Document:

Exhibit 10.5

    MEMORANDUM
      OF UNDERSTANDING

    

    This
      Memorandum of Understanding (hereinafter referred to as “MoU-A”) is made this
      10th
      day of
      September, 2005 by and between:

    

    Kirloskar
      Oil Engines Limited, a company incorporated under the Companies Act 1956 and
      having its registered office at Pune, hereinafter referred to as KOEL (which
      expression shall mean and include its successors and representatives) as the
      party of the FIRST PART;

    

    Axial
      Vector Engine Corporation (Previously known as Aero Marine Engine Inc Name
      change effective May 31, 2005), a company incorporated in Nevada, USA and having
      its registered office at Portland Oregon USA, hereinafter referred to as AVEC
      (which expression shall mean and include its successors and representatives)
      as
      the party of the SECOND PART; WHEREAS:

    

    KOEL
      is
      an established company in India and is involved in the Research, Development
      and
      Manufacturing of Diesel Engines for various applications, bearings, valves
      and
      catering to markets in India and a few Overseas markets as well.

    

    AVEC
      is a
      company possesses a unique technology in the field of internal combustion engine
      and generator sets (Gen Sets) which have potential use in a wide range of
      applications such as the military, automotive, power generation, fluid handling,
      aviation, boats and ships, etc. Hereinafter, this unique technology is referred
      to as Axial Vector Engine (AVE).

    

    Both
      the parties wish to work together for mutual benefit on the following
      understanding:

    

    
      	1.  	
              KOEL
                is keen to obtain manufacturing license to manufacture AVE in India
                and
                AVEC is agreeable to grant such a license on terms and conditions
                to be
                agreed to.

            

    

    

    
      	2.  	
              On
                execution of this MoU, KOEL will deposit one (1) million United States
                Dollars (USD) in a separate bank account in India solely controlled
                by
                KOEL. And, KOEL will formally instruct the bank to promptly advise
                AVEC of
                the creation of the account and all activities that occurs in the
                account.

            

    

    

    
      	3.  	
              As
                result of depositing the amount as above, KOEL will have the following
                rights:

            

    

    

    3.1 First
      right of refusal for stationary use of AVE and Gen Sets such
      as generating
      sets and pumping sets amongst other such applications, and non-automotive
      mobile use 

                 
      such as tractor engines, excavator engines, loader
      engines, fork life truck engines, farm and forestry applications.

    

    3.2 AVEC
      will
      provide enough opportunities to KOEL to conduct.

    

    3.21 Detailed
      Technical Due Diligence. The estimated time to complete due diligence
      is January 2006.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    3.2.2 Commercial
      Feasibility Study for the manufacture of AVE in India under license.
      The estimated time to complete the study is April 2006.

    

    3.3 AVEC
      will
      deal exclusively with KOEL concerning the manufacture of AVE
      under
      license in India as identified in Item 3.1 and AVEC will not entertain,
      solicit or discuss 

                 
      with any third party the subject matter of this MoU
      as
      defined in Item 3.1

    

    4. The
      one
      million dollars referred in Item 2 above shall be kept in the bank account
       until
      one
      or more of the following events occur:

     

    4.1 The
      final
      agreement for manufacture of AVE in India under license is executed
      after all the due diligences, commercial feasibility and trials
      and negotiations
      are complete. 

                 
      The money from the bank account will then be used
      as
      license fees to AVEC.

    

    4.2 If
      the
      final agreement for manufacture of AVE in India under license
      is not
      executed by June 2006 for any reason KOEL will be free to deal
      with the
      bank
      account in 

                 
      whatever way it deems proper. 

    

    5. In
      response to the KOEL desire described above, AVEC is agreeable to exclusive
      negotiation
      a license for the said products identified in Item 3.1 during the validity
       of
      this

        MoU.

    

    6.
      The
      parties will share their proprietary information to each other. Such proprietary
       information
      shall be confidential and shall be kept secret as per the terms and  conditions
      

        agreed
      between the parties in confidential agreement dated May 12,  2005,
      a
      copy of which appears as Annexure to this MoU.

    

    7.
       All
      disputes, proceedings, claims by either Party and suits in relation to this
      MoU
 shall
      be
      referred to Arbitration. The arbitration proceeding shall be governed by
 the
      

        
      Arbitration and Conciliation Act 1996 and the Place of such Arbitration shall
       be
      Singapore.

    

    8.
       This
      MoU
      shall remain in force till June 2006. The MoU may be extended by the
 written
      and mutual consent of KOEL and AVEC.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF the parties hereto have set and subscribed their hands to the
      writing (in duplicate) on the day and year mentioned above.

    
 

    
      	 For: Kirloskar Oil Engines
              Limited	
               For: Axial Vector Engine
                Corporation

            
	
               

               /s/ Atul
                Kirloskar

               _____________________

            	
               

              /s/
                Raymond Brouzes

               _____________________

            
	 Authorized Signatory 	 Authorized Signatory
	 Date: 10 September 2005 	 Date: 09 September 2005
	 Place: Pune India 	 Place:
              MontrealDiaSys Corporation - Exhibit 10.14A

Exhibit 10.14A

PURCHASING AGREEMENT 

  

  Healthtrust Purchasing Group

  

  Products

Vendor: DiaSys Corporation 

Products: WORKSTATIONS FOR AUTOMATED MICROSCOPY 

Effective Date: December 1, 2001 

Agreement No.: 500251 

Version: 08-25-01 

TABLE OF CONTENTS

	1.0 	 Definitions 	 
	2.0 	Relationship; Purchases/Distribution; Term;
      Capital Investment Risk 	 
	3.0	GPO Fees, Rebates, Reporting, Prices 	 
	4.0 	Electronic Data Interchange / e-commerce Marketplace
      	 
	5.0 	Price Warranty 	 
	6.0 	State Sales Or Use Taxes 	 
	7.0 	Vendor Delivery Performance and Purchaser Service
      	 
	8.0 	Product Shipment, Risk Of Loss, Freight Payment
      and Title 	 
	9.0 	Warranties and Disclaimer of Liability 	 
	10.0 	Inspection 	 
	11.0 	Indemnity 	 
	12.0 	Confidentiality 	 
	13.0 	Publicity 	 
	14.0 	Insurance 	 
	15.0 	Order Cancellation 	 
	16.0 	Termination of Agreement or of Sole / Dual
      Source Status 	 
	17.0 	Books, Records and Compliance Requirements
      	 
	18.0 	Reports 	 
	19.0 	Assignment 	 
	20.0 	Merger Of Terms, Modification, and Conflict
      of Terms 	 
	21.0 	Partial Invalidity 	 
	22.0 	Purchase Order Terms 	 
	23.0 	Personal Inducements 	 
	24.0 	Vendor Relations Policy 	 
	25.0 	Controlling Law 	 
	26.0 	Legal Fees 	 
	27.0 	Product Bar Coding 	 
	28.0 	Minority Businesses Enterprises 	 
	29.0 	Notices 	 
	30.0 	New Technology 	 

 

Exhibit A 

Exhibit B 

PURCHASING AGREEMENT

  

  Healthtrust Purchasing Group 

  Hospital Products

This Purchasing Agreement (the "Agreement"), dated December 1, 2001, is entered
into by HEALTHTRUST PURCHASING GROUP, L.P., a Delaware Partnership, having
its principal place of business at One Park Plaza, Nashville, TN 37203 (hereinafter
referred to as "HPG"), and the following entity: 

DIASYS CORPORATION, 

a Delaware corporation 

Address: 81 West Main Street 

Waterbury, CT 06702 

(hereinafter referred to as "Vendor"), for the primary purpose of establishing
the terms and conditions for members of HPG, to purchase certain products and
services from Vendor. 

WHEREAS, HPG is organized as a group purchasing organization with various
healthcare providers belonging to HPG as Participants (as is hereinafter defined);

WHEREAS, Participants have entered into agreements with HPG ("Participation
Agreements") which permit Participants to obtain products and services under purchasing
agreements between HPG and its vendors, provided Participants comply with the
purchaser obligations stated in the supply agreements and Participants' obligations
under the Participation Agreements; and 

WHEREAS, Vendor desires to offer certain of its products and/or services to
Participants. 

NOW, THEREFORE, HPG and Vendor hereby agree that Vendor shall provide its
products and/or services to Participants in accordance with the following terms
and conditions set forth herein: 

	1.0 	Definitions	 

 

	 	1.1 	"Affiliates" as applied to any particular entity,
      is defined as those entities, businesses, facilities, and enterprises, that
      are controlled by, controlling, or under common control with a stated entity,
      including, without limitation, all parent corporations and their respective
      subsidiaries and affiliates, joint ventures, partnerships, limited liability
      companies and partnerships, together with any and all entities and businesses
      to which any of the above described entities provide management services
      or purchasing services. "Control" as used herein means control through ownership
      of more than a majority interest in an entity, or control by contract. 

