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Exhibit 10
[*] Designates portions
of this document that have been omitted pursuant to a request for
confidential treatment filed separately with the Commission
AMENDED AND RESTATED INTERNATIONAL
DISTRIBUTION AGREEMENT
This Amended and Restated
International Distribution Agreement (“Agreement”),
dated as of May 2, 2008, is made by and between
| (1) |
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ThermoGenesis Corp., a corporation having a place of business
at 2711 Citrus Road, Rancho Cordova, CA 95742, USA
(“TGC”); and |
| (2) |
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GE Healthcare Bio-Sciences AB, a GE Healthcare company
headquartered at Björkgatan 30, SE-751 84 Uppsala, Sweden
(“GEHC”). |
RECITALS
Whereas, effective as of
October 13, 2005, TGC and GEHC entered into an International
Distribution Agreement (the “Original Agreement”),
pursuant to which TGC granted GEHC certain rights to distribute and
service the Auto Xpress™ System which automates the volume
reduction process for cord blood (the “AXP Platform”)
and consists of a battery-operated device, a processing set that
has integrated sampling segments, and GMP-compliant software
(XpressTRAK™), and a computer-controlled, robotic liquid
nitrogen cryopreservation and storage system that enables the
freezing and managing of approximately 3,600 blood component
samples (the “BioArchive System”); and
Whereas,
the parties now wish to amend and restate the Original Agreement in
its entirety as set forth below, effective as of July 1, 2008
(the “Effective Date”) including the reversion back to
TGC of global distribution rights to the BioArchive System.
Now,
therefore, the parties have agreed as follows:
As used in this Agreement, the
following terms shall have the meaning given below:
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1.1 |
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“Affiliate” means any company controlling,
controlled by or under common control with the relevant party where
control means direct or indirect ownership of at least 50% of the
voting stock or interest in a company or control of the composition
of the board of directors. |
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1.2 |
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“Appropriate Regulatory Authorities” means
those governmental or regulatory agencies within the Exclusive
Territory, which are responsible for (i) approving Products
before they can be sold commercially and (ii) regulating the
manufacturing, packaging, labelling, marketing, advertising,
storage, records and reports and distribution of Products. |
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1.3 |
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“ AXP Platform Transfer Territories ” means
those countries and territories set forth in Schedule 1
, attached hereto. |
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1.4 |
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“ Confidential information ” means any
information, knowledge or material of a confidential or secret
nature of or concerning TGC or GEHC or their respective activities,
which shall include, but not be limited to, information, knowledge
or material: |
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(a) |
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of a technical or scientific nature relating to or concerning
know-how, technical data, computer programs and systems, designs,
databases, inventions, manufacturing or engineering techniques and
procedures, equipment, materials, product designs and
specifications, test and quality assurance procedures, research and
research projects, and plans for future development; |
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(b) |
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of a business nature such as marketing plans, product plans,
business strategies, costs, profits, formulae, markets, sales,
lists of customers and suppliers, distributors, agents,
consultants, information concerning or relating to any of its
employees, training methods and the like; or |
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(c) |
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entrusted to TGC or any of its Affiliates by third parties on a
confidential basis. |
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1.5 |
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“ Exclusive Territory ” means worldwide,
excluding the AXP Platform Transfer Territories. |
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1.6 |
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“ Field ” means the automated volume
reduction of blood derived from umbilical cords and/or
placentas. |
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1.7 |
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“Products ” means the AXP Platform products
used within the Field, as specified in Schedule 2
hereto, including any future products or line extensions of the
Products for use within the Field, which are or will be
manufactured by TGC or its Affiliates during the term of this
Agreement. Notwithstanding anything else contained in this
Agreement, pricing for any future products or line extensions of
the Products developed by TGC during the term of this Agreement
will be determined by mutual written agreement of TGC and GEHC,
except as otherwise expressly set forth below. |
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2.1 |
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Subject to the terms and
conditions hereinafter set out, TGC appoints GEHC as its exclusive
