Exhibit 10.54

 

CONFIDENTIAL TREATMENT REQUESTED

 

INFORMATION FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED IS OMITTED AND
NOTED WITH “****”. AN UNREDACTED VERSION OF THIS DOCUMENT HAS ALSO BEEN PROVIDED
TO THE SECURITIES AND EXCHANGE COMMISSION.

 

AMENDMENT NO. 2 TO AMENDED AND RESTATED SUPPLY AGREEMENT

(Thallium and Generators)

 

This Amendment No. 2 to Amended and Restated Supply Agreement (Thallium and
Generators) (this “Amendment”) is made effective as of December 27, 2012 (the
“Amendment Date”) by and between Lantheus Medical Imaging, Inc. (“Supplier”) and
Cardinal Health 414, LLC (“Cardinal”).

 

WHEREAS, Supplier and Cardinal entered into an Amended and Restated Supply
Agreement (Thallium and Generators) as of January 1, 2009 and effective as of
January 1, 2004 (the “Original Agreement”);

 

WHEREAS, Supplier and Cardinal entered into an Amendment No. 1 to Amended and
Restated Supply Agreement (Thallium and Generators) as of December 29, 2009
(together with the Original Agreement, collectively, the “Agreement”); and

 

WHEREAS, Supplier and Cardinal wish to further amend the Agreement to extend its
term and specify pricing and volume requirements for the continued supply of
Products as set forth in this Amendment.

 

NOW, THEREFORE, for good and valuable consideration, the sufficiency of which is
hereby acknowledged, the Parties hereto hereby agree as follows:

 

1.                                      Definitions.  The definition of
“Products” in Section 1.1 of the Agreement is hereby amended by replacing the
reference to “Thallium and Generators” with “gallium citrate (Ga 67)
(“Gallium”), xenon (Xe-133) (“Xenon”), NEUROLITE® Kit for the Preparation of
Technetium Tc99m Bicisate for Injection (“Neurolite”), Thallium and Generators”
as of the Amendment Date.  All other terms defined in the Agreement and not
otherwise defined or modified in this Amendment are used herein with the
meanings ascribed to them in the Agreement, except that the defined term
“Affiliate” has the meaning given to it in the Amended and Restated Cardiolite®
License and Supply Agreement entered into by the Parties as of January 1, 2009
and effective as of January 1, 2004.

 

2.                                      Purchase and Sale of Products.  All of
the references to “Thallium” in the Agreement (except for the definition of
“Thallium”) shall be amended to mean “Gallium, Xenon, Neurolite and Thallium” as
of the Amendment Date.  Except for sales to Cardinal’s end-user customers, in no
event shall Cardinal sell, loan, transfer, give or otherwise supply Products to
any third party without Supplier’s prior written approval.  Cardinal shall be
permitted to sell Products, on a drop ship basis through Supplier, to ****;
provided that, Cardinal may supply Product to **** on a drop ship basis through
Supplier upon ****.

 

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3.                                      LEU Generators.  Section 3.1 of the
Agreement is hereby amended by adding the following language after the last
sentence as of the Amendment Date:

 

“In addition, Cardinal shall be entitled to order up to a **** share of the LEU
Generators made available for sale by Supplier, provided, however, that Cardinal
shall be entitled to order up to ****curies of LEU Generators per week during
periods of normal production and supply of LEU-based molybdenum-99 by all
suppliers to Supplier if Cardinal has placed a firm order for such increased
volumes of LEU Generators at least **** (****) days  prior to the shipping
date.  For purposes of this Agreement, “LEU Generators” shall mean Generators
containing molybdenum-99 sourced from at least ninety-five percent (95%) low
enriched uranium targets (“LEU”).  A “**** share” shall mean a share of
Supplier’s LEU Generators equal to **** percent (****%) of ****.  Cardinal’s
orders for LEU Generators shall be subject to the terms for Generators set forth
in this Agreement, including, but not limited to, Supplier’s customary ordering
requirements and lead times described in Article 4.”

