Effective beginning January 1, 2021
AGREEMENT TERMS AND CONDITIONS
These Agreement Terms and Conditions (these “Agreement Terms”) are a part of and incorporated into that certain 7D Surgical System Agreement (the “Agreement”). Capitalized terms used in these Agreement Terms not otherwise defined in these Agreement Terms shall have the meanings given them in Section 1 of the Agreement.
1. Purchase and Sale.
a. 7D System. Supplier’s sale of the 7D System to Purchaser under the Agreement is subject to the System Terms and Conditions and Purchaser shall comply with the System Terms and Conditions. Supplier shall have no responsibility or liability for the 7D System or the performance of any obligations of 7D set forth in the System Terms and Conditions.
b. 7D Services. Supplier shall have no responsibility or liability with respect to any services provided by or on behalf of 7D, including without limitation with respect to customer training (e.g., basic and/or comprehensive training with respect to basic operation, set-up, workflow and feature option review), clinical support days, or Support Services. In addition, Purchaser is responsible for purchasing, directly from 7D at 7D’s then-prevailing prices and terms and conditions, any customer training that Purchaser desires in connection with its purchase of the 7D System.
c. Product Supply Terms. For avoidance of doubt and without limiting the foregoing, any warranty and/or indemnification obligations of Supplier under or pursuant to the Product Supply Terms shall not apply to the 7D System, and Purchaser shall seek recourse for any warranty and indemnification claims applicable to the 7D System directly against 7D.
2. Shipping. The 7D System (and components thereof) shall be shipped directly by 7D to Purchaser at the location indicated on the Order, at Purchaser’s expense. Purchaser agrees to pay any shipping charges and any additional charges for special packaging requested by Purchaser or deemed necessary by Supplier or 7D.
3. Title. Purchaser acknowledges and agrees that each 7D System is the sole property of Supplier unless and until such time as Purchaser satisfies and pays the Purchase Obligation in full with respect such 7D System, at which time Supplier shall transfer to Purchaser title to such 7D System (excluding the 7D Software). Supplier may display notice of its ownership of the 7D System by affixing an identifying stencil, legend, plate or any other indicia of ownership, and Purchaser will not alter, obscure or remove such identification. Purchaser shall at all times prior to ownership and transfer of title to Purchaser identify the 7D System as property of Supplier. To secure its obligations under the Agreement, Purchaser hereby grants Supplier a continuing, first priority security interest in all of its right, title and interest in and to the 7D System and upon any breach of the Agreement by Purchaser, Supplier shall have all of the rights and remedies of a “secured party” under the Uniform Commercial Code. Purchaser authorizes Supplier to file all Uniform Commercial Code financing statements necessary to perfect such security interest.
4. Risk of Loss, Care, and Use. Purchaser shall bear all risk of damage or loss to the 7D System and shall be responsible for the proper care and use of the 7D System in accordance with the System Terms and Conditions. Purchaser will keep the 7D System free and clear from any and all third party claims, liens, encumbrances and legal processes of Purchaser’s creditors and other persons. Until Purchaser pays the Purchase Obligation in full, Purchaser may not transfer (legally or physically) the 7D System to any company or other entity, whether by lease, loan, sale, distribution or otherwise. The 7D System shall at all times be and remain personal property notwithstanding that any such property may now or hereafter be affixed to realty. Supplier shall have the right to inspect the 7D System at any time, during Purchaser’s business hours, upon no less than ten (10) days prior notice.
5. Insurance. From the date of placement of the 7D System with Purchaser, Purchaser shall obtain, and continuously maintain and keep (until the title is transferred under Section 3 of these Agreement Terms (Title)) insurance to cover the 7D System for all types of loss, including theft, in an amount not less than the full replacement value, and Purchaser shall name Supplier as an additional insured and loss payee on such insurance policy. Purchaser shall also obtain, maintain and keep throughout such period, comprehensive public liability insurance covering liability for bodily injury, including death, and property damage resulting from the purchase, ownership, leasing, maintenance, use, operation or return of the 7D System with a combined single limit of not less than Two Million Dollars ($2,000,000.00) per occurrence. All said insurance shall be in with companies with minimum “A-” Best rated insurance carriers. Upon request, Purchaser shall provide Supplier with evidence of such insurance by furnishing a certificate of insurance. All insurance shall provide for at least thirty (30) days advance written notice to Supplier before any cancellation, expiration or material modification thereof and also provide that no act or default of any person, other than Supplier, its agents or those claiming under Supplier, will affect Supplier’s right to recover under such policy or policies in case of loss.
