Exhibit 10.4
AMENDED AND RESTATED
AQUAMER, INC.
PRODUCT SUPPLY AGREEMENT
This PRODUCT SUPPLY AGREEMENT ("Agreement") effective as of
March 31, 2006 (the "Effective Date") by and between Aquamer, Inc.,
Inc., a Delaware corporation, with offices at 237 Cedar Hill
Street, Ste 4, Marlborough, MA 01752, and Partners in
Biomaterials, Inc., a California corporation, with offices at 466
West Arrow Highway, Suite H, San Dimas, California, 91773. Aquamer,
Inc. and Partners in Biomaterials either individually or in the
collective may be hereinafter referred to as a "Party" or the
"Parties."
BACKGROUND
WHEREAS, Aquamer, Inc. has a need for and desires to purchase
certain polymer Products (as defined herein) and Aquamer, Inc.
desires to purchase its requirements of such Products from Partners
in Biomaterials;
WHEREAS, the Parties have entered into a Product Supply
Agreement as of October 14, 1999 as amended on March 6, 2002,
May 4, 2002, and October 19, 2005, all of which the Parties desire
to replace and supercede in its entirety with this Agreement;
and
WHEREAS, Partners in Biomaterials has acquired the right to
manufacture, or have manufactured for it, and sell such polymer
Products and desires to supply Aquamer, Inc. with its requirement
for Products.
NOW, THEREFORE, in consideration of the foregoing and mutual
promises and covenants contained herein, the Parties agree as
follows:
1. DEFINITIONS
The following terms shall have the following meanings
herein:
1.1 " CE Mark " shall mean "Certified for Export,"
indicating that the product may be exported to and marketed in the
European Common Market (EEC).
1.2 " FDA " shall mean the US. Food and Drug
Administration.
1.3 " GMP " shall mean Good
Manufacturing Practices as established by FDA regulations.
1.4 " Intellectual Property Rights " shall mean all
current and future worldwide patents and other patent rights,
copyrights, trade secrets, and all other intellectual property
rights, including without limitation all applications and
registrations with respect thereto.
1.5 " PMA " shall mean FDA
"PreMarket Approval" to market and sell products in the U.S.
1.6 " Products " shall mean the high water
content hydrogel product based on poly-N-vinylpyrrolidone as
claimed in U.S. Patents 5,116,371 and 5,713,960 attached hereto,
and/or made a part hereof, of Exhibit C, and as set forth in
Exhibit A attached hereto and described and made in accordance with
the respective detailed Specification.
1.7 " Specifications " shall mean the
technical and other specifications for the Products set forth in
Exhibit A.
1.8 " Specified Use " shall mean the use of
the Products in the fields of dermatology (for application of the
Products in the epidermis, dermis, or subcutaneous fatty
tissue), urology, and gastroenterology.
2. OWNERSHIP
Each party shall retain ownership of all Intellectual Property
Rights owned by it as of the Effective Date. Nothing in this
Agreement shall be construed to convey any title or ownership
interest in and to any Intellectual Property Rights owned by either
party hereto.
3. PRODUCT MANUFACTURE AND SALE
3.1 Purchase and Sale . Subject to the
terms and conditions of this Agreement, Partners in Biomaterials
agrees to manufacture and sell to Aquamer, Inc. all Products
ordered by Aquamer, Inc. during the term of this Agreement for the
Specified Use.
3.2 Exclusive Supplier . During the
term of this Agreement, Partners in Biomaterials shall be the
exclusive supplier of Products to Aquamer, Inc. for its worldwide
sales. Notwithstanding the foregoing, if Partners in Biomaterials
is unable to supply Aquamer, Inc.’s requirements for
Products, Aquamer, Inc. shall, until such time as Partners in
Biomaterials can reasonably demonstrate manufacturing capacity,
financing (if needed), sources of raw materials and ability to meet
Aquamer, Inc.’s reasonable delivery schedule, sufficient to
meet Aquamer, Inc.’s requirements for Products, have the
right to secure access to the Products or any components from any
other non-affiliated source. In that event, Aquamer, Inc. shall
contract with the other source to manufacture the Products
sufficient to meet Aquamer, Inc.’s requirements for Products
during the interim period. At such time when Partners In
Biomaterials demonstrates sufficient manufacturing capacity,
financing (if needed), sources of raw materials and ability to meet
Aquamer, Inc.’s reasonable delivery schedule, Aquamer, Inc.
shall cease to purchase further products from the other source.
3.3 Regulatory Approvals.
Aquamer, Inc. shall be solely responsible for regulatory
clearances deemed necessary by individual countries or
regulatory bodies. Partners in Biomaterials shall use its best
efforts to provide technical information and physical test data as
requested by Aquamer, Inc. in support of such efforts to the extent
that such information and/or physical test data is readily
available and/or can be made available without unreasonable effort
or expense. In the event that any such information and/or physical
test data is not readily available by Partners in Biomaterials for
Aquamer, Inc., then any expense incurred by Partners in
Biomaterials arising from Aquamer, Inc.’s request shall be
paid for by Aquamer, Inc.