 

4.                                      Purchase Price.  Section 3.2 of the
Agreement is hereby amended by deleting the second sentence in its entirety and
replacing it with the following as of the Amendment Date:

 

“The pricing for Generators set forth in Exhibit B shall remain firm through
****.  Calculations of applicable “Share” (as defined under Exhibit B) amounts
for purposes of determining the pricing set forth in Exhibit B for each ****
Period (as defined in Exhibit B) shall be based upon Cardinal’s ****reports in
the form set forth on Exhibit C (“****Report”).  In the event of any discrepancy
in Share amounts applied to invoices for any **** Period and the actual Share
amount reflected in Cardinal’s **** Report for such period, Supplier shall
invoice Cardinal for any necessary true-up payments or credits to adjust for any
overpayments or underpayments with respect to the pricing for Generator
purchases made by Cardinal to Supplier as a result of such Share discrepancy”.

 

5.                                      Minimum Purchase Obligation. 
Section 3.4 of the Agreement is hereby amended by deleting it in its entirety
and replacing it with the following as of the Amendment Date:

 

“3.4                        Minimum Purchase Obligation.  Cardinal guarantees,
subject to Supplier’s ability to supply, a minimum purchase of Product as set
forth in this Section 3.4.

 

2

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(a)                                 Cardinal shall purchase from Supplier or its
Affiliates on a regular **** basis reasonably **** (as reported under
Section 5.3(b)) at least the Minimum Quantities (as hereinafter defined) of
Product.  Compliance with such Minimum Quantities will be determined as of ****
and at the end of each **** thereafter.  In any **** in which Cardinal does not
purchase at least the applicable Minimum Quantities of Product from Supplier,
Cardinal will promptly pay to Supplier the Minimum Payment (as hereinafter
defined).

 

“Minimum Quantities” means the following minimum quantities of Product, on a
**** basis, as purchased by Cardinal and its Affiliates from Supplier (as
measured using calibration equivalent to the calibration set forth in Exhibits A
and B):

 

(i) **** percent (****%) of all technetium Tc 99m generator curies purchased by
Cardinal and its Affiliates in each **** during the period from **** through
****;

 

(ii) **** percent (****%) of all Gallium purchased by Cardinal and its
Affiliates in each **** during the period from **** through ****;

 

(iii) **** percent (****%) of all Thallium curies purchased by Cardinal and its
Affiliates in each **** during the period from **** through ****;

 

(iv) **** percent (****%) of all Xenon purchased by Cardinal and its Affiliates
in each **** during the period from **** through ****; and

 

(v) **** percent (****%) of all Neurolite purchased by Cardinal and its
Affiliates in each **** during the period from **** through ****.

 

For purposes of clarity, the Minimum Quantities shall include all of the
Products (including ****) purchased by Cardinal and its Affiliates for ****;
provided that LMI or, with respect to the supply of Products outside of the
United States, its Affiliates shall supply Products to all radiopharmacy
locations controlled by Cardinal or its Affiliates in such geographic
territories.  Neither Cardinal nor any of its Affiliates shall be restricted by
Supplier from selling any Product ****, provided that the Product is approved
and properly labeled for sale in such geographic territory under all applicable
laws and regulations.  In addition, if Cardinal or its Affiliates elect to
purchase a Product in ****, Cardinal or its Affiliates, as applicable, shall use
their best efforts to establish regular standing orders to purchase at least a
reasonable portion of Product

 

3

--------------------------------------------------------------------------------

 

requirements for applicable locations on a regular **** basis for the
radiopharmacy locations controlled by Cardinal or its Affiliates in ****.  For
all such purchases in ****, Supplier’s Affiliate will invoice such
radiopharmacies in **** at the **** for the immediately preceding ****.

 

“Minimum Payments” means, as of an applicable date, the payment calculated on
such date pursuant to the terms of this Agreement  (and, in the case of
Generators, based on the average ****price of such Generators purchased
hereunder over the prior **** (****) **** period; provided, that for the **** in
****, such calculation shall be based on the average **** price of Generators
purchased hereunder during ****) for any remaining portion of the applicable
Minimum Quantities for which purchase orders were not received by Supplier prior
to such date.”

