Exhibit 10.14
Contract Manufacturing Agreement
This Contract Manufacturing Agreement ("Agreement") is made as of February 28,
2001 (the "Effective Date") between Peak Industries, Inc., 0000 Xxxx 00,
Xxxxxxxx, XX 00000 ("Peak") and Aksys, Ltd., Xxx Xxxxxxxx Xxxxx, Xxxxxxxxxxxx,
XX 00000 ("Aksys").
AGREEMENT
In consideration of the mutual covenants, promises, and conditions set forth
below, the parties, intending to be bound, agree as follows:
1) Supply Obligations. During the Term, (a) Peak shall manufacture the
Products in accordance with the terms and conditions set forth in this
Agreement and the Specifications, and (b) Peak shall manufacture all of
Aksys's requirements for Products as provided in Section 5 (a) except as
provided below in Section 5(b).
2) Design and Specifications.
a) Specifications. The "Specifications" shall mean all of the following:
(i) the preliminary drawings and specifications for the Products will
be mutually agreed upon and controlled in the Peak Manufacturing and
Quality System (PMQS), and all revisions thereof delivered in writing
by Aksys to Peak and accepted by Peak; (ii) manufacturing procedures
and quality plans for the specific assembly in accordance with Section
2(c); and (iii) all prototypes made by Peak and approved by Aksys for
production.
b) Design Changes. Peak and Aksys will mutually review and accept changes
in Specifications by releasing such changes in the PMQS. Peak reserves
the right to re-quote prices in the event of Aksys changes to the
Specifications.
c) Testing and Quality. Aksys and Peak will establish testing procedures
mutually agreed upon by Peak and Aksys. Peak will evaluate and
incorporate Aksys test procedures into its PMQS. Aksys and Peak will
agree on Non Recurring Engineering fees to compensate appropriate
activities. Peak agrees that Aksys's representatives may have access
to the area of Peak's facility where Products are being manufactured
or stored or where parts and materials are being processed or stored
at all times during normal business hours for purposes of quality
inspection and verification of manufacturing procedures to
Specifications.
d) Quality Requirements.
i) Aksys shall maintain the "Design History File" and perform all
necessary "Design Verification and Validation."
ii) Aksys shall be responsible for identifying any components
requiring lot traceability. These requirements will be released
into the PMQS as a customer specification.
iii) Peak shall maintain an approved vendor list (AVL) which shall
serve as a record of acceptable suppliers. Any suppliers
selected, evaluated and approved by Aksys or their representative
shall be noted as a customer approved supplier on the AVL. All
suppliers selected by Peak shall be either approved or certified
according to the PMQS.
iv) Peak will perform process validation where results cannot be
verified by subsequent inspection or test. Any additional
validation will be specified by Aksys. Aksys will provide
specifications for and
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will obtain any necessary regulatory approvals of printed
materials, including labels manuals, artwork and copy.
v) Aksys will investigate and handle complaints from end-users. Peak
shall cooperate with Aksys's investigations, including providing
manufacturing-related records as they relate to the
investigation. Aksys will reimburse Peak for all reasonable costs
and expenses in cooperation of such investigation.
vi) Aksys is responsible for conducting product recalls. Peak shall
cooperate with Aksys recall investigations, including providing
manufacturing-related records as they relate to the recall. Peak
and Aksys shall cooperate in jointly assessing the root cause of
a product recall. Both parties will mutually agree as to the
assessment of responsibility. Should Aksys be determined solely
responsible for the recall, Aksys will reimburse Peak for all
reasonable costs and expenses in cooperation of such recall.
Should Peak be determined solely responsible, Aksys will not
reimburse Peak for expenses incurred in providing replacement
components. Aksys will bear the cost of all field service related
activities.
vii) Aksys is responsible for all installation and start up activities
of the Product.