3.4 Approved Manufacturing Facility.
Partners in Biomaterials shall ensure that its
manufacturing facilities conform to European Community (EC) and ISO
standards requirements at such time as is required for the sale of
product for the Specified Use bearing a CE Mark and/or a PMA
approval.
3.5 Packaging Development.
Development and testing of packaging and procurement of containers
for the Product shall be the responsibility of Aquamer, Inc.
Validation of the processes used to manufacture the Product in the
packaging at Partners In Biomaterials shall be the responsibility
of Partners In Biomaterials.
3.6 Orders . Aquamer, Inc. may initiate
purchases under this Agreement by submitting written purchase
orders to Partners in Biomaterials at the address above, together
with prepayment for one half of the Products ordered. All purchase
orders shall contain: (a) purchase order number and date; (b)
Product model number; (c) specification number and revision level;
(d) part number and revision level; (e) quantity of Product(s) to
be purchased; (f) shipping instructions; (g) specified
delivery date; (h) destination and billing address (if different
from address listed above); (i) the net unit price for the
Product(s); and j) an authorized signature.
3.7 Acceptance . Purchase orders shall
be binding when accepted by Partners in Biomaterials. Partners in
Biomaterials shall acknowledge each purchase order in writing
within ten (10) business days of receipt. Within such ten (10) day
period, Partners in Biomaterials may only reject an order which
does not conform with the terms and conditions of this Agreement.
Notice of rejection must be sent to Aquamer, Inc. by telex or fax,
followed by registered letter. If an order is neither confirmed nor
rejected by Partners in Biomaterials within ten (10) business days
of receipt, it shall be deemed to have been accepted.
3.8 Delivery Date . Unless otherwise
agreed in writing by the Parties, Partners in Biomaterials shall
deliver Products no later than five (5) days after the date
specified in an accepted purchase order, provided Partners in
Biomaterials receives such purchase order at least ninety
(90) days prior to the specified delivery date. If Partners in
Biomaterials receives a purchase order less than ninety (90) days
before the specified delivery date, Partners in Biomaterials shall
use reasonable commercial efforts to deliver such Products on the
specified delivery date.
3.9 Shipping . All Products subject to
this Agreement shall be packaged in accordance with the
Specifications set forth in the attached Exhibit A. Partners in
Biomaterials shall mark all shipping containers with
necessary lifting, handling and shipping information, purchase
order numbers, and date of shipment. An itemized packing list must
accompany each shipment. Aquamer, Inc. will reimburse Partners in
Biomaterials for all transportation, shipping and insurance
expenses. In the event that Aquamer, Inc. requests special
packaging or finishing for any order, as requested in writing in
conjunction with the submission of a purchase order, Aquamer, Inc.
shall pay the incremental cost for such special packaging or
finishing; provided, however, Partners in Biomaterials agrees to
pack any special documentation regarding the Products as may be
requested by Aquamer, Inc., so long as such special documentation
is readily available and/or can be made available without
unreasonable effort or expense, at no additional charge. In the
event that any such special documentation is not readily available
by Partners in Biomaterials then any expenses incurred by Partners
In Biomaterials arising from Aquamer, Inc.’s request shall be
prepaid for by Aquamer, Inc.. Shipment will be F.O.B.,
Partners in Biomaterials’s plant. All shipping papers and/or
invoices shall include the purchase order number and serial numbers
of Products shipped.
3.10 Minimum Purchase . Aquamer shall
make minimum purchases of the Products of fifty thousand dollars
($50,000) in each calendar year.
3.11 Terms and Conditions . This
Agreement contains the terms and conditions which shall apply to
all purchases of Products by Aquamer, Inc.. In ordering and
delivering Products, Aquamer, Inc. and Partners in Biomaterials may
use their standard forms but nothing in such forms shall amend or
modify the terms of this Agreement. In case of conflict between
such forms and this Agreement, the terms of this Agreement shall
control.
4. RESCHEDULING
4.1 Changes . Aquamer, Inc. may delay
delivery for up to sixty (60) days from the scheduled delivery date
of a purchase order previously accepted by Partners in
Biomaterials, provided Aquamer, Inc. provides Partners in
Biomaterials notice at least thirty (30) days prior to the
specified delivery date. Partners in Biomaterials will use
reasonable commercial efforts to meet all rescheduled delivery
dates. Aquamer, Inc. may advance delivery of a shipment only
by written agreement with Partners In Biomaterials based on the
earlier availability of the Product.
4.2 Delayed Delivery . Partners in
Biomaterials shall promptly notify Aquamer, Inc. if any
circumstance outside its reasonable control arises which could
result in delivery of a Product after the specified delivery date
of an accepted purchase order. If Aquamer, Inc. has not received
Products for which Partners in Biomaterials accepted a purchase
order within thirty (30) days following the specified delivery
date, Aquamer, Inc. shall be entitled to cancel such order, in
whole or part, without any obligation or liability to Partners in
Biomaterials.
