DISTRIBUTION AGREEMENT
This Agreement dated as of August 15, 2004
between, Ozonebio (herein called
"Distributor"), and Saliva Diagnostic
Systems, Inc., a Delaware corporation,
located at 2294 Nostrand Avenue Brooklyn,
New York 11210 and hereinafter
referred to as ("SDS").
:
1. APPOINTMENT OF
REPRESENTATIVE
Subject to
the terms and conditions of this Agreement, SDS hereby grants
to said
Distributor, and Distributor hereby accepts, the exclusive
right
to
solicit, sell, market and act as sales agent for certain
Products
produced
or sold by SDS which Products are listed in Exhibit I hereto
(hereinafter referred to as the "Products").
2. NATURE OF
APPOINTMENT
The
appointment of Distributor as sales agent shall be only for sales
to
the
professional markets and governments in the "Exclusive Territory".
The
Exclusive
Territory is defined as India
3. SALES, PRICES AND
PAYMENTS
a.
SDS agrees
to sell to Distributor the Products ordered by
Distributor at the prices listed in Exhibit I which prices are
in
U.S. dollars. All Purchase Orders must include an irrevocable
Letter
of Credit from a bank acceptable to SDS.
b.
Distributor will be free to set the sales price for the
Products
purchased from SDS.
c.
All
payments due to SDS by Distributor resulting from this
Agreement
shall be made by direct wire transfer or letter of credit in
accordance with SDS' terms.
d.
Payments
shall be made in U.S. Dollars
e.
All
handling charges, customs, duties, taxes, storage and all other
charges applicable to the Products after they are delivered to
the
port in India shall be the responsibility of Distributor.
4. DUTIES OF SDS
SDS
shall:
a)
not sell
the Products in the exclusive Territory, other than through
Distributor;
b)
not enter
into any other contract for sales to the professional
markets and governments in the "Exclusive Territory" during the
term
of this Agreement;
c)
use its
reasonable best efforts basis that the Products ordered by
Distributor are delivered in accordance with its transportation
instructions;
<PAGE>
d)
provide
Distributor with all the available standard information and
marketing literature in the English language that are related to
the
Products;
e)
confirm to
Distributor, after receipt of advice of payment set forth
in Section 2, the corresponding delivery schedule for the
Products;
f)
Use its
reasonable best efforts to ensure that Distributor is
provided with Products that are in good selling condition and
fit
for the ordinary purposes for which the Product is intended.
g)
In the
event that SDS receives any offer, purchase order or request
for proposal for
the sales of the Products within the exclusive
territory of Distributor, SDS shall refer such offer, purchase
order
or request for proposal to Distributor on a timely basis.
h)
Not
divulge any information with respect to Distributor's
operations
except as may be necessary to carry on its activities under
this
Agreement. This obligation shall survive any termination or
expiration of this Agreement.
i)
SDS shall
supply its standard registration package to Distributor
within 10 days of the execution of this Agreement...
5. DUTIES OF
DISTRIBUTOR
Distributor shall, during the term of this Agreement:
a)
in order
to assist SDS in its coordination of sales and delivery,
provide SDS with quarterly forecasts with Distributor's
requirements
for the Products, which forecasts shall not constitute a
binding
purchase order of Distributor;
b)
Provide
SDS with reports on a quarterly basis regarding sales
activity, distribution partners, and other arrangements that
Distributor is making to promote products.
c)
at
Distributor's sole expense, obtain all licenses, permits,
approvals and other governmental authorizations, and make all
filings, notifications and registrations (collectively
"Authorizations and Registrations") with all governmental
agencies
necessary or appropriate for the distribution and sale of
Products
by Distributor and its distributors, and use by Distributor' and
its
distributors' customers, of the Products in the territories;
d)
furnish to
SDS, together with any purchase order, clear and complete
written instructions for the transportation of the Products
ordered,
including the name of the carrier appointed by Distributor
whenever
necessary; the organization of the transportation of any
Products
ordered and any costs related to said transportation, including
freight and insurance costs, all of which shall be the sole
responsibility of Distributor;
e)
Undertake
all necessary means, measures and efforts and implement
policies and procedures to ensure that the Products sold to
Distributor by SDS are not sold for resale or otherwise outside
the
Exclusive Territory by Distributor, its agents, affiliates,
consultants and/or any
other party or entity.
<PAGE>
f)
In order
to maintain the exclusive rights granted in this Agreement,
obtain registration of the Products in India not later than 3
months
following the date of signing.
g)
In order
to maintain the exclusive rights granted in this Agreement,
meet the Cumulative Minimum Purchases set forth in Exhibit II.
In
the event that Distributor does not meet the Cumulative Minimum
Purchases set forth in Exhibit II, SDS will be allowed to
appoint
additional distributors in the Exclusive Territory. In such
case,
the right of Distributor to continue as a non-exclusive
distributor
shall be decided by SDS in its sole and exclusive discretion.
For
the purpose of this clause ,an order shall be deemed placed if
delivery is to occur within 60 days after the order is placed
h)
Allow SDS
upon reasonable request and notice to obtain reports of
sales and purchases of the Products from Distributor as
reasonably
required by SDS to determine Distributor's performance as
compared
with the Cumulative Minimum Purchases for the Exclusive
Territory.
i) Refrain from entering
into any contract or other arrangement with
any other party for the sale or marketing of any products, using
a
rapid point of care technology, that are competitive to
Products
during the term of this Agreement.
j)
Not
divulge any information with respect to SDS' operations except
as may be necessary to carry on its activities under this
Agreement.
This obligation shall survive any termination or expiration of
this
Agreement.
6. SHIPMENT:
SDS shall
ensure the expeditious shipment as soon as possible after an
order is
placed by Distributor for the Territory. In the event of any
delays in
shipment Distributor will be notified within forty-eight (48)
hours by
telephone, telefax and/or email, so that Distributor may in
turn
advise its
clients in the Territory of the expected delays. SDS agrees to
replace
defect