Exhibit 10.1
BSD MEDICAL CORPORATION
EXCLUSIVE DISTRIBUTION AGREEMENT
This Exclusive
Distribution Agreement is made and entered into this 14th day of
May 2008 by and between Sennewald/Medizin-Technik GmbH,
hereinafter referred to as "DISTRIBUTOR"), a company organized and
existing under the laws of the Federal Republic of Germany and
having a principal place of business at Schatzbogen 86, 81829
Munich, Germany and BSD Medical Corporation, a Delaware
Corporation, (hereinafter referred to as "MANUFACTURER") having a
principal place of business at 2188 West 2200 South, Salt Lake
City, Utah 84119 U.S.A.
Recitals
A. The MANUFACTURER is the sole owner
of all rights. title, and interest in and to certain inventions,
technology, and know-how relating to its hyperthermia cancer
therapy products, namely the BSD 2000 and BSD 500 as well as the
tumor ablation products (MTX-100) to be introduced to the market
(hereinafter referred to as "PRODUCTS") and other applications, and
MANUFACTURER has the right to grant exclusive distributorships
thereunder.
B. DISTRIBUTOR is now desirous of
acquiring from MANUFACTURER an exclusive distributorship to market
and sell the PRODUCTS.
C. The MANUFACTURER is willing to
grant an exclusive distributorship based upon the terms and
conditions hereafter set forth.
NOW, THEREFORE,
in consideration of the mutual covenants and promises contained
herein, and for good and valuable consideration, the parties hereto
intending to be legally bound agree as follows:
Terms of Agreement
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The term
"TECHNOLOGY" related to hyperthermia and ablation cancer therapy
products as used in this Agreement, shall mean any confidential or
proprietary technical information, know-how, trade secrets, written
documentation, machine readable documentation, detailed drawings,
data, methods, processes, specifications, quality and inspections
standards, sales literature, advertising and marketing materials,
reports and training materials.
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The term
"PRODUCTS" as used in this Agreement, shall mean all products, and
by-products produced by or resulting from the use of any portion of
the TECHNOLOGY. The term "PRODUCTS" shall specifically include all
models of the PRODUCTS.
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Section
2 -- Grant of
PRODUCTS
exclusive distributorship
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Subject to the
other terms and conditions set forth herein, MANUFACTURER hereby
grants to DISTRIBUTOR the right to sell, and otherwise to
commercialize the Hyperthermia PRODUCTS for sales in Russia as well
as all European Countries (with the exception of Poland) (all
hereinafter referred to as "TERRITORY"). DISTRIBUTOR agrees that it
will not make sales of these products except in the TERRITORY
unless prior authorization is granted on specific projects in
writing from MANUFACTURER.
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Subject to the
other terms and conditions set forth herein, MANUFACTURER hereby
grants to DISTRIBUTOR the right to sell, and otherwise to
commercialize its Tumor Ablation PRODUCTS for sales in Germany,
Switzerland and Austria. DISTRIBUTOR agrees that it will not make
sales of this product except in the TERRITORY unless prior
authorization is granted on specific projects in writing from
MANUFACTURER.
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Section
3 --
Performance
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DISTRIBUTOR
covenants that it will in good faith commit itself to a thorough,
vigorous, and diligent program of exploiting the PRODUCTS hereof in
accordance with the best business customs of the industry, exerting
its best efforts, so that full utilization of the PRODUCTS will
result. This shall include exposure of PRODUCTS to hospitals,
medical clinics, individual medical practitioners, and appropriate
medical equipment subdealers, outlets and markets throughout the
country(s) in section 2.
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DISTRIBUTOR
further agrees to commit to annual sales projections established in
writing by mutual agreement by the two parties. In the event that
DISTRIBUTOR does not, at any future date, fulfill its projected
sales or shows lack of progress to that end, MANUFACTURER shall
have the right, at its option to terminate this Agreement pursuant
to section 6. Failure to reach agreement on sales projections may
also be cause for termination.
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DISTRIBUTOR
further agrees to provide technical service and support for the
PRODUCTS sold in the TERRITORY. To this end, DISTRIBUTOR will
comply with the training requirements outlined in section 12 and
further agrees to order and keep in stock sufficient spare parts to
be able to service equipment in a timely manner. Failure to provide
this support and/or comply with the training requirements shall be
cause for termination.
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DISTRIBUTOR
further agrees to obtain, at its expense all necessary and relevant
government approvals and permission to market, sell and operate the
PRODUCT in the TERRITORY. Failure to obtain these
approvals shall be cause for termination.
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Section 4-- PRODUCTS pricing.
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Current pricing
as of this contract to the DISTRIBUTOR shall be per quotation from
MANUFACTURER or via published price lists from MANUFACTURER.