 

	 	1.2 	"Agreement" shall be defined as this Purchase
      Agreement, Exhibit A, Exhibit B, and any additional Exhibits and attachments
      referenced herein. 
	 		 
	 	1.3 	"Commencement Date" shall be defined as the
      date Vendor will begin receiving orders from Purchaser for purchase of Products
      and Services pursuant to this Agreement. 
	 		 
	 	1.4 	"Distributor" shall be defined as a product
      distributor designated by HPG to distribute Products to Participants on
      behalf of Vendor. 
	 		 
	 	1.5 	"Dual Source Award" shall be defined as an
      agreement by HPG not to contract with more than one alternative supplier
      pursuant to which Participants can purchase products and services comparable
      to those listed in Exhibit A during the Term. 
	 		 
	 	1.6 	"Effective Date" shall be defined as the date
      first stated in the opening paragraph to this Agreement, unless otherwise
      stated herein or in an Exhibit hereto. 
	 		 
	 	1.7 	"Multi-Source Award" shall be defined as Vendor
      being designated as an approved source of Products and/or Services listed
      in Exhibit A with no limitation on HPG contracting for Participants to purchase
      comparable products and services from alternative suppliers under their
      contracts with HPG. 
	 		 
	 	1.8 	"Participant(s)" shall be defined as member(s)
      of HPG who have entered into a written agreement with HPG that permits Participants
      to purchase products and services from various vendors having purchasing
      agreements with HPG ("Participation Agreement"). 
	 		 
	 	1.9 	"Optional Source Award" shall be defined as
      Vendor being designated as an approved source of the Products and/or Services
      listed in Exhibit A with no limitation on HPG or Participants contracting
      for purchasing comparable products and services from alternative suppliers
      or on Participants purchasing similar products and services from alternative
      suppliers on a non-contract basis. 
	 		 
	 	1.10 	"Products" shall be defined as those goods
      listed in Exhibit A to this Agreement. 
	 	 	 
	 	1.11 	"Purchaser" shall be defined as any Participant,
      or facility that is an Affiliate of a Participant, obtaining Product and/or
      Services from Vendor under this Agreement. 
	 	 	 
	 	1.12 	"Services" shall be defined as those services
      listed in Exhibit A to this Agreement as well as any services provided by
      Vendor in connection with any Purchaser's purchase and/or use of Products.
      
	 	 	 
	 	1.13 	"Sole Source Award" shall be defined as an
      agreement by HPG not to contract with any alternative supplier pursuant
      to which Participants can purchase products and services comparable to those
      listed in Exhibit A during the Term. 

	 	1.14 	"Term" shall be defined as the period this
      Agreement is in effect, commencing on the Effective Date and expiring on
      the Expiration Date specified in Exhibit B to this Agreement. 

	2.0 	Relationship; Purchases I Distribution;
      Term: Capital Investment Risk 

	 	2.1 	HPG represents and Vendor recognizes that HPG
      is a group purchasing organization. The parties acknowledge that it is their
      intent to establish a business relationship in which payments by Vendor
      to HPG and Purchasers comply with the exceptions to the Medicare and Medicaid
      Anti-Kickback statute set forth at 42 U.S.C. § 1320a-7b(b)(3) (A) and (C),
      the "safe harbor" regulations regarding discounts set forth in 45 C.F.R.
      § 1001.952(h), and the "safe harbor" regulations regarding payments to group
      purchasing organizations set forth in 45 C.F.R. § 1001.952(j); and the parties
      believe that the relationship contemplated by this Agreement is in compliance
      with those requirements. 
	 		
	 	2.2 	HPG and Vendor hereby agree that they are entering
      into this Agreement on an "Optional Source Award" basis unless otherwise
      designated in Exhibit B to this Agreement. 
	 		
	 	2.3 	All facilities of Participants qualifying under
      the definition of Purchasers and located in the United States or its territories
      shall be eligible to obtain Products and/or Services from Vendor under this
      Agreement, including but not limited to acute care facilities, hospitals,
      ambulatory surgery centers, alternate site entities, physician practices,
      clinics or any other kind of healthcare providers, as well as any Participant
      distribution centers qualifying as an Affiliate and servicing only such
      Participant's Affiliate healthcare providers and/or Affiliates of other
      Participants. HPG shall provide a list of eligible Purchasers, including
      additions, deletions, and revisions, updated on a monthly basis and Vendor
      agrees to promptly update its list of eligible Purchasers to include such
      additions, deletions and revisions to accurately reflect the name, address
      and COlD for each eligible Purchaser. 
	 		
	 	2.4 	Payment for purchases made by Purchasers under
      this Agreement shall be the sole responsibility of the Purchaser and HPG
      shall have no responsibility or obligation for such payments. 
	 		
	 	2.5 	Upon receipt of an order from Purchaser (regardless
      of form or media used), unless Product is designated in Exhibit A as available
      only through a distributor, Vendor agrees to sell and deliver to Purchaser,
      the Products and/or Services-listed in the order at the prices set forth
      in Exhibit A (including any discounts or rebates stated in Exhibit A), subject
      to and in accordance with the terms and conditions stated in this Agreement.
      No minimum quantity or dollar amount shall apply to any order unless expressly
      stated in Exhibit B to this Agreement. If any Product is designated as available
      only through a distributor, then Vendor's shipments of Product shall be
      to the Distributor designated by HPG and the terms and conditions of this
      Agreement which apply to shipment from Vendor to Purchaser shall not be
      applicable; and the 

 

	 		prices listed in Exhibit A shall be the prices
      Vendor charges the Distributor, with the ultimate price paid by Purchaser
      determined by HPG and the Distributor. Otherwise, with respect to purchases
      of Products through distributors, all other terms and conditions of this
      Agreement shall apply to each purchase transaction by a Purchaser. Vendor
      shall assume total responsibility for obtaining from distributors purchase
      information for each Purchaser so that Vendors accurately pay and report
      on GPO fees and rebates (if any). 
	 		
	 	2.6 	Subject to the termination provisions of Section
      16, this Agreement shall have a Term commencing on the Effective Date and
      expiring on the Expiration Date specified in Exhibit B to this Agreement,
      with the obligation of Vendor to first make Products and/or Services available
      hereunder beginning as of the Commencement Date. Except as otherwise provided
      herein, the provisions of this Agreement, including prices, shall be effective
      from the Commencement Date through the Expiration Date. If the date for
      signing this Agreement by the last party to sign is after the Commencement
      Date and purchases of Products and/or Services by Purchaser occurred after
      the Commencement Date at a price higher than that. provided by this Agreement,
      then Vendor shall issue rebates for all purchases of Products and/or Services
      such that the net purchase price will equal that stated in this Agreement.
      Prices for Products and/or Services may not be increased except pursuant
      to a written amendment to this Agreement that has been signed by both parties.
      
	 		
	 	2.7 	Vendor assumes the full and complete risk of
      any capital investments Vendor makes to enable or enhance its capabilities
      to serve HPG and to provide Products and Services to Purchasers under this
      Agreement. In no event will HPG, any Participant of HPG, or any Purchaser
      assume any financial or other risk associated with capital investments made
      by Vendor as a result of or related to this Agreement. 
	 		
	 	2.8 	The terms set forth in this Agreement shall
      apply to each order by Purchaser, whether such order is communicated by
      Purchaser's Purchase Order form, EDI, internet e-commerce, facsimile, orally,
      or any other method, or whether reference is made to this Agreement. 

	3.0 	GPO Fees, Rebates, Reporting, Prices
      

	 	3.1 	In consideration for the administrative and
      other services HPG shall perform in connection with purchases of Products
      and Services under this Agreement by Purchasers, Vendor agrees to pay HPG
      GPO fees as provided in Exhibit B to this Agreement ("GPO Fees"). If a percentage
      is listed in Exhibit B for the GPO Fee, the percentage shall be applied
      against the net dollar volume of purchases of Products and Services by Purchasers
      during the applicable time period, (i.e., total sales less refunds and credits
      on returns, rebates and discounts). The payment of such GPO Fees is intended
      to be in compliance with the exception to the Medicare and Medicaid Anti-Kickback
      Statute set forth at 42 USC § 1320a-7b(b)(3)(C) and the "safe harbor" regulations
      set forth in 42 C.F.R. § 1001.952(j). 

 

	 	The GPO Fees for purchases under this Agreement
      during each calendar quarter during the Term shall be paid to HPG within
      thirty (30) days from the end of the calendar quarter. Vendor shall provide
      electronic reports with each GPO Fee payment that accurately list purchases
      upon which GPO Fees are based by Purchaser for the applicable quarter. 