3) Tools and Fixtures. Aksys shall be responsible for purchasing all tooling
and fixtures that are required for production of the Products (including
any tooling and fixtures required due to a change to the Specifications)
and which Peak does not own as of the Effective Date. All such tooling and
fixtures shall be held by Peak in trust for Aksys's exclusive use in
accordance with manufacturing and testing procedures established for
Aksys's products only. Such tooling and fixtures shall be owned by Aksys
and identified to Peak's lenders, creditors, shareholders and other third
parties as Aksys assets consigned to Peak. Except for normal production
maintenance, which will be the responsibility of Peak, Aksys shall be
exclusively responsible for the costs to repair or replace such tooling and
fixtures. Peak and Aksys shall cooperate to obtain the best available
pricing for all such tooling and fixtures. Peak agrees to execute and
deliver to Aksys upon request a form UCC-1 or such other documents as Aksys
reasonably may request to protect its interest in such assets.
4) Forecasts.
a) Generally. Aksys agrees to provide Peak a six (6) month rolling
forecast of Aksys's reasonably anticipated cumulative quantity of the
Product for such six-month period. Aksys agrees to update the forecast
monthly and provide it to Peak each month. Peak is authorized to
purchase materials for the first thirteen weeks of the forecast (the
"Rolling 13 Week Firm Forecast") after the product has officially been
launched into the marketplace. Pre-launch purchasing quantities will
be provided by Aksys.
b) Long Lead Time Items. Peak may request from Aksys written
authorization to purchase certain long lead time items for Peak
inventory, safety-stock and manufacturing requirements ("Special
Inventory"). Upon termination or cancellation of this Agreement, Aksys
shall purchase from Peak, at Peak's actual cost, any unused Special
Inventory not to exceed the amount that has been specifically agreed
to in writing by Aksys.
c) Deposit. Aksys agrees to provide a one-time cash deposit in an amount
equal to Peak's cost for the materials required to produce the number
of Product units specified in the initial Rolling 13 Week Firm
Forecast. Such deposit shall be applied as a credit against each
subsequent invoice. No deposit shall be required for any order other
than the initial deposit described herein.
5) Orders and Fulfillment.
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a) Purchase Order. Aksys shall issue written purchase order releases (PO
releases) for its Product requirements. Peak shall accept and fulfill
all such PO releases to the extent that the Product quantity ordered
by Aksys for delivery in any one week period does not exceed the
delivery forecast for such week in the Rolling 13 Week Firm Forecast
provided by Aksys at least [thirteen (13) weeks] prior to such week;
provided, however, that Peak shall make all reasonable efforts and
afford first priority to production for Aksys to accept and fulfill PO
releases that exceed such forecasts. Aksys shall provide a required
delivery date for each PO release based on a thirty (30) day lead time
or as otherwise mutually agreed between Aksys and Peak.
b) Exclusivity; Inability to Supply. During the Term and for so long as
Peak continues to timely supply Aksys' requirements for the Products,
Aksys shall not have the Products made by any third party; provided,
however, that nothing in this Agreement shall be deemed to preclude
Aksys from manufacturing the Products itself. Peak shall provide
immediate written notice to Aksys if Peak reasonably anticipates that
it may be unable to meet Aksys' requirements specified in the then-
current Rolling 13 Week Firm Forecast (or thereafter), and in such
event Aksys shall be entitled to have Products made by other third
parties, and may thereafter allocate, in Aksys's sole discretion, its
Product requirements among Peak and such third parties. Exclusivity is
predicated upon Peak's maintenance of ISO 9002 certification and FDA
registration during the term of the agreement. Loss of either of these
certifications will result in forfeiture of exclusivity until
certification is reestablished.
c) Order Cancellation. Aksys may cancel any PO release or any Rolling 13
Week Firm Forecast, provided that in such event, Aksys shall pay Peak
for Products and any inventory affected by the cancellation as
follows, not to exceed to purchase price for such order: (i) 100% of
Peak's price to Aksys for all finished Products in Peak's possession,
(ii) 110% of the cost of all inventory in Peak's possession procured
for Aksys confirmed purchase orders and not returnable to the vendor
or usable for other customers, whether in raw form or work in process,
(iii) 100% of the cost of inventory on order and not cancelable, (iv)
any vendor cancellation charges incurred with respect to inventory
accepted for cancellation or return by the vendor, and (v) actual
costs to Peak of labor incurred by Peak related to work in process for
Aksys's canceled PO releases. Upon such payment all such inventory
and work in progress shall become the sole property of Aksys.
