AMENDMENT TO TOLL MANUFACTURING AGREEMENT
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Confidential treatment requested on certain portions of this agreement. An
unredacted version of this agreement has been filed separatelly with the
Securities and Exchange Commission.
Exhibit
10.1
AMENDMENT
TO
This Amendment (this “Amendment”) to
the Toll Manufacturing Agreement, dated as of July 31, 2008 (“Amendment
Effective Date”), is made by and between KCI Manufacturing (“KCI”) and Avail
Medical Products, Inc.(“Avail”). Avail and KCI are referred to herein
as the “Parties”.
RECITALS
WHEREAS, KCI and Avail are party to
that certain Toll Manufacturing Agreement by and between KCI and Avail (the
“Toll Agreement”); and
WHEREAS, the Parties wish to amend the
Toll Agreement as set forth herein.
AGREEMENT
NOW, THEREFORE, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Parties do agree as follows:
1. Section
4 of the Toll Agreement is hereby amended by deleting Section 4 in its entirety
and replacing it with the following:
“4. Exclusivity
Terms.
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(a)
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Absent
a written contrary agreement between the Parties, which both parties
represent does not exist as of the November 30, 2007 [***] shall be deemed
"Exclusive Products". In the event that KCI Manufacturing
develops Different Products (as defined in Section 1 above), such
Different Products shall not be Products without express agreement by KCI
Manufacturing designating such Different Product as
Products. In the Parties’ mutual spirit of goodwill and
cooperation contemplated by this Agreement, unless KCI Manufacturing is
contractually prevented from doing so by a confidentiality agreement or
other written agreement that expressly bars KCI Manufacturing from doing
so, KCI Manufacturing agrees to disclose to Avail the details of the
Different Products and manufacturing plans for them, and to grant Avail
the opportunity to submit proposals for the Processing Services related to
such Different Products in sufficient time prior to KCI Manufacturing’s
commencement of the manufacture, or marketing launch of the Different
Products by KCI Manufacturing, for Avail to adequately prepare and for KCI
Manufacturing to analyze such proposal. Subject to Section 4(b)
below, throughout the Exclusivity Period, KCI Manufacturing agrees to
obtain Products exclusively with Avail for Processing
Services.
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(b)
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Notwithstanding
the foregoing, KCI Manufacturing shall have the right to manufacture and
commercialize the Products in unlimited quantities and for any purpose,
conditioned upon [***]. In such event, Avail agrees to continue
providing the Processing Services with respect to all Exclusive Products
ordered by KCI Manufacturing or its Affiliates. The exercise by
KCI Manufacturing of its rights under this Section 4(b) shall not be
deemed a conversion of this Agreement under Section 22.”
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3. Section
15 is hereby amended by deleting Section 15 in its entirety and replacing it
with “Intentionally Omitted”.
4. Section
22 is hereby amended by deleting Section 22 in its entirety and replacing it
with the following:
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“22.
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Term and Termination
or Conversion. The term of this Agreement shall commence
on November 30, 2007 and shall continue for a period of five (5) years
thereafter (the "Initial Term"). At the end of the Initial
Term, the term will automatically extend for separate but successive
additional twelve (12) month terms if neither Party has provided the other
with a notice of termination three (3) months or more prior to the end of
the then current term. A termination by Avail pursuant to the
immediately preceding sentence shall constitute an “Avail Termination
Without Cause.” In addition, KCI Manufacturing may terminate or convert
this Agreement to a non-exclusive agreement at its sole option, in the
event that Avail: (i) materially breaches this Agreement, (ii)
seeks protection from its creditors under the bankruptcy or insolvency
laws of its jurisdiction of incorporation or domicile, or becomes
involuntarily subject to the jurisdiction of a Court under the bankruptcy
or insolvency laws of its jurisdiction of incorporation or domicile; (iii)
fails in a material way to manufacture Products in accordance with the QSR
of the FDA and in accordance with any and all applicable international
regulations or standards and fails to cure or remedy such situation within
ninety (90) days unless the US FDA, or similar foreign counterpart,
requires action that takes longer than ninety (90) days to execute, in
which case Avail shall have the time necessary to comply with such
regulations or standards; (iv) manufactures and/ or distributes any
Product involved in a Class I "recall" subject to the conditions specified
in sections 17 and 25 and as defined in
the regulations promulgated by the FDA) and (v) failure to meet Product
shipping or inventory level standards in accordance with Sections 7 and 8,
or Product quality standards in accordance with Section
17. Each of the foregoing occurrences (i) through (v) shall
constitute an “Avail Event of Default”. Avail may terminate this Agreement
in the event that KCI Manufacturing (i) materially breaches this Agreement
or (ii) seeks protection from its creditors under the bankruptcy or
insolvency laws of its jurisdiction of incorporation. Each of
the foregoing occurrences, (i) and (ii) shall constitute a “KCI Event of
Default”. Either Party may elect to terminate or convert this
Agreement if the other Party is not able to cure an Avail Event of Default
or KCI Event of Default, as the case may be, within thirty (30) days of
written notice of such an Avail Event of Default or KCI Event of Default,
as the case may be,; such termination shall be deemed a “Termination or
Conversion With Cause” and the Agreement shall be “Terminated or Converted
With Cause.” Only in the event of an Avail Termination Without Cause or in
the event of Termination or Conversion With Cause by KCI Manufacturing,
Avail shall supply Products to KCI Manufacturing at the pricing in effect
as of conversion or termination for a period of one (1) year after any
conversion or termination of this Agreement (subject to price changes
permitted in this Agreement), and Avail shall make available to KCI
Manufacturing a list of vendors who supply Product components, and do such
things, as may be reasonably requested by KCI Manufacturing to enable KCI
Manufacturing to manufacture the Products in the same manner as previously
manufactured by Avail. For purposes of this Agreement, the term
“conversion” and “convert” shall mean the conversion of this Agreement to
a non-exclusive agreement. Upon termination of this Agreement,
Avail agrees to deliver to KCI Manufacturing all finished Product
produced, acquired or committed in accordance with outstanding purchase
orders and forecasts, in addition to all Raw Materials in Avail’s
possession.”
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5. On
or before September 15, 2008, [***] instructions of KCI.
Except as expressly amended by this
Amendment, the Toll Agreement shall remain in full force and
effect. This Amendment may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
***
Confidential treatment requested on certain portions of this agreement. An
unredacted version of this agreement has been filed separatelly with the
Securities and Exchange Commission.
IN
WITNESS WHEREOF, The parties have duly executed this Amendment effective as of
the Amendment Effective Date set forth herein.
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KCI
MANUFACTURING
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AVAIL
MEDICAL PRODUCTS, INC.
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/s/ Xxxx
Xxxxxx
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/s/ Xxxxxx X.
Xxxxxxx
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By: Xxxx
Xxxxxx
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By: Xxxxxx X.
Xxxxxxx
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Title: Director
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Title: President
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31
– July – 2008
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(Signed Copy on
File)