 

	 	3.2 	Vendor agrees to pay rebates based on purchases
      of Products and/or Services by Purchasers in the amounts stated in Exhibit
      A to this Agreement, if any is stated therein. Rebates shall be payable
      to HPG for payment by HPG to Participants/Purchasers, shall be based on
      purchases by Purchasers under this Agreement made during each calendar quarter
      during the Term, and shall be paid within thirty (30) days from the end
      of the calendar quarter. The payment of rebates is intended to be in compliance
      with the exception to the Medicaid and Medicare Anti-Kickback Statute set
      for at 42 USC § 1320a-7b(b)(3)(A) and the "Safe Harbor" regulations set
      forth in 42 CFR § 100 1. 952(h). Vendor shall provide electronic reports
      with each rebate payment that contain sufficient detail to permit HPG to
      accurately allocate the appropriate amounts to each Participant/Purchaser.
      
	 	 	 
	 	3.3 	The Vendor reports submitted pursuant to Paragraph
      3.1 and 3.2 shall include a listing of each Purchaser by the Purchaser "COID"
      number supplied with HPG's list of eligible Purchasers. If Vendor uses its
      own customer identification number, then Vendor shall also provide a cross-reference
      to each Purchaser by the Purchaser "COID" number. 
	 	 	 
	 	3.4 	Vendor acknowledges that failure to promptly
      pay rebates or to submit accurate reports will delay HPG's payment of rebates
      to Participants and Purchasers, thereby potentially causing Participants
      and Purchasers to be unable to accurately complete cost reports required
      under United States government reimbursed healthcare programs. 
	 	 	 
	 	3.5 	HPG shall have the right to charge, and Vendor
      agrees to pay, a fee equal to one percent (1%) per month (or the maximum
      allowed by law, whichever is less) of the amount of any GPO Fees and Rebates
      not paid in accordance with the above time requirements. Timely payment
      without the required reports shall be considered as non-payment until reports
      meeting the above requirements have been delivered to HPG. 
	 	 	 
	 	3.6 	GPO Fees and Rebates shall be sent to HPG as
      follows: 

	 	 	 	For wire payments: 	Healthtrust Purchasing Group 
	 	 	 	 	C/o Wachovia Bank 
	 	 	 	 	ABA #053100494 
	 	 	 	 	Account #8739009157 
	 	 	 	 	P.O. Box 751576 
	 	 	 	 	Charlotte, NC 28275-1576

 

	 	 	 	For checks: 	Healthtrust Purchasing Group 
	 	 	 	 	Lockbox 751576 
	 	 	 	 	Charlotte, NC 28262 

 

	 	3.7 	In addition to the Product pricing listed in
      Exhibit A to this Agreement, on or prior to the Effective Date, Vendor agrees
      to provide HPG with an electronic copy of Exhibit A that conforms to standards
      set forth by HPG. 

	4.0 	Electronic Data Interchange / Internet
      e-commerce Marketplace 

 

	 	4.1 	Order placement, order confirmation, change
      orders and invoices for Products and Services obtained pursuant to this
      Agreement shall be sent by use of Electronic Data Interchange ("EDI"), except
      where Vendor or a Purchaser does not have EDI capability or as otherwise
      authorized pursuant to Exhibit B. 
	 		
	 	4.2 	Vendor acknowledges (a) that HPG has entered
      into an arrangement with Medibuy.com, Inc. ("Medibuy.com") for Medibuy.com
      to provide to HPG and Participants internet based e-commerce services associated
      with the ordering of products and services; (b) that many Participants will
      transition from EDI ordering systems to the Medibuy.com internet based electronic
      marketplace system for order placement and confirmation; (c) that it (Vendor)
      will reasonably cooperate with HPG and Medibuy.com in facilitating efficient
      transactions with Participants and Purchasers, and if applicable, any distributor,
      through the Medibuy.com ecommerce system; and (d) that Vendor will make
      commercially reasonable efforts to enter into an agreement with Medibuy.com
      on mutually agreed terms, which will permit Products and Services to be
      obtained by Purchaser using the Medibuy.com internet based e-commerce system.
      Vendor acknowledges that there is a cost associated with access to and use
      of the Medibuy.com e-commerce system and that Vendor will not have access
      to the internet based e-commerce system unless it negotiates a user agreement,
      including its financial terms, with Medibuy.com. 

	5.0 	Price Warranty 

 

	 	5.1 	Vendor represents and warrants that the prices
      charged for the. Products and/or Services purchased hereunder, net of all
      discounts and rebates, do not exceed Vendor's net prices for the particular
      Products and/or Services charged to others who are the same class of purchaser
      as are Purchasers and who purchase in comparable volume and terms of purchase.
      
	 		
	 	5.2 	If Vendor provides any general price decreases
      for Products to a substantial number of its customers during the Term, Vendor
      agrees to make such decreases available to Purchasers immediately and in
      like amounts. 
	 		
	 	5.3 	Purchaser shall have the right to set-off against
      any amount it owes to Vendor, the amount of any claim Purchaser may have
      against Vendor as. a result of Vendor's 

 

 

 

	 		breach of its representations, warranties,
      and obligations contained in this Agreement or any other agreement between
      Vendor and Purchaser and/or Affiliates of Purchaser. 

	6.0 	State Sales Or Use Taxes 

	 	6.1 	Vendor shall collect from Purchaser and remit
      to the state wherein each Purchaser is located, all proper sales and use
      taxes imposed by that State on any transactions by Purchaser under this
      Agreement, if any. Each invoice to Purchaser shall clearly and separately
      state the amount of such tax. 
	 		
	 	6.2 	Vendor shall furnish to HPG and each Purchaser,
      upon request, an electronic file of tax rates by item and by taxing authority
      to help ensure Purchaser's item files reflecting the taxable status and
      taxable amounts are reconciled for each Product item purchased from Vendor.
      An indication of taxable status shall be provided for each invoice line
      item on all invoices to allow each Purchaser to identify any discrepancies
      noted on the taxable amount. Vendor shall furnish to HPG and each Purchaser,
      upon request, a copy of Vendor's registration certificate and number within
      each taxing jurisdiction prior to collecting such sales or use taxes. If
      a Purchaser's purchase is tax exempt, such Purchaser shall furnish Vendor
      with any documents necessary to demonstrate its tax-exempt status. 
	 		
	 	6.3 	Vendor shall provide to each Purchaser, upon
      request, Vendor's Federal Tax Identification number. 
	 		

 
	7.0 	Vendor Delivery Performance and Customer
      Service Requirements 

 

	 	7.1 	Vendor warrants that it shall maintain in inventory
      at appropriate locations, sufficient quantities of each Product and shall
      both choose a transportation mode and carrier and provide said carrier with
      appropriate instructions, to ensure that any Purchaser ordering Product
      will receive delivery within seven (7) calendar days of the date the order
      is received by Vendor, unless a different delivery schedule is stated in
      Exhibit A or B, in which case the stated delivery schedule time period in
      Exhibit A shall apply to this warranty. This delivery performance warranty
      shall become effective with respect to each such Product, thirty (30) calendar
      days from the Effective Date of this Agreement, if such Product is listed
      in Exhibit A, or from the date such Product is later added to Exhibit A
      of this Agreement. 
	 		
	 	7.2 	If Vendor anticipates that it will not be able
      to deliver any particular Product ordered by any Purchaser within the later
      of (i) seven (7) calendar days following either the date of receipt of the
      order (or within the delivery schedule of Exhibit A or B, if applicable)
      (ii) or the date of delivery stated in the order, Vendor shall immediately
      notify the Purchaser and work with the Purchaser to resolve the supply issue
      to Purchaser's satisfaction. This resolution may include assistance in the
      identification 

 

	 		and location of an acceptable substitute at
      the same or lower pricing as the unavailable Product. Vendor shall be responsible
      for paying additional costs for any expedited shipment of Products required
      to meet the delivery obligations stated in this Agreement. However, Purchaser
      shall be required to pay any additional freight charges for any shipment
      where Purchaser requests a delivery period shorter than that stated in this
      Agreement. Payment of such additional shipping charges shall be in accordance
      with the Freight Payment terms of Exhibit B. 
	 		
	 	7.3 	If Vendor is unable to ship Product or provide
      Services within the time periods specified in this Agreement or applicable
      order, Purchaser shall have the right to either cancel the order, in whole
      or part, to accept alternative delivery dates, or to order a replacement
      from another source, in addition to any other rights of Purchaser arising
      under this Agreement or by law. If Vendor backorders Product for any order
      or portion thereof which it is unable to ship for delivery within the required
      time period, and Purchaser does not cancel such order, or portion thereof,
      any incremental expedited freight charges associated with shipment of the
      Product back ordered shall be paid by Vendor, even if Purchaser requested
      such expedited shipment. 
	 		
	 	7.4 	Intentionally Omitted 
	 		
	 	7.5 	Neither Purchaser nor HPG shall be deemed to
      be in breach of any Sole Source Award or Dual Source Award terms of this
      Agreement (if any) as a result of the purchase of replacements for Product
      that Vendor is unable to provide as required by the terms of this Agreement.
      
