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EXHIBIT 10.7
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN REDACTED PROVISIONS OF
THIS AGREEMENT. THE REDACTED PROVISIONS ARE IDENTIFIED BY THREE ASTERISKS AND
ENCLOSED BY BRACKETS. THE CONFIDENTIAL PORTION HAS BEEN FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.
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FIRST AMENDMENT TO
DEVELOPMENT AND MANUFACTURING AGREEMENT
BY AND BETWEEN
ANSYS DIAGNOSTICS, INC.
AND
ROCHE DIAGNOSTIC SYSTEMS, INC.
DATED
SEPTEMBER 25, 1998
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FIRST AMENDMENT TO
DEVELOPMENT AND MANUFACTURING AGREEMENT
This First Amendment to Development and Manufacturing Agreement is
entered into to be effective as of the September 25, 1998, by and between Roche
Diagnostic Systems, Inc. ("RDS"), a corporation organized and existing under the
laws of the State of New Jersey with offices at 0000 Xxxxx Xxxx, Xxxxxxxxxxxx,
Xxxxxxx 00000, and ANSYS Diagnostics, Inc., formerly ANSYS, Inc. ("ANSYS"), a
corporation organized and existing under the laws of the State of California,
with offices at 00000 Xxxxxxxxxxxx Xxxxx, Xxxx Xxxxxx, Xxxxxxxxxx 00000.
WHEREAS, RDS and ANSYS entered into a Development and Manufacturing
Agreement effective as of September 1, 1996 (the "Agreement"), whereby RDS and
ANSYS agreed to jointly develop a single test kit for biological and chemical
analytes including, without limitation, certain drugs of abuse, which kit the
parties commonly refer to in the Agreement as the "Device" and otherwise as
"TesTstik;"
WHEREAS, RDS and ANSYS have jointly developed a two-test kit and a
four-test kit for biological and chemical analytes based upon the same
technology and dipstick design, which the parties commonly refer to as "TesTstik
2" and "TesTstik 3," respectively;
WHEREAS, each of RDS and ANSYS desire to amend the Agreement in certain
respects to provide for the further development and manufacturing of TesTstik 2
and TestTstik 3;
NOW THEREFORE, in consideration of the premises and of the mutual
covenants of the parties set forth herein, the parties agree as follows:
1. The Agreement is hereby amended to reflect that ANSYS has amended
its Articles of Incorporation to change its name from ANSYS, Inc. to ANSYS
Diagnostics, Inc.
2. The Agreement is hereby amended to add new Sections 1.6 and 1.7 as
follows:
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1.6 "TesTstik 2" shall mean the two-test dipstick device
developed by RDS and ANSYS to test various fluids for biological and chemical
analytes including, without limitation, certain drugs of abuse through the
utilization of RDS's Reagent Technology. The product specifications for TesTstik
2 are set forth on Exhibit A-1, which RDS may, subject to ANSYS's reasonable
approval, modify from time to time.
1.7 "TesTstik 3" shall mean the three-test dipstick device
developed by RDS and ANSYS to test various fluids for biological and chemical
analytes including, without limitation, certain drugs of abuse through the
utilization of RDS's Reagent Technology. The product specifications for TesTstik
3 are set forth on Exhibit A-2, which RDS may, subject to ANSYS's reasonable
approval, modify from time to time.
3. References in the Agreement to "the Device" at Sections 2.1(b),
2.2(a), 2.3, 2.4, 3.1(a), 3.1(e), 3.2(a), 3.2(b), 3.4, 3.6, 3.7, 3.9, 4.0, 5.0,
6.0, 7.0, 8.0, 9.1(b), 11.3, and 11.5 are hereby amended to read "the Device,
TesTstik 2 and TesTstik 3" and all such provisions shall apply equally to each
of the Device, TesTstik 2 and TesTstik 3.
4. A new Section 3.10 is hereby added to the Agreement as follows:
"3.10. ANSYS shall be responsible for selecting and purchasing
the equipment and materials, including without limitation, product
tooling and hardware, necessary to manufacture TesTstik 2 and TesTstik
3, all as set forth in the capital budget attached hereto as Exhibit E
and incorporated herein by this reference. Other than as set forth on
Exhibit E, ANSYS shall not purchase any equipment or materials without
RDS's prior written approval. In lieu of direct and immediate
reimbursement of ANSYS' capital expenditures under this Section 3.10,
the parties agree that ANSYS shall recoup the total documented
expenditures plus [***], not to exceed $[***], in respect of such
capital expenditures from an increase in the per unit price of the
TesTstik device equal to $[***] per unit for TesTstik units shipped on
or after the effective date of this Agreement. As and when ANSYS has
fully recouped the total documented expenditures plus [***] through
such price increase, RDS shall own the entire right, title and interest
to such equipment and materials, and ANSYS shall have no right, title
or interest therein,
[***] Confidential treatment has been requested for redacted portions. The
confidential redacted portion has been omitted and filed separately
with the Securities and Exchange Commission.
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except the right to use such equipment and materials to manufacture and
supply TesTstik 2 and TesTstik 3 to RDS pursuant to the terms of this
Agreement. Such equipment shall, upon the request of RDS, be delivered
by ANSYS to RDS upon the expiration or termination of this Agreement.
