Document:

Unassociated Document

 

EXCLUSIVE DISTRIBUTION AGREEMENT

 

THIS EXCLUSIVE DISTRIBUTION AGREEMENT (the “Agreement”), entered into as of May 20, 2009 (the “Effective Date”), is made by and between INSPIREMD GmbH. of 16 Boschstrasse, Winsen, Germany, a Corporation organized and existing under the laws of Germany and any of its affiliated companies (under formation) (individually and collectively referred to as the “Supplier”), and _IZASA _Distribuciones Tecnicas SA, Aragon 90, Barcelona, España _________ (the “Distributor”) (each of the Company and the Distributor, a “Party” and together, the “Parties”).

 

WHEREAS, Supplier develops, manufactures and supplies the Product(s) set forth on Exhibit A hereto, that may be improved or updated by Supplier from time to time (the “Product(s)”;

 

WHEREAS, Distributor distributes and sells a wide variety of Product(s) for use in the territory;

 

WHEREAS, Supplier wishes to sell the Product(s) to Distributor, and Distributor wishes to purchase the Product(s) from Supplier, subject to the terms and conditions of this Agreement;

 

NOW THEREFORE, in consideration of the premises and mutual covenants contained herein, the parties agree as follows:

 

1.           Representations, Undertakings, Appointment and Responsibilities of Distributor

 

1.1           Representations and Warranties: Distributor hereby represents and warrants to the Supplier that it possesses and will maintain throughout the term of this Agreement, the means, experience, know-how, skill, facilities and personnel to properly fulfill its obligations under this Agreement in a timely manner and to the Supplier’s satisfaction.  Further, the Distributor represents and warrants that it is duly licensed to execute its obligations under this Agreement.

 

1.2           Undertakings: Distributor hereby undertakes that he will, at its own expense, be responsible for obtaining any and all permits, approvals, product registration with the Ministry of Health, licenses authorizations and clearances from local, state, municipal, governmental, quasi-governmental and other authorities, required, necessary or desirable for the sale and distribution of the Product(s) in the Territory and for the performance of the Distributor’s obligations hereunder.  Pursuant to this engagement, Distributor agrees to purchase the Product(s) from Supplier, and Supplier agrees to sell the Product(s) to Distributor when such Product(s) are ordered hereunder in accordance with the terms hereof.

 

1.3           Appointment.  As of the Effective Date, Supplier hereby engages Distributor as its Exclusive distributor for the distribution and sale of the Product(s) solely in the geographical areas set forth on Exhibit B hereto (the “Territory”), subject to the terms and conditions of this Distribution Agreement.  Distributor hereby accepts such engagement, subject to the terms and conditions of this Distribution Agreement.  Distributor acknowledges that it may not make any commitment or binding obligation on behalf of Supplier.

 

  

  

  

 

1.4           Purchase Minimums.  Distributor hereby commits to Supplier to achieve, at a minimum, the purchase targets set forth on Exhibit C hereto during the Term (“Purchase Minimum”), and the Total Value of orders for each year listed therein (the “Order Value”).  If Distributor fails to achieve the Purchase Minimum and/or the Order Value in any given period specified in Exhibit C hereto, Supplier may, at its own discretion terminate this Agreement in accordance with Section 9.1 below.  Supplier shall notify Distributor if such appointment is made.  Said appointment shall not derogate from the terms of this Agreement and all other terms of this Agreement shall remain in effect Mutatis Mutandis.

 

1.5           Responsibilities.  Distributor shall bear its own expense for the execution of the following:

 

(a)           Product(s) Promotion.  Distributor shall use its best efforts to introduce to the market, promote, obtain orders for the Product(s) in the Territory.  For the execution of said promotion, Distributor shall employ highly qualified sales and technical personnel familiar with the Product(s).  Distributor agrees that it shall execute its obligation under this section in a manner that reflects positively on the Supplier and the Product(s) and shall not perform any act or omission which may harm the goodwill of, or be injurious to, the Product(s) or Supplier.  Further, all marketing material, Product(s) information, brochures and the like, containing information relating to the Product(s) requires the approval of the Supplier prior to its distribution to end users or prospects Distributor engages.

 

(b)           Marketing Plan.  Distributor shall keep Supplier continuously informed of the status of its marketing efforts under the marketing plan and shall furnish all information relating to the sales of the Product(s) in the Territory as may be reasonably requested by Supplier from time to time.

 

(c)           Sales Personnel.  Distributor shall train an appropriate number of its qualified employees in the sale of the Product(s) (“Sales Personnel”).  Number of Sales Personnel shall be sufficient for the purpose of promoting, marketing, selling and distributing the Product(s) in the Territory in accordance with Section 1.3 above.  Without derogating from the above, Distributor may use subcontractors for the distribution of the Products provided that the prior written approval of the Supplier is provided.  Distributor shall be held accountable for all distribution activities preformed by subcontractors in distributing the Products under this Agreement.  The Supplier shall have the right, at all times, to discontinue the use of a specific subcontractor at its sole discretion.

