EXHIBIT 10.1

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

ACI-MAIX SUPPLY AGREEMENT
between
Matricel GmbH, a company duly incorporated in Germany (registered under HR B
8628 in the Commercial Register of the Lower Court of Aachen) having its
registered office located at Kaiserstrasse 100, 52134 Herzogenrath, Germany
("Matricel")
and
Vericel Corporation, a company incorporated under the laws of Michigan, having
its registered office located at 64 Sidney Street, Cambridge, MA 02139, U.S.A.
(“Vericel”).
RECITALS
WHEREAS, Matricel and Vericel wish to enter this ACI-Maix Supply Agreement
(“Agreement”), in order to define the terms of their business relationship for
the term of this agreement.
NOW, THEREFORE, Vericel and Matricel, intending to be legally bound, agree as
follows:
1.    DEFINITIONS
For the purposes of this Agreement, the following terms shall have the following
meanings:
ACI-Maix-Membrane Product shall mean the sterile ACI-Maix-Membrane, a bilayered
collagen membrane product derived from an animal source, as described more
closely in the Quality Service Agreement (Annex 1 to this Agreement).
Effective Date shall mean the date of the last signature of this agreement.
Final Product shall mean Vericel’s autologous chondrocyte implant incorporating
the ACI-Maix-Membrane Product.
Forecast shall have the meaning as defined in Section 3.3 of this Agreement.
Quality Service Agreement shall be the Agreement which forms Annex 1 to this
Agreement.
Party shall mean Vericel or Matricel, and Parties shall mean Vericel and
Matricel.
Specifications shall have the meaning as defined in Section 2.1 of this
Agreement.
Unit Price shall have the meaning as defined in Section 3.6 of the Agreement.

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

2.    SUPPLY & RELEASE PROCESS
2.1
Specifications

During the term of this Agreement, Matricel shall supply to Vericel
ACI-Maix-Membrane Products that conform to the specifications set forth in the
Quality Service Agreement attached as Annex 1 (“Specifications”) and
incorporated herein by reference according to the terms as defined herein. All
ACI-Maix-Membrane Products sold hereunder shall meet the
Specifications and no changes to the Specifications shall be made by Matricel
without prior written approval of Vericel.
2.2
Change in Specifications

In the event that a regulatory authority requires any changes in the
Specifications as a condition to authorizing the marketing of the Final Product,
or any other product that incorporates the ACI-Maix-Membrane Product, the
Parties shall negotiate in good faith to amend Annex 1 as appropriate.
2.3
Shrinkage

The Parties hereby agree to the minimum acceptable surface area of
ACI-Maix-Membrane Products after hydration and before cell seeding and to
jointly develop a work plan related thereto as further described in Annex 2
(incorporated herein by this reference).
2.4
[***].

(a)
[***].

(b)
[***].

(c)
[***].

(d)
[***].

(e)
[***].

3.0
TERMS OF SALE

3.1
Matricel shall make the ACI-Maix-Membrane Products for the exclusive use and
benefit of Vericel. Matricel shall supply to Vericel the ACI-Maix-Membrane
Products on an exclusive basis and in such quantities as may be ordered by
Vericel by way of binding purchase orders as set forth in Section 3.3.

3.2
Title to, and risk of damage or loss of, the ACI-Maix-Membrane Products shall
pass to Vericel upon delivery to Vericel. Matricel shall be responsible for
freight, transportation, transport insurance, shipping, storage, handling,
customs duty, demurrage, taxes and other similar

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

charges using carriers, warehouses and handlers as expressly directed by
Vericel, subject to reimbursement by Vericel upon being invoiced by Matricel.
3.3
Upon execution of the Agreement Vericel will submit an initial non-binding
forecast substantially in the form of Annex 4 (“Initial Forecast”). Every [***],
starting with [***], Vericel shall provide Matricel with an updated non-binding
realistic forecast of its supply requirements for ACI-Maix-Membrane Products in
the [***] following the submission of the respective forecast (“Forecast”),
which shall be substantially in the form of Annex 4. Generally, the Forecasts
shall not constitute an obligation of the Parties of any nature. All purchases
shall be made by way of binding purchase orders only. For the first calendar
year following the Effective Date, the minimum purchase volume shall be [***]
units of ACI-Maix-Membrane Product. For any calendar year periods subsequent to
the BLA approval of the Final Product, the minimum purchase volumes shall be
[***] of ACI-Maix-Membrane Product per [***]. The purchase volumes for the first
calendar year following the BLA approval of the Final Product shall be pro-rated
based on the timing of the BLA approval of the Final Product. In the event that
the Final Product is approved and then is not commercially available in the U.S.
for reasons of product recall [***], regulatory action, or facility closure by
the FDA, any minimum purchase commitments shall be suspended until Vericel is
authorized again to market the Final Product in the U.S.

Vericel will accept full lots and it is anticipated that the actual number of
units in a lot will vary. For planning purposes, it is anticipated that an
average lot will contain [***] units. Matricel shall inform Vericel in writing
of the actual number of units of ACI-Maix Membrane Product contained in each lot
and shall generally ship full ACI-Maix Membrane Product lots to Vericel. Credits
can be taken by Vericel for a full lot against the minimum purchase volume of
ACI-Maix Membrane Products based on the number of units in each lot [***].
Subject to Section 9.5, if greater quantities of ACI-Maix-Membrane Products are
requested than the amount in the Forecast for the applicable period, Matricel
shall use commercially reasonable efforts to meet the increased order.
3.4
All full ACI-Maix-Membrane Product lots delivered to Vericel shall have a
minimum of [***] of shelf life remaining prior to expiration. Smaller
ACI-Maix-Membrane Product deliveries to Vericel [***] due to reasons described
in Section 3.3 shall have a minimum of [***] of shelf life remaining prior to
expiration. The Parties will cooperate with each other to use diligent efforts
to extend the shelf life of the ACI-Maix-Membrane Product.