d) Order Changes. Peak will make commercially reasonable efforts to
accommodate changes to Aksys confirmed purchase orders. Peak will move
out purchase order dates to accommodate changes, but in no event will
the move out exceed thirty (30) days. Purchase orders moved out
greater than 30 days may be invoiced at full value upon completion.
e) Part Change Orders. Aksys agrees to purchase from Peak, at Peak's
actual cost, any inventory purchased by Peak in reliance on Aksys's
Rolling 13 Week Firm Forecast, which inventory is rendered obsolete
due to a change to the Specifications. Peak shall, however, first use
reasonable efforts to return any such inventory, and Aksys agrees to
pay for the restocking charges and shipping if applicable.
6) Packaging, Shipping and Delivery. Peak shall ship the Products in
accordance with packaging and shipping instructions provided by Aksys.
Unless otherwise specified in writing in a particular PO release, all
Product deliveries shall be shipped F.O.B. factory to the destination
specified by Aksys for delivery, and Peak shall insure such shipments
against any loss or damage to the goods caused during shipment.
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7) Payment.
a) Invoice. Peak will invoice at the time of shipment of Products.
Payment is due at Peak on or within twenty (20) calendar days from the
date that such invoice is received by Aksys.
b) Pricing. Peak's invoices shall reflect charges for the Products as
specified in Exhibit B. Such charges are exclusive of taxes, shipping
and insurance. Charges for taxes, shipping and insurance (to the
extent applicable) shall be separately stated on Peak's invoice.
c) Cost Reductions. Peak agrees to seek ways to reduce the cost of
manufacturing Products by obtaining alternate sources of materials,
and improved assembly or test methods. Peak shall notify Aksys in
writing not less than thirty (30) days prior to starting any such cost
reduction efforts or implementation of any such cost reduction
methods. Upon implementation of such methods, Peak may include in its
invoices thereafter (for so long as such cost reduction method remains
in effect) a line item representing one-half (1/2) of the reduction in
actual costs that would, immediately prior to implementation of such
cost reduction methods, have been charged to Aksys for the Products
delivered under such invoice in accord with Section 7(b). Cost
reductions initiated directly by Aksys, such as product re-engineering
of materials, components or subsystems; refinement of manufacturing
processes or procedures; identification of new vendors, volume related
price improvements or changes in the pricing or availability of third
party materials and services will accrue 100% to Aksys. Aksys and Peak
will mutually agree to ownership of cost reduction activities prior to
efforts expended in pursuit of such reductions. Such reductions will
be reflected as a line item on Peak invoices immediately following
implementation.
8) Limited Product Warranties.
a) Basic Warranty. Peak warrants that the Products are and shall be free
from defects in workmanship which exist or develop for a period of [90
days] from the date of installation or 6 months from date of shipment
thereof to Aksys or Aksys's designated distributor, whichever occurs
first, provided that such defect developed under normal and proper use
within the operating parameter described in the Specifications.
b) Specification Warranty. Peak warrants that the Products are
manufactured to PMQS for a period of [90 days] from the date of
installation or 6 months from date of shipment thereof to Aksys or
Aksys's designated distributor, whichever occurs first.
c) Limitation of Liability. Aksys's sole and exclusive remedy in the
event of a breach of the foregoing warranties shall be repair or, at
Peak's sole discretion, replacement, including related shipping costs.
Aksys will bear financial responsibility for all field service related
warranty expenses.