 

(d)           Compliance and Reporting.

 

(1)           Distributor shall comply with any and all safety regulations and standards and such other regulations or requirements as are or may be promulgated by authorized governmental authorities and required in order to carry out the terms of this Distribution Agreement.

 

(2)           Distributor shall provide Supplier with all information pertaining to adverse events or safety issues related to the Product(s) within one working day.  Further, Distributor shall promptly provide Supplier with all information alleging Product(s) deficiencies related to the identity, quality, durability, reliability, effectiveness, or performance of the Product(s).

 

  

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(e)           Quality Assurance and Product Traceability and MDD 93/42/EEC: The Distributor or any sub-distributor rendered by Distributor, shall be responsible for the implementation and maintenance of a quality System that fulfills the requirements of MDD 93/42/EEC, including, inter alia recalls, notification to local authorities and document maintenance.

 

1.           Post-Marketing Surveillance Program.  Distributor shall maintain a Post-Marketing Surveillance Program.  Inspire and the Distributor shall cooperate with each other in order to provide all information required and execute said program.  The PMSP shall include, among others, immediate notification to both Inspire and Distributor in the event that a serious defect is discovered in a product which has already been released

 

2.           Traceability of products.  In order to ensure compliance with laws and regulations relating to the traceability of the products, Distributor undertakes to take all appropriate measures to ensure:

 

	
  

	
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backward traceability to Inspire (and where applicable, to the Authorized Representative (name and address of the Authorized Representative printed on Product packaging); and

 

	
  

	
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reasonable product traceability to users to minimize the risks in case of recall; and

 

	
  

	
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language requirements according to national legislation; and

 

	
  

	
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compliance with any other responsibilities, liabilities, and obligations as set forth in Council Directive 93/42/EEC for manufacturers and any other laws, statutes, directives and regulations promulgated by any governmental body that may apply to the manufacturing and distribution of products.

 

3.           Customer Complaints and Recalls: In the event a serious defect is discovered in a Product which has already been distributed, Distributor shall immediately notify Inspire in writing, specifically in cases of notifiable incidents or near-incidents according to §§ 28-31 MPG, which are to be reported immediately in written form to the safety commissioner for medical products of Inspire.  Inspire shall support the Distributor in analyzing product complaints in an effective manner.

 

(f)           Customers.  Supplier undertakes not to disclose the Customer Information to third parties, and to use the Customer Information strictly for support and licensing purposes.  Supplier further undertakes not to contact the end-user directly or indirectly for sales and marketing purpose during the Term, unless otherwise agreed by the parties hereto.  Distributor shall provide Supplier on a quarterly basis and upon termination of this Agreement, with a list of all customers that have purchased Product(s) from Distributor, including their names, addresses, Product(s) purchased, purchasing date and purchase price.

 

  

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(g)           Records.  Distributor shall maintain complete and accurate records of all Product(s) sold by Distributor in sufficient detail to enable Supplier to comply with its obligations under this Agreement.

 

(h)           Storage.  Distributor shall store the Products in a storage facility and under conditions suitable to fit the Product’s nature as a delicate sterilized medical device to be used in humans.

 

(i)           Minimum Inventory.  Distributor shall at all times after the Effective Date of this Agreement maintain at all time, a minimum inventory of Products equivalent to one quarter of sales of the current year, to ensure the timely supply of Products to the customers.

 

2.           Term of Agreement

 

This Agreement shall commence and be effective as of the Effective Date and shall continue for a term of 3 years (the “Term”) commencing with the Effective Date of this Agreement, unless terminated pursuant to Section 9 below.  The Term shall be automatically extended to an additional term (“Renewal”) unless a written notice of termination has been provided by one party to the other ninety (90) days during the first 3 years of this Agreement otherwise would have expired.  The terms of this Agreement shall apply to any Renewal, except if otherwise agreed on in writing by the parties.

 

3.           Purchases, Prices, Payment and Forecasts

 

3.1           Standard Terms.  Distributor shall purchase Product(s) from Supplier pursuant to Supplier’s standard purchase order.  After receipt of Distributor’s purchase order, Supplier shall confirm, in writing, the details of the purchase order.  Supplier shall be obligated to sell to Distributor Products after the confirmation of the purchase order has been made by Supplier.

 

3.2           Prices.

 

(a)           Price per stent of the Product(s) from Supplier to Distributor are specified in Exhibit C to this Agreement (the “Prices”), FOB Israel or Germany at the Supplier’s sole decision.

 

Distributor shall complete the appropriate import/export forms as required by applicable laws and shall pay all other fees associated with the sale and delivery of all Product(s) hereunder, Including but not limited to customs clearance or customs tax as may apply.