distributor in the Exclusive Territory of Products used within the
Field. In the event GEHC exercises its option to provide service
for Products it sells in the Exclusive Territory, as set forth more
fully Section 2.2 below, TGC also appoints GEHC as its
authorized service provider for such Products within the Exclusive
Territory and any other countries or territories the parties
mutually agree upon in writing. |
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2.2 |
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Within five (5) business days of the Effective Date, GEHC
shall have the right to elect to provide service for the Products
in the Exclusive Territory (the “Service Option”). In
the event GEHC so elects to provide service for the Products, such
service shall be provided in accordance with the terms and
conditions set forth herein. In the event GEHC does not elect to
provide service for Products in the Exclusive Territory, then GEHC
shall have no rights or obligations to provide service of the
Products and such related terms contained herein shall be of no
effect. |
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2.3 |
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Except as otherwise provided in this Agreement, GEHC
shall: |
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(a) |
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purchase all Products and replacement Product parts from TGC,
which Products and replacement Product parts shall thereafter be
resold by GEHC to its customers; |
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(b) |
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maintain an inventory of the Products and replacement Product
parts in quantities sufficient to adequately service its customers;
and |
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(c) |
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not sell or market Products for use (i) outside the
Exclusive Territory or (ii) outside the Field (whether within
or outside of the Exclusive Territory). |
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2.4 |
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GEHC shall market and sell the Products under the TGC product
names and trademarks and service marks described on
Schedule 3 hereto and may hold itself out only as
TGC’s exclusive distributor of Products for use within the
Field within the Exclusive Territory. For promotional materials
produced after the Effective Date, GEHC shall not use any brand
names, trademarks or service marks other than as may be listed on
Schedule 3 in connection with the Products without also
indicating in a clear and conspicuous manner that the Products are
manufactured by TGC. For the avoidance of doubt and by way of
example, GEHC shall not market the Products using any brand names,
trademarks or service marks not listed on Schedule 3
unless such Product also contains the phrase “Auto
Xpress™ by ThermoGenesis”. |
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2.5 |
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In the event GEHC exercises the Service Option as provided in
Section 2.2: |
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(a) |
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TGC shall use its best efforts to cause replacement Product
parts to be delivered to GEHC or GEHC’s customers, as
directed by GEHC, without excessive delay. GEHC shall be obliged to
purchase all replacement Product parts from TGC. GEHC should have
an option to source replacement Product parts from other third
party suppliers who are not Affiliates of GEHC if negotiated prices
are fifty percent (50%) or more above an alternative firm bid
(which price is not met by TGC) or quality standards do not meet
the component or product specification defined in TGC’s
technical files for such replacement Product parts; provided that
in such event TGC will have no further indemnification obligations
under this Agreement with respect to Products which may include
replacement parts acquired from such other suppliers. TGC will
supply order lead time for all system components to facilitate
forecasting efforts; |
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(b) |
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GEHC may integrate the Products with GEHC’s service
delivery platforms provided that any such integrated Products
comply with (i) TGC’s QSR (Quality Systems Requisitions)
procedures, including engineering change notices, and (ii) any
Product regulatory certifications then-issued by all Appropriate
Regulatory Authorities. Such Product integrations may include
integration of tools for remote service delivery or design
modification of future generations of the Products to improve
serviceability; |
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(c) |
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GEHC shall have the exclusive right and obligation to deliver
Product training, qualification, repair and other services in the
Exclusive Territory. For the avoidance of doubt, (i) GEHC
shall provide warranty repair service for all Products and
replacement Product parts sold by GEHC; provided that TGC shall
provide, at its cost, any necessary replacement Product parts free
and GEHC shall provide, at its cost, any necessary labor to perform
such warranty repair service, and (ii) GEHC may sell service
contracts for Products sold prior to or during the term of this
Agreement, provided that GEHC purchases replacement Product parts
for use in connection with such service contracts pursuant to
Section 2.5(a) above; and |