3.5
Matricel shall ship the ordered full ACI-Maix-Membrane Product lot to the
following address: 64 Sidney Street, Cambridge, MA 02139, USA within [***] days
of receipt of each binding purchase order. If more than one full
ACI-Maix-Membrane Product lot is ordered in the binding purchase order, then
each additional lot will be delivered [***] days after shipment of the previous
ACI-Maix-Membrane Product lot to the address listed above. Matricel shall
package the ACI-Maix-Membrane Product in a manner suitable for shipment and
sufficient to withstand the effects of shipping, and consistent with Vericel’s
shipping requirements and instructions, including handling during loading and
unloading. Matricel shall include the following with each shipment: (i) the
Vericel purchase order number, and (ii) Matricel‘s lot and batch numbers.

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

3.6
All sales of the ACI-Maix-Membrane Product shall be at a net price per
ACI-Maix-Membrane Product (the “Unit Price”) plus Value Added Tax (if
applicable) according to the staggered table below:

Volume threshold per calendar year
Unit Price
[***]
[***]
[***]
[***]
[***]
[***]

In the event that Vericel extends the term pursuant to Section 9.1, Matricel may
adjust the prices on an annual basis for calendar years [***] and beyond. Upon
the first extension of this Agreement, the Unit Prices as set out in this
Section 3.6 will be adjusted according to the following principle: [***].
3.7
Vericel shall pay the ordered ACI-Maix-Membrane Products within [***] days from
the date of respective shipment to a bank account designated by Matricel. No
cash discounts are allowed and the bank transfer costs shall be paid by Vericel.

4.    REGULATORY APPROVAL & SUPPORT, AUDITS, CONSULTANCY
4.1
All costs (internal & external) for maintaining regulatory approval of the
medical device ACI-Maix-Membrane Product in Europe (CE mark) shall be paid for
by Vericel, as a pass through cost, without markup. All costs (internal &
external) for achieving or maintaining regulatory approval of Matricel´s quality
system for the supply of the ACI-Maix-Membrane Product to countries designated
by Vericel [***] shall be paid by Vericel (internal costs [***]). Vericel will
also reimburse Matricel for additional insurance costs for the supply of the
ACI-Maix-Membrane Product to countries that are not covered by Matricel´s
current insurance policy. If additional service providers are needed (e.g.
regulatory consultants, publishers for FDA) or if additional internal or
external studies are required for the registration or approval of the Product
outside the EU, for instance to demonstrate compliance with national
regulations, the Parties will agree on the performance of such studies and the
costs for the studies will be covered by Vericel. [***]. For any costs exceeding
[***], an estimate of the costs shall be first provided to Vericel by Matricel
prior to the initiation of work or payment of fees.

4.2
Matricel shall support the filing and approval of Vericel´s BLA for the Final
Product with the United States Food and Drug Administration (“FDA”). Vericel may
request that Matricel disclose certain Confidential Information directly to the
FDA that Vericel believes will be required or that is required by FDA to be
provided in the Device Master File (“MAF) or by direct correspondence with the
FDA. Vericel confirms that Matricel will not be obligated to make available
directly to Vericel any manufacturing process information for the
ACI-Maix-Membrane Product that is considered Confidential Information by
Matricel. In order to support the BLA filing and approval, the Parties have
agreed [***].

4.3
Regulatory and compliance support by Matricel personnel, shall be provided [***]
in case that it is related to either the ACI-Maix-Membrane Product in Europe or
the submissions to the FDA as it relates to the ACI-Maix-Membrane Product
information in the BLA and/or open and closed

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

sections of the MAF. [***]. If additional regulatory and compliance support is
requested for other countries designated by Vericel or for other purposes [***]
then Matricel shall [***] for consulting services. No consulting services will
be performed by Matricel without a prior written request from Vericel detailing
the nature and scope of the services to be provided and approval by Vericel of
the approximate costs of the consulting services.
4.4
Matricel shall keep current with FDA medical device guidelines and standards,
[***].

4.5
Matricel will keep complete and accurate records related to the
ACI-Maix-Membrane Product (“Records“). All original Records on the development
and manufacture of ACI-Maix-Membrane Product will be retained and archived by
Matricel in accordance with 21 CFR 820 medical device regulations and applicable
law, but in no case for less than a period of [***] (the “Retention Period“).
Following the Retention Period, Matricel will not destroy the Records without
first giving Vericel written notice and the opportunity to further store the
Records at Vericel’s expense. Matricel agrees to quality audits by Vericel [***]
(as described in the Quality Service Agreement) in order to ascertain the
quality of ACI-Maix-Membrane Products and compliance with all applicable rules,
regulations and Specifications (and related Records) during the term of this
Agreement. [***].

4.6
[***].

4.7
Matricel shall provide Vericel with a current (as and when executed by the
product’s manufacturer) Certificate of Analysis, Certificate of Compliance and
Letter of Origin relating to the ACI-Maix-Membrane Product within [***] after
Vericel’s request. Such Certificate of Compliance shall be a certified statement
that [***]. Matricel shall notify Vericel in writing of any changes to the
Certificate of Analysis, Certificate of Compliance and Letter of Origin relating
to the ACI-Maix-Membrane Product [***] upon becoming aware of any such changes
from the manufacturer and shall provide an updated copy of the Certificate of
Analysis, Certificate of Compliance and Letter of Origin relating to the
ACI-Maix-Membrane Product [***]. Matricel shall provide Vericel with a
Certificate of Analysis [***].

4.8
In the performance of its obligations under this Agreement, Matricel and its
employees and agents (i) shall not offer to make, make, promise, authorize or
accept any payment or giving anything of value, including, without limitation,
bribes, either directly or indirectly to any public official, regulatory
authority or anyone else for the purpose of influencing, inducing or rewarding
any act, omission or decision in order to secure an improper advantage, or
obtain or retain business and (ii) shall comply with all applicable
anti-corruption and anti-bribery laws and regulations. Matricel and its
employees and agents shall not make any payment or provide any gift to a third
party in connection with Matricel’s performance of this Agreement except as may
be expressly permitted in this Agreement or a purchase order without first
identifying the intended third party recipient to Vericel and obtaining
Vericel’s prior written approval. Matricel shall notify Vericel immediately upon
becoming aware of any breach of Matricel’s obligations under this Section 4.8.

