EXHIBIT 10.16
MANUFACTURING AND SUPPLY AGREEMENT
This Manufacturing and Supply Agreement (the "Agreement") is entered into
as of February 23, 2000 (the "Effective Date"), between XXXX Medical Systems,
Inc. ("XXXX") and Apical Instruments, Inc. ("Apical").
BACKGROUND
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Apical has already developed on behalf of XXXX the Model 1500 150 Watt
Generator (the "RF Generator(s)"). XXXX and Apical wish to have Apical
manufacture the RF Generators and to sell such products exclusively to XXXX.
This Agreement sets forth the terms and conditions of the manufacture and supply
of RF Generators.
TERMS AND CONDITIONS
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XXXX and Apical, therefore, agree as follows:
1. Manufacture and Supply
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1.1 Manufacture and Supply. Apical agrees to manufacture the RF
Generators (i) in accordance with GMP and ISO standards and (ii) to meet the
Product Specifications for these RF Generators as referenced in purchase orders
which XXXX may issue from time to time based on written quotations from Apical
(the "Purchase Order(s)").
1.2 RITA's Right to Manufacture. XXXX or its designee shall have the
right to manufacture the RF Generators at any time. Should there be a need for
technical assistance or documentation support, Apical will provide it at RITA's
expense at Apical standard rates then in effect. In addition, Apical grants
XXXX or its designee a non-exclusive worldwide license, with the right to
sublicense, to all intellectual property (including patents and know-how) that
Apical owns or has license rights to, necessary to make, have made, use and sell
the RF Generators.
2. Inspections
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2.1 Manufacturing Compliance. Apical shall immediately notify XXXX if an
authorized agent of the FDA or other agency visits Apical's manufacturing
facility for the purposes of inspecting the manufacturing and testing of RF
Generators.
2.2 Inspections by XXXX. Representatives from XXXX shall be permitted
access, at reasonable times during Apical's normal business hours and upon
reasonable advance notice to Apical, to visit, in the company of a Apical
representative, the manufacturing and/or packaging facility or facilities where
the RF Generators will be or are being manufactured and/or packaged for the
purposes of auditing Apical's processes to ensure that the RF Generators are
being manufactured, packaged, stored and handled in accordance with the Product
Specifications, GMP and applicable laws, rules and regulations.
2.3 Inspection by Regulatory Agencies. Duly authorized representative(s)
from the FDA or other applicable regulatory agencies shall be permitted access,
at reasonable times
during Apical's normal business hours, to visit, in the company of a Apical
representative, the manufacturing and/or packaging facility or facilities where
the RF Generators will be or are being manufactured and/or packaged for the
purposes of auditing Apical's processes to ensure that the RF Generators are
being manufactured, packaged, stored and handled in accordance with the Product
Specifications, GMP and applicable laws, rules and regulations. Apical shall, at
its own expense, promptly respond to all inquiries and questions resulting from
such visits and inspections and, at its own expense, promptly correct any
deficiencies reported as a result of such inspections.
3. Product Recalls
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In the event (a) any governmental entity issues a request, directive or
order that a RF Generator be recalled, (b) a court of competent jurisdiction
orders such a recall, (c) Apical reasonably determines after consultation with
XXXX that a RF Generator should be recalled because the RF Generator does not
conform to the related Product Specifications at the time of shipment by Apical
or (d) XXXX reasonably determines that a RF Generator should be recalled for any
reason, the parties shall take all appropriate corrective actions. In the event
that such recall results from the breach by Apical of its warranties under this
Agreement, defective manufacture by Apical or other actions of Apical, Apical
shall be responsible for the expense to repair, rectify and or upgrade the
recalled RF Generators in order to comply with RITA's product requirements. In
the event the recall results from the actions of XXXX (not including the recall
order), XXXX shall be responsible for the expenses associated with notification
and destruction or return of the recalled RF Generator, and any costs associated
with the distribution of replacement RF Generators.