DISTRIBUTOR shall receive 25% discount off list prices at time of
purchase order. See attachment for current MANUFACTURER list
pricing.
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4.2 From
time to time MANUFACTURER shall have the right to change prices of
PRODUCTS. Unless otherwise specified by MANUFACTURER, in writing,
new published pricing shall be effective 90 days from the date of
issue of new price lists.
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DISTRIBUTOR
shall purchase all spare and replacement parts directly from
MANUFACTURER
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DISTRIBUTOR
agrees that all purchase orders for PRODUCTS shall be purchased
with a 50% payment at time of placement of purchase order and 50%
payment at time of shipment of product, according to the terms set
forth in MANUFACTURER's quotation as agreed by both parties unless
other terms or conditions are agreed upon in writing by DISTRIBUTOR
and MANUFACTURER prior to new orders being placed. Spare parts
orders shall be payable net 45 days after shipment.
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All moneys
payable hereunder shall be paid in United States Dollars at such
locations in the United States of America as MANUFACTURER may from
time to time designate; unless, any payments due and payable in the
United States is not at that time permitted by law or by reason of
the decision of any competent authority in the country involved,
then, in such event, DISTRIBUTOR shall discharge its obligation for
payment in such other currency and at such place as may be
permitted and agreed to by MANUFACTURER.
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Section 6-- Term and Termination
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With respect to
the DISTRIBUTOR and rights granted hereby, this Agreement shall
commence upon the executing hereof and, unless terminated earlier,
shall continue year to year with automatic 12 (twelve) month
extensions if all conditions of this Agreement have been met,
subject to new sales projections which will serve as minimum
purchase volume targeted amounts (as mutually agreed) as described
in Subparagraph 3.1 and 3.2.
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If any payment
to MANUFACTURER is in arrears for thirty (30) days after the due
date, or if DISTRIBUTOR fails to achieve minimum sales performance
or defaults in performing any of the other terms of this Agreement,
and continues in default for a period of fifteen (15) days after
written notification as provided herein, or if DISTRIBUTOR becomes
insolvent or files for bankruptcy or enters into an agreement with
creditors, or if a receiver is appointed for it, MANUFACTURER shall
have the right to terminate this Agreement upon giving a fifteen
(15) day notice to DISTRIBUTOR.
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As a course of
normal business, the MANUFACTURER has reasonable expectations in
regards to performance, communications, promotions, etc. If, at any
time during this agreement, the DISTRIBUTOR fails to meet these
expectations, the MANUFACTURER shall promptly notify the
DISTRIBUTOR in writing. Failure by the DISTRIBUTOR to remedy the
situation within 30 days to the satisfaction of the MANUFACTURER
shall be sufficient grounds for immediate termination of this
agreement.
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Subsequent to
the termination of this Agreement as provided for in Subsection 6.1
– 6.3, DISTRIBUTOR agrees that it will not engage in the use,
sale or other commercialization or in any other manner for its own
benefit or any person, firm, corporation, association, or other
entity of the TECHNOLOGY for a period of five (5) years and that it
will not sell the PRODUCTS or competitive products during that
period. This excludes any PRODUCTS that the DISTRIBUTOR currently
manufactures, or subsequent developments of this technology that is
not derived from technology offered by the MANUFACTURER.
DISTRIBUTOR agrees that it will not use its knowledge of the
MANUFACTURER'S systems to build or develop competing products that
use phased-array technology to treat deep tumors or any other
software or hardware technology utilized by the MANUFACTURER of
which the DISTRIBUTOR becomes aware because of its activities
associated with this agreement. At the termination of this
agreement, any items remaining in stock may be returned to the
MANUFACTURER at a mutually agreed upon price.
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Upon
termination of this Agreement for any reason, nothing herein shall
be construed to release either party of any obligation that matured
prior to the effective date of such termination, and any unpaid
payments under this Agreement shall become immediately due and
payable.
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Notwithstanding
the above, DISTRIBUTOR shall have no obligation to purchase the
minimum purchase requirements herein for any period after the day
of notification of termination by DISTRIBUTOR or notification of
default by MANUFACTURER, unless such default is remedied as
contained herein. DISTRIBUTOR shall not be liable to purchase any
units beyond those already ordered and paid for in the event of
termination or default.
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Section 7-- Third party Infringement of Patent or
Future Patent Applications
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Should
MANUFACTURER or DISTRIBUTOR become aware of any infringement or
alleged infringement in the country in paragraph 2, that party
shall immediately notify the other party in writing of the name and
address of the alleged infringer, the alleged acts of infringement,
and any available evidence of infringement. MANUFACTURER and
DI
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