 

(b)           Supplier shall not have the right to change the Prices with a sixty (60) days prior written notice (the “Price Notice”) to Distributor Price negotiations shall not occur more than once a year.  In the event prices are negotiated the following shall apply: (i) prices increases shall not affect unfulfilled orders prior to the effective date of the price increase, (ii) price increase shall not affect either to products that the distributor might have to sell to the customers obtained through tenders quoted or awarded prior to the effective date of the price increase.  Orders placed by Distributor prior to the last day of the Price Notice period shall not be effected by said price change, prior to the Price Notice shall be subject to the previous pricing, provided that a copy of such quote has been provided by Distributor to the Supplier prior to the Price Notice.

 

  

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3.3           Product(s) Changes.  Supplier reserves the right, at any time, to make changes to any Product(s) whenever such changes are (a) required for safety, (b) required in order to facilitate performance in accordance with specifications, or (c) such that they represent non-substantial substitutions and modifications not adversely affecting performance in accordance with applicable Product(s) performance specifications.  Supplier will inform Distributor 90 days in advance of any changes under this Section 3.3.

 

3.4           Purchase Orders.  All orders for Product(s) shall be placed by and subject to Distributor’s purchase orders in the form attached to as Exhibit E to this Agreement, each of which shall be subject to review and acceptance in writing by Supplier at its principal place of business.  Distributor’s purchase orders shall include the following information:

 

(a)           Identify each unit of Product(s) ordered;

 

(b)           Indicate quantity, price (determined in accordance with the provisions of this Agreement) and shipping instructions; and

 

(c)           Specify Distributor’s requested delivery dates.

 

Supplier is not bound by any term, condition or other provision in any purchase order that conflicts with the terms of this Agreement, unless such purchase order was confirmed in writing by Supplier.

 

3.5           After Purchase order is received and confirmed by Supplier, sales transaction shall be deemed complete and final.

 

3.6           Payment.

 

(a)           Payments for Product(s) shall be made in accordance with the payments schedule set forth in Exhibit D, by Distributor to Supplier pursuant to all additional terms listed therein.

 

(b)           Risk of Loss: Title to the Product(s) purchased hereunder shall pass to Distributor and all risk of loss or damage to such Product(s) shall be borne by Distributor from the time such Product(s) arrive on board consistent with FOB choice (Germany or Israel)

 

(c)           Distributor’s obligation to pay for all Product(s) ordered and all charges from the time such products are delivered to distributor according to EXW 1NCOTERMS agreed between the parties with the execution of this Agreement shall survive termination or expiration of this Agreement.

 

3.7           Forecasts.  Not later than the first day of each quarter during the Term of this Agreement, Distributor will provide an estimate of its demand for Product(s) for the following quarter.  Such rolling forecasts shall not be binding on either party, but shall be prepared with reasonable care, based upon Distributor’s experience with the Product(s) and information concerning existing customers.

 

  

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4.           Responsibilities of Supplier

 

4.1           Marketing and Sales Support.

 

(a)           Training and Support - Distributor shall train and support its personnel or subcontractors for the satisfactory completion of its obligations under this Agreement.  Supplier will assist in training by furnishing Distributor with English training literature.  Supplier may, at his sole discretion, provide Distributor with his own personnel for training.

 

(b)           Marketing Material.  Supplier shall provide Distributor with English language marketing literature.

 

(c)           Marketing Activities.  Supplier may at his own discretion choose to assist Distributor in marketing activities, by participating in conferences, meeting with customers, bringing opinion leaders and any other activities Supplier may choose to be involved in provided that said activities shall be coordinated with Distributor.

 

(d)           Supplier may list Distributor at the Supplier’s Website as a Distributor in the Territory.

 

4.2           Product(s) Specifications and Standards.

 

(a)           Recalls and Retrofits.  Supplier agrees that if any Product(s) is found by a government agency, sovereign, legislative or executive branch of government, or a court of competent jurisdiction to be in violation of any applicable law or regulation, Supplier shall be solely responsible for the necessary repair, replacement, or other remedy of such violation.  Costs of such replacement, freight charges, duties and taxes shall be borne by Supplier> in the event of a recall Supplier shall make available to Distributor all necessary documentation and information required in order to allow Distributor to carry out a proper and effective recall.  In addition Supplier shall report on its plan to resolve or prevent recurrences of the problem.

 

(b)           Compliance with Applicable Laws.  Supplier represents and warrants that all of the Product(s) to be furnished under this Agreement will be manufactured or supplied by Supplier in accordance with all applicable government provisions and stipulations of the European Union and the Territory applicable to the manufacturing quality, regulatory, traceability, labeling and packaging of the Products.  Supplier shall provide the Distributor with the Material Safety Data Sheet of the Products.

 

4.3           Compliance with Ethical rules.  Supplier represents and warrants that for all the duration of this Agreement it shall not make any payments, promises, rebates, gifts, or gratuities, of any kind, which are intended to secure the award of any business from any government official, government body, or agency or instrumentality of any government.