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(d) |
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TGC shall forward to GEHC inquiries or other issues from
customers and other third parties in the Exclusive Territory which
relate to the Products for handling. GEHC shall promptly respond to
such inquiries or other issues and keep TGC advised with respect
thereto. |
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2.6 |
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Nothing in this Agreement shall be deemed to preclude TGC,
either directly or indirectly, (i) from making, using, selling
or licensing any of the Products or its technology for use other
than within the Field, (ii) making, using, selling or
licensing any of the Products or its technology outside the
Exclusive Territory and (iii) from using any of the Products
in the banking of veterinary cord blood cells (without any
requirement to purchase Products from GEHC). The parties agree that
TGC shall neither directly nor indirectly sell or actively market
Products in the Exclusive Territory for use within the Field during
the term of this Agreement. |
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2.7 |
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In the event that GEHC intends to sell the Products into a
country that will require modification of such Products by TGC,
GEHC shall provide written notice of the required modifications,
along with an estimate of projected sales, not less than ninety
(90) days prior to the initiation of marketing activities into
such country. Provided that the costs of the required modifications
are reasonable in light of the projected revenues to be received by
TGC in connection with such sales, TGC shall work with GEHC in an
attempt to modify the Products to comply with any such requirements
within a reasonable time frame. |
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PURCHASE OF PRODUCTS AND MINIMUM
PURCHASE OBLIGATIONS |
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3.1 |
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GEHC shall place orders with TGC
for its requirements of the Products and TGC shall deliver any such
ordered Products to GEHC or GEHC customers, as directed by GEHC,
within fifteen (15) days of receipt of the order for Products.
In the event that TGC cannot deliver the quantity ordered within
such lead times, then TGC shall notify GEHC thereof in writing
within three (3) working days and identify the delivery dates
when such quantity will be delivered. TGC shall use its best
efforts to minimize delays in delivering Products. |
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3.2 |
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GEHC agrees to purchase from TGC during the twelve
(12) month period ending December 31, 2008 TGC’s
current single and multi-chamber processing bag sets (the
“Bagsets”) totaling no less than [*], provided however that: |
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(a) |
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such minimum shall be reduced in accordance with the mechanism
set forth in Schedule 4 of this Agreement if there is
any interruption in the supply of Bagsets by TGC for less than six
(6) months at any time during the term of this Agreement,
regardless of cause (including rejection by GEHC of any Bagsets as
a result of the quality of such Bagsets not conforming to the
Purchased Material Quality Requirements set forth in
Schedule 6 of this Agreement. The parties expressly
agree that in the event there is such interruption in the supply of
Bagsets, but such interruption lasts less than six (6) months
then the Annual Minimum for the subsequent calendar year shall be
calculated by taking the lesser of: |
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(i) |
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the original minimum for the calendar year during which the
interruption occurred; or |
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(ii) |
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GEHC’s actual sales for the calendar year during which
the interruption occurred, excluding sales by GEHC necessary to
build safety stock for CBR. |
If the
purchase of the Annual Minimum by GEHC cannot be fulfilled by GEHC
due to a lack of supply of Products other than Bagsets, the parties
will negotiate in good faith a modification to the Annual
Minimum.
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(b) |
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in the event there is a material interruption in the supply of
Bagsets or Products by TGC for greater than six (6) months in
any consecutive twelve (12) month period during the term of
this Agreement, regardless of the cause (including rejection by
GEHC of any Bagsets or Products as a result of the quality of such
Bagsets or Products not conforming to the Purchased Material
Quality Requirements set forth in Schedule 6 of this
Agreement) there shall be no further Annual Minimums applicable
during the term of this Agreement. |
It is
further agreed between the parties to try to agree on a revision of
such Annual Minimum for 2008 prior to June 30, 2008, provided
that if no such revision is agreed to, the Annual Minimum for 2008
shall remain as provided in the preceding sentence. The parties
agree that any revised Annual Minimum shall be calculated
disregarding build-up of CBR safety stock, and safety stock
purchases shall be excluded for purposes of determining whether
Annual Minimums are met. Such minimum number of units for
subsequent years of the Agreement shall be known as the Annual
Minimum.