	 		
	 	7.6 	Vendor shall provide customer service support
      staff for receipt of telephone calls and facsimiles from Purchasers and
      HPG for the purpose of resolving issues related to this Agreement. Vendor's
      Purchaser Service representatives shall be available between 8:30 A.M. and
      5:30 P.M. Eastern time, Monday through Friday, except for holidays. 

 

	8.0 	Product Shipment, Risk Of Loss, Freight
      Payment and Title 
	 	 

	 	8.1 	Terms for shipment of Product, and freight
      payment responsibility shall all be in conformance with the provisions in
      this Section 8 and Exhibit B to this Agreement. 
	 		
	 	8.2 	Vendor assumes all responsibility for proper
      packaging of Products for safe shipment to Purchaser, in accordance with
      both the packing and shipping regulations of the transportation service
      provider, and also, if applicable, the packaging, marking, labeling and
      shipping paper requirements of the US Department of Transportation's Hazardous
      Material Regulations. 
	 		
	 	8.3 	Title and risk of loss or damage pass to Purchaser
      upon receipt of goods by carrier, FOB Destination. 

 

	 	8.4 	Except for Purchaser's request for expedited
      shipments, no "Handling" or "Shipping and Handling" charges shall be added
      to the invoice or paid by Purchaser. Purchaser shall have no obligation
      to pay non-expedited "Handling" and "Shipping and Handling charges". Vendor
      shall charge Purchaser $50.00 per expedited shipment. 
	 		
	 	8.5 	If Vendor receives any rebate from a transportation
      provider, attributable either in whole or in part to a shipment made pursuant
      to this Agreement, wherein payment for freight is either freight collect
      or separately billed to Purchaser, Vendor shall remit the rebate, or a pro-rata
      portion thereof, to Purchaser. 

	9.0 	Warranties and Disclaimer of Liability
      

	 	9.1 	Vendor warrants to HPG and Purchasers
      that at time of Delivery ("Warranty") Products: 

	 	 	9.1.1 	are new and not used, remanufactured
      or reconditioned (unless specified in the order); 
	 	 		
	 	 	9.1.2 	are fit and sufficient for the
      purposes intended by Vendor; 
	 	 		
	 	 	9.1.3 	are of good quality and will remain
      free from defects, whether patent or latent, in materials or workmanship
      for the twelve (12) month period commencing at date of Delivery to Purchaser;
      
	 	 		
	 	 	9.1.4 	conform to or exceed United States
      government approved grading applicable at time of shipment to Purchaser
      (if any); 
	 	 		
	 	 	9.1.5 	conform to all applicable federal,
      state and local laws, regulations and ordinances, including Federal Drug
      Administration rules, regulations, guidelines and required approvals, as
      well as requirements imposed by the Joint Commission on Accreditation of
      Healthcare Organizations ("JCAHO") and Medicare/Medicaid conditions of participation;
      and 
	 	 		
	 	 	9.1.6 	conform with statements in Vendor's
      advertising literature, published documentation, published specifications,
      and written warranties for the Products; 
	 	 		
	 	 	9.1.7 	are listed with Underwriters Laboratory
      or a nationally recognized testing laboratory as suitable for use in a healthcare
      facility, if such listing is available for Products; if Products include
      medical electrical equipment, Products shall meet or exceed the requirements
      of UL-2601 Medical Electrical Equipment, Part 1: General Requirements for
      Safety; 

 

	 	 	9.1.8 	if Products are electrically powered,
      each Product is provided with an appropriate power supply or heavy duty
      grade power cord that meets the requirements of NFPA 99 § 9-2.1.2.2 does
      not exceed eight feet in length; and has a hospital grade plug and that
      meets the requirements of NFP A 99 § 9-2.1.2.1.; 
	 	 		
	 	 	9.1.9 	to the extent applicable, meet
      the requirements of NFP A 99 for Health Care Facilities, Chapter 7, with
      maximum leakage current not to exceed the values set forth in NFPA 99 §
      7-5.1.3 or 7-5.2., as applicable. (Actual leakage current test values for
      Products shall be furnished by Vendor at the request of HPG.); 
	 	 		
	 	 	9.1.10 	Intentionally Omitted 
	 	 		
	 	 	9.1.11	if Product is equipment, each
      Product is shipped with an operator or user manual which includes: 
	 	 		

	 	 	 	9.1.11.1 	Illustrations that show locations
      of controls. 
	 	 	 	9.1.11.2 	Explanation of the function of
      each control. 
	 	 	 	9.1.11.3 	Illustrations of proper connection
      to the patient and other equipment. 
	 	 	 	9.1.11.4 	Step by step procedure for proper
      use of appliance. 
	 	 	 	9.1.11.5 	Safety precautions (or considerations)
      in application and in servicing. 
	 	 	 	9.1.11.6 	Effects of probable malfunctions
      on patient and employee safety. 
	 	 	 	9.1.11.7 	Difficulties that might be encountered,
      and care to be taken if the Product is used on a patient at the same time
      as other electric devices. 
	 	 	 	9.1.11.8 	Circuit diagrams for the particular
      Product shipped. 
	 	 	 	9.1.11.9 	Functional description of the
      circuits in Product. 
	 	 	 	9.1.11.10	Power requirements, heat dissipation,
      weight, dimensions, output current, output voltage and other pertinent data
      for the Product.

	 	 	9.1.12	if Product is equipment, each
      Product contains: 
	 	 		

 
	 	 	 	9.1.12.1 	Condensed operating instructions
      clearly and permanently displayed on the Product itself. 
	 	 	 	 	 
	 	 	 	9.1.12.2 	Nameplates, warning signs, condensed
      operating instructions, labels, etc. that are legible and will remain so
      for the expected life of the Product under the usual stringent hospital
      service cleaning conditions. 

 

	 	9.2 	Vendor further warrants to HPG and Purchasers
      that at time of Delivery it has good title to the Products supplied and
      that the Products are free and clear from all liens and encumbrances. 
	 		
	 	9.3 	Vendor represents that it has investigated
      the design and specifications for all Products, to determine if any of the
      Products infringe the patent, trademark or copyrights of any third party,
      and has determined that, and hereby expressly warrants that the Products
      and the use thereof by Purchaser in the manner intended by Vendor do not,
      at date of Delivery, infringe the patent, trademark or copyrights of any
      third party. To the extent Purchaser's purchase and/or use of any Products
      infringes any intellectual property rights owned by Vendor or any Affiliates
      of Vendor, provided Purchaser has paid the purchase price for Products,
      Vendor hereby expressly grants Purchaser a non-exclusive license under such
      intellectual property rights to use the Products. 
	 		
	 	9.4 	If any Product purchased hereunder fails to
      conform to the express warranties stated herein, then Vendor shall promptly
      repair or replace the Product at no cost to Purchaser. 
	 		
	 	9.5 	If Vendor is required to provide any Services
      under this Agreement, Vendor expressly warrants to HPG and Purchasers that
      such Services shall be performed timely, in a workman-like manner, consistent
      with industry standards; in compliance with applicable federal; state and
      local laws and regulations; and otherwise in conformance with any standards
      provided in an exhibit to this Agreement. 
	 		
	 	9.6 	The express warranties provided in this Agreement
      shall run to Purchaser, its successors and permitted assigns and shall survive
      termination of this Agreement. 
	 		
	 	9.7 	In the event any Product is to be recalled,
      whether voluntarily or as required by a governmental entity, Vendor' shall
      assume all responsibility and costs for implementing such recall. Vendor
      shall manage the recall in accordance with applicable laws, regulations
      and government directives, and assume responsibility for communicating necessary
      details on the recall to all Purchasers. Vendor shall pay all freight costs
      incurred for the return of recalled Products and shall credit or reimburse
      each Purchaser for Purchaser's original costs, including freight, in acquiring
      Product. 
	 		
	 	9.8 	Vendor represents that it has and maintains
      a Disaster Recovery Plan to ensure delivery of Product in the event of a
      natural disaster at its primary manufacturing and distribution locations,
      and agrees to review such plan with HPG upon request. 
	 		
	 	9.9 	Except as otherwise expressly provided herein,
      neither party shall be liable to the other party for the other party's special,
      consequential, incidental or indirect damages, however caused, on any theory
      of liability, and whether or not they have been advised of the possibility
      of such damages.

 

	 	9.10 	Notwithstanding anything to the
      contrary contained herein, all warranties stated herein are void as to any
      Product in which the Purchaser fails to maintain electrical power and environmental
      conditions described in Vendor's published specifications or instructions
      for Products, or if the products have been subject to any unauthorized modification
      or use, accident, neglect, misuse, use of unauthorized product, software
      or media, tampering, or any event other than ordinary and/or authorized
      use. 
	 		
	 	9.11 	Except as expressly stated in this Agreement
      or in materials furnished with Product, all guarantees, warranties, conditions,
      and representations, either expressed or implied, including, but not limited
      to, implied warranties of merchantability and fitness for a particular purpose,
      are expressly excluded. 
	 		