 

4.4           Complaints.  Supplier commits to record, evaluate and provide feedback to the Distributor regarding all complaints it receives about the Product(s) sold in the Distributor’s Territory.  Supplier shall inform Distributor of the outcome of said complaints as promptly as reasonable practicable.

 

  

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5.           Warranty and Maintenance

 

5.1           Warranty, Maintenance Obligations of Supplier to Distributor.

 

(a)           All Warranty claims against Supplier shall be made by Distributor, regardless of whether Distributor has transferred title or possession of the Product(s) to other parties.

 

(b)           The Warranty is contingent upon the proper use of the Product(s), and does not cover Product(s) that have been modified without Supplier’s approval, or that have been subject to unusual physical or electrical stress, misuse, unauthorized use, negligence or accident, or that have passed their expiration date.

 

(c)           Supplier makes no warranty in respect of accessories and other parts made by other suppliers that have been attached or connected to the Product(s).

 

(d)           THE FOREGOING WARRANTIES SET FORTH IN SECTION 5.1 ABOVE ARE EXCLUSIVE AND IN LIEU OF ALL OTHER WARRANTIES, EITHER WRITTEN, ORAL OR IMPLIED, WHICH ARE HEREBY SPECIFICALLY DISCLAIMED AND EXCLUDED BY SUPPLIER, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE AND NON-INFRINGEMENT OR ANY IMPLIED WARRANTIES ARISING BY COURSE OF DEALING OR USAGE OF TRADE).  THE SOLE AND EXCLUSIVE REMEDIES OF DISTRIBUTOR FOR BREACH OF PRODUCT(S) WARRANTY SHALL BE LIMITED TO THE REMEDIES PROVIDED IN THIS AGREEMENT.

 

(f)           NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT, SUPPLIER SHALL NOT BE LIABLE TO ANY PERSON FOR ANY SPECIAL, CONSEQUENTIAL, INCIDENTAL OR INDIRECT DAMAGES, HOWEVER ARISING, INCLUDING, BUT NOT LIMITED TO, DAMAGES TO OR LOSS OF PROPERTY OR EQUIPMENT, LOSS OF PROFIT, LOSS OF USE OF DATA, LOSS OF REVENUES OR DAMAGES TO BUSINESS OR REPUTATION ARISING FROM THE PERFORMANCE OR NON-PERFORMANCE OF ANY ASPECT OF THIS AGREEMENT OR ANY ORDER HEREUNDER, OR FROM ANY CAUSE WHATSOEVER ARISING FROM OR IN ANY WAY CONNECTED WITH THE MANUFACTURE, SALE, HANDLING, REPAIR, MAINTENANCE OR USE OF THE PRODUCT(S), WHETHER OR NOT SUPPLIER SHALL HAVE BEEN MADE AWARE OF THE POSSIBILITY OF SUCH LOSS.  ANY OTHER PRODUCT(S) REPRESENTATIONS OR WARRANTY MADE BY ANY OTHER PERSON OR ENTITY, INCLUDING EMPLOYEES OR REPRESENTATIVES OF DISTRIBUTOR THAT ARE INCONSISTENT HEREWITH, SHALL BE DISREGARDED AND SHALL NOT BE BINDING UPON SUPPLIER.  IN NO EVENT SHALL SUPPLIER’S LIABILITY FOR PARTICULAR UNITS OF THE PRODUCT(S) HEREUNDER EXCEED THE PURCHASE PRICE OF SUCH UNITS.

 

(g)           This Section 5.1 shall survive expiration or termination of this Agreement.

 

  

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5.2           Warranty and Maintenance Obligations of Distributor to Customers.

 

(a)           Distributor shall make no warranties or guarantees with respect to Product(s) or the use thereof except as provided herein or otherwise authorized in writing by Supplier.

 

(b)           Distributor shall educate and inform End Users of the proper and safe use of the Product(s).  In the event that Distributor learns or becomes aware of any information indicating that any of the Product(s) have failed to perform satisfactorily, or receives any complaints or information from anyone concerning the safety and/or merchantability of any of Product(s), Distributor shall notify Supplier immediately.  Distributor shall maintain a file of customer suggestions, comments, incident reports and Distributor responses and shall forward all such information to the Supplier in writing on the last day of each quarter this Agreement is in effect and for a period of 6 months from the termination of this Agreement if such information becomes available after termination.

 

6.           Intellectual Property and Ownership

 

6.1           Distributor acknowledges and agrees that:

 

(a)           Supplier represents and warrants that with regard to all intellectual property rights (including patents and trademarks) annexed to the Products, that up to his knowledge : (a) it holds legal and sufficient intellectual property rights over the Products, (b) at time of signature it has not received any notice, claim or sue from any third party, based on a possible infringement by the Product’s intellectual property right, and (c) during all the duration of the Agreement it will hold Distributor harmless against any possible third parties’ claims due to Products’ infringement of third parties’ intellectual property rights.  Distributor acknowledges and agrees that all intellectual property rights pertaining to the Product (s) {....}

 

(b)           Distributor shall not have or acquire any right, title or interest in or otherwise become entitled to any IP Rights by taking delivery of, making payment for, distributing and/or selling or otherwise using or transferring the Product(s).