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

5.
REPRESENTATIONS, WARRANTIES AND NON-CONFORMING PRODUCTS

5.1    Representations and Warranties
Matricel hereby represents and warrants (selbständiges Garantieversprechen) to
Vericel that
(a)
it has obtained and shall, for the term of this Agreement, maintain a CE Marking
for the ACI-Maix-Membrane Product in the European Union;

(b)
any submission to Vericel or to any regulatory body in connection with the
ACI-Maix-Membrane Product was made or will be made in good faith and to the best
of Matricel´s knowledge contained or will contain accurate and complete data and
information as required by applicable laws, rules and regulations at the
registered offices of the Parties;

(c)
Matricel shall transfer good title to all ACI-Maix-Membrane Product sold to
Vericel, and that the ACI-Maix-Membrane Product supplied to Vericel shall (i)
have been manufactured in accordance with all applicable laws, rules and
regulations, including, without limitation, 21 CFR 820 medical device
regulations as well as the Quality Service Agreement, and the Specifications,
(ii) be of satisfactory quality and free from defects in material and
workmanship, (iii) not be adulterated or misbranded under the United States
Federal Food, Drug, and Cosmetic Act or other law; and

(d)
as of the date hereof, Matricel has not been debarred or is subject to debarment
and will not use in any capacity in connection with the manufacture of
ACI-Maix-Membrane Product, any person who has been debarred pursuant to Section
306 of the United States Federal Food, Drug, and Cosmetic Act, or who is the
subject of a conviction described in such section. Matricel agrees to inform
Vericel in writing immediately if it or any person who is performing services
hereunder is debarred or is the subject of a conviction described in Section
306, or if any action, suit, claim, investigation or legal or administrative
proceeding is pending or, to the best of Matricel’s knowledge, is threatened,
relating to the debarment or conviction of Matricel or any person used in any
capacity by Matricel in connection with the manufacture of the ACI-Maix-Membrane
Product.

5.2    Non-Conforming Products
(a)
Vericel may reject any ACI-Maix-Membrane Product that is not in compliance with
cGMP or fails to conform to the Specifications (“Rejected Products”) (i) for
“apparent defects,” meaning those non-conformities that are capable of detection
upon a reasonable visual inspection, within [***] days after receipt of the
ACI-Maix-Membrane Products; or (ii) for “latent defects,” meaning those that are
not capable of detection upon a reasonable visual inspection, within [***] days
from the date of discovery of such non-conformity. Vericel shall inform Matricel
of such rejection by providing notice in writing (including via email) and shall
return the Rejected Product to Matricel in accordance with Matricel’s
instructions. In case of a supply by Matricel of any ACI-Maix-Membrane Products
that is not in compliance with cGMP or fails to conform to the Specifications,
then Vericel may choose that [***]. Matricel shall not be liable for (I) any
incorrect use of the ACI-Maix-Membrane

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Product or (II) any use of the ACI-Maix-Membrane Product without the legally
required approval of the Final Product by Vericel, or a Vericel customer.
ACI-Maix-Membrane Products that comply with the Specifications but do not comply
with the Minimum Acceptable Surface Area After Hydration shall not be regarded
as a material defect.
(b)
Section 377 of the German Commercial Code (Handelsgesetzbuch) is expressly
excluded and replaced by the provisions of this Agreement and the Quality
Service Agreement.

6.    RISK MANAGEMENT
6.1
In the event Vericel receives information indicative of a risk relating to the
use of one of its products which incorporates the ACI-Maix-Membrane Product, or
of any injury or impairment of health or death of a patient, coincidental with
or relating to the use of one of its products which incorporates the
ACI-Maix-Membrane Product, and to the extent such risk, injury, impairment or
death may be attributable to the ACI-Maix-Membrane Product, Vericel shall report
within [***] days of receipt of that information by Vericel first by telephone
and followed by facsimile to Matricel, any such report of risk, injury,
impairment, or death. Matricel shall have a reciprocal obligation to inform
Vericel upon its receipt of any information indicative of risk, injury,
impairment of health or death associated with use of the ACI-Maix-Membrane
Product or similar products of Matricel.

6.2
The Parties agree to [***] notify each other in the event either Party is the
subject of any governmental or regulatory action, investigation, or sanction, or
in the event any litigation is threatened or instituted against either Party
[***].

7.
INDEMNIFICATION AND INSURANCE

7.1
Vericel shall indemnify and hold Matricel harmless against all claims injuries,
disabilities, losses, fines, penalties, costs, expenses (including reasonable
attorneys' fees), damages or liabilities (“Claims”) arising out of (i) any
breach by Vericel or any of its representatives of any obligation,
representation, or warranty of Vericel under this Agreement, or (ii) any
negligence, error, or omission by Vericel or any of its representatives with
respect to its or their obligations under or by reason of this Agreement.

7.2
Matricel shall indemnify and hold Vericel harmless against any and all Claims
arising out of (i) any breach by Matricel or any of its representatives of any
obligation, representation, or warranty of Matricel under this Agreement, (ii)
any negligence, error, or omission by Matricel or any of its representatives
with respect to its or their obligations under or by reason of this Agreement.

7.3
Vericel and Matricel shall each procure and maintain in full force and effect
during the term of this Agreement valid and collectible insurance policies in
connection with their respective obligations in the supply of the
ACI-Maix-Membrane Product under this Agreement. Such insurances shall each have
a coverage of at least [***] in case of damage to property and [***] in case of
damage to a person arising out of or relating to the ACI-Maix-Membrane Product
and use thereof in Vericel‘s products. Upon request, the Parties shall provide
to each other a

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

certificate of coverage or other written evidence reasonably satisfactory to
demonstrate the continuing existence of such insurance coverage. Each Party‘s
maximum liability to the other under this Agreement shall be limited to the
amount of insurance coverage such indemnifying Party is obliged to maintain.
7.4
The Parties shall, within [***] days from the date of receipt of notice of any
claims, furnish to the other Party a copy of such notice and inform the other
Party of all known facts relating to such claims. The indemnifying Party shall,
at its cost and expense, to defend, negotiate, and otherwise resolve any claim
[***]. Each Party shall provide all information in its possession and all
reasonable assistance to the other Party as necessary to enable the other Party
to defend any claims.