 

6.                                      Delays in Delivery.  Section 4.2 of the
Agreement is hereby amended by adding the following language after the last
sentence:

 

“In the event that delivery of a Generator is delayed more than **** (****) ****
past the agreed upon local delivery time, Supplier will ****.  The foregoing
shall not apply to delays caused by events of Force Majeure, such as weather
conditions effecting transportation of Generators, for which there will be no
****.”

 

7.                                      Initial Minimum Quantities.  The
definition of “Initial Minimum Quantities” in Section 4.1 of the Agreement is
hereby amended by deleting it in its entirety and replacing it with the
following as of the Amendment Date:

 

“Initial Minimum Quantities” means **** (****) **** for each Product.”

 

8.                                      Term.  Section 5.1 of the Agreement is
hereby amended such that the date “December 31, 2012” appearing in the first
sentence thereof shall be deleted and replaced with “December 31, 2014” as of
the Amendment Date.

 

9.                                      Reporting.  Section 5.3(b) of the
Agreement is hereby amended by deleting it in its entirety and replacing it with
the following as of the Amendment Date:

 

“(b)                          Cardinal will provide Supplier reports, in
substantially the form of Exhibit C, promptly at the end of each **** for
Products other than Generators, and at the end of each **** for Generators.  For
Generators, reports shall list (i) Cardinal’s total requirements for all
technetium Tc 99m generators for the most recent ****Period(s) (as defined in
Exhibit B) immediately preceding the applicable report and (ii) the portion of
such technetium Tc 99m generator volumes purchased from Supplier during such
****Period(s).  For all Products other than Generators, ****

 

4

--------------------------------------------------------------------------------

 

reports shall list (i) Cardinal’s total **** requirements for each Product on a
weekly basis and (ii) the portion of such Product volumes purchased from
Supplier.”

 

10.                               Amendment to Exhibit A.  Exhibit A of the
Agreement is hereby amended by deleting it in its entirety and replacing it with
Exhibit A attached hereto as of the Amendment Date.

 

11.                               Amendment to Exhibit B.  Exhibit B of the
Agreement is hereby amended by deleting it in its entirety and replacing it with
Exhibit B attached hereto as of the Amendment Date.

 

12.                               Amendment to Exhibit C.  Exhibit C of the
Agreement is hereby amended by deleting it in its entirety and replacing it with
Exhibit C attached hereto as of the Amendment Date.

 

13.                               **** Payment.  In exchange for Supplier making
commercially available to Cardinal **** hereunder and for providing assurances
to Cardinal with respect to Supplier’s ability to supply ****, Cardinal shall
pay Supplier **** US dollars (US$****) in the following irrevocable and
non-refundable amounts in accordance with the following schedule, subject to the
conditions set forth below:

 

(a)                                 $**** on or before ****; provided that
Supplier provides written certification to Cardinal on or before **** that
Supplier is ready and able starting in **** to supply Cardinal with **** in the
amounts required hereunder.

 

(b)                                 $**** on **** (the “**** Payment”); provided
that (a) Supplier complies with its obligations to supply **** hereunder from
**** to ****, and (b) as of ****, Supplier delivers to Cardinal a written
certification that Supplier has complied with the applicable terms of the
Agreement relating to the supply of **** and has no reasonable basis to believe
that it cannot continue to comply with such obligations.

 

(c)                                  $**** on **** (the “**** Payment”);
provided that (a) Supplier complies with its obligations to supply ****
hereunder from **** to ****, and (b) as of ****, Supplier delivers to Cardinal a
written certification that Supplier has complied with the applicable terms of
the Agreement relating to the supply of **** and has no reasonable basis to
believe that it cannot continue to comply with such obligations.

 

In no event will Cardinal be obligated to make the **** Payment or the ****
Payment under this Section 13, unless Supplier provides Cardinal with such
written

 

5

--------------------------------------------------------------------------------

 

certification on the applicable date that Supplier has complied with the
applicable terms of the Agreement relating to the supply of ****, or if at the
time such payment would otherwise be payable, Cardinal has a reasonable good
faith belief, which can be reasonably substantiated with the appropriate written
evidence that the conditions set forth for such payment in the proviso of
paragraph (b) or (c) above, as applicable, have not been satisfied.

