Exhibit
10.2
CONFIDENTIAL PORTIONS HAVE
BEEN OMITTED BASED UPON A REQUEST
FOR CONFIDENTIAL TREATMENT
PURSUANT TO RULE 24b-2 OF THE
SECURITIES EXCHANGE ACT OF
1934 AND HAVE BEEN SEPARATELY FILED
WITH THE
COMMISSION.
THIRD AMENDMENT TO OEM
PURCHASE AND SUPPLY AGREEMENT
This Third Amendment (the
“Amendment”) is made as of June 10, 2005, by and
between Cardiac Science, Inc., a Delaware corporation
(“Supplier” or “Cardiac Science” or
“CSI”), a medical device developer and manufacturer of
automated external defibrillators having its principal place of
business at 1900 Main Street, Irvine, CA 92614 and GE Medical
Systems Information Technologies, Inc., a Wisconsin corporation
d/b/a GE Healthcare (“GEMS-IT”), having its principal
place of business at 8200 W. Tower Avenue, Milwaukee, WI
53223.
W I T N E S S E T H:
WHEREAS, CSI and GEMS-IT are parties to that
certain OEM Purchase and Supply Agreement dated July 29, 2003, an
“Addendum 1” to the OEM Purchase and Supply Agreement
dated as of March 24, 2004, Amendment One to OEM Purchase and
Supply Agreement dated August 10, 2004 (“Amendment
One”), and Second Amendment to OEM Purchase and Supply
Agreement dated February 14, 2005 (collectively, the “OEM
Purchase and Supply Agreement”).
WHEREAS, CSI and GEMS-IT desire to supplement
and amend the OEM Purchase and Supply Agreement as set forth
herein.
WHEREAS, CSI and GEMS-IT are simultaneously
entering into that certain Exclusive Distribution Agreement for
United States and Canadian Hospitals (“Exclusive Distribution
Agreement”) to provide GEMS-IT with certain exclusive
distribution rights with respect to the OEM Products.
NOW THEREFORE, in consideration of the premises
and other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, is the parties hereto agree as
follows:
1.
Construction
. Except as provided in this
Amendment, the terms and conditions set forth in the OEM Purchase
and Supply Agreement shall remain unaffected by the execution of
this Amendment. To the extent any provisions or terms set forth in
this Amendment conflict with the terms set forth in the OEM
Purchase and Supply Agreement, the terms set forth in this
Amendment shall govern and control. Terms not otherwise defined
herein, shall have the meanings set forth in the OEM Purchase and
Supply Agreement. This Amendment amends the OEM Purchase and Supply
Agreement and not that certain OEM Purchase Agreement entered into
by the parties on July 29, 2003.
2. Section 1.3 is hereby amended by inserting the
following sentence at the end of that section:
“For the purposes of this
Agreement, “GEMS-IT” shall include GEMS-IT and any
GEMS-IT Affiliate or GEMS-IT Subcontractor (including distributors)
involved in the marketing, sale, distribution or servicing of the
OEM Products.”
3. Section 1.4 is hereby deleted in its entirety
and replaced with the following:
“ Term of the Agreement
. This Agreement will commence as of the Effective Date and
continue until June 30, 2009 (the “Term”), unless
terminated earlier under the terms of this Agreement. Any extension
beyond the initial term shall be based upon the mutual agreement of
the parties.
Notwithstanding the foregoing, this
Agreement shall remain in effect and GEMS-IT shall have the right
to purchase from Supplier, GE-branded Responder® AEDs and AED
Pros (in GEMS-IT specified coloring) and related accessories and
consumables for sale on a non-exclusive basis outside the United
States and Canada (excluding the country of Japan) until December
31, 2010.”
4. Section 2.15 is hereby deleted in its entirety
and replaced with the following:
“ Parts and Accessories
” means the Service Parts and the Supplies and Accessories,
collectively. “Service Parts” means the replacement
parts and components used to service, maintain and repair the OEM
Products. “Supplies and Accessories” means the
accessories, consumables and other products that may be supplied in
conjunction with, used with, or used as additions to the OEM
Products.”
5. Section 3.6 is hereby deleted in its entirety
and replaced with the following:
“The Lead Time for the OEM
Products is one (1) week for Order(s) of units of OEM Products that
are within one hundred and ten percent (110%) of the volume of
purchases in the previous calendar quarter. Supplier agrees
that it is in the mutual business interest of the parties to ship
the OEM Products on the next day or as soon as practicable after
receipt of an Order.
If, during any calendar quarter,
Supplier fails to meet three (3) or more Delivery Dates it has
confirmed or that has been deemed accepted in accordance with
Section 3.2, the then current Term of the Agreement shall be
extended, and the date upon which GEMS-IT must attain minimum
purchase levels to achieve exclusivity under the Exclusive
Distribution Agreement shall be deferred, for an additional three
(3) month period for each calendar quarter in which such failure
occurs.”
6. Section 9.4.1 is hereby deleted in its entirety
and replaced with the following:
“ Customer Service
. Outside of the United States and Canada,
customer service calls will be handled by GEMS-IT. If a customer
calls GEMS-IT with a Product Warranty issue (GEMS-IT fields the
warranty call), GEMS-IT will inform Supplier of the warranty call
and will receive a RMA from Supplier. GEMS-IT or its customer will
return the product for repair or replacement to Supplier’s
facility in Minnetonka, MN or Supplier’s then current
facility. Supplier will repair or replace the OEM Product and
deliver the OEM Product to a location requested by GEMS-IT within
two (2) weeks of Supplier’s receipt of a returned OEM
Product. Within the United States and Canada, customer service
calls will be handled directly by Cardiac Science, and all repaired
or replaced OEM Products must be delivered within two (2) weeks of
Supplier’s receipt of a returned OEM Product. Supplier and
GEMS-IT shall work together to ensure prompt communication to the
other party of all customer communication.
Loaner Inventory.
Within thirty (30) days of this
Amendment, Cardiac Science shall provide, at no cost to GEMS-IT, up
to fifteen (15) additional GE Healthcare-branded Responder®
AEDs and/or AED Pros to be used by GEMS-IT as loaner inventory
and to facilitate warranty exchanges for end users. These units
shall be suitably configured with local languages as per GEMS-IT
instructions.
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In all cases, freight charges to and
from Supplier’s facility for warranty service and loaner
inventory will be paid by Supplier.
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Out of Warranty
Service. Outside the
United States and Canada, if GEMS-IT requires out of warranty
service from Cardiac Science, GEMS-IT will bill the customer as
appropriate per GEMS-IT policies. GEMS-IT will inform Supplier of
the customer issue and will receive a RMA from Supplier. GEMS-IT or
its customer will return the product to Supplier’s facility
as outlined above. Supplier will repair and deliver the product to
a location requested by GEMS-IT within two (2) weeks of
Supplier’s receipt of a returned OEM Product. Supplier will
bill GEMS-IT at a discount to Supplier’s then current service
fee schedule, which service fee schedule shall not exceed the
amount Supplier charges (after disc