6. Data Collection. 7D collects data as set forth under the link titled “Data Collection” located at the URL, which may be updated from time to time upon notice to Purchaser. 7D is required to comply with the terms and restrictions set forth therein and with all applicable federal and state laws with respect to such collection and use of end-user and patient data, including, with respect to patients, the Health Insurance Portability and Accountability Act of 1996 as amended, and its implementing regulations regarding privacy, security and breach notification (“HIPAA”). 7D has represented and warranted to Supplier that it has implemented and maintains a comprehensive and current HIPAA compliance program consistent with its obligations as a “Business Associate,” as that term is defined under HIPAA. It is Purchaser’s responsibility to enter into a Business Associate Agreement with 7D. The Parties acknowledge and agree that Supplier will not receive any “Protected Health Information,” as such term is defined under HIPAA, or personal information protected under state law, and 7D will not transmit such data to Supplier in any form.
7. No Warranty; Disclaimer.
a. THE ONLY WARRANTIES APPLICABLE TO THE 7D SYSTEM ARE SOLELY AS SET FORTH IN THE SYSTEM TERMS AND CONDITIONS AND ARE MADE BY 7D DIRECTLY TO PURCHASER.
b. SUPPLIER MAKES NO WARRANTIES WITH RESPECT TO THE SYSTEM OR SERVICES, AND SUPPLIER HEREBY DISCLAIMS ANY AND ALL IMPLIED WARRANTIES, INCLUDING BUT NOT LIMITED TO, IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, AND ANY IMPLIED WARRANTY ARISING FROM COURSE OF PERFORMANCE, COURSE OF DEALING, USAGE OR TRADE OR OTHERWISE.
8. Limitation of Liability. NOTWITHSTANDING ANY PROVISION SET FORTH IN THE PRODUCT SUPPLY TERMS TO THE CONTRARY, THE LIABILITY OF SUPPLIER AND ITS AFFILIATES IN THE AGGREGATE UNDER AND WITH RESPECT TO THE AGREEMENT (INCLUDING THESE AGREEMENT TERMS AND THE OTHER DOCUMENTS COMPRISING THE INCORPORATED TERMS) AND THE PERFORMANCE OR NONPERFORMANCE OF THE AGREEMENT SHALL BE LIMITED TO THE PURCHASE PRICES PAID TO SUPPLIER BY PURCHASER UNDER THE AGREEMENT. SUPPLIER SHALL NOT BE LIABLE FOR ANY INCIDENTAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES, LOSS OF PROFIT, OR LOSS OF USE IN CONNECTION WITH THE ACQUISITION OR USE OF ANY 7D SYSTEM, EVEN IF SUPPLIER IS INFORMED OF THE POTENTIAL FOR SUCH DAMAGES.
9. Compliance with Laws; Reporting and Disclosure Obligations. Each Party shall comply with all applicable laws in connection with its performance under the Agreement. It is the intention of the Parties hereto that the Agreement be administered in accordance with the provisions of the federal anti-kickback statute (42, U.S.C. § 1320a-7b(b)). Accordingly, insofar as required by such statute or by the discount safe harbor regulations at 42 C.F.R. § 1001.952(h), Purchaser shall fully and accurately report in applicable cost reports and provide information upon request to Medicare, Medicaid, and other federal health care programs on all discounts and price reductions under the Agreement and/or the Product Supply Terms, including disclosing and accurately reflecting where appropriate, and as appropriate, the applicable reimbursement methodology. Supplier shall provide Purchaser with accurate sales and discount information to allow Purchaser to comply with this Section and such discount safe harbor.
a. Services Discontinuation. In the event that Purchaser fails to fulfill the Purchase Obligation in a timely manner, Supplier may direct 7D to cease to provide the Support Services.
b. Confidentiality. Purchaser agrees not to disclose the terms and/or conditions of the Agreement, including the Purchase Obligation, the Commitment Period, and any other pricing arrangements, to any third party, except (i) as required by law; or (ii) to federal or state health care payors (including Medicare and Medicaid payors) and to other health care regulators as required by law. The Parties further agree not to use such Confidential Information for any purpose other than implementation of the Agreement.
c. Notices. All notices, demands or other communications required or permitted to be given pursuant to the Agreement shall be effective only if given in writing, hand-delivered, or sent by courier service or certified or registered mail, return receipt requested, postage prepaid and addressed to Purchaser at the address on the cover page of the Agreement and to Supplier as follows:
Attention: Vice-President, U.S. Sales
5770 Armada Drive
Carlsbad, CA 92008
Attention: Legal Department
5770 Armada Drive
Carlsbad, CA 92008
d. Governing Law. The Agreement shall be construed, interpreted and enforced in accordance with, and governed by, the laws of the State of California, as applied to agreements among California residents, entered into and to be performed entirely within California.
e. Medicare Books and Records. Supplier shall make available upon written request from the Secretary of the Department of Health and Human Services, the Comptroller General of the United States, or any of their duly authorized representatives, the Agreement and all books, documents and records of Supplier that are necessary to certify the nature and extent of costs incurred by Purchaser for services provided under the Agreement, if any, until the expiration of four (4) years after the furnishing of services to Purchaser pursuant to the Agreement, to the extent the value of such services exceeds Ten Thousand Dollars ($10,000) on an annualized basis.