9) Intellectual Property.
a) As between Aksys and Peak, Aksys shall own all right, title and
interest in and to Products and the Know-How, Improvements and Patents
related thereto. No implied rights or licenses are granted by this
Agreement. Aksys shall have the right to apply, in its own name and at
its own expense, for patent, copyright or other Intellectual Property
rights in such Know-How and Improvements and, if requested, Peak shall
cooperate with Aksys in any reasonable manner in obtaining such
protection. Peak agrees that all such Know-How and Improvements shall
be owned solely by Aksys, even
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though developed as a result of this Agreement, and regardless of
whether conceived, created or developed by Aksys or Peak.
b) License. During the Term Aksys grants to Peak a non-exclusive,
royalty-free right and license under the Patents, Know-How and
Improvements to make the Products solely for delivery to Aksys or
Aksys's designee.
10) Confidentiality.
a) General Obligation. All information provided by one party (the
"Disclosing Party") to the other party (the "Recipient") shall be
governed by this Section 10.
b) Proprietary Information. As used in this Agreement, the term
"Proprietary Information" shall mean all trade secrets or confidential
or proprietary information designated as such in writing by the
Disclosing Party, whether by letter or by the use of an appropriate
proprietary stamp or legend, prior to or at the time any such trade
secret or confidential or proprietary information is disclosed by the
Disclosing Party to the Recipient. Notwithstanding the foregoing,
information which is orally or visually disclosed to the Recipient by
the Disclosing Party, or is disclosed in writing without an
appropriate letter, proprietary stamp or legend, shall constitute
Proprietary Information if the Disclosing Party, within thirty (30)
days after such disclosure, delivers to the Recipient a written
document or documents describing such Proprietary Information and
referencing the place and date of such oral, visual or written
disclosure and the names of the employees or officers of the Recipient
to whom such disclosure was made.
c) Disclosure. The Recipient shall hold in confidence, and shall not
disclose to any person outside its organization, any Proprietary
Information for a period of five (5) years from the Effective Date,
regardless of the termination of the Term of this Agreement. The
Recipient shall use such Proprietary Information only for the purpose
of developing the Product with the Disclosing Party or fulfilling its
future contractual requirements with the Disclosing Party and shall
not use or exploit such Proprietary Information for any other purpose
or for its own benefit or the benefit of another without the prior
written consent of the Disclosing Party. The Recipient shall disclose
Proprietary Information received by it under this Agreement only to
persons within its organization who have a need to know such
Proprietary Information in the course of the performance of their
duties and who are bound to protect the confidentiality of such
Proprietary Information.
d) Limitation on Obligations. The obligations of the Recipient specified
in Section 10 above shall not apply, and the Recipient shall have no
further obligations, with respect to any Proprietary Information to
the extent that such Proprietary Information: (i) is generally known
to the public at the time of disclosure or becomes generally known
through no wrongful act on the part of the Recipient; (ii) is in the
Recipient's possession at the time of disclosure otherwise than as a
result of Recipient's breach of any legal obligation; (iii) becomes
known to the Recipient through disclosure by sources other than the
Disclosing Party having the legal right to disclose such Proprietary
Information; (iv) is independently developed by the Recipient without
reference to or reliance upon the Proprietary Information; or (v) is
required to be disclosed by the Recipient to comply with applicable
laws or governmental regulations, provided that the Recipient provides
prior written notice of such disclosure to the Disclosing Party and
takes reasonable and lawful actions to avoid and/or minimize the
extent of such disclosure.
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e) Ownership of Proprietary Information. The Recipient agrees that the
Disclosing Party is and shall remain the exclusive owner of
Proprietary Information and all Intellectual Property rights embodied
therein.
f) Return of Documents. The Recipient shall, upon the request of the
Disclosing Party, return to the Disclosing Party all drawings,
documents and other tangible manifestations of Proprietary Information
received by the Recipient pursuant to this Agreement (and all copies
and reproductions thereof): provided that the Recipient may keep one
archival copy of the same.
g) During the period beginning on the date hereof and ending on the later
of two (2) years from such date or one (1) year after the termination
of business relations between Peak and Aksys, Peak covenants and
agrees that it shall not actively solicit any employee to leave the
employment of Aksys.
