EXHIBIT 10.1
CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED BY MARKING SUCH
PORTIONS WITH ASTERISKS (THE "XXXX"). THIS EXHIBIT HAS BEEN FILED SEPARATELY
WITH THE SECRETARY OF THE COMMISION WITHOUT THE XXXX PURSUAN TO THE COMPANY'S
APPLICATION REQUESTING CONFIDENTIAL TREATMENT.
FIRST AMENDMENT TO LICENSE AND SUPPLY AGREEMENT
This First Amendment to License and Supply Agreement (this "Amendment")
is entered as of January 1, 2002 (the "Effective Date"), by and among ADVANCED
TISSUE SCIENCES, INC., a Delaware corporation ("ATS"), and BIOZHEM
COSMECEUTICALS, INC. a Texas corporation ("Buyer").
WHEREAS, ATS And Buyer have entered into a Development, License and
Supply Agreement dated September 25, 2000;
WHEREAS, certain changes have occurred in development timelines and
strategies which require adjustments to the terms of the Agreement.
NOW, THEREFORE, in consideration of the foregoing premises and the
terms, covenants and conditions set forth herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, ATS
and Buyer agree that the License and Supply Agreement will be amended as
follows:
I. The parties agree that Section 1.6 of the Agreement shall be deleted
and replaced with the following new Section 1.6:
1.6 "Contract Year" shall be a twelve month period
commencing on January 1st of any year the Agreement is in effect. The
First Contract Year is the period from January 1, 2002 until December
31, 2002.
II. The parties agree that Section 5.1.1.1 of the Agreement shall be
deleted and replaced with the following new Section 0.0.0.0:
5.1.1.1 on or before November 30, 2002 a payment in the amount
of One Million Dollars ($1,000,000);
III. The parties agree to add the following new Section 3.6.8 related to
Buyer's Obligations:
3.6.8 that the apportionment of revenue to the Licensed
Product shall be according to the following schedule:
3.6.8.1 100% to ATS on individual purchases of Licensed
Product
3.6.8.2 80% to ATS on purchased of one licensed Product
packaged with one or two Buyer or other third party products
3.6.8.3 70% to ATS on purchases of one Licensed Product
packaged with three or more Buyer or other third party
products
3.6.8.4 For offerings, if any, containing more than one
Licensed Product, the parties will negotiate in
good faith to determine apportionment of
revenues.
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IV. The parties agree that Section 5.3.1 of the Agreement shall be deleted
and replaced with the following new Section 5.3.1:
5.3.1 The "Exclusivity Threshold" shall be determined
according to the following schedule:
Contract Annual Minimum Quarterly Minimum Annual
Year Royalty Payment Royalty Payment Sales Targets
-------- --------------- ----------------- -------------
1 $2,000,000 $500,000 [** ]
2 $3,000,000 $750,000 [** ]
3 $4,000,000 $1,000,000 [** ]
4 $6,100,000 $1,525,000 [** ]
5 $9,600,000 $2,400,000 [** ]
6-10 $12,000,000/year $3,000,000 [** ]
The payments made under this section shall be cumulative so that Buyer
shall receive a credit in the following period in the event the actual
royalties paid in any period exceed the minimum payments hereunder.
For the First Contract Year only, the following terms will apply:
o Payment for Q1 and Q2 actual royalties will be made within 30 days
following the end of the quarter.
o No later than September 1, 2002 payment of the difference between
the actual royalties and minimum royalties for Q1, if any.
o No later than October 30, 2002, payment of the minimum royalty
for Q3.
o No later than November 1, 2002, payment of the difference between
the actual royalties and minimum royalties for Q2, if any.
o No later than January 30, 2003, payment of the minimum royalty
for Q4.
o If actual royalties exceed the minimums for any quarter, the
difference will be paid to ATS no later than 30 days following
the end of the applicable quarter.
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment to
be effective as of the date first written above.
ADVANCED TISSUE SCIENCES, INC.
By: /s/ Xxxx X. Xxxxxxxx
---------------------------------------
Title: President
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Print Name: Xxxx X. Xxxxxxxx
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BIOZHEM COSMECEUTICALS, INC.
By: /s/ X. X. Xxxxxx
---------------------------------------
Title: CEO
------------------------------------
Print Name: X. X. Xxxxxx
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