QT Imaging Holdings, Inc. (NASDAQ:QTI), a developer of electromedical apparatus, has entered into an exclusive distribution agreement with NXC Imaging, Inc., a subsidiary of Canon Medical Systems USA, Inc., as per a recent 8-K filing with the Securities and Exchange Commission. This new agreement, effective June 10, 2024, supersedes a prior non-exclusive sales agent agreement, marking a strategic shift in the company's sales and service operations.
Under the terms of the Distribution Agreement, NXC will become the exclusive reseller of QT Imaging's specified equipment in the U.S. and its territories, handling marketing, advertising, and reselling activities. NXC has the right to appoint sales agents for equipment sales and can mark up the equipment cost by a maximum of twenty percent, subject to mutual agreement with QT Imaging.
QT Imaging maintains the right to sell directly to customers and to other entities globally, without NXC's consent. The pricing schedule for NXC's purchases is outlined in the agreement and may be adjusted by QT Imaging with 60 days’ notice.
Orders from NXC are subject to QT Imaging's acceptance and once approved, they are non-cancellable. Payment terms dictate that NXC pays 50% upon order approval and the remaining 50% upon shipment. In addition, QT Imaging retains a security interest in the equipment until full payment is received.
Delivery terms state that the risk of loss passes to NXC upon pickup from QT Imaging's site in Novato, California. The agreement includes limited warranties, indemnification rights, and a limitation of liability clause.
After-sale servicing and the provision of spare parts are also addressed, with QT Imaging not obligated but may choose to supply spare parts upon request. Software upgrades and updates for the equipment will be provided according to the terms set forth in the agreement.
This distribution partnership is set to continue until December 31, 2025, subject to earlier termination or extension by mutual written agreement. The termination of the previous Sales Agent Agreement coincided with the establishment of this new Distribution Agreement.
The details of this arrangement reflect QT Imaging's strategy to enhance its distribution capabilities and market reach through this exclusive relationship with NXC Imaging. The information is based on a press release statement from QT Imaging Holdings, Inc.
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