 
	10.0 	Inspection 

      

      Purchaser may inspect any and all Products upon receipt and any time thereafter.
      Any Products which do not comply with Purchaser's purchase order may be
      returned to Vendor at Vendor's cost and risk. Any Products which are defective
      under Warranty as stated in Section 9 above, whether discovered at time
      of receipt or at any time thereafter, may be rejected by Purchaser irrespective
      of date of payment subject to Vendor's Warranty obligations set forth in
      Section 9 above. 
	 	 
	11.0 	Indemnity
	 	 

	 	11.1 	Vendor agrees to and does hereby defend, indemnify
      and hold harmless HPG and each Purchaser, their Affiliates, successors,
      assigns, directors, officers, agents and employees ("HPG Indemnitees") from
      and against any and all liabilities, demands, losses, damages, costs, expenses,
      fines, amounts paid in settlements or judgments, including without limitation,
      costs, reasonable attorneys' fees, witnesses' fees, investigation expenses,
      , any and all out-of-pocket expenses, , and all other expenses and costs
      incident thereto (collectively referred to as "Damages") resulting from:
      (i) any claim, lawsuit, investigation, proceeding, regulatory action, or
      other cause of action, that may be suffered by reason of any loss, damage,
      death, injury, and/or other reason arising out of or in connection with
      Products furnished or Services performed by Vendor pursuant to this Agreement
      ("Injury"), unless the Injury was caused by reason of Purchaser's negligence
      or willful misconduct; (ii) the breach, or alleged breach, by Vendor of
      the warranties or representations contained in this Agreement or in materials
      furnished by Vendor, or (iii) any infringement or alleged infringement of
      any patent, trademark, copyright or trade secret right resulting from the
      purchase of Products and/or Purchaser's use thereof as well as from receipt
      of any Services provided hereunder so long as such claim is based on the
      Product and not: the combination of the Product with other products or equipment
      not provided by Vendor, the combination of which forms the basis of the
      claim. If the Injury is caused by the negligence of both Vendor and any
      of the HPG Indemnities, the apportionment of said Damages shall be shared
      between Vendor and such HPG 

 

	 		Indemnities based upon the comparative degree
      of each party's negligence and each party shall be responsible for its own
      defense and its own costs including but not limited to the cost of defense,
      attorneys' fees and witnesses' fees and expenses incident thereto. 
	 		
	 	11.2 	In the event that any demand or claim is made
      or suit is commenced against HPG Indemnitees for which Vendor has an indemnity
      obligation under Paragraph 11.1 above, written notice of such shall be timely
      provided to Vendor, and such HPG Indemnitees shall cooperate with Vendor
      in the defense of the demand, claim or suit to whatever reasonable eA1:ent
      Vendor requires, and Vendor shall have the exclusive right to compromise
      such claim to the extent of its own interest and/or undertake the defense
      of any such suit. Notwithstanding, if Vendor fails to assume its obligation
      to defend, HPG Indemnitees may do so to protect their interest and seek
      reimbursement from Vendor. Vendor consents to venue in any court having
      competent jurisdiction over a lawsuit filed against HPG, Purchaser, HPG
      Indemnities, or any of their Affiliates in which one or more claims from
      and against which Vendor is obligated to defend, hold harmless or indemnify
      HPG, Purchaser, HPG Indemnitees, or any other of their affiliates. 

	12.0 	Confidentiality 

	 	12.1 	During the term of this Agreement and surviving
      its expiration or termination, Vendor will regard and preserve as confidential
      and not disclose publicly or to any third party all information related
      to the business of HPG, Purchaser and its Affiliates, clients and patients
      that may be obtained as the result of performance under this Agreement.
      Vendor will not, without first obtaining HPG's prior written consent, disclose
      publicly or to any third party person, firm or enterprise or use for its
      benefit any information relating to pricing methods, processes, financial
      data, lists, apparatus, statistics, programs, research, development or related
      information of HPG, Purchaser, or their Affiliates concerning their past,
      present or future business activities or plans, and results or terms of
      the sale of Products or provision of Services by Vendor under this Agreement.
      Both parties agree that the terms of this Agreement, including the prices
      for Products and Services and the sales volumes of Products and Services,
      in the aggregate or by Purchaser, shall also be held in confidence and not
      disclosed publicly or disclosed to any third party. Subject to the requirements
      of Paragraph 12.3 HIPAA Requirements below and any applicable law or regulation,
      the confidentiality obligations of this Section 12.0 do not apply to: (a)
      information that is publicly known prior to the disclosure or becomes publicly
      known through no wrongful act of the Vendor; (b) information that was in
      lawful possession of the Vendor prior to the disclosure and was not received
      as a result of any breach of confidentiality with respect to HPG, Purchaser
      or their Affiliates; (c) information that was independently developed by
      Vendor outside the scope of this Agreement, (d) information which Vendor
      is

	 	 	required to disclose by law, court order or
      regulatory agency request; or ( e) information that must be disclosed for
      performance under this Agreement. In the event of a request for disclosure
      falling under part (d) above, immediate notice of such request shall be
      provided to HPG and the Purchaser in order to provide an opportunity to
      oppose such request for disclosure. Vendor agrees to disclose to HPG and
      the applicable purchaser within two business days from first discovery,
      all. information relating to any use or disclosure of confidential information
      in violation of the requirements of this paragraph 12.1. 
	 	 	
	 	12.2 	HPG shall have the right to use Vendor pricing
      information on Products and Services for HPG's internal analyses and for
      creating pricing evaluations for disclosure to potential Participants pursuant
      to a confidentiality agreement. HPG shall also have the right to disclose
      such information to third parties under a confidentiality agreement for
      performance of such analysis. HPG shall have the right to disclose the terms
      of this Agreement to Participants and to also provide copies of this Agreement
      to potential purchasers of any Purchaser being offered for sale by a Participant,
      provided such disclosure is made pursuant to the terms of a confidentiality
      agreement executed by the potential purchaser. HPG shall have the right
      to provide Product and Service pricing information to third party ecommerce
      companies which process orders between Purchaser and Vendor. 
	 	 	
	 	12.3 	HIPAA Requirements. Vendor agrees to
      comply with the applicable provisions of the Administrative Simplification
      section of the Health Insurance Portability and Accountability Act of 1996,
      as codified at 42 U.S.C. § 1320d through d-8 ("HIP AA"), and the requirements
      of any regulations promulgated thereunder including without limitation the
      federal privacy regulations as contained in 45 CFR Part 164 (the "Federal
      Privacy Regulations") and the federal security standards as contained in
      45 CFR Part 142 (the "Federal Security Regulations"). Vendor agrees not
      to use or further disclose any protected health information, as defined
      in 45 CFR 164.504, or individually identifiable health information, as defined
      in 42 U.S.C. § 1320d (collectively, the "Protected Health Information"),
      concerning a patient other than as permitted by this Agreement and the requirements
      of HIP AA or regulations promulgated under HIPAA, including without limitation
      the Federal Privacy Regulations and the Federal Security Regulations. Vendor
      will implement appropriate safeguards to prevent the use or disclosure of
      a patient's Protected Health Information other than as provided for by this
      Agreement. Vendor will promptly report to "HPG and/or Purchaser" any use
      or disclosure of a patient's Protected Health Information not provided for
      by this Agreement or in violation of HIPAA, the Federal Privacy Regulations,
      or the Federal Security Regulations of which Vendor becomes aware. In the
      event Vendor, with "HPG and/or Purchaser's approval, contracts with any
      Vendors or agents to whom Vendor provides a patient's Protected Health Information
      received from Vendor, Vendor shall include provisions in such agreements
      whereby the Vendor and agent agree to the same restrictions and conditions
      that apply to Vendor with respect to such patient's Protected Health Information.
      Vendor will make its internal practices, 

 

	 	 	books, and records relating to the use and
      disclosure of a patient's Protected Health Information available to the
      Secretary of Health and Human Services to the extent required for determining
      compliance with the Federal Privacy Regulations and the Federal Security
      Regulations. Notwithstanding the foregoing, no attorney-client, accountant-client,
      or other legal privilege shall be deemed waived by Vendor or "HPG and/or
      Purchaser" by virtue of this Section. Any violation of this provision shall
      be considered a material breach of this Agreement, conferring on HPG the
      right to terminate this Agreement immediately without any right of Vendor
      to cure such breach. 

 

	13.0 	Publicity 

      

      Any advertisement, solicitation, or public announcement of the existence
      of this Agreement or the relationship created hereby, must be first approved
      by HPG in writing. The text of any proposed announcements shall be submitted
      in writing to: Vice-President, National Agreements, Healthtrust Purchasing
      Group, One Park Plaza, Nashville, TN 37203. Approval shall be obtained before
      public release of the disclosure submitted for approval. Any violation of
      this provision shall be considered a material breach of this Agreement,
      conferring on HPG the right to terminate this Agreement immediately without
      any right of Vendor to cure such breach. 
	 	