 

(c)           Distributor shall take all reasonable measures to ensure that all IP Rights of Supplier shall remain with Supplier, including promptly notifying Supplier of any possible infringement by third parties of Supplier’s IP Rights and participating with Supplier, at Supplier’s expense, in any legal action against such infringement that in Supplier’s sole judgment is required for protection or prosecution of Supplier’s rights.

 

(d)           Distributor shall be the owner of the Product Registration in the Territory.

 

6.2           Without derogating from Section 6.1 above:

 

(a)           Supplier may at any time affix Supplier’s trade name, service marks or trademarks (the “Trademarks”) to any of the Product(s) and use the Trademarks in relation to any services Supplier provides hereunder in connection with the Product(s); Distributor shall not make any changes to the Trademarks used on Products by Supplier.

 

(b)           Distributor shall not have or acquire any right, title or interest in or otherwise become entitled to use any of the Supplier’s Trademarks, either alone or in conjunction with other words or names, or use the goodwill thereof, without the express written consent of Supplier in each instance; and

 

  

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(c)           Distributor shall not to apply for or oppose registration of any trademarks, including the Trademarks, used by Supplier.

 

6.3           Nothing contained in this Agreement shall be construed as conferring on either party any right or imposing any obligation to use in advertising, publicity or otherwise any trademark, name or symbol of the other party, or any contraction, abbreviation or simulation thereof, except as expressly provided for in this Agreement.

 

6.4           Distributor acknowledges that no license or right is granted hereby with respect to Supplier’s intellectual property.

 

7.           Confidentiality

 

7.1           Without the written consent of the other party, neither party shall disclose to any third party, or use for its own benefit or the benefit of others, either during or after the Term of this Agreement, any confidential or proprietary business or technical information of the other party that has been identified as confidential or proprietary by the disclosing party in accordance with Section 7.2 below.

 

7.2           To be considered proprietary information, the information must be (i) disclosed in writing or other tangible form and marked confidential or proprietary, or (ii) disclosed orally or visually, identified as confidential at the time of disclosure and reduced to writing and marked confidential or proprietary within thirty (30) days of the disclosure thereof.

 

7.3           Proprietary information shall not include information which (i) is already rightfully known or becomes rightfully known to the receiving party independent of proprietary information disclosed hereunder; (ii) is or becomes publicly known through no wrongful act of the receiving party; (iii) is rightfully received from a third party without similar restrictions and without breach of this Agreement; or (iv) in the opinion of counsel, is required to be disclosed to comply with any applicable law, regulation or order of a government authority or court of competent jurisdiction, in which event the receiving party shall, prior to such disclosure, advise the other party in writing of the need for such disclosure and use its reasonable best efforts to obtain confidential treatment of such information.

 

8.           Indemnification and Insurance

 

8.1           Supplier Indemnification.  Supplier shall indemnify, hold harmless and defend Distributor, its successors and assigns for all losses, claims and defense costs claimed by any third party for any injury, death or property damage suffered by such third party to the extent resulting from a defect in the manufacture or design of the Product(s) supplied hereunder, unless such injury, death or property damage is the result of Distributor’s negligence, willful misconduct, breach of this Agreement or any modification made by Distributor to the Product(s) without the Supplier’s consent.

 

  

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8.2           Distributor Indemnification.  Distributor shall indemnify, hold harmless and defend Supplier, its successors and assigns for all losses, claims and defense costs claimed by any third party for any injury, death or property damage suffered by such third party to the extent resulting from Distributor’s negligence, willful misconduct or breach of this Agreement.

 

8.3           Insurance.  To secure the indemnification provided in Sections 8.1 and 8.2 above, each of Supplier and Distributor agrees to maintain policies of insurance providing terms and conditions as follows:

 

(a)           General liability insurance in the amount of $300,000 per occurrence (which may be provided by a combination of primary and umbrella insurance); and

 

(b)           Product(s) liability insurance in the amount of $300,000 per occurrence (which may be provided by a combination of primary and umbrella insurance).

 

(c)           The insurance provided above shall include endorsements providing “contractual liability” coverage or equivalent terms; must be effective for claims or suits filed in the Territory.

 

Each of Supplier and Distributor shall provide a certificate of insurance covering the above requirements within thirty (30) days of execution of the Agreement, and upon each renewal of such insurance.

 

9.           Termination

 

9.1           The Supplier may terminate this Agreement with thirty (30) days written notice if the Distributor:

 

(a)           Is in default of its payment obligations hereunder, and such default continues for fifteen (15) days following receipt of written notice; or,

 

(b)           Is in default of any other material obligation hereunder and such default continues for thirty (30) days following receipt of written notice; or

 

(c)           Fails to meet the Minimum Sales or Order Value as defined in Exhibit C.