8.
CONFIDENTIALITY, NON-DISCLOSURE

8.1    Definition
During the term of this Agreement and subject to the terms and conditions of
this Agreement, a Party (“Disclosing Party”) may communicate to the other Party
(“Receiving Party”) information in connection with this Agreement or the
performance of its obligations under this Agreement [***] (collectively,
“Confidential Information”). The Parties acknowledge that Vericel has certain
Confidential Information of Matricel in its possession that was provided to
Vericel in connection with Vericel’s purchase of the cartilage repair and
regenerative medicine business (including, without limitation, the Final
Product) from Genzyme Corporation, and that Vericel agrees to treat such
information as Confidential Information under this Agreement. Matricel permits
Vericel to disclose such Confidential Information to FDA or other regulatory
authorities for purposes of the BLA and other regulatory submissions, audits and
related interactions with regulatory authorities.
8.2    Exclusions
Notwithstanding the foregoing, any information of a Party will not be deemed
Confidential Information with respect to the Receiving Party for purposes of
this Agreement if, and from such point in time, where, such information:
is already known or available to the Receiving Party or any of its affiliates,
other than under an obligation of confidentiality or non-use, at the time of
disclosure to the Receiving Party;
is generally available or known to a third party reasonably skilled in the field
to which such information pertains, or is otherwise part of the public domain,
at the time of its disclosure to the Receiving Party;
becomes generally available or known to a third party reasonably skilled in the
field to which such information pertains, or otherwise becomes part of the
public domain, after its disclosure to the Receiving Party through no fault of
or breach of its obligations under this Section 8 by the Receiving Party;

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

is disclosed to the Receiving Party, other than under an obligation of
confidentiality or non-use, by a third party who has no obligation not to
disclose such information to others; or
is independently discovered or developed by the Receiving Party, its affiliates
or permitted sublicensees, as evidenced by their written records, without the
use of, Confidential Information.
8.3    Disclosure and Use Restriction
Except as expressly provided herein, the Parties agree that, during the term and
for [***] thereafter, each Party and any of its affiliates and sublicensees will
keep completely confidential and will not publish or otherwise disclose any
Confidential Information of the other Party, its affiliates or sublicensees.
Neither Party will use any Confidential Information of the other Party without
such other Party’s consent, except in connection with performance of this
Agreement.
8.4    Authorized Disclosure
Each Party may use and disclose Confidential Information of the other Party to
the extent that such use and disclosure is:
(i)
made in response to a valid order of a court of competent jurisdiction or other
governmental or regulatory body of competent jurisdiction; provided, however,
that such Party will first have given notice to such other Party and given such
other Party a reasonable opportunity to quash such order and to obtain a
protective order requiring that the Confidential Information that is the subject
of such order be held in confidence by such court or governmental or regulatory
body or, if disclosed, be used only for the purposes for which the order was
issued; and provided, further, however, that if a disclosure order is not
quashed or a protective order is not obtained, the Confidential Information
disclosed in response to such court or governmental order will be limited to
that information which is legally required to be disclosed in response to such
court or governmental order;

(a)
otherwise required by applicable law; provided, however, that the Disclosing
Party will provide such other Party with written notice of such disclosure in
advance thereof to the extent practicable;

(b)
made by such Party, in connection with the performance of this Agreement, to
affiliates, permitted sublicensees, employees or consultants, each of whom prior
to disclosure must be bound by obligations of confidentiality and non-use at
least equivalent in scope to those set forth in this Section 8.

9.
TERM AND TERMINATION

9.1
The Agreement shall have effect as of the Effective Date and, unless terminated
earlier pursuant to any provisions of this Agreement, will end on December 31,
2022.So long as Matricel has not delivered written notice of its decision not to
renew this Agreement to Vericel by June 30, 2021, Vericel has the option to
extend the term of the Agreement by five (5) additional calendar

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

years under the same terms defined in this Agreement by sending a written
confirmation of the extension to Matricel before June 30, 2022. Following such
initial term and term extension by Vericel, this Agreement shall automatically
renew for one additional five-year period unless otherwise terminated by
Matricel or by Vericel in accordance with Section 9.2.
9.2
At any time on or after the fifth anniversary of the Effective Date, Vericel
shall have the right to terminate this Agreement, for any reason, upon nine
months’ prior written notice to Matricel. At any time on or after July 1, 2021,
Matricel shall have the right to terminate this Agreement for any reason upon
eighteen (18) months’ prior written notice to Vericel.

9.3
Either Party may, at its option, terminate this Agreement in the event the other
Party breaches any material obligation under this Agreement and fails to remedy
or otherwise cure such breach within [***] days from the date of receipt of
notice of such breach given by the non-breaching Party; provided, however, that
if the other Party cures such breach within such [***] day period, then there
shall be no termination of this Agreement for such breach pursuant to this
Section 9.3.

9.4
Either Party shall have the right to terminate this Agreement immediately by
written notice to the other Party in the event the other Party presents, or has
presented, a petition for its voluntary winding up or dissolution, makes an
assignment for the benefit of creditors, becomes subject to an attachment of,
execution upon, or other judicial seizure of all or substantially all of its
assets, or becomes subject to involuntary proceedings under any bankruptcy or
insolvency law which proceedings are not dismissed within sixty (60) days.

9.5
Upon expiration or termination of this Agreement pursuant to Section 9.1 or 9.2,
Vericel shall have the option [***].

9.6
Upon termination of this Agreement Vericel shall have the right to use any
inventory of the ACI-Maix-Membrane Product which it then has, in accordance with
its normal course of business.

9.7
Notwithstanding the termination of this Agreement for any reason, each Party
shall be entitled to recover any and all damages that such Party shall have
sustained by reason of the breach by the other Party hereto of any of the terms
of this Agreement.