	14.0 	Insurance 

      

      During the term of this Agreement, Vendor shall maintain at its own expense,
      commercial general liability insurance for bodily injury, death and property
      loss and damage (including coverages for product liability, completed operations,
      contractual liability and personal injury liability) covering Vendor for
      claims, lawsuits or damages arising out of its performance under this Agreement,
      and any negligent or otherwise wrongful acts or omissions by Vendor or any
      employee or agent of Vendor, with HPG and Purchasers listed as additional
      insureds. All such policies of insurance may be provided on either an occurrence
      or claims-made basis, and shall provide limits of liability in the minimum
      amount of one million dollars ($1,000,000) per occurrence with an annual
      aggregate of three million dollars ($3,000,000). If such coverage is provided
      on a claims made basis, such insurance shall continue throughout the term
      of the Agreement; and upon the termination of this Agreement, or the expiration
      or cancellation of the insurance, Vendor shall purchase or arrange for the
      purchase or arrange for the purchase of, either an unlimited reporting endorsement
      ("Tail" Coverage), or "Prior Acts" coverage from the subsequent insurer,
      with a retroactive date on or prior to the effective date of this Agreement.
      Upon HPG's request, Vendor, or Vendor's agent, shall provide HPG with a
      copy of all such policies and/or certificates of insurance satisfactory
      to HPG, evidencing the existence of all coverage required hereunder. Vendor
      shall require its insurance carriers or agents to provide HPG, and Vendor
      shall also provide HPG with not less than thirty (30) days' prior written
      notice in the event of a change in the liability policies of Vendor.

 

	15.0 	Order Cancellation 

      

      Purchaser may cancel any order arising out of this Agreement in whole or
      in part, without liability if, (i) Products have not been shipped as of
      date of receipt of notice of cancellation, (ii) Product deliveries are not
      made at the time and in the quantities specified; (iii) Products infringe
      or are alleged to infringe any patent, trademark, copyright or trade secret
      right or (iv) Products fail to comply with any applicable law or regulation.
      To cancel, Purchaser shall give notice to the Vendor in writing, and to
      the extent specified therein, Vendor shall immediately terminate deliveries
      under the order. 
	 	
	16.0 	Termination of Agreement or of Sole / Dual
      Source Status 

	 	16.1 	Termination with Cause. Vendor and HPG
      shall both have the right to terminate this Agreement in its entirety or
      with respect to certain Products or Services, in the event of a breach of
      the terms hereof by the other party which is not cured within thirty (30)
      calendar days following receipt of written notice thereof specifying the
      breach. 
	 	 	 
	 	16.2 	Termination without cause. Vendor and
      HPG shall both have the right to terminate this Agreement in its entirety
      or with respect to certain Products or Services, without cause by providing
      at least sixty (60) days' prior notice, without any liability to the other
      party for such termination. 
	 	 	 
	 	16.3 	Remedies. Any termination by either
      party, whether for default or otherwise, shall be without prejudice to any
      claims for damages or other rights against the other party that preceded
      termination. 
	 	 	 
	 	16.4 	Change of Control. HPG shall also have
      the right to terminate this Agreement in its entirety or with respect to
      certain Products or Services, upon thirty (30) days' prior notice upon the
      transfer, directly or indirectly, by sale, merger or otherwise, of substantially
      all of the assets of Vendor or its ultimate parent or any permitted assignee
      (upon assignment to such assignee) or in the event that more than 49% Vendor
      ownership interest in or its ultimate parent or any such permitted assignee
      is transferred to an independent third party entity. 
	 	 	 
	 	16.5 	Inventory of Termination. With respect
      to any Products that are available through a third party distributor, upon
      termination or expiration of this Agreement, Vendor agrees that it will
      purchase from the distributor all such Products remaining in distributor's
      inventory thirty (30) days following termination or expiration. Such remaining
      product shall be shipped back to Vendor freight collect, FOB origin. 
	 	 	 
	 	16.6 	Termination of Sole / Dual Source Status.
      Upon fifteen (15) calendar day notice, HPG shall have the right to convert
      any Sole or Dual Source Product designation in this Agreement to a "Optional
      Source" designation, with no change in pricing from the Sole or Dual Source
      pricing, if Vendor fails to maintain at least a 95% fill rate for all Products
      for all Purchasers. "Fill rate" as used herein shall be described as the
      

 

	 		average of the individual fill rates for all
      Dual and Sole Source Products ordered during any calendar month. The fill
      rate for any individual Product is the ratio of total units ordered for
      such Product divided into the total unit delivered within the delivery schedule
      requirements of Section 7 of this Agreement. 
	 		
	 	16.7 	Survival of Terms. Any terms in this Agreement
      which by their nature must survive after the Term of this Agreement to give
      their intended effect shall be deemed to survive termination of this Agreement.
      

 

	17.0 	Books. Records and Compliance Requirements
      

	 	17.1 	To the extent the requirements of 42 CFR 420.300
      et seq. are applicable to the transactions contemplated by this Agreement,
      Vendor agrees to make available to the Secretary of Health and Human Services
      ("HHS "), the Comptroller General of the General Accounting Office ("GAO")
      and their authorized representatives, all contracts, books, documents and
      records relating to the nature and extent of costs hereunder until the expiration
      of four (4) years after Products and Services are furnished under this Agreement.
      
	 		
	 	17.2 	If Vendor carries out its obligations under
      this Agreement through a subcontract worth $10,000 or more over a twelve
      month period with a "related" organization, the subcontract will also contain
      clauses substantially identical to Paragraphs 17.1 through 17.8 and will
      permit access by HPG, the HHS, GAO and their representatives to the "related"
      organization's books and records. 
	 		
	 	17.3 	Vendor agrees to comply at all times with the
      regulations issued by the Department of Health and Human Services published
      at 42 CFR 1001, and which relate to Vendor's obligation to report and disclose
      discounts, rebates and other price reductions to HPG and Purchasers for
      Products and/or Services purchased under this Agreement. Where a discount
      or other reduction in price of the Products is applicable, the parties also
      intend to comply with the requirements of 42 U.S.C. §1320a-7b(b)(3)(A) and
      the "safe harbor" regulations regarding discounts or other reductions in
      price set forth at 42 C.F.R. §1001.952(h). In this regard, the parties acknowledge
      that Vendor will satisfy any and all requirements imposed on sellers by
      these regulations and Purchaser will satisfy any and all applicable requirements
      imposed on buyers by these regulations. Thus, in cases where the Vendor
      forwards to Purchaser an invoice that does not reflect the net cost of Products
      and/or Services to the Purchaser, the Vendor shall include the following
      language or comparable language on such invoice: 

 

	 		 	"This invoice does not reflect the net cost
      of supplies to Purchaser. Additional discounts or other reductions in price
      may be paid by Vendor and may be reportable under federal regulations at
      42 C.F.R. §1001.952(h)."

 

 

	 		In cases where the Vendor forwards to Purchaser
      an invoice that does reflect a net cost of Products and/or Services after
      a discount to the Purchaser, the Vendor shall include the following language
      or comparable language on such invoice: 
	 		

	 	 	 	"This invoice reflects the net price of supplies
      to Purchaser. This price is net after a 'discount or other reduction in
      price' and the net price as well as any discount may be reportable under
      federal regulations at 42 C.F.R. §1001.952(h)." 

	 		In cases where Vendor sends Purchaser an invoice
      listing charges that include a capital cost component (e.g., equipment that
      must be either capitalized or reported as lease expense) and a operating
      cost component (e.g., services and/or supplies), Vendor shall issue separate
      invoices to Purchaser for each component. The price for all capital component
      items must be reported on the invoice at the net price, with no discount
      or rebate to be received separately or at a later point in time. 
	 		
	 	17.4 	HPG is not a federal government contractor;
      however some of the Purchasers that will purchase from Vendor under this
      Agreement may be federal government contractors or subcontractors. Vendor
      acknowledges that purchase orders by any such entities incorporate the contract
      clauses regarding equal employment opportunity and affirmative action contained
      in 41 CFR 60-1.4 (Executive Order 11246), 41 CFR 60-250.4 (Vietnam Era Veterans
      Readjustment and Assistance Act), and 41 CFR 60-741.5 (Rehabilitation Act).
      
	 		
	 	17.5 	HPG shall have the right, during normal business
      hours and with reasonable advance notice, to review and photocopy Vendor's
      books, documents and records (whether in hard copy, electronic or other
      form) that pertain directly to the accounts of HPG, Participants, Purchasers,
      and their Affiliates, the fees payable to Vendor under this Agreement, the
      GPO Fees and rebates payable by Vendor for the Products and Services provided
      by Vendor hereunder. The audit may be conducted by HPG employees or by an
      external auditing firm selected by HPG. The cost of audit, including the
      cost of the auditors and reasonable cost of copies of books, documents,
      and records shall be paid by HPG. HPG shall have no obligation to pay any
      other costs incurred by Vendor, or its employees and agents in cooperating
      with HPG in such audit. 
	 		