 

14.                               No Further Changes.  Except as specifically
amended hereby, the Agreement shall remain in full force and effect and
otherwise unmodified.  All amendments in Sections 1 through 13 of this Amendment
shall be deemed made as of the Amendment Date, and the Agreement shall not be
deemed to have been modified until the Amendment Date.

 

15.                               General.  This Amendment may be executed in
two or more counterparts, each of which when executed shall be deemed to be an
original but all of which when taken together shall constitute one and the same
agreement.  Signatures hereto may be delivered by facsimile or a “pdf” file
through electronic mail, and such delivery will have the same effect as the
delivery of the paper document bearing the actual handwritten signatures.  This
Amendment shall be governed by and construed in accordance with the laws of the
State of New York, without giving effect to the conflict of laws provisions
thereof.  Supplier and Cardinal understand and agree that each and every term
and condition of this Amendment, have or has been mutually negotiated, prepared
and drafted, and in connection with the interpretation or construction of such
term or condition or this Amendment, no consideration will be given to the issue
of which of Supplier or Cardinal prepared, drafted or requested any term or
condition of this Amendment.

 

[Signature page follows.]

 

6

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IN WITNESS WHEREOF, the Parties hereto have executed this Amendment as of the
Amendment Date.

 

Signed for and on behalf of Cardinal Health 414, LLC

 

 

Signature:

/s/ Thomas J. Rafferty

 

 

 

 

By:

Thomas J. Rafferty

 

 

 

 

Title:

Vice President, Sourcing

 

 

 

 

 

 

Signed for and on behalf of Lantheus Medical Imaging, Inc.

 

 

Signature:

/s/ Michael P. Duffy

 

 

 

 

By:

Michael P. Duffy

 

 

 

 

Title:

Vice President and Secretary

 

 

7

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EXHIBIT A

 

INITIAL PRODUCT PRICES; ADJUSTMENTS

 

GALLIUM

 

The unit prices for Gallium for the period from **** through **** shall be as
follows:

 

SKU

 

Description

 

UOM

 

Price per Unit

 

****

 

****

 

Vial

 

$

****

 

****

 

****

 

Vial

 

$

****

 

****

 

****

 

Vial

 

$

****

 

****

 

****

 

Vial

 

$

****

 

 

The unit prices of Gallium for the period from **** through **** shall be
increased from the prior ****’s pricing by an amount equal to the **** of
(i) **** percent (****%) and (ii) the annual percentage increase, if any, for
the most recent **** period for which figures are available in the **** (the
“PPI”) published by the U.S. Bureau of Labor Statistics (the “BLS”) or, if the
same is no longer published, the successor index published by the BLS that is
most similar thereto.  If the PPI is discontinued and not replaced with a
corresponding or similar index, then the Parties shall, in good faith, agree
upon a replacement PPI (item (ii) is hereinafter referred to as the “Annual PPI
Increase”).

 

XENON

 

The unit prices for Xenon for the period from **** through **** shall be as
follows:

 

SKU

 

Description

 

UOM

 

Price per Unit

 

****

 

****

 

Kit

 

$

****

 

****

 

****

 

Kit

 

$

****

 

****

 

****

 

Kit

 

$

****

 

****

 

****

 

Kit

 

$

****

 

 

Supplier shall have the right to increase the unit prices of Xenon for the
period from **** through **** by an amount not to exceed ****percent (****%) of
the prior ****’s pricing.

 

THALLIUM

 

The unit price for Thallium for the period from **** through **** shall be
$****.  The unit price of such Product for the period from **** through ****
shall be $****.

 

--------------------------------------------------------------------------------

 

NEUROLITE

 

The unit price for Neurolite for the period from **** through **** shall be as
follows:

 

SKU

 

Description

 

UOM

 

Price per Unit

 

****

 

****

 

Kit

 

$

****

 

 

Supplier shall have the right to increase the unit price of Neurolite for the
period from **** through **** by an amount not to exceed the Annual PPI
Increase.

