon from time to time by the parties,
but will at a minimum materially satisfy all FDA and or other regulatory
requirements as may be necessary. As such, the Provider agrees to remain
in compliance with all pertinent regulations at all times.
4. Order Fulfillment; Customer Service. Orders for the Product, whether
received by OccuLogix or directly by the Provider, shall be forwarded to
the Provider for processing. Upon Provider's receipt of confirmation of
the purchase from OccuLogix, the order shall be picked from inventory on a
FIFO basis, packed, labeled and otherwise prepared for
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shipping by the Provider, all in accordance with order fulfillment
procedures to be agreed upon from time to time by the parties.
5. Shipping; Billing. The Provider agrees to ship all orders processed
hereunder in accordance with shipping procedures to be agreed upon from
time to time by the parties. At the time of shipment, the Provider shall
invoice the customer in accordance with procedures approved by OccuLogix
and shall enter such invoice information into a billing and collection
system specified by OccuLogix.
6. Reporting. The Provider shall report its activities hereunder to OccuLogix
in reasonable detail on a daily basis using such report formats as are
agreed upon from time to time by the parties.
7. Fees. OccuLogix shall pay to the Provider service fees for the services
provided hereunder in accordance with the following terms:
(a) OccuLogix shall pay to the Provider a basic service fee of 5%
of the cost of delivered goods. For purposes of this
Agreement, the tern "cost of delivered goods" shall mean the
purchase price paid by OccuLogix for the goods, together with
all shipping and related charges to the Provider's warehouse.
For the purposes of this agreement, the basic service fee
shall be compensation for all preparation and handling of
shipments, customer service of shipping, handling and returns,
all invoicing activities and warehousing (including labor
costs for employees directly involved in the performance of
such services).
(b) In addition, Occulogix shall pay the Provider the cost of
shipping between Provider and customer including any required
packaging and labeling (materials and labor).
(c) The Provider shall invoice OccuLogix for services monthly.
Invoices are due 30 days after the date of the invoice. The
invoice shall be in a format with sufficient detail for use by
OccuLogix for financial reporting and management planning
purposes.
8. Examination of Records. Upon not less than 48 hours notice, each party
shall be entitled to examine the records of the other party regarding the
performance of the parties under this Agreement on regular business days
(Monday through Friday) and during regular business hours (8:30 A.M. -
5:00 P.M. Eastern Time).
9. Notices. Notice by either party will be made only in writing by certified
mail, return receipt requested or facsimile addressed to the other party
and will be considered given as of the time it is received. Addresses for
notices are as follows:
Provider:
Apheresis Technologies, Inc
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612 Florida Avenue
Palm Harbor FL 34683
FAX: 784-0898
OccuLogix Corporation
612 Florida Avenue
Palm Harbor FL 34683
FAX: 784-0898
Changes to the notice addresses may be accomplished by notice in
accordance with this paragraph.
10. Risk of Loss and Insurance.
(a) The risk of loss of OccuLogix inventory shall at all times be
borne by OccuLogix; provided, however, that any damage
occurring as a result of negligence of the Provider shall be
the responsibility of the Provider.
(b) Each party shall be responsible for maintaining insurance upon
its own inventory, equipment, furniture, fixtures, supplies
and other property located upon the premises of the Provider.
(c) Each party shall carry General Liability Insurance in the
amount of not less than $1,000,000 per occurrence/$2,000,000
aggregate during the term of this agreement.
(d) Each party shall furnish evidence to the other party of its
compliance with this paragraph.
11. Confidential Information. The parties hereto consider this Agreement and
all of its terms and conditions to be confidential. Except as may have
been, or shall be, authorized in writing, or as hereinafter mentioned,
each of the parties hereto shall keep confidential and shall not use
otherwise than in the performance of this Agreement and shall take all
reasonable steps to insure that its employees keep confidential and not
use, all information supplied to them or which they have learned during
the negotiations leading to this Agreement or learned hereafter concerning
the business of the other. This obligation shall survive the termination
of this Agreement and for 5 years after any termination of this Agreement.
Nothing herein shall preclude disclosure of information to the extent that
the disclosure is required to be made under laws or regulations in force
and applicable to the party, or pursuant to a subpoena; provided, however,
the party required to disclose any such confidential information shall
immediately, upon receipt of a subpoena, notice, demand or order to
produce the information, and prior to complying with the subpoena, notice,
demand, or order, notify the other party of said subpoena, notice, demand
or order and at the request of the other party, contest or join with the
other party in contesting the propriety and/or authority of disclosing the
information. Each party shall bear its own costs of complying with the
provisions of this paragraph.
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12. Independent Contractor. The parties each agree and acknowledge that this
Agreement does not constitute a joint venture or partnership. This
Agreement has been reached by arms' length negotiations and is an
independent services contract in which the Provider acts as an independent
contractor.