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3.3 |
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Before October 31 of each year during the term of this
Agreement, GEHC and TGC shall negotiate in good faith and attempt
to agree on an adjustment to the Annual Minimum for the following
calendar year. Subject to the provisions of Section 3.2, and in the
event the parties do not for any reason reach agreement on such
adjustment to the Annual Minimum for the following calendar year,
the Annual Minimum for such following calendar year shall
automatically be adjusted to be equal to one hundred and one
percent (101%) of the initial Annual Minimum for the previous
calendar year. |
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3.4 |
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GEHC shall provide to TGC the initial rolling, twelve
(12) month, quarterly, non-binding forecast of Products to be
purchase from and supplied by TGC by June 30, 2008; provided
however that TGC has provided its production schedule by
June 14, 2008. Thereafter, GEHC shall provide its rolling,
twelve (12) month, quarterly, non-binding forecast of Products
within thirty (30) days of the beginning of each calendar
quarter. |
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4.1 |
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TGC shall deliver the Products
and replacement Product parts to GEHC or GEHC’s customers, as
directed by GEHC using the following shipping terms: |
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(a) |
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For shipments that originate within the United States of
America, regardless of the shipment destination, the shipping term
shall be EXW (Ex Works) from either Rancho Cordova, or such other
warehouse or manufacturing facility as may be designated by TGC.
All costs, including freight, insurance, duties, and taxes will be
the responsibility of GEHC. Additionally, GEHC will clear any
shipments for export. |
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(b) |
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For shipments that originate outside the United States of
America for shipment destinations within the United States of
America, the shipping term shall be DDP (Delivered Duties Paid) to
a named port of importation into the United States of America. All
costs including freight, insurance, duties and taxes incurred after
importation into the United States of America shall be the
responsibility of GEHC. |
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(c) |
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For shipments that originate outside the United States of
America for shipment destinations outside the United States of
America, the shipping term shall be EXW (Ex Works) from a warehouse
or manufacturing facility as designated by TGC. All costs,
including freight, insurance, duties, and taxes will be the
responsibility of GEHC. Additionally, GEHC will clear any shipments
for export or import into the country of shipment destination. |
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4.2 |
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Risk in and title to the Products and replacement Product parts
shall pass to GEHC on delivery per the shipping terms described in
Section 4.1. |
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4.3 |
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GEHC shall be responsible for: |
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(a) |
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obtaining all necessary importation and exportation licenses or
other permits for the Products and replacement Product parts; |
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(b) |
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making suitable arrangements for the importation of the
Products and replacement Product parts into countries other than
the United States; |
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(c) |
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making suitable shipping arrangements for the Products and
replacement Product parts from the location of delivery by TGC as
provided in Section 4.1 to the customers’ locations;
and |
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(d) |
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minimizing the risk of any loss in activity or perishing of the
Products resulting from importation and inland transportation
procedures. |
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4.4 |
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TGC hereby agrees that GEHC purchase orders identified for New
York Blood Center (“NYBC”) and Cord Blood Registry
(“CBR”) shall take priority over any other purchase
orders including, but not limited to, third party purchase orders.
