Exhibit 10.18*
The confidential portions of this exhibit, which have been removed and
replaced with an asterisk, have been omitted and filed separately with the
Securities and Exchange Commission pursuant to a request for confidential
treatment under Rule 406.
SECOND AMENDMENT
TO SUPPLY AGREEMENT
This SECOND AMENDMENT is made to the Supply Agreement between XXXXXX XXXXXXXXXX
LTD. ("WGL") and MEDTRONIC, INC. ("Medtronic") dated July 31, 1991 (the "Supply
Agreement") and to the first Amendment to that Supply Agreement dated June 3,
1996 (the "First Amendment").
RECITALS
Medtronic and WGL desire to amend certain terms of the Supply Agreement and
First Amendment to Supply Agreement in writing pursuant to Section 13.6 of the
Supply Agreement.
The parties therefore agree as follows:
1. Supply. The parties agree that WGL will become the exclusive supplier of
SVO batteries for Medtronic Model 7221 and Model 7271 implantable cardiac
defibrillators, contingent upon WGL's ability to meet existing or mutually
agreed to modifications of existing battery specifications and qualify the
batteries and subject to Medtronic's ability to receive FDA approval for
the use of the WGL batteries within the Medtronic products identified.
Medtronic will use its best commercial efforts to secure approval for use
of the WGL product on a timely basis.
2. Failure to Meet Delivery Schedules. The parties agree that if WGL is
unable for any reason other than force majeure to meet any scheduled
deliveries specified by Medtronic for the SVO batteries identified under
Section 1 hereof, Medtronic shall be flee to make or have made SVO
batteries which meet Medtronic's product needs.
3. Unit Price. The parties agree that the price for the 7221 and 7271 SVO
battery shall be * each. Any subsequent price increases in the price of
the 7221 and/or 7271 shall be subject to Section 6.10.
4. Design Fee Medtronic agrees to pay WGL a design fee of * for the
development of the WGL battery to be used in Medtronic's Model 7271
device. Medtronic shall pay the design fee to WGL as follows:
* Upon Receipt of purchase order
* Upon WGL's completion of engineering prototypes; and
* Upon completion of the qualification of the cell by WGL and Medtronic
5. Advance Payment. The parties the First Amendment to the Supply Agreement,
WGL repaid * of the advance payment made pursuant to Section 6.7 of the
Supply Agreement. The parties further agree that WGL shall hold the
balance of the advance payment in the amount of *. Said amount will be
considered an advance and will be applied to the final purchases under the
final Contract Period. The parties further agree that WGL shall not be
required to maintain any finished goods as security for the remaining *
advance payment; however, WGL will use its best commercial efforts to
satisfy Medtronic's supply needs under this Second Amendment. WGL shall
have no continuing obligation to provide any security for its obligation
to repay the remaining * of the advance payment referred to in Article 6.7
of the Supply Agreement, as amended, and the Security Agreement is hereby
terminated.
6. Quota. WGL and Medtronic agree that WGL will waive the minimum purchase
requirements for the remainder of the Second Contract Period. Medtronic
agrees to report on its usage of SVO batteries pursuant to the terms of
the Supply Agreement. This amendment shall not effect, or operate as a
waiver by WGL of, Medtronic's obligations under Section 5.2(c) with
respect to the Third Contract Period or the quota of SVO Batteries to be
purchased by Medtronic in each Contract Year of the Third Contract Period
which are set forth in Section 5.1. The parties further agree that the
price for the 7221 Cell and 7271 Cell shall not trigger a quota reduction
for the Third Contract Period pursuant to Section 6.10(c).
7. Other Terms Remain in Effect. Except as modified by this Second Amendment,
all terms and provisions of the Supply Agreement and First Amendment shall
remain in full force and effect.
With their signature below, each of the parties indicates they have read,
understand and agreed to the terms of this Second Amendment.
MEDTRONIC, INC.
By /s/ Xxx X. Xxxxxxx Date: 3/14/97
---------------------------------
Xxx X. Xxxxxxx, Vice President and
President Tachyarrhythmia Management
Business
XXXXXX BREATBATCH LTD.
By /s/ Xxxxxx X. Xxxxxxx Date: 3/24/97
--------------------------------- -----------------------------------
Xxxxxx X. Xxxxxxx, President