	 	17.6 	Vendor represents and warrants to HPG, Purchasers
      and their Affiliates that Vendor and its directors, officers, and employees
      (i) are not currently excluded, debarred, or otherwise ineligible to participate
      in the Federal health care programs as defined in 42 USC §1320a-7b(f) (the
      "Federal healthcare programs"); (ii) have not been convicted of a criminal
      offense related to the provision of healthcare items or services but have
      not yet been excluded, debarred, or otherwise declared ineligible to participate
      in the Federal healthcare programs, and (iii) are not under investigation
      or otherwise aware or any circumstances which may result in Vendor being
      excluded from participation in the Federal healthcare programs. This shall
      be an ongoing representation and warranty during the term of this Agreement
      and 

	 		Vendor shall immediately notify HPG of any
      change in the status of the representations and warranty set forth in this
      section. Any breach of this section shall give HPG the right to terminate
      this Agreement immediately for cause. 
	 		
	 	17.7 	Vendor represent and warrants that it has not
      made, is not obligated to make, and will not make any payment or provide
      any remuneration to any third party in return for HPG entering into this
      Agreement or for any business transacted under this Agreement. 
	 		
	 	17.8 	HPG's rights under this Section 17 shall survive
      for a period of four (4) years after termination or expiration of this Agreement.
      

	18.0 	Reports 

      

      Vendor shall be required to furnish to HPG quarterly sales volume reports,
      including rebate amounts and GPO Fees earned (excluding payments), concerning
      the purchases of Products and Services by each Purchaser at the following
      address: 

	 	Finance Manager, National Agreements 
	 	Healthtrust Purchasing Group, LP 
	 	One Park Plaza 
	 	Nashville, TN 37203 

 

	19.0 	Assignment 

      

      Neither party shall assign this Agreement in whole or in part, or subcontract
      their obligations hereunder, without the prior written consent of the other
      party. Any assignment or subcontract without such prior consent shall be
      void and have no effect. Notwithstanding, HPG may assign without obtaining
      consent from Vendor, HPG's rights and obligations under this Agreement,
      (a) to any entity which is an Affiliate of HPG, and (b) to a successor entity
      of HPG as part of an internal reorganization of HPG which results in HPG
      being organized in a different legal entity or corporate form, whether through
      conversion or merger. Subject to the foregoing, all terms, conditions, covenants
      and Agreements contained herein shall inure to the benefit of, and be binding
      upon, any successor and any permitted assignees of the respective parties
      hereto. It is further understood and agreed that consent by either party
      to such assignment in one instance shall not constitute consent by the party
      to any other assignment. 
	 	 
	20.0 	Merger of Terms, Modification, and Conflict
      of Terms 

      

      This Agreement terminates and supersedes any existing agreement between
      HPG and Vendor pertaining to the same Products and/or Services. This Agreement,
      as executed and approved, shall not be modified except by written amendment,
      expressly stating an intent 

 

		to modify the terms of this Agreement, and
      signed by the parties hereto. In the event of any conflict between the terms
      herein and. the terms of any Exhibit hereto, the priority for control, from
      first to last priority, shall be Exhibit B, Exhibit A, and then the terms
      herein. The terms of this Agreement shall take priority over any conflicting
      terms contained in any Product warranty referenced herein, attached to this
      Agreement, or included with any Product sold by Vendor. 
		
	21.0 	Partial Invalidity 

      

      In the event that any provision of this Agreement should for any reason
      be held invalid, unenforceable or contrary to public policy, the remainder
      of the Agreement shall remain in full force and effect notwithstanding.
      
		
	22.0 	Purchase Order Terms 

      

      The terms of any purchase order issued by a Purchaser shall not apply to
      purchases of Products and Services hereunder, except as necessary to designate
      specific Products and Services, quantities, delivery dates, and other similar
      terms that may vary from order to order; and the terms of this Agreement,
      to the extent applicable, shall be deemed incorporated in such purchase
      orders. The terms and conditions contained in any invoice, bill of lading,
      or other documents supplied by Vendor are expressly rejected and' superseded
      by this Agreement and shall not be included in any contract with Purchaser.
      
		
	23.0 	Personal Inducements 

      

      No personal cash, merchandise, equipment or other items of intrinsic value
      shall be offered by or on behalf of Vendor to HPG or Purchasers and/or their
      employees, officers, or directors as an inducement to purchase from Vendor.
      
		
	24.0 	Vendor Relations Policy. 

      

      Vendor acknowledges that HPG has a Vendor Relations Policy relating to ethics
      and compliance issues between suppliers and HPG, and that it has received
      a copy of this policy. The Vendor Relations Policy is also available through
      the internet at: http://www.hcahealthcare.com/Ethics/Policies/mm/mm.002.doc:
      
	 	 
	25.0 	Controlling Law 

      

      The performance of the parties under this Agreement shall be controlled
      and governed by the laws of the State of Tennessee, excluding conflicts
      of law provisions, and jurisdiction and venue for any dispute between Vendor
      and HPG concerning this Agreement shall exclusively rest within the State
      and Federal Courts of Davidson County, Tennessee. 
	 	 
	26.0 	Legal Fees 

      

      In the event of any litigation between Vendor and Purchaser or HPG that
      relates to this Agreement, the prevailing party shall recover its own costs,
      expenses and legal fees (including reasonable attorneys' fees). 

	27.0 	Product Bar Coding
      

      

      Intentionally omitted. 
		
	28.0 	Minority Businesses Enterprises
      
		

	 	28.1 	HPG and Vendor hereby acknowledge their respective
      corporate policies and practices to encourage the participation of Minority
      Business Enterprises ("MBE's") in their procurement processes and their
      desire to work together to encourage their use of MBE's in fulfillment of
      the obligations under this Agreement. As used in this Agreement, "MBE's
      shall be defined to include any company certified as a minority owned business
      by the National Minority Supplier Development Council or any local affiliates
      thereof, or any Federal, National, State, Municipal, or Local agencies that
      certify minority businesses in accordance with PL. 95-507. 
	 		
	 	28.2 	Vendor recognizes and acknowledges that in
      conjunction with HPG's efforts to involve MBE's in its contracting process
      that HPG may enter into purchasing agreements with MBE's which will enable
      HPG Participants and their Facilities to purchase supplies and/or equipment
      equivalent to those listed as Products under this Agreement. In such event,
      notwithstanding any other terms of this Agreement to the contrary, the parties
      agree that if HPG enters into any such agreement(s) with any MBE's that
      such will not be deemed to be a breach of this Agreement by HPG, nor will
      any purchases by HPG Participant or their Facility from MBE's be deemed
      to be a breach of this Agreement. 
	 		
	 	28.3 	Vendor shall, on a quarterly basis, identify
      and report in writing to HPG, all MBE activities in which it participates,
      specifically identifying such activities and purchases relating to Products
      and Services obtained under this Agreement. Vendor shall identify in such
      reports any first and second tier MBE's it or its subcontractors have used
      during the reporting period. The MBE reports shall otherwise comply with
      format and content mutually agreed to by both parties. The MBE contact for
      Vendor shall be the person listed in Exhibit B. The MBE contact for HPG
      shall be: 
	 		
	 		Director of Diversity Programs 
	 		c/o Triad Hospitals, Inc. 
	 		13455 Noel Road 
	 		Dallas, TX 75240 

	29.0 	Notices 

      

      Notices under this Agreement shall all be in writing, effective upon receipt
      and shall be sent by any of the following methods (a) facsimile with return
      facsimile acknowledging receipt; 

		(b) United States Postal Service certified
      or registered mail with return receipt showing receipt; or (c) courier delivery
      service with proof of delivery; or (d) personal delivery. Either party hereunder
      may change the names and addresses for receipt of notices by notice given
      as provided for herein. Notices to Vendor shall be sent to the person and
      address listed in Exhibit B. Unless stated otherwise in this Agreement,
      notices to HPG shall be sent as follows: 

	 		Vice President, National Agreements 
	 		Healthtrust Purchasing Group, LP 
	 		One Park Plaza 
	 		Nashville, TN 37203 

 
		
	30.0 	New Technology 

      

      The terms of this Section 30, New Technology, shall be applicable only to
      those Products and/or Services that are included in any Dual Source or Sole
      Source Award designated in Exhibit B. If, during the Term, new technology
      (more than an improvement or enhancement to an existing Product) for a Product
      covered by this Agreement becomes available from any source including Vendor,
      which (i) offers significant technological advancements, (ii) . would significantly
      improve clinical outcomes, or (iii) would significantly streamline work
      processes, as compared to existing Products (hereinafter, "New Technology
      Product"), HPG shall have the right to evaluate and ultimately contract
      with another supplier so that HPG can offer to Participants New Technology
      Products. Vendor shall provide HPG with the first opportunity to purchase,
      at discounts comparable to those applicable to Products under this Agreement,
      New Technology Products offered by Vendor and not referenced in Exhibit
      A of this Agreement and shall notify HPG of such at least thirty (30) days
      prior to New Technology Products being made available for purchase. Vendor
      shall also meet with HPG to provide required product information to HPG
      and its clinical committees prior to the New Technology Product being made
      available to Purchasers for purchase. HPG shall offer Vendor equal consideration
      and review for potential supply commitments for New Technology Products
      on a Dual Source basis. In the event that HPG enters into any national or
      group agreement for Participants to purchase a New Technology Product on
      a Sole Source, Dual Source or Optional Source Award basis from a source
      other than Vendor or any Dual Source supplier of Products (if applicable),
      neither such agreement or the purchase of the New Technology Product (by
      itself) shall constitute a breach of this Agreement or failure by HPG or
      Purchasers to meet the Compliance Requirements under this Agreement. 