9.8
Any rights and obligations of the Parties that by their terms survive
termination or expiration of this Agreement or of any purchase order will
survive termination or expiration, including, without limitation, Sections 2.4
(including Annex 3, if applicable), 3.2, 3.4, 4.5, 5, 6, 7, 8, 9.5, 9.6, 9.7,
9.8, and 10.

10.    GENERAL PROVISIONS
10.1    Force Majeure
Neither Party shall be liable for any delay or failure of performance of any
obligation hereunder by reason of any act or circumstance beyond the control of
such Party, including, without limitation, an act of God, fire, flood, war,
terrorist act, public disaster, strike or labour dispute, or governmental
enactment, rule or regulation; provided, however, that a Party asserting any
excuse for delay or failure of performance shall immediately notify the other
Party, be excused

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

from such performance only to the extent of such delay or failure, take
good-faith efforts to resume performance hereunder and do all things
commercially reasonably possible to remove the cause of such delay or failure
and mitigate its effect, and continues performance hereunder with the utmost
dispatch as soon as the cause for such delay or failure is removed. In the event
a force majeure event exists for more than [***] days, the Parties shall meet to
negotiate in good faith a mutually satisfactory solution.
10.2    Non-Waiver
Neither a Party's ongoing performance of this Agreement, nor a Party's failure
to exercise or enforce, or delay in exercising or enforcing, any right conferred
upon it hereunder, shall be deemed to be a waiver of any such right or any other
right or operate to bar the exercise or performance thereof at any time or times
thereafter. A Party's waiver of any right hereunder at any time, including right
to any payment, shall not be deemed a waiver thereof for any other time.
10.3    Governing Law, Jurisdiction; Arbitration
(a)
This Agreement and all issues arising under or relating to this Agreement,
including, without limitation, its construction, interpretation, breach, and
damages for breach, shall be governed by and construed in accordance with the
laws of Germany, excluding any conflicts or choice of law rule or principles and
further excluding the UN Convention for the International Sale of Goods. The
Parties agree to attempt to resolve amicably any dispute, claim or controversy
arising out of or relating to this Agreement or the breach, termination,
enforcement, interpretation or validity thereof.

(b)
Unless specifically reserved for the competent courts of Cologne, Germany under
German law, all disputes, controversies or claims arising out of or relating to
the operation or interpretation of this Agreement, the Parties shall seek
arbitration under the Rules of Arbitration of the International Chamber of
Commerce by three (3) arbitrators. Each Party appoints one arbitrator and the
Chamber appoints a third arbitrator who is to be the chairman of the arbitration
tribunal. If a Party fails to appoint an arbitrator within thirty (30) days of
having filed or received a request for arbitration, the Chamber shall appoint
such arbitrator. The award rendered shall be final and binding upon both
Parties. Such arbitration shall be held in Geneva, Switzerland, and be conducted
in the English language. This arbitration agreement set forth herein shall be
without prejudice to the right of a Party to seek any interim or conservatory
measure as it deems appropriate to enforce Section 8. Each Party shall pay for
the arbitrator it selects with the cost of the third arbitrator being split
equally between the Parties. All other costs shall also be split equally between
the Parties.

  
10.4    Assignment
Neither this Agreement nor any of the rights and obligations of a Party under
this Agreement shall be assigned, delegated, sold, transferred, sub-contracted,
sublicensed (except as otherwise provided in this Agreement), or otherwise
disposed of, by operation of law or otherwise, to any Person, without the prior
written consent of the other Party, and any attempted assignment, delegation,
sale, transfer, sub-contract, sublicense, or other disposition, by

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

operation of law or otherwise, of this Agreement or of any rights or obligations
under this Agreement contrary to this Section 10.4 shall be deemed a material
breach of this Agreement by the attempting Party, and shall be void and without
force or effect. Notwithstanding the foregoing, either party may assign this
Agreement in whole to a third party who acquires all or substantially all of the
assets of the business to which this Agreement relates.
10.5    Amendment
Neither this Agreement nor any provision hereof may be amended, supplemented,
waived, or modified, except by a specific writing, entitled as an amendment and
specifically referring to this Agreement and this Section 0. This Agreement may
not be amended or waived by any course of conduct.
10.6    Severability
If any provision of this Agreement shall be finally determined by a court of
competent jurisdiction to be illegal, invalid or unenforceable in whole or in
part, then such provision shall not invalidate or render unenforceable any other
provision of this Agreement. The Parties shall negotiate in good faith to
replace such provision with an appropriate, legal provision and, to the extent
permitted by law, hereby waive any provision of law that renders any provision
of this Agreement invalid or unenforceable in any respect.
10.7    Notices
All notices required or permitted under this Agreement shall be in writing and
shall be deemed to have been duly given when delivered by hand, courier, or
express mail service (with written confirmation of receipt), or mailed by
registered or special delivery mail, return receipt requested, at the address
set forth below (or to such other person or address as a Party may, from time to
time, designate by written notice):
(a)
if to Vericel:

Vericel Corporation
64 Sidney Street
Cambridge, MA 02139, U.S.A.
Attn: [***]

With a copy to:
Attn: Vice President, Legal Affairs

if to Matricel:

Matricel GmbH
Kaiserstrasse 100
52134 Herzogenrath
Attention: [***]

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

10.8    Further Assurances
Each of the Parties shall perform such acts, execute and deliver such
instruments and documents, and do all such other things as may be reasonably
necessary to accomplish the transactions contemplated under this Agreement.
10.9    Independent Contractor
Nothing contained in this Agreement shall be construed to constitute either
Party as a partner or agent of the other Party or to create any other form of
legal association that would impose liability upon a Party for any act or
omission of the other Party or provide a Party with the right, power, or
authority to create or impose any duty or obligation on the other Party, it
being intended that each Party shall remain an independent contractor acting in
its own name and for its own account.
10.10    Entire Agreement
This Agreement (including its Exhibits and Annexes) represents and contains the
full and complete understanding and agreement of the Parties with respect to the
subject matter hereof and supersedes and replaces all prior and contemporaneous
agreements, understandings, statements, clauses, and conditions (both oral and
written) with respect to the transactions contemplated by this Agreement or
which may be contained in any other form or document.
10.11
Language