 

(d)           Distributes or attempts to distribute the Products outside of the Territory.

 

(e)           Distributor shall be entitled to terminate the Agreement in case Supplier is under situation 9.1 (b).

 

9.2           Either party may terminate this Agreement if the other party is declared bankrupt or is involved in any insolvency proceedings, attachment or other proceedings, which, in the reasonable opinion of either party prevents the other party from performing its obligations under this Agreement.

 

9.3           Either party may terminate this Agreement for any reason or without reason with six (6) months previous written notice to the other (hereinafter “Termination Notice”) without further penalties or indemnification, provided however that Supplier shall be obligated to provide Distributor with product to let it conclude Pending Sales.  For the purpose of this Section, Pending Sale shall be defined as follows:

 

  

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i) Sales to be undertaken by Distributor within the framework of public tenders which have been awarded to Distributor in any date before the effective termination date.

 

The commitment assumed by the Supplier in this clause shall survive until Distributor has concluded all Pending Sales.

 

9.4           Termination and/or expiration of this Agreement shall not affect any obligations of either party incurred hereunder prior to such termination, and/or expiration or any obligations that expressly survive termination of this Agreement, such as the Supplier obligations assumed by the Supplier under paragraph 9.3 of this Agreement.

 

9.5           Distributor is aware that in certain jurisdictions and/or countries, local authorities require that a sole named importer of the Product is authorized to distribute the Product in the Territory.  Therefore, distributor agrees to execute all documents required by the relevant authorities for the purpose of execution of this Agreement and shall further provide the Supplier, upon its first request with all documents and signatures required for the purpose of disengaging distributor as the Supplier’s sole names distributor in the Territory as set forth in Exhibit F of this Agreement.

 

10.           General Provisions

 

10.1           Relationship of the Parties.  Distributor shall act as an independent contractor, purchasing Product(s) from Supplier and reselling them in the Territory.  Distributor shall not act, and shall not be deemed as, agent for Supplier, nor shall Distributor have any right or power hereunder to act for or to bind Supplier in any respect.  This Agreement shall not be deemed to create any employer-employee relationship between Supplier and Distributor, nor any agency, franchise, joint venture or partnership relationship between the parties.

 

10.2           Amendment of Policies and Exhibits.  Supplier shall not be allowed to change any policies, exhibits or terms of the Agreement.  In the event either Supplier or Distributor is interested in amending any term of the Agreement, the parties shall meet and negotiate under bona fide principles the amendments or changes in which they might be interested in and said amendment or change shall be signed by both parties.

 

10.3           Assignment.  This Agreement, and the Distributor’s rights and obligations hereunder, shall not be assigned in whole or in part by the Distributor without the prior written consent of Supplier.  Any attempted assignment or delegation without such consent shall be void and of no effect.  The Parties agree that the Supplier shall have the right to assign all of its rights and obligations under this Agreement to an entity not a party to this Distribution Agreement provided that such Entity undertakes the obligations of the Supplier.

 

10.4           Notices.  Any and all notices permitted or required to be made under this Agreement shall be in writing, signed by the party giving such notice, and shall be delivered, personally or sent by facsimile or registered mail, to the other party at its address set forth in this Agreement, or the latest known address of the party.  The date of personal delivery, facsimile confirmation date as stated on the facsimile transfer report, or ten (10) days after being sent by registered mail, shall be the date of such notice.

 

  

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10.5           Publicity.  It is agreed the Supplier may identify Distributor as a distributor of Supplier’s Product(s) in advertisements and other promotional literature.  It is further agreed that Distributor may identify to its customers that Supplier is a supplier of the Product(s) to Distributor.  Neither party shall otherwise use the name of the other party in any advertising, publicity, promotional literature, brochures, sales aids or marketing tools without the prior written consent of such other party.

 

10.6           Agreement Governs.  In the event of any conflict between the terms of this Agreement and the terms of any Supplier or Distributor purchase order, sales contract or acknowledgment used in connection with any individual sale or purchase, the terms of this Agreement shall overrule, unless otherwise expressly agreed to in writing by Distributor and Supplier at the time of such individual sale.

 

10.7           No Waiver.  Failure to enforce any rights hereunder, irrespective of the length of time for which such failure continues, shall not constitute a waiver of those or any other rights, nor shall a waiver by either party in one or more instances be construed as constituting a continuing waiver or as a waiver in other instances.

 

10.8           Governing Law.  This Agreement and the rights and obligations of the parties hereunder shall be governed by and interpreted in accordance with the laws of the State of Israel, without giving effect to principles of conflicts of law.

 

10.9           Settlement of Disputes.  All disputes arising in connection with this Agreement shall be settled by mediation.  The mediation shall be held in Tel Aviv, Israel.  This provision shall expressly survive termination of this Agreement.