                       IN
WITNESS WHEREOF, the parties hereby indicate their acceptance of the terms of
this Agreement by the signatures of their authorized representatives. 

	Healthtrust Purchasing Group, LP: 	DiaSys Corporation 
	a Delaware limited partnership	 
	by CMS GP, LLC 	 
	a Delaware limited liability company	 
	its general partner	 

 

By:__________________________ Date: ______________________ 

	By:	_________________________________	By:	_________________________________
	 	 		
	 	Name: Scott Farrar 		Name: Todd Me. Dematteo
	 	 		
	 	Title: Vice President,
      National Agreements 		Title: President/CEO 
	 	 		
	 	Date:______________________________
      		Date:______________________________ 
	 	 		
	 	 	Vendor
      Federal Tax ID No.: 06-1339248 

 

Exhibits

  

  

A: Products & Services with Prices 

B: Specific Purchasing Terms 

C: Cost Per Test Program 

Exhibit A 

Healthtrust Purchasing Group 

  Purchasing Agreement 

  No. 500251 

  Vendor: Diasys Corporation 

  Date: December 1, 2001 

  

  Products & Services with Prices

Not including, with this filing. 

The material contained in this document, together with an application for Confidential
Treatment thereof has been filed separately with the Securities and Exchange Commission.

Exhibit B 

 
 Healthtrust Purchasing Group 

  Purchasing Agreement 

  No. 500251 

  Vendor: DiaSys Corporation 

  Date 12-01-2001 

  

  Specific Purchasing Terms

 

Award Basis: 

			Applicable Products / Services 
	Option Source Award 		Urine Sediment Workstations
			

	Term: 	Commencement Date: December 1, 2001
		Expiration Date: November 30, 2003 
		
	Prior Agreement: 	The (N/A) agreement with Vendor is superceded
      by this Agreement. 
		
	GPO Fees: 	3%

	Ordering Process: 	oXp
      Internet 	op
      EDI 	oXp
      Purchase Order 
		op
      Verbal 	xop
      Facsimile 	o Other
	 	 	 	 

	Payment Terms:	Per Distributor 
		
	Delivery Time:	Thirty (30) calendar days from receipt of order
      
	 	 

Delivery Terms: 

		 	 	 
	Origin: 	op
      Vendor (direct) 	op
      Distributor Purchaser's agreement with the distributor shall control. 

      

      Both of the above apply.	 

Freight / Shipping Charges: 

	 	o	Freight/shipping charges are not included in
      the Product Price and shall be "prepaid" by Vendor and added to the invoice
      as a separate line item that is identified as either a "freight" or "shipping"
      charge. The freight/shipping charge shall not include any additional amounts
      for shipping for which vendor is responsible pursuant to paragraphs 7.2
      and 7.3 of the Agreement. 
	 		
	 	o	Freight/shipping costs are included in the
      Product price, subject to Purchaser's obligations for additional freight/shipping
      charges as stated in paragraph 7.2 of the Agreement. 
	 		
	 	o	Freight collect via carrier designated by Purchaser
      or HPG.

Training, Repair, Safety: 

Operator Training provided to each Purchaser by Vendor: At time of installation
N/A 

Preventative maintenance and repair instruction to be supplied to each Purchaser
by Vendor: At time of installation. N/A 

Repair and replacement parts lists ordering instructions, and alternative sources
of parts to be supplied to each Purchaser by Vendor. 

Vendor shall provide each Purchaser Material Safety Data Sheets (MSDS) for all
material/chemical Product purchases in compliance with OSHA standards and those
of any other applicable federal, state or local law or regulation. Where applicable.
N/A 

Vendor Contacts for Notices: 

	Vendor's MBE Contact: 		John Liseo 

      Director of Engineering 

      DiaSys Corporation 

      81 West Main Street 

      Waterbury, CT 06702
	 		

Vendor's contact for notices under the Agreement: 

	 	 	Todd M. DeMatteo, President/CEO 

      DiaSys Corporation 

      81 West Main Street 

      Waterbury, CT 06702 

Vendor's contact for receiving updated lists of Participants:

	 	 	Laura Marshall, Field Services 

      DiaSys Corporation 

      81 West Main Street 

      Waterbury, CT 06702 

Initial 

HPG _____ 

Vendor _____ 

Exhibit C 

 
Healthcare Purchasing Group o Cost-Per-Test
  Agreement 

  R/S Series Automated Urine Sediment Workstations

  

  

	 	Customer Installation Site: 

      

      Account Name ____________________ 

      Contact __________________________ 

      Address _________________________ 

      City _____________State____Zip___	 	Customer Billing (if different): 

      

      Account Name ____________________ 

      Contact __________________________ 

      Address _________________________ 

      City _____________State____Zip___ 	 

PLAN: Allegiance Healthcare Corporation (Allegiance) is a distributor of
the R/S Series Urine Sediment Workstations (Workstation) manufactured by DiaSys
Corporation (DSC). Under this relationship, Allegiance and DSC have agreed to
provide Customers with a Workstation on a cost-per-test basis under the following
terms and conditions: 

WORKSTATION TYPE, INSTALLATION & TRAINING: DSC will install an R/S 2003 Workstation
in any installation site performing 1,500 to 9,000 urine micros per month. DSC
will install an R/S 2000 Workstation in any installation site performing 400 to
1,499 urine micros per month. Laboratories performing fewer than 400 urine micros
per month will require a special quotation. At no additional cost to Customer,
a DSC Representative will install each such Workstation and train Customer personnel
in its proper use and care. Thereafter, Customer agrees to use the Workstation
under the terms of this Agreement and strictly in compliance with the operating
and care procedures set forth in the Workstation's Instruction & Technical Specifications
Manual provided by DSC. 

TERM: This Agreement will expire on the thirty-sixth (36th) month following
installation (TERM). Upon expiration, Customer may renew this Agreement for up
to two (2) additional one (1) year increments upon the same terms and conditions.

DELIVERY: All shipments are made FOB, Destination (Delivery), freight and
insurance billed separately. 

INVOICING & PAYMENT 

Information is not including, with this filing. 

The omitted material, together with an application for Confidential Treatment
thereof, has been filed separately with the Securities and Exchange Commission.

WARRANTY & REPAIR: DSC warrants that the Workstation will be free from
defects in labor and materials for the TERM of the Agreement (Warranty).
At no additional cost to Customer, DSC shall repair or replace Workstation, or
any component thereof, that is defective under Warranty, shipping one way. Customer
shall purchase accessories and replacement parts fro Allegiance. DSC will perform
any non-warranty service or repairs and invoice Customer directly. Non-Warranty
repairs include, but are not limited to, damage caused to the Workstation, or
any component thereof, by improper use, neglect, poor maintenance or willful misconduct,
including, but not limited to, improper care of the Workstation's Optical Slide
Assembly. All warranties of Merchantability and/or fitness are expressly excluded.

WORKSTATION OWNERSHIP & RISK OF LOSS: The Workstation shall remain the
property of DSC and Customer shall execute and deliver a financing statement as
provided under the Uniform Commercial Code (UCC), if requested, to permit DSC
to record as ownership interest in the Workstation. Customer shall be responsible
for risk of loss and damage to the Workstation while it is in the Customer's possession
(reasonable wear and tear excepted) and shall maintain adequate damage insurance
coverage with respect to the Workstation. DSC shall have no obligation with respect
to operation or use of Workstation other than that specified in the Instruction
& Technical Specifications Manual provided with the Workstation at installation.

ENTIRE AGREEMENT: This agreement is subject to the Purchaser
Agreement between HPG and DSC, which together constitutes the entire agreement
between DSC and Customer. There are no other understandings or agreements between
the Customer and DSC on this matter. This agreement shall be effective upon delivery
of a fully signed copy to Customer. 

Customer ACCEPTED: Signature _________________________________________ 

Date:________________________________ 

Print Name: _____________________________________ 

P.O./Ref #:__________________________ 

Vendor: DiaSys Corporation, 81 West Main Street, Waterbury, CT 06702-2115 USA

Telephone: 800-360-2003 

Fax: 203-755-5105 

DSC ACCEPTANCE:  Signature: ___________________________________________ 

Date: _________________________ 

Print Name: ____________________

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