4. Additional Obligations of the Parties
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4.1 Apical Obligations. During the term of this Agreement, Apical will:
4.1.1 At its own expense, promptly respond to all reasonable inquires
from XXXX pertaining to the supply of RF Generators;
4.1.2 Without limitation on any other provision of this Agreement,
use reasonable efforts at all times to minimize RF Generator delivery time;
4.1.3 At its own cost, obtain and maintain any Federal and applicable
state and local licenses and permits with respect to the manufacture of the RF
Generators;
4.1.4 Promptly notify XXXX of any comments, responses or notices
received from the FDA, or other applicable regulatory authorities, which relate
to or may impact the RF Generators or their manufacture;
4.1.5 Provide ongoing technical product and process support with
respect to the RF Generators at Apical standard rates then in effect;
4.1.6 At its own expenses, promptly respond to all reasonable
inquires from XXXX pertaining to RF Generator complaints.
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4.1.7 Not sell the RF Generator to any other entity or person without
RITA's prior written consent.
5. Warranties
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5.1 Conformity with Specifications. Apical warrants that all RF
Generators sold and delivered pursuant to this Agreement will have been
manufactured, packaged and stored in accordance with the Product Specifications
as referenced in RITA's Purchase Orders. Any changes to the Specifications have
to be approved in writing by both parties and will become the Specifications to
be conformed to from the approval date onwards. Changes in Specifications may
result in changes to delivery dates and additional fees.
5.2 Conformity with Regulations and GMP. Apical warrants that all RF
Generators sold and shipped pursuant to this Agreement shall have been
manufactured, packaged and stored by Apical in compliance with all applicable
laws and governmental regulations and applicable GMP and ISO standards in effect
at the time of shipment.
5.3 Intellectual Property. Apical warrants that it owns or has rights to
all intellectual property necessary to manufacture, supply and sell the RF
Generators including the right to xxxxx XXXX the manufacturing rights set forth
in Section 1.2. Except for intellectual property where XXXX is the licensee, to
the best of Apical's knowledge, the manufacture, supply and sale of the RF
Generators by Apical or XXXX does not infringe the intellectual property or
contract rights of any third party.
6. Term and Termination
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6.1 Termination. This Agreement may be terminated upon the occurrence of
any of the following events:
6.1.1 Notice by either party to the other party in the event of the
other party's material breach of its obligations under this Agreement, which
breach continues unremedied for thirty (30) days after notice of such breach is
provided to the breaching party.
6.1.2 Notice by either party to the other upon the insolvency or
bankruptcy of the other party.
6.2 Survival. Termination of this Agreement by one party pursuant to this
Section 6 shall not relieve the other party of its obligations or liability for
breaches of this Agreement incurred prior to or in connection with such
termination. The following sections shall survive any termination of this
Agreement: Section 3 ("Product Recalls"), Section 5 ("Warranties"), and Section
7 ("Additional Provisions").
7. Additional Provisions
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7.1 Notices. Any notices permitted or required by this Agreement shall be
sent by telex or telecopy or by delivery service, certified or registered mail
and shall be effective the date received if sent by telex, telecopy or delivery
service or three (3) days after deposit in the U.S.
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mail, if sent by certified or registered mail. Notices shall be addressed as
follows or to such other address as may be designated by a party in writing:
If to Apical:
Apical Instruments, Inc.
0000X Xxxxxxxx Xxxx.
Xxxxxxxx Xxxx, XX 00000
Attn: Xxxxx Xxxxx
If to XXXX:
XXXX Medical Systems, Inc.