This Agreement is executed in the English language and shall be deemed to
comprise the language mutually chosen by the Parties and no rule of strict
construction shall be applied against either Party.
* * * * *

IN WITNESS THEREOF, the Parties have caused this Agreement to be duly executed
as of the date first above written.
Signed for and on behalf of Vericel Corporation
 
By:     /s/ Gerard Michel______________
Name:    Gerard Michel    
Title:    Chief Financial Officer

Date:     20 October 2015_______________

Signed for and on behalf of Matricel GmbH

By:     /s/ Ingo Heschel________________
Name:    Ingo Heschel
Title:    Managing Director, Matricel GmbH

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Date:    19 October 2015_______________

Annex 1:    Quality Service Agreement
Annex 2:    Shrinkage
Annex 3:    [***]
Annex 4:    Initial Forecast

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Annex 1:    Quality Service Agreement

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Quality Service Agreement

between

Vericel Corporation
64 Sidney Street, Cambridge, MA 02139, USA

 

and

Matricel GmbH
Kaiserstrasse 100, 52134 Herzogenrath, Germany

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

1.0Quality Service Agreement Signatures

Contract Giver

Vericel Corporation (“Vericel”)
64 Sidney Street
Cambridge, MA 02139
USA
 
 
 
Name:  Cynthia Entstrasser

Date: 20 Oct 15
 
 
/s/ Cynthia Entstrasser
 
 
 
Title: Senior Director
 
 
 

Contract Acceptor

Matricel GmbH (“Matricel”)
Kaiserstrasse 100
D-52134 Herzogenrath, Germany
 
 
 
Name:  Leon Olde Damink
Date: 19 Oct 15
Name: Ingo Heschel
Date: 19 Oct 15
/s/ Leon Olde Damink

 
/s/ Ingo Heschel
 
Title: Head of Regulatory Affairs and Quality Management
 
Title: Managing Director
 

2.0
Date of Issue

2.1
This Quality Service Agreement (“Quality Agreement”) is Annex 1 to the ACI-Maix
Supply Agreement between Vericel and Matricel, dated October 20, 2015 (”ACI-Maix
Supply Agreement”), and is valid as long as this ACI-Maix Supply Agreement is in
place.

Date of issue: October 20, 2015
 
 
 
 
 
Version: 01  
Date:
Name:           
Date:

3.0
Scope

3.1
This Quality Agreement constitutes the technical agreement required under
European Good Manufacturing Practice (GMP) legislation 2003/94/EC Article 12,
and FDA Good Manufacturing Practices 21CFR210, 211 to cover the final packaged
ACI-Maix-Membrane Product manufactured by Matricel.

3.2    This Quality Agreement fulfills the requirements of 21 CFR 820.50
Purchasing Controls.

3.3
This Quality Agreement defines the individual responsibilities of Vericel and
Matricel.

4.0
Procedures for Revision

4.1    Updates and changes will be addressed in collaboration with Vericel and
Matricel.

5.0     Document Revision History

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Original Version
(Issue 1)
 

6.0    Definitions
                                        
6.1
ACI-Maix-Membrane Product
 
[***]
 
 
 
 
 
 
6.2
Final Product
 
Vericel´s autologous chondrocyte implant incorporating the ACI-Maix-Membrane
Product
 
 
 
 
 
6.3
For Cause Audit
 
An audit that is initiated for a particular reason [***]

 
 
 
 
 
6.4
ISO 11137, Parts 1,2,3 [in the current version(s)]
 
Sterilization of Health Care Products - Requirements for Validation and Routine
Control - Radiation Sterilization for Medical Devices

 
 
 
 
 
6.5
ISO 13485 [in the current version(s)]
 
Medical Devices -Quality Management Systems - Requirements for Regulatory
Purposes
 
 
 
 
 
6.6
ISO 14644 Parts 1-5 [in the current version(s)]
 
Cleanrooms and associated controlled environments

 
 
 
 
 
6.7
Product Recall    
 
[***]
 
 
 
 
 
6.8
Product Withdrawal
 
[***]

                            
7.0    QUALITY REQUIREMENTS

7.1
The obligations set out in this Quality Agreement shall apply to Matricel with
respect to the ACI-Maix-Membrane Products manufactured by Matricel or any of its
affiliates.

[***], Matricel shall supply the ACI-Maix Membrane Product, [***] in accordance
with the Specifications set forth in the applicable approved applications and
such other Specifications as may from time to time be established by the
applicable regulatory authorities [***].

7.2    Manufacture

7.2.1    Premises. All ACI-Maix-Membrane Products supplied to Vericel shall be
manufactured at [***].

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

The premises and equipment used for manufacture must be in compliance with
current device GMPs as described in Section 7.2.2, current regulatory
requirements, and in accordance with the documentation approved by FDA
(including without limitation calibration and maintenance in a controlled
state).

7.2.2    GMP Regulations. The current device GMP regulations to be applied are
the United States cGMPs listed in Title 21 Code of Federal Regulations (“CFR”)
Part 820 and associated Compliance Guidances.

7.2.3    Materials. Matricel is responsible for ensuring that all materials
procured for use in the ACI-Maix-Membrane Products are in full compliance with
the registered Specifications.

7.2.4    Manufacturing Documentation. Matricel will maintain original
manufacturing documentation according to record retention procedure consistent
with FDA requirements.

7.2.5    Methods. The ACI-Maix-Membrane Products shall be manufactured and
tested in accordance current device GMP regulations and the information
contained in the FDA Device Master File (MAF).

7.2.6    Batch Numbering. Matricel’s batch numbering system will be used for
numbering each batch of the ACI-Maix-Membrane Products made for sale. This
identification will appear on all documents relating to the particular batch of
the ACI-Maix-Membrane Products. The code for batch numbering identification will
be supplied to Vericel.