11) Indemnification.
a) Aksys Indemnification of Peak. Aksys shall indemnify, defend and hold
harmless Peak from and against any Losses arising out of or relating
to a claim brought by a third party against Peak only to the extent
that such claim and corresponding Losses are based upon allegations
that (i) there exists a defect in the design of any Products by Aksys
(including a defect in any materials provided to Peak by a third party
with respect to which materials Aksys's Specifications required to be
purchased from such third party), (ii) would constitute a breach of
the terms of this Agreement by Aksys, or (iii) the manufacture, sale
or use of any Product, in accordance with the Specifications and
operating instructions provided by Aksys, infringes a patent,
copyright, trade secret or other proprietary right of a third party.
b) Indemnification Procedure. A party claiming indemnification under this
Section 11 (an "Indemnified Party") shall provide prompt written
notice to the other party (the "Indemnifying Party") of any and all
notices, claims, demands, pleadings, and other facts or circumstances
that may, in the Indemnified Party's reasonable judgment, be likely to
result in a claim for indemnification. The Indemnified Party's failure
to provide such prompt written notice shall reduce the indemnification
obligation of the Indemnifying Party to the extent that such failure
resulted in demonstrable prejudice to the Indemnifying Party. The
Indemnified Party shall promptly tender defense of any litigation or
other formal dispute to the Indemnifying Party, and the Indemnifying
Party shall select counsel of its choice, reasonably acceptable to the
Indemnified Party for such litigation or dispute. The Indemnified
Party shall cooperate completely with the Indemnifying Party,
including without limitation providing timely responses to all
discovery requests and providing expert and factual witnesses as
necessary or desirable. The Indemnifying Party shall have the sole
authority to negotiate and settle such claims to the extent of the
applicable indemnification obligation.
c) Insurance. Each party shall maintain general liability insurance in an
amount not less than [$5,000,000] per claim. Any amounts paid under
such insurance policies by the either party's insurer shall reduce the
indemnification obligation of the Indemnified Party with respect to a
particular claim.
12) Disclaimer of Liability. Neither party shall be liable to the other party
or to any third parties for any consequential, incidental or punitive
damages, including, but not limited to, damage to property, for loss of
use, loss of time, or loss of profits or income.
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13) Limitation of Liabili1y. Peak's liability for any breach of warranty under
Section 8 or for any manufacturing defect and Aksys sole remedy shall be
limited to repair or at Peak's discretion replacement of Products. For any
other claim hereunder, Peak's liability shall be limited to the proceeds
from of any applicable insurance carried by Peak pursuant to Section 11c.
14) Spare Parts. During the Term, and for a period five (5) years thereafter,
Peak shall provide Aksys with all spare parts which form part of the
Products. In the event that the production of any spare part is to be
discontinued prior to the end of such five (5) year period, Peak shall
notify Aksys at least one hundred and twenty (120) days before completion
of the production of such part and Aksys may order, and Peak shall deliver,
such quantity as Aksys shall request.
15) Integration. This Agreement constitutes the complete and exclusive
statement of the terms of the agreement between Peak and Aksys and
supersedes all prior and contemporaneous agreements and undertakings of
Peak and Aksys with respect to the subject matter hereof.
16) Term and Termination.
a) Initial Term and Renewal Term. Unless sooner terminated in accordance
with Section 16(b) or 16(c): (i) the initial term of this Agreement
shall be two (2) years; and (ii) after such initial term, the term of
this Agreement shall automatically renew for successive one year
periods unless either party provides written notice to the other party
of non-renewal not less than ninety (90) days prior to the end of the
then-current renewal term (such initial term and renewal terms
collectively referred to herein as the "Term").
b) Termination For Convenience. After the first anniversary date of this
Agreement, either Peak or Aksys may terminate the Term of this
Agreement by giving the other party not less than one hundred and
eighty (180) days written notice prior to the effective date of such
termination.
c) Termination For Cause. The Term of this Agreement shall terminate: (i)
automatically, if one of the parties fails to perform any material
obligations hereunder, and such material obligations remain uncured
sixty (60) days following the date that the other party delivers to
the defaulting party written notice describing such performance
failures; (unless breach is for non payment for Product in which case
the cure is 10 days plus interest at 18%, annualized) or(ii)
immediately upon notice by either party if the other party shall file
for liquidation, bankruptcy, reorganization, compulsory composition,
dissolution, or if the other party has entered into liquidation,
bankruptcy, reorganization, compulsory composition or dissolution, or
if the other party is generally not paying its debts as they become
due (unless such debts are the subject of a bona fide dispute).