13. Assignability. This Agreement and the rights and obligations hereunder may
not be assigned by either party without the prior written consent of the
other party.
14. Force Majeure. Except for the payment of money due hereunder, the Provider
and OccuLogix shall be excused for failure to perform under this Agreement
where such failure results from circumstances beyond the affected party's
control including, without limitation, such circumstances as fire, storm,
flood, earthquake, strikes, work stoppages or slow downs, delay or failure
of transportation or supplies, acts of the public enemy, acts of God or
acts, regulations, priorities or actions of the United States, a state or
any local government or agents or instrumentalities thereof.
15. Governing Law. This Agreement shall be interpreted, and the rights,
obligations and liabilities of the parties determined in accordance with
the laws of the State of Florida (without regard to the conflicts of laws
provisions thereof). The parties agree that any litigation arising out of
this Agreement or performance of it by either party shall be litigated in
either the Circuit Court of Pinellas County, Florida, or the United States
District Court for the Middle District of Florida, Tampa Division.
16. Amendments. No alteration, modification or change of this Agreement shall
be valid except by an agreement in writing executed by both parties
hereto.
17. Dispute Resolution. The Provider and OccuLogix will attempt to settle any
claim or controversy arising out of this Agreement through consultation
and negotiation in good faith and a spirit of mutual cooperation. If those
attempts fail, then the dispute will be mediated by a mutually acceptable
mediator to be chosen by the Provider and OccuLogix within 45 days after
written notice by either to the other demanding mediation. Neither party
may unreasonably withhold consent to the selection of a mediator, and the
Provider and OccuLogix will share the cost of the mediation equally. By
mutual agreement, the Provider and OccuLogix may postpone mediation until
some specified but limited discovery about the dispute has been completed.
The parties may also agree to replace mediation with some other form of
alternative dispute resolution. Any dispute which cannot be resolved
between the parties through negotiation, mediation or other form of agreed
alternative dispute resolution within 120 days of the date of the initial
demand for it by one of the parties may then be submitted to the courts
for resolution. Nothing in this section will prevent either party from
resorting to judicial proceedings if (A) good faith efforts to resolve the
dispute under these procedures have been unsuccessful, (B) interim relief
from a court is necessary to prevent serious and irreparable injury to one
party or to others, or (C) litigation is required to be filed prior to the
running of the applicable statute of limitations. The use of any
alternative dispute resolution procedure will not be construed under the
doctrines of laches, waiver or estoppel to affect adversely the rights of
either party.
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18. Severability. In the event that any provision or any portion of any
provision of this agreement is held illegal, unenforceable, or invalid by
any Court, such provision or portion thereof shall be deemed to be deleted
from this agreement, and the validity of the remainder of this agreement
shall remain unaffected thereby.
19. Entire Agreement. This Agreement constitutes the entire Agreement and
understanding of the parties with regard to the matters covered herein.
20. Attorneys' Fees. If any suit, action or arbitration is initiated by any
party to enforce this Agreement or otherwise with respect to the subject
matter of this Agreement, the prevailing party in such suit, action or
arbitration shall be entitled to recover reasonable attorneys' fees and
expenses, including but not limited to travel, incurred in the preparation
and prosecution or defense of such suit, action or arbitration, and if any
appeal is taken from the decision of the trial court or arbitrator,
reasonable attorneys' fees for such appeal.
21. Events of Default. The occurrence of one or more of the following events
(an "Event of Default") shall constitute a default hereunder:
(a) Covenants. The failure of either party hereto to perform or
observe any covenant, term or condition binding on it
contained herein if such default is not remedied within 30
days after written notice thereof from the non-defaulting
party.
(b) Liquidation; Bankruptcy. In the case of the Provider, the
liquidation or dissolution of the Provider, or the filing by
or against the Provider of a petition seeking relief under the
United States Bankruptcy Code, as amended, or under any other
insolvency act or law.
(c) Business Suspension. In the case of the Provider, the
suspension of the Provider's business by a governmental agency
or instrumentality, including without limitation the United
States Food and Drug Administration, as a result of any
alleged violation by the Provider of any law, rule or
regulation administered or promulgated by such agency or
instrumentality.
22. Remedies. Upon the occurrence of any Event of Default, and at any time
thereafter as long as the Event of Default is continuing, the
nondefaulting party may terminate this Agreement and may pursue all
rights, remedies or recourses available to such party at law, in equity or
otherwise. Such remedies are cumulative, and exercisable concurrently, and
may be pursued singularly, successively or together and may be exercised
as often as occasion therefore shall arise.
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IN WITNESS WHEREOF, each of the parties hereto have caused this
Agreement to be signed by its respective duly authorized representative.
Apheresis Technologies, Inc.
By: /s/ John Cornish
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OccuLogix Corporation
By: /s/ Richard Davis
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