 

10.10           Complete Agreement.  This Agreement, including the Exhibits hereto, constitutes the full and complete agreement of the parties hereto and supersedes all prior agreements and understandings relating to the subject matter hereof.  Except as otherwise provided in Section 10.2 above or elsewhere herein, this Agreement may not be amended or otherwise modified unless evidenced in writing and signed by Distributor and Supplier.

 

10.11           Severance.  If any provision or provisions of this Agreement is held invalid, illegal, or unenforceable by a court of competent jurisdiction, such provision(s) shall be severed, and the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.  The parties shall use all commercially reasonable efforts to agree upon a valid and enforceable provision for the severed provision(s), taking into account the intent of this Agreement.

 

10.12           Force Majeure.  Failure of either party to perform its obligations under this Agreement (except the obligation to make payments) shall not subject such party to any liability or constitute a breach of this Agreement if such failure is caused by any event or circumstances beyond the reasonable control of such non-performing party, including without limitation acts of God, fire, explosion, flood, drought, war, riot, sabotage, embargo, strikes or other labor trouble, failure in whole or in part of suppliers to deliver on schedule materials, equipment or machinery, interruption of or delay in transportation (unless caused by the party so affected), a national health emergency or compliance with any order or regulation of any government entity.  A party whose performance is affected by a force majeure event shall take prompt action to remedy the effects of such force majeure event.

 

  

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10.13           Further Assurances.  Each party shall execute and deliver such further instruments and do such further reasonable acts and things as reasonably may be required to carry out the intent and purpose of this Agreement.

 

10.14           Counterparts.  This Agreement may be executed in any number of counterparts (including facsimile counterparts), each of which shall be original as against the party whose signature appears thereon, but all of which taken together shall constitute one and the same instrument.

 

10.15           Survival: Sections 1, 3, 5, 6, 7, 8, 9, and 10.15 shall survive the termination of this Agreement.

 

IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed by its duly authorized representative:

 

	

Inspire MD Ltd.

	 	

Distributor

	 	 	 	 	 
	Signature: 	s/ Eric Ben Mayor 	 	Signature:   	/s/ Enric Moret  
	Name:	Eric Ben Mayor  	 	Name: 	Enric Moret
	Title: 	 	 	Title: 	

General Manager Hospital Group

 

  

- 13 -

  

 

EXHIBIT A - PRODUCT(S)

 

MGUARD TM

 

  

  

  

 

EXHIBIT B - TERRITORY

 

SPAIN

 

  

  

  

 

EXHIBIT C — STENT PRICES AND SALES MINIMUMS

 

Prices: 700EUROS EXW Germany

 

	  	
2009

	
2010

	
2011

	
Stent Quantity

	
600

	
2000

	
4000

	
Total Order Value (in thousands)

	
420000

	
1400000

	
2800000

 

Comments:

 

First order minimum 200 stents

 

With 5% free of charge

 

1.           Sales minimum are defined in order values.

 

2.           Sales minimums are listed on a yearly basis which Distributor must meet under this Distribution Agreement.

 

3.           In addition to the yearly basis, Distributor must meet on a quarterly basis the cumulative proportional part of the quota.

 

  

  

  

 

EXHIBIT D — PAYMENT SCHEDULE

 

Payment by Distributor: by means of irrevocable letter of credit payable 90 days from date of AirWayBill.

 

  

  

  

 

EXHIBIT E -PURCHASE ORDER

 

  

  

  

 

EXHIBIT F

DISTRIBUTOR WAIVER

 

To: Inspire MD Ltd.

Menorat Hamaor 3

Tel Aviv, Israel

Distributor Waiver

 

Attn: Dr.  Asher Holzer

 

IZASA Distribuciones Tecnicas S.A. hereby undertakes to sign, execute and deliver to you all required documents requested by the local regulatory authorities or other authorities as may be relevant, in order to allow Inspire MD to name another local importer for the purpose of distributing its products IZASA Distribuciones Tecnicas S.A. understands and acknowledges that Inspire would suffer irreparable damages and great financial loss if it is unable to appoint a distributor of its choice in the Territory and therefore IZASA Distribuciones Tecnicas S.A. undertakes to perform the above in a timely and efficient manner.  Further, IZASA Distribuciones Tecnicas S.A. waives any rights with respect to it being the named importer in the Territory, or the registration rights to the Product(s) as provided for in the Distribution Agreement executed between IZASA Distribuciones Tecnicas S.A. and the Supplier.

 

This letter does not release Inspire of any obligations it has towards IZASA Distribuciones Tecnicas S.A. including any financial claims IZASA Distribuciones Tecnicas S.A. may have for services it preformed under the Distribution Agreement.