7.2.7    Expiration Dating. The expiration date shall be established from [***].
  
7.2.8 Particulates and Size. The ACI-Maix-Membrane Product must be [***].

7.3    Quality Assurance

7.3.1    Testing. Matricel is responsible for ensuring that all required
in-process testing is carried out and documented.

7.3.2    Certificate of Analysis (COA) and Certificate of Compliance (COC).
Matricel will issue a Certificate of Analysis (COA) substantially in the form of
Attachment 2, confirming that the ACI-Maix-Membrane Product has been tested, and
meets the Specifications. Test specifications and test results must be included
for each test. Matricel will provide a Certificate of Compliance (COC)
substantially in the form of Attachment 2, stating that the finished
ACI-Maix-Membrane Product has been manufactured in accordance with the approved
MAF. The COA and COC shall accompany each batch of finished ACI-Maix-Membrane
Product shipped from Matricel. The COA and COC may be combined into a single
document provided all required information is combined therein.

7.3.3    Products Refusal. All regulations regarding handling of product
refusals of the ACI-Maix-Membrane Product are covered in the ACI-Maix Supply
Agreement. Written notification will be supplied to Matricel detailing the
reason(s) for the refusal of the ACI-Maix-Membrane Product.
 
7.3.4    Documentation/Validation Batches. Matricel is responsible for
generating a validation package that includes: (1) the validation protocol, (2)
full batch document packages, (3) all validation data, and (4) validation report
for all validation batches of the ACI-Maix-Membrane Product manufactured.

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

7.3.5    Retained Samples. Matricel will retain sufficient samples of the
product to carry out [***] full specification test of the ACI-Maix-Membrane
Product.

7.3.6    Inspections. In the event that Matricel’s Facilities used in the
manufacturing of ACI-Maix-Membrane Product hereunder are inspected [***], for
the specific purpose of inspecting Matricel’s manufacture of the
ACI-Maix-Membrane Product for Vericel, Matricel shall notify Vericel [***], upon
learning of such inspection, and shall inform Vericel [***]. In the event that
any such inspection relates to other products manufactured in Matricel’s
Facilities, Matricel shall inform Vericel [***]. Matricel may ask for Vericel´s
regulatory and QA support during an FDA inspection related to the
ACI-Maix-Membrane Product in connection with the BLA review in order to assist
in responding to FDA questions related to the open sections of the MAF. [***].
Matricel will notify Vericel, within [***] days, of any request made by a
regulatory authority for ACI-Maix-Membrane Product samples or batches.

7.3.7    Audits
Matricel agrees to quality audits by Vericel [***].

After the conclusion of any audit Matricel will be informed in writing of the
specific audit results, and will develop and execute a corrective action plan
within [***] in response to any audit finding. This plan and follow-up
corrective actions are subject to mutual agreement of the parties.

7.3.8    Corrective Actions from Audits
Critical defects (Substantial cGMP deficiency). In the event “Critical” defects
are discovered during audits by either Vericel or a regulatory authority [***].

Other defects. In the case of other defects (minor cGMP issues) arising during
audits by Vericel or regulatory authorities [***].

7.3.9 Recalls/Complaints/Adverse Events

Recalls. [***] shall initiate and implement a recall of the Final Product,
whether such recall is voluntarily or requested by the regulatory authorities in
accordance with the approved SOP. [***].

Complaints. Vericel will forward all the complaints related to the
ACI-Maix-Membrane Product to Matricel within [***] days from the date received
by Vericel’s Quality Assurance Department. Matricel will initiate an
investigation according to its standard operating procedure. A written report of
the investigation shall be sent to Vericel within [***] days of the forwarded
complaint. Vericel shall respond directly to all complaints.

Adverse Events. All adverse events will be handled in accordance with Attachment
1 of the Quality Agreement.

7.3.10    Change Control and Deviations
Change Control. Matricel shall comply with GMP regulations in its change control
procedures. Matricel shall provide prior written notice to Vericel of proposed
changes to the ACI-Maix-Membrane Product [***].

Deviations.
Matricel shall notify Vericel [***] of any planned deviations from the
manufacturing process. In such a case the provisions of Attachment 1, Section
5.4 shall apply.

Matricel will record any unplanned deviations from the manufacturing process
and/or testing of the ACI-Maix-Membrane Product in the batch/testing records.
Matricel shall notify Vericel [***]

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

of any confirmed quality-relevant deviations from the manufacturing process.
[***]. In such a case the provisions of Attachment 1, Section 5.2 shall apply.

7.3.11    Failures Investigation. Matricel shall investigate any test result or
in-process test which fails to meet specification and use [***] to determine the
root cause. In case the failure results in a quality-relevant deviation [***].

The investigation must determine [***]. Additional, sampling, testing and checks
may be performed in accordance with Matricel procedures and FDA guidance.

7.3.12    Annual Management Reviews. Matricel is responsible for [***] preparing
the management review of the ACI-Maix-Membrane Product manufactured at Matricel.
A copy shall be provided to Vericel.

7.4    Validation

7.4.1    Process. Matricel is responsible for ensuring that the manufacturing
process is validated before any routine production can start. The validation
should ensure that the process is capable of consistently meeting the
ACI-Maix-Membrane Product Specifications. Validation protocols and reports shall
be available for Vericel’s review upon request. Prior to a request for document
inspection by Vericel, Matricel may redact any sensitive confidential
information contained in the relevant document.

7.4.2    Equipment Cleaning. Matricel is responsible for ensuring that adequate
cleaning is carried out for each manufactured ACI-Maix-Membrane Product. The
cleaning process will be validated before the first ACI-Maix-Membrane Product
batches are made for Vericel. All analytical methods for testing of the cleaning
samples, including recovery studies shall be validated per documented protocols
and reports which comply with ICH and USP guidelines, as applicable. Validation
protocols and reports shall be available for Vericel’s review upon request.
Prior to a request for document inspection by Vericel, Matricel may redact any
sensitive confidential information contained in the relevant document.

7.4.3    Computer System. Any electronic records will be stored in such a manner
as to maintain their traceability, reliability and integrity throughout the
required record keeping timeframes established in the applicable regulations.