5. PRICING
5.1 Product Prices . The price for
Products (unit = sterile 1cc syringe of hydrogel with labeling
according to Aquamer, Inc. specifications) subject to this
Agreement shall be those listed on attached Exhibit B . All
prices are in United States dollars.
5.2 Price Adjustment. The prices
as set forth in Exhibit B shall be reviewed annually on a calendar
year basis commencing January 1, 2007 and shall be
adjusted to reflect the percentage increase or decrease during the
preceding calendar year in the Consumer Price Index ("All Urban
Consumers"). Notwithstanding anything contained herein to the
contrary, any such adjustment for any given period shall not
increase or decrease any price by more than two-and-one-half
percent (2.5%). If during the term of this Agreement revised
prices are put into effect by Partners in Biomaterials, such
revised prices shall apply only to purchase orders received
after such revised prices are put into effect by Partners in
Biomaterials and in any event, shall be applied only to quantities
ordered and shipped, on a pro-rata basis, in accordance with the
attached Exhibit B.
5.3 Taxes . All prices described herein
are exclusive of federal, state and local excise, sales, use and
similar taxes. Aquamer, Inc. shall be liable for and shall pay all
applicable taxes invoiced by Partners in Biomaterials unless
Aquamer, Inc. provides Partners in Biomaterials with a properly
executed tax exemption certificate prior to delivery.
6. PAYMENT
6.1 Payment . Partners in Biomaterials shall
issue Aquamer, Inc. individual invoices for each Product shipment.
Each such invoice shall separately list the price of each Product,
taxes, transportation, shipping and insurance charges, and any
special packaging or finishing charges. Prior to acceptance of an
order by Partners in Biomaterials under paragraph 3.7, Aquamer,
Inc. shall pay 50% of the total price of the order in advance and
the balance within forty five (45) days of the date of such
invoice or the delivery date, whichever is later.
6.2 Payment Method . Aquamer, Inc. shall make
payment to Partners in Biomaterials for Products by check or by
wire transfer to an account specified by Partners in
Biomaterials.
6.3 Overdue Payments . Payments more than
thirty (30) days overdue will be subject to a service charge of one
percent (1%) per month or the maximum amount allowed by law,
whichever is less.
6.4 In the event that final payment for any shipment
made to Aquamer, Inc. is more than 30 days overdue, Partners in
Biomaterials shall have no obligation to fill subsequent orders
placed by Aquamer, Inc., and Partners in Biomaterials shall have
the right to apply prepayment moneys made for such subsequent
orders to such overdue payments.
7. FORECASTS
Within thirty (30) days following acceptance of the Product
pursuant to Section 2.1, and on a quarterly basis thereafter,
Aquamer, Inc. shall provide Partners in Biomaterials with a
forecast of Aquamer, Inc. ’ s anticipated
quarterly requirements of Products for the following twelve (12)
month period commencing on the date of such forecast. It is
understood that such forecast is not binding but Aquamer, Inc.
shall use all reasonable efforts to make each forecast as accurate
as possible, particularly as it pertains to the six (6) months
immediately following the date of such forecast.
8. PRODUCT QUALITY
8.1 Quality Assurance Program . Partners in
Biomaterials agrees to assure the quality level of Products through
the use of a formal quality assurance program reasonably acceptable
to Aquamer, Inc. Such program shall require Partners in
Biomaterials to prepare and maintain written records sufficient to
enable Aquamer, Inc. to trace the history of each Product. Pursuant
to such program, Partners in Biomaterials shall place lot numbers
on all Products to enable the identification and tracing of
Products. During the term of the Agreement, Aquamer, Inc. shall
have the right to audit such quality assurance program together
with the manufacturing and storage of Products, at its expense,
during regular business hours upon forty-eight (48) hours advance
notice to Partners in Biomaterials.
8.2 Inspection . Partners in Biomaterials shall
conduct a final inspection and quality control test on each Product
prior to shipment to verify that such Products meet and conform
with the Specifications. Each shipment of Products shall be
accompanied by a quality assurance analytical data sheet (the
"Quality Assurance Data Sheet").
8.3 Acceptance by Aquamer, Inc. In accordance with
Section 8.1, no inspection or test made prior to final inspection
and acceptance at Aquamer, Inc.’s facility shall relieve
Partners in Biomaterials of responsibility for defects or other
failure to supply Products that conform to the Specification or
respective purchase order. Final inspection and acceptance shall be
at Aquamer, Inc.’s facility, and shall be performed within a
reasonable time, and in any event within the specified payment
period as detailed in Section 6.1.
8.4 Latent Defects . It is understood that Products
may have defects which would not be discoverable upon reasonable
physical inspection