000 X. Xxxxxxxxx Xxxx.
Xxxxxxxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
7.2 Entire Agreement. The parties hereto acknowledge that this document
sets forth the entire agreement and understanding of the parties and supersedes
all prior written or oral agreements or understandings with respect to the
subject matter hereof, including but not limited to that certain Development,
Manufacturing and Supply Agreement between XXXX and Apical entered into as of
April 8, 1998. No modification of any of the terms of this Agreement, or any
amendments thereto, shall be deemed to be valid unless in writing and signed by
the parties. No course of dealing or usage of trade shall be used to modify the
terms and conditions herein. To the extent any term included in any purchase
order, quote or other document between the parties hereto is inconsistent with
the terms set forth in this Agreement, this Agreement shall control.
7.3 Waiver. No waiver by either party of any default shall be effective
unless in writing, nor shall any such waiver operate as a waiver of any other
default or of the same default on a future occasion.
7.4 Assignment. This Agreement shall be binding upon and inure to the
benefit of the successors or permitted assigns of each of the parties, their
subsidiaries, parent or affiliates, and may not be assigned or transferred by
either party except to a subsidiary, parent or affiliate without the prior
written consent of the other, (i) which consent will not be unreasonably
withheld and (ii) which consent shall not be required in the case of a
transaction involving the merger, consolidation or sale of substantially all of
the assets of the party seeking such assignment or transfer and such transaction
relates to the business covered by this Agreement. Any assignments shall not
release the original party hereto from their duties and obligations under this
Agreement. For the purposes of this Agreement, the terms "subsidiaries,"
"parent" and "affiliates" shall mean any corporation controlling, controlled by,
or under common control with, either of the parties hereto.
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7.5 Governing Law. The validity, interpretation and effect of this
Agreement shall be governed by and construed under the laws of the State of
California, without regard to conflict of law principles.
7.6 Severability. In the event that any term or provision of this
Agreement shall violate any applicable statute, ordinance or rule of law in any
jurisdiction in which it is used, or otherwise be unenforceable, such provision
shall be ineffective to the extent of such violation without invalidating any
other provision hereof.
7.7 Headings, Interpretation. The headings used in this Agreement are for
convenience only and are not a part of this Agreement.
7.8 Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same original.
7.9 Independent Contractors. The relationship of the parties under this
Agreement is that of independent contractors, and neither party is an employee,
agent, partner or joint venturer of the other.
SIGNATURE PAGE FOLLOWS
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IN WITNESS WHEREOF, the parties hereto have each caused this Agreement to
be executed by their duly authorized representatives as of the Effective Date.
APICAL INSTRUMENTS, INC. XXXX MEDICAL SYSTEMS, INC.
By: /s/ Xxxxx Xxxxx By: /s/ Xxxxxx Xxxxxxx
--------------------------- ------------------------------
Print Name: Xxxxx Xxxxx Print Name: Xxxxxx Xxxxxxx
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Title: President Title: Vice President of Operations
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Apical Instruments, Inc.
[LOGO HERE]
February 18, 2000
Xx. Xxx Xxxxxxx
XXXX Medical Systems, Inc.
000 X. Xxxxxxxxx Xxxx.
Xxxxxxxx Xxxx, XX 00000
Dear Xxx:
Apical Instruments, Inc. is pleased to provide the following quote:
Quantity and Price: [***] XXXX Model 1500 RF Generators at [***] each.
Delivery schedule: [***].
Terms: [***].
I understand that XXXX has a tentative forecast for [***] additional units
in the next [***] but no commitment to purchase them at this time. Please do
not hesitate to call me if you have any questions.
Sincerely,
Xxxxx Xxxxx, President
*** Material has been omitted pursuant to a request for confidential treatment
and such material has been filed separately with the SEC.
Apical Instruments, Inc.
XXXX 1500 RF Generator
Price Quote
Terms & Conditions
Payment: [***]
Pre-Payment [***]
Quantity Lead Time
on IPO 13 Weeks
[***] $ [***]
[***] $ [***]
[***] $ [***]
[***] $ [***]
[***] $ [***]
[***] $ [***]
*** Material has been omitted pursuant to a request for confidential treatment
and such material has been filed separately with the SEC.
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