d) Effect of Termination/Survival. Upon expiration or termination of the
Term of this Agreement, the following provisions only shall survive
such termination or expiration.
e) Transition. Upon expiration or termination of the Term of this
Agreement, and for a period of six (6) months thereafter, Peak shall
provide reasonable cooperation and assistance (including without
limitation knowledge transfer, materials sourcing, transfer of unused
materials and unfinished inventory, and removal and shipping of Aksys-
owned tooling and fixtures) to transition production of the Products
to a third party designated by Aksys. Peak may invoice Aksys for
actual charges incurred by Peak in such rendering such transition
services, including Consulting Service fees billed on an hourly basis
at Peak's standard rates.
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17) Required Approvals. Each party shall obtain all domestic and foreign
governmental licenses, permits and approvals required for such party's
performance under this Agreement. Without limiting the generality of the
foregoing: (i) Aksys shall be responsible for complying with all applicable
foreign and U.S. federal, state and local laws, rules, regulations and
orders and for obtaining all applicable U.S. FDA and other governmental
agency product and design approvals and applicable foreign agency approval
for sale of the Product; and (ii) Peak shall be responsible complying with
all U.S. FDA and applicable state and local laws, rules, regulations and
orders applicable to the manufacturing processes and procedures.
18) Compliance with Laws. Each party shall comply with all domestic and foreign
laws, rules, regulations and orders applicable to such party's performance
under this Agreement.
19) Assignment and Delegation. This Agreement cannot be assigned nor is the
performance of the duties delegable by either party without the written
consent of the other party which shall not be unreasonably withheld;
provided, however, that this Agreement may be assigned by either party to a
purchaser of substantially all of such party's assets relating to the
Products, or to a successor in interest by merger or corporate
reorganization.
20) Governing Law. This Contract Manufacturing Agreement shall be construed to
be between merchants and shall be governed by the laws of the State of
Colorado.
21) Relationship of Parties. The relationship of Aksys and Peak is that of
buyer and seller/manufacturer, respectively, of goods. Nothing in this
Agreement is intended to, or shall be deemed to, constitute a partnership,
joint venture, agency, or a transfer of any intellectual property of either
party, and neither party hereto shall be authorized to act in the name of
the other or enter into any contract or other agreement which binds the
other.
22) Enforceability. If any of the provisions of this Agreement, or portions
thereof, are found to be invalid by any court of competent jurisdiction the
remainder of this Agreement shall nevertheless remain in full force and
effect.
23) Force Majeure. Neither Aksys nor Peak shall be liable for any failure to
perform obligations under this Agreement if prevented so by a cause beyond
their control and without the fault or negligence of the defaulting party.
Without limiting the generality of the foregoing, such causes include acts
of God, fires, floods, storms, epidemics, earthquakes, riots, civil
disobedience, wars or war operations, or restraint of government.
24) Amendment. This Agreement may not be amended except in a written amendment
signed by each of the parties. Additional or different terms contained in
purchase orders or order acknowledgments or similar forms shall not be
effective unless signed by both parties with reference to this Agreement.
25) Dispute Resolution. Consent to Arbitration and Venue. Peak and Aksys agree
that upon the written demand of either party, whether made before or after
the institution of any legal proceedings, but prior to the rendering of any
judgment in that proceeding, all disputes, claims, and controversies
between them (but excluding disputes, claims and controversies in which a
third party is a necessary party), arising from this Agreement, including
without limitation contract disputes and tort claims, shall be arbitrated
in the Denver, Colorado metropolitan area, pursuant to the Commercial Rules
of the American Arbitration Association by a panel of three arbitrators.