In times of shortage, TGC shall allocate available Products and
replacement Product parts with the following priority: |
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(a) |
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NYBC and CBR (and GEHC shall cause units shipped under purchase
orders identified for NYBC and CBR to be shipped to NYBC and
CBR); |
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(b) |
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Pro-rata based on the total number of units associated with all
outstanding purchase orders, excluding NYBC and CBR, across all
GEHC orders, TGC distributors orders and direct account orders. By
way of example, if GEHC‘s outstanding purchase orders
constitute 75% of the total outstanding purchase orders (based upon
number of units and excluding NYBC and CBR), then GEHC shall be
allocated 75% of the available Product inventory. |
| 5 |
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FEES, PRICES AND
PAYMENT |
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5.1 |
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GEHC shall purchase the Products
and replacement Product parts from TGC at the purchase prices forth
on Schedule 5 hereto, provided that the purchase price
for the AXP Bagsets (i) sold to NYBC and CBR shall be $
[*] each (it being understood that the $ [*] purchase
price for CBR shall apply to both single component and
multi-component processing sets) and (ii) sold to any
customers, other than NYBC and CBR, shall be $ [*] each.
Notwithstanding the foregoing, effective January 1 of each year
during the term of this Agreement, and commencing January 1,
2009, all purchase prices then in effect, other than the purchase
prices described in (i) of the preceding sentence, shall be
increased by three percent (3%), unless the parties otherwise
agree. |
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5.2 |
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Payment for all amounts due under this Agreement shall be made
in full in United States dollars (US$) by GEHC to TGC net of any
Swedish or other applicable withholding, sales, use or other taxes
and fees. GEHC will be responsible for paying all VAT and import
fees, charges, tariffs and assessments attributed to amounts
payable to TGC. GEHC shall furnish TGC upon request with duly
obtained sales tax exemption certificates to the effect that all
sales made to distributor by TGC are for resale, and such other
certificates, permits and documents as TGC may request for tax
purposes. |
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5.3 |
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GEHC will make payment to TGC of all amounts due pursuant to
Section 5.1 above within forty-five (45) days after
delivery and receipt of an invoice. Invoices should be sent to the
Accounts Payable Department at the street address for GEHC set
forth in Section 21.1 below. |
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5.4 |
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In the event of a failure to make any payment on the due date
agreed hereunder, interest compounded quarterly shall be paid on
the outstanding balance at the rate of three percent (3%) above
three month LIBOR for US dollars from the day next following the
due date up until the day of payment. TGC may terminate this
Agreement with sixty (60) days prior written notice in the
event GEHC fails to make payment in full as set forth in
Section 5.3 above of such past due amount (including interest
thereon) following receipt by GEHC of forty-five (45) day
prior written notice from TGC (deliverable after the forty-five
(45) day period described in Section 5.3 has expired),
that the Agreement will be terminated in the event such amount is
not received by TGC. |
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5.5 |
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GEHC agrees to (i) keep accurate and uniform sales and
financial records regarding its sales of Products, which records
shall be preserved during the term of this Agreement and for a
period of two (2) years thereafter and (ii) submit to
TGC, from time to time as TGC may reasonably request, complete and
accurate information concerning the sales and service of the
Products and the other activities of GEHC pursuant to this
Agreement. In addition, at any time during the term of this
Agreement, but not more frequent than once every calendar year, and
for a period of one (1) year thereafter, TGC shall have the
right to have GEHC’s sales and financial records examined by
an independent public accountant reasonably acceptable to GEHC for
the sole purpose of resolving a dispute regarding the purchase
price paid by GEHC for Bagsets sold to NYBC and CBR, at the place
where GEHC maintains such records and during GEHC’s usual
business hours, in order to verify the information provided by GEHC
pursuant to the preceding sentence. |
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5.6 |
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TGC agrees to (i) keep (a) accurate and uniform sales
and financial records regarding its sales of Products and
(b) the records and maintain the systems for all Products as
described in Schedule 6 hereof, which records and
systems shall be preserved during the term of this Agreement and
which records shall be preserved for a period of two (2) years
thereafter and (ii) submit to GEHC, from time to time as GEHC
may reasonably request, complete and accurate information
concerning the r |
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