 

--------------------------------------------------------------------------------

 

EXHIBIT B

 

GENERATOR PURCHASE PRICE; ADJUSTMENTS

 

2013 and 2014 Generator pricing

 

 

 

Up to ****% Share

 

More than ****% Share

 

 

 

 

 

 

Standard 
Generator

 

LEU 
Generator

 

Standard 
Generator

 

LEU 
Generator

Size

 

Description

 

UOM

 

Price per Unit

 

Price per Unit

 

Price per Unit

 

Price per Unit

****

 

TechneLite®

 

Unit

 

****

 

****

 

****

 

****

****

 

TechneLite®

 

Unit

 

****

 

****

 

****

 

****

****

 

TechneLite®

 

Unit

 

****

 

****

 

****

 

****

****

 

TechneLite®

 

Unit

 

****

 

****

 

****

 

****

****

 

TechneLite®

 

Unit

 

****

 

****

 

****

 

****

****

 

TechneLite®

 

Unit

 

****

 

****

 

****

 

****

****

 

TechneLite®

 

Unit

 

****

 

****

 

****

 

****

****

 

TechneLite®

 

Unit

 

****

 

****

 

****

 

****

****

 

TechneLite®

 

Unit

 

****

 

****

 

****

 

****

****

 

TechneLite®

 

Unit

 

****

 

****

 

****

 

****

****

 

TechneLite®

 

Unit

 

****

 

****

 

****

 

****

****

 

TechneLite®

 

Unit

 

****

 

****

 

****

 

****

****

 

TechneLite®

 

Unit

 

****

 

****

 

****

 

****

 

For purposes of this Exhibit, “Share” shall be calculated for each separate but
consecutive **** (****) ****period from and after **** during the Term of the
Agreement (each a “**** Period”) (with a pro-rata adjustment as applicable for
any portion of a **** Period occurring as of the expiration or termination of
the Agreement) based on Supplier’s share of **** for such **** Period.  The
pricing set forth in this Exhibit shall remain fixed for ****.  Except for the
price changes based upon changes in Share amounts as described in this
Exhibit B, no surcharge or premiums shall apply to the Generators ordered by
Cardinal in excess of the Minimum Quantities.

 

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EXHIBIT C

 

SHARE CALCULATION REPORTS

 

Cardinal

Volume and Share Certification

 

 

 

Beginning (Sunday)

 

 

 

Through (Saturday)

For the **** Period(s)

 

****

 

through

 

****

 

 

 

e.g. Sunday, ****

 

 

 

e.g. Saturday, ****

 

 

 

****

 

 

 

 

 

1

 

2

 

3

 

4

 

Total

 

Total Technetium Curies Purchased

 

 

 

 

 

 

 

 

 

0.00

 

Total Technetium Curies Purchased from Lantheus

 

 

 

 

 

 

 

 

 

0.00

 

Lantheus Share

 

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

 

Cardinal hereby certifies that the information contained herein is true and
complete.

 

Name:

 

 

 

Signature:

 

 

 

Date:

 

 

--------------------------------------------------------------------------------

 

Cardinal

Volume and Share Certification

 

 

 

Beginning (Sunday)

 

 

 

Through (Saturday)

For the **** period

 

****

 

through

 

****

 

 

 

e.g. Sunday, ****

 

 

 

e.g. Saturday, ****

 

 

 

****

 

 

 

 

 

1

 

2

 

3

 

4

 

5

 

6

 

7

 

8

 

9

 

10

 

11

 

12

 

13

 

Total

 

Total Gallium **** Purchased

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

0.00

 

Total Gallium **** Purchased from Lantheus

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

0.00

 

Lantheus Share

 

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Xenon **** Purchased

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

0.00

 

Total Xenon **** Purchased from Lantheus

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

0.00

 

Lantheus Share

 

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total **** Curies Purchased

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

0.00

 

Total Thalllium **** Purchased from Lantheus

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

0.00

 

Lantheus Share

 

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

0.00

%

 

Cardinal hereby certifies that the information contained herein is true and
complete.

 

Name:

 

 

 

 

 

Signature:

 

 

 

 

 

Date:

 

 

 

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