Further, if Supplier enters into a subcontract for services with a related organization and the subcontract has a value or cost of Ten Thousand Dollars ($10,000) or more over a twelve (12) month period, Supplier shall include in the subcontract a clause requiring that the related organization, upon request, shall make available to the Secretary of the Department of Health and Human Services, the Comptroller General of the United States, or any of their duly authorized representatives, the subcontract and such of the related organization’s books, documents and records as are necessary to verify the nature and extent of such costs of services under such subcontract until the expiration of four (4) years after the furnishing of services under such subcontract.
f. Assignment and Binding Effect. Neither Party may assign or transfer the Agreement or any part thereof or any rights under or arising from the Agreement, or transfer any obligations under the Agreement, either voluntarily or involuntarily or by operation of law, without the other Party’s prior written consent; provided, however, that either Party may, without the written consent of the other Party, assign the Agreement and its rights hereunder and thereunder to an affiliate or in connection with the transfer or sale of all or substantially all of its business related to the Agreement, or in the event of a merger, consolidation, change in control, corporate reorganization or similar transaction. Any assignment in violation of this paragraph shall be null and void and of no force or effect. Subject to the foregoing, the Agreement shall inure to the benefit of and be binding upon each Party’s successors and assigns.
g. Remedies. Except as otherwise provided herein, no remedy is intended to be exclusive of any other remedy, and each and every remedy shall be cumulative and be in addition to every other remedy now or hereafter existing at law or in equity or by statute or otherwise. Supplier and Purchaser each acknowledge that damages alone may not be an adequate remedy for any breach or violation of its obligations under the Agreement and that in addition to any other remedies to which the other Party may be entitled, such other Party shall be entitled to injunctive relief, including specific performance, with respect to such obligations in any court of competent jurisdiction.
h. Waivers. No waiver by a Party or any failure by a Party to keep or perform any covenant or condition of the Agreement shall be deemed to be a waiver of any preceding or succeeding breach of the same or other covenant or condition, unless the waiver is expressed in writing and signed by the waiving Party. No failure to enforce any provision of the Agreement shall operate as a waiver thereof or be deemed to be a release of any rights granted under the Agreement.
i. Force Majeure. Except with respect to the payment of money, neither Party (or 7D) shall be liable for any failure or delay in performance under the Agreement (or, with respect to 7D, the performance of Support Services) if such Party (or 7D) is prevented from performing its obligations under the Agreement due to a cause which is beyond its reasonable control, which cause may include fire, explosion, earthquake, flood; war (whether or not declared), terrorism, or civil commotion; strike, lock-out, or labor disturbance; failure of public utilities or common carrier; embargo or other governmental action or requirement or request; equipment failure; shortage of raw materials or inability to obtain labor, fuel, materials, supplies or power at reasonable prices (each, a “Force Majeure Event”); provided, however, that the non-performing Party shall promptly give notice thereof to the other Party and shall use reasonable commercial efforts to cure or correct the applicable Force Majeure Event and to resume performance of its affected obligations as soon as possible.
j. Severability. If any provision of the Agreement would be held or made invalid or unenforceable by a court decision, statute, rule, or otherwise, such provision shall be construed in such a way as to make it valid and enforceable to the maximum extent possible. The invalidity or unenforceability of any provision of the Agreement shall not affect the remaining provisions of the Agreement, which shall be enforceable to the maximum extent permitted by law.
k. Entire Agreement. The Parties acknowledge that the Agreement (including Exhibit A, the Incorporated Terms, and the Order) constitute the complete and exclusive understanding between the Parties with respect to the subject matter of the foregoing. No amendment of the Agreement may be made or rider added, except in a writing duly signed by each of the Parties. For clarity, all terms set forth in the Product Supply Terms remain in full force and effect. Notwithstanding any termination of any written agreement evidencing any of the Product Supply Terms, if and as applicable, the Agreement shall continue to apply with respect to any 7D Systems purchased under the Agreement.
l. Section Headings; Interpretation. The section headings in the Agreement are inserted for convenience only and are not intended to affect the interpretation of the Agreement. The word “including” means “including without limitation.” The Agreement will be construed as if drafted jointly by the Parties and no presumption or burden of proof will arise favoring or disfavoring any Party by virtue of the authorship of any provision in the Agreement. All words in the Agreement will be construed to be of such gender or number as the circumstances require.
m. Counterparts. The Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same instrument. The Parties agree that a facsimile signature or an electronic signature shall constitute an original signature. For the purposes of the Agreement, an electronic signature is an electronic symbol or process attached to or logically associated with the Agreement and executed or adopted by an authorized person with the intent to sign the Agreement.