 

_________________________________

NAME

 

 

_________________________________

TITLE

 

 

_________________________________

DATEUnassociated Document

 

AMENDMENT TO THE DISTRIBUTION AGREEMENT

 

This Amendment (the “Amendment”, entered into as of February_, 2011 (the “Effective Date”) is made by and between INSPIREMD GmbH. Of 16 Boschstrasse, Wiesen, Germany, a Corporation organized and existing under the laws of Germany and any of its affiliated companies (under formation) (individually and collectively referred to as the “Supplier”), and IZASA Distribuciones Tecnicas SA ______________ with offices at Aragon 90, Barcelona, Spain (“IZASA”); and IZASA Hospital, S.L.U., a fully owned subsidiary of IZASA Distribuciones Tecnicas SA, located at Aragon 90, Barcelona, Spain (“IZASA HOSPITAL” or the “Distributor”) each of the Supplier, IZASA and New Distributor, a “Party” and together, the “Parties”).

 

WHEREAS, Supplier and IZASA entered into that certain Exclusive Distribution Agreement, contract no. COD-014-09 (the “Agreement”) dated May 20, 2009;

 

The Parties agree to amend the Agreement by assigning IZASA’s rights and obligations under the Agreement to IZASA HOSPITAL and additional revisions as follows:

 

Capitalized terms used herein and not otherwise defined shall have the respective meaning ascribed to them in the Original Agreement.

 

1.           IZASA HOSPITAL hereby assumes all of IZASA’s rights and obligations under the Agreement, and consequently as of the date hereof IZASA HOSPITAL shall be considered as “Distributor” under the Agreement.  Despite anything to the contrary herein IZASA shall continue to be responsible for the fulfillment of the Distributor’s obligations under the Agreement, jointly with IZASA HOSPITAL.

 

2.           The Parties agree to include in Exhibit A to the Agreement the ultra thin micro mesh coated stent called MGuard Prime as of the Effective Date.  As a consequence, a new Exhibit A is issued and attached to this Amendment.

 

3.           Without derogating from the Distributor’s undertakings under the Agreement, including Section 1.3 and Exhibit C thereto, the Distributor will order from the Supplier 500 units of the MGuard Prime stent at a price of 700 Euros per unit by Feb. 10, 2011.  The shipment of the order will be carried out in three phases as follows with invokes being issued upon shipment:

 

a.           150 units immediately upon execution of this Amendment Agreement

b.           150 units on April 10, 2011

c.           200 units on July 10, 2011

In the event that the Study (defined below) is delayed, IZASA HOSPITAL has the right to postpone the 2nd and 3rd shipments for the delay period in the commencement of the Study.

 

4.           Subject to the fulfillment of Section 3 above in its entirety, the Supplier will deliver an additional 20% of stents as free goods, i.e., 100 units.  The 100 free of charge units will be shipped as follows:

 

  

  

  

 

a.           30 units with the shipment mentioned in Section 3a.

b.           30 units with the shipment mentioned in Section 3b.

c.           40 units with the shipment mentioned in Section 3c.

5.           A clinical study (the “Study”) will be conducted within Spain entitled MGuard Prime Implementation in STEMI (acute myocardial infarction with ST elevation).  The Study’s aim is to evaluate the efficacy and safety of the use of MGuard Prime stent in reducing the rate of complications associated with the procedure such as no reflow phenomenon and distal embolization, as well as non -- inferiority as compared to other devices in terms of thrombosis and or restenosis.  Three hundred patients will participate in the Study.

 

6.           Subject to the support of the Distributor to the Study as stated herein, the Supplier will loan to the Distributor 300 units of MGuard Prime for the Study mentioned in clause 5.  Any MGuard Prime unit which shall not be deployed until the end of the Study will be returned immediately to Supplier.  The end date of the Study will be determined by Supplier.

 

7.           The Distributor will purchase from the Supplier each stent deployed from the stents loaned to Distributor and mentioned in Clause 6 above at a price of 700 Euros each.  The Distributor will issue a report to the Supplier once a month with the total number of stents deployed within the Study with payment due to the Supplier immediately upon issuance of the report and the Supplier invoice.

 

8.           For each patient participation in the Study, the Distributor will pay in addition to the 700 Euros per stent, an additional 200 Euros for its share in the clinical study cost.  Upon receipt of the report mentioned in clause 7, the Supplier will issue an invoice for this amount to the Distributor for each patient who participates in the Study.  The payment by the distributor will be due immediately upon receipt of the Supplier invoice.

 

9.           Except for the changes in the Agreement set forth above, the provisions of the Agreement shall remain in full force and effect and without any change.

 

 

	

 
INSPIREDMD GmbH.

	 	

 
IZASA Hospital, S L.U.

	 	 	 	 	 
	Signature: 	 /s/ Ofir Paz	 	Signature:   	/s/ Alfonso Garcia
	Name:	Ofir Paz	 	Name: 	Alfonso Garcia 
	Title: 	Chief Executive Officer	 	Title: 	

General Manager   

	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 
IZASA Distribuciones Tecnicas SA

	 	 	 	 	 
	 	 	 	Signature:   	/s/ Enric Moret  
	 	 	 	Name: 	Enric Moret    
	 	 	 	Title: 	General Manager     

 

 

- 2 -

  

 

EXHIBIT A PRODUCTS

 

MGuardTM

MGuardTM Prime

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