In the event that RDS ceases to purchase TesTstik product from
ANSYS, any unrecouped portion of the capital expenditure charge shall
become immediately due and payable, and RDS shall remit payment of such
sum within ten (10) days of ANSYS written request therefor.
3.11 Pricing. Pricing for TesTstik 2 and TesTstik 3 is as set
forth on Exhibit F and incorporated herein by this reference. In the
event that RDS modifies the product specifications set forth in Exhibit
A-1 or A-2 or that the assumptions set forth in Exhibit F are not
implemented, then the parties shall negotiate appropriate modifications
to Exhibit F.
3.12 TesTstik 2 and TesTstik 3 Launch Date. The target launch
date for TesTstik 2 and TesTstik 3 is [***] after the date this First
Amendment is executed."
5. Section 11.15 of the Agreement is hereby amended to provide that the
address for notice to ANSYS is:
ANSYS Diagnostics, Inc.
00000 Xxxxxxxxxxxx Xxxxx
Xxxx Xxxxxx, Xxxxxxxxxx 00000
Attn: President
Telecopier No.: (000) 000-0000
[***] Confidential treatment has been requested for the redacted portions. The
confidential redacted portion has been omitted and filed separately with
the Securities and Exchange Commission.
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6. Except as expressly modified hereby, the parties hereby ratify and
confirm the Agreement in all respects.
7. This First Amendment may be executed in two (2) counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
IN WITNESS WHEREOF, the duly authorized representatives of the
parties have executed this First Amendment to be effective as of the dates first
set forth above.
ANSYS DIAGNOSTICS, INC., ROCHE DIAGNOSTIC SYSTEMS, INC.,
a California corporation a New Jersey corporation
By: /s/ Xxxxxxx X. Xxxxxxxxxx By: /s/ Xxxxxx X. Xxxxxxxx, Xx.
--------------------------------- --------------------------------
Xxxxxxx X. Xxxxxxxxxx Xxxxxx X. Xxxxxxxx, Xx.
President and C.E.O. Director, Global Marketing
Point of Care, DAT
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EXHIBIT A-1
PRODUCT SPECIFICATIONS FOR TESTSTIK 2
PAGE 1 OF 2
GENERAL PRODUCT APPEARANCE
[THREE PICTURES OF THE TESTSTIK 2 PRODUCT]
[***]
[***] Confidential treatment has been requested for the redacted portions. The
confidential redacted portion has been omitted and filed separately with
the Securities and Exchange Commission.
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EXHIBIT A-2
PRODUCT SPECIFICATIONS FOR TESTSTIK 3
PAGE 2 OF 2
FUNCTIONAL REQUIREMENTS
o The overall functionality of the device will be similar to the current
TesTstik.
o There are [***] per device. The strips are identical to those used in
the TesTstik product.
o The length of the device will be the same as TesTstik. The width of the
slide will be approximately 0.09 inches. The overall thickness will be
approximately the same as the current TesTstik.
o The sample window, test valid and result windows, will be approximately
the same size as the current TesTstik.
o The device will require a maximum of 10 seconds immersion into the
urine sample. The results of the particular drug assay shall be
interpretable within 3 minutes.
o The drug type will be pad printed next to the appropriate result
window. All other printing will be similar to that of TesTstik. Only 1
color will be printed. The protective slide will have the text:
"TesTstik 2", this will be pad printed with the same blue ink as the
device housing. The artwork will be supplied by Roche.
o A tab will be torn off the slide component to expose the result window
at the appropriate time. This feature is similar to the current
TesTstik product.
o The device will be sealed with a desiccant material inside a foil
pouch. Lot number and expiration date will be printed on each foil
pouch.
o The component materials will be the same as TesTstik.
[***] Confidential treatment has been requested for the redacted portions. The
confidential redacted portion has been omitted and filed separately with
the Securities and Exchange Commission.
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EXHIBIT E
CAPITAL EXPENDITURES IN CONNECTION WITH
PRODUCT DEVELOPMENT AND MANUFACTURING FOR
TESTSTIK 2 AND TESTSTIK 3
Prototype molds (single-cavity) $ [***]
Production molds (four-cavity) [***]
Pad printing equipment [***]
Sealing equipment [***]
Assembly fixtures [***]
Gluing equipment [***]
Miscellaneous [***]
TOTAL $ [***]
[***] Confidential treatment has been requested for the redacted portions.
The confidential redacted portion has been omitted and filed separately
with the Securities and Exchange Commission.
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EXHIBIT F
PRODUCT PRICING FOR XXXXXXXX 0 XXX XXXXXXXX 0
XxxXxxxx 0 $ [***]*
TesTstik 3 $ [***]*
(*) Based upon manual assembly, manual packaging, and RDS supplying
nitrocellulose and reagents. If ANSYS purchases nitrocellulose and performs all
quality control of the membrane and other assumptions remain constant, prices
are as follows:
TesTstik 2 $ [***]
TesTstik 3 $ [***]
[***] Confidential treatment has been requested for redacted portions. The
confidential redacted portion has been omitted and filed separately
with the Securities and Exchange Commission.
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