All expenses of such arbitration shall be borne equally by the parties. Any
arbitration decision shall be final and non-appealable unless the parties
mutually agree otherwise in writing before a final decision by the panel of
arbitrators. Any arbitration order or award may be enforceable in an
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appropriate court as provided herein. Each party shall select one
arbitrator and those two arbitrators shall select the third arbitrator to
form the panel. Each party reserves the right, notwithstanding the
foregoing, to seek equitable relief in a court of competent jurisdiction in
any appropriate state or federal court. The prevailing party in any
arbitration or court proceeding is entitled to be reimbursed for any and
all reasonable attorney's fees, expert fees, and costs of suit from the
losing party.
26) Financial Disclosure: Peak agrees to provide Aksys with annual audited
financial statements audited by a Certified Public Accounting Firm.
Unaudited financial statements will be provided on a quarterly basis within
30 days of official quarter-end close.
27) Definitions. The following terms, when used herein with initial
capital letters, shall have the respective meanings set forth in this
Section 25.
a) "Aksys Customers" shall mean end users of the Products (including
without limitation institutional purchasers that use the Products for
treatment of their patients) that purchase the Products from Aksys or
from an Aksys distributor.
b) "Disclosing Party" shall have the meaning stated in Section 10.
c) "Effective Date" shall have the meaning stated in the preamble of this
Agreement.
d) "Improvements" shall mean all improvements to Aksys Patents or Know-
How hereafter created or acquired during the term of this Agreement by
Peak or jointly by one or more employees of Aksys and Peak, including
without limitation advances, developments, modifications,
enhancements, variations, revisions, adaptations, extensions or any
element thereof, utilizing or incorporating, or based on, the Know-How
or Patents, whether patentable or not.
e) "Intellectual Property" shall mean trade secrets, ideas, inventions,
designs, developments, devices, methods or processes (whether patented
or patentable and whether or not reduced to practice) and all patents
and patent applications related thereto; copyrightable works and mask
works (whether or not registered); trademarks, service marks and trade
dress; and all registrations and applications for registration related
thereto; and all other intellectual or industrial property rights, to
the extent in or related to the Products.
f) "Know-How" shall mean the know-how, technical information and
confidential technical data, together with all trade secrets,
unpatented technical knowledge and inventions, confidential
manufacturing procedures and methods, that are related to the
Products.
g) "Losses" shall mean any and all damages, liabilities, costs and
expenses (including reasonable attorneys' fees and expenses), and
amounts paid in settlement.
h) "Patents" shall mean those patents and patent applications that are
now or hereafter owned or acquired by Aksys and relate to the
Products.
i) "Products" shall mean the [kidney dialysis machine] described in
detail in the Specifications.
j) "Proprietary Information" shall have the meaning stated in Section 10.
k) "Recipient" shall have the meaning stated in Section 10.
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l) "Rolling 13 Week Firm Forecast" shall have the meaning stated in
Section 4(a).
m) "Special Inventory" shall have the meaning stated in Section 4(b).
n) "Peak Manufacturing and Quality System (PMQS)" shall have the meaning
to include the following processes and procedures and quality
requirements.
(1) Manufacturing Procedures: Mutually agreed upon document with procedures for
manufacturing Product.
(2) Quality Plans: Mutually agreed upon document outlining component quality
plans and assembly quality plans for Product.
(3) Document Change Request: Document approved by Peak and Aksys for changes in
Specifications.
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IN WITNESS WHEREOF, the parties hereto have executed this Contract Manufacturing
Agreement as of the Effective Date indicated above.
Peak Industries, Inc. Aksys, Ltd.
By: /s/ Xxxx Xxxxxxx By: /s/ Xxxxxxx X. Xxx
Title: President & CEO Title: President & CEO
Date: 02/28/01 Date: 03/05/01
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Exhibit A
Preliminary Design and Specifications
Preliminary design specifications, xxxx of materials and drawings will be
provided by Aksys and incorporated hereto, when available. Some preliminary
design specifications have already been hand delivered to Peak, and will be
incorporated into this exhibit as well. Exhibit A will be updated on a regular
basis and / or as appropriate until final designs are stabilized and recognized
as being complete by both parties.
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