7.5    Storage and Shipping

Matricel will ensure that during packaging, storage and shipment of the Product
that there is [***]. Matricel will also notify Vericel [***] months prior to
bringing additional products into the same area of Matricel’s Facilities where
the ACI-Maix-Membrane is produced [***]. Matricel will only ship goods to
facilities designated by Vericel.

7.6    Termination

The term of this Quality Agreement shall be for the period beginning with the
Effective Date and shall remain in effect for the term of the ACI-Maix Supply
Agreement between the parties. At any time on or after the fifth anniversary of
the Effective Date, Vericel shall have the right to terminate the ACI-Maix
Supply Agreement, for any reason, upon nine months’ prior written notice to
Matricel. At any time on or after July 1, 2021, Matricel shall have the right to
terminate the ACI-Maix Supply Agreement for any reason upon eighteen months’
prior written notice to Vericel. Upon such termination or expiration of the
ACI-Maix Supply Agreement, this Quality Agreement will terminate automatically.

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

7.7    Miscellaneous

7.7.1    Amendment. This Quality Agreement may only be amended or modified by a
written instrument executed by both parties hereto.

7.7.2    Assignment. This Quality Agreement shall inure to the benefit of, and
shall be binding upon each of, the parties hereto and their respective
successors and permitted assigns; provided, and only in accordance with the
provisions and restrictions on assignment contained therein which are hereby
incorporated by reference.

7.7.3.    Severability. In the event that any one or more of the Quality
Agreement’s provisions or terms contained herein shall be declared invalid,
illegal or unenforceable in any respect, the validity of the remaining
provisions herein shall in no way be affected, prejudiced or invalidated
thereby.

7.7.4    Entire Agreement. This Quality Agreement, together with the Appendix
hereto contains the entire agreement between the parties hereto and supersedes
any agreements between them with respect to the subject matter hereof.

7.7.5    Section Headings. The section headings contained in this Quality
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Quality Agreement.

7.7.6    Counterparts. This Quality Agreement may be executed in any number of
separate counterparts, each of which shall be deemed to be an original, but
which together shall constitute one and the same instrument.

7.7.7     Governing Law, Jurisdiction. This Quality Agreement and all issues
arising under or relating to this Quality Agreement, including, without
limitation, its construction, interpretation, breach, and damages for breach,
shall be governed by and construed in accordance with the laws of Germany,
excluding any conflicts or choice of law rule or principles and further
excluding the UN Convention for the International Sale of Goods. The parties
agree to attempt to resolve amicably any dispute, claim or controversy arising
out of or relating to this Quality Agreement or the breach, termination,
enforcement, interpretation or validity thereof.

7.7.8    Arbitration. Unless specifically reserved for the competent courts of
Cologne, Germany under German law, all disputes, controversies or claims arising
out of or relating to the operation or interpretation of this Quality Agreement,
the parties shall seek arbitration under the Rules of Arbitration of the
International Chamber of Commerce by three (3) arbitrators. Each party appoints
one arbitrator and the Chamber appoints a third arbitrator who is to be the
chairman of the arbitration tribunal. If a party fails to appoint an arbitrator
within thirty (30) days of having filed or received a request for arbitration,
the Chamber shall appoint such arbitrator. The award rendered shall be final and
binding upon both parties. Such arbitration shall be held in Geneva,
Switzerland, and be conducted in the English language. This arbitration
agreement set forth herein shall be without prejudice to the right of a party to
seek any interim or conservatory measure as it deems appropriate to enforce
Section 8 of the ACI-Maix Supply Agreement. Each party shall pay for the
arbitrator it selects with the cost of the third arbitrator being split equally
between the parties. All other costs shall also be split equally between the
parties.

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

    
8.0    Table of Contents
1.0    Quality Service Agreement
Signatures...............................................................................2
2.0    Date of
Issue........................................................................................................................2
3.0    Scope...................................................................................................................................2
4.0    Procedures for
Revision......................................................................................................3
5.0    Document Revision
History................................................................................................3
6.0    Definitions...........................................................................................................................3
8.0    Table of
Contents................................................................................................................9
Attachment
1.................................................................................................................................10
1.0    Quality System
Requirements...........................................................................................10
2.0    Regulatory Affairs (Actions, and
Inspections)..................................................................10
3.0    Production and
Validation.................................................................................................10
4.0    Design/Change
Control.....................................................................................................10
5.0    Deviations and Out of Specification
Management...........................................................10
7.0    Lot Number Assignment & Expiration Dating
Assignment.............................................11
8.0    Testing, Analysis and Assay
Validation............................................................................11
9.0    Product
Release................................................................................................................11
10.0    Records Required for Release and submitted to
Vericel..................................................12
11.0    Product Complaints and Adverse
Events.........................................................................12
12.0 Product Recall and
Withdrawal.......................................................................................12
13.0    Storage, Transportation, and
Distribution.........................................................................12
14.0    Contract
Manufacturing/Testing.......................................................................................12
Appendix 1 - List of
Contacts.......................................................................................................15

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Attachment 1

1.0
Quality System Requirements

Both Parties agree to the following listed responsibilities for all the
operations that are marked with “√ “ in the respective column that bears their
name.

Ref
Description of Activity
M
V
1.1
[***]
 
 
1.2
[***]
 
 
1.3
[***]
 
 
1.4
[***]
 
 

 
2.0
Regulatory Affairs (Actions, and Inspections)

Ref
Description of Activity
M
V
2.1
[***]
 
 
2.2
[***]
 
 
2.3
[***]
 
 
2.4
[***]
 
 

3.0
Production and Validation

Ref
Description of Activity
M
V
3.1
[***]
 
 
3.2
[***]
 
 
3.3
[***]
 
 
3.4
[***]
 
 
3.5
[***]
 
 
3.6
[***]
 
 
3.7
[***]
 
 
3.8
[***]
 
 
3.9
[***]
 
 
3.10
[***]
 
 
3.11
[***]
 
 

4.0
Design/Change Control

Ref
Description of Activity
M
V
4.1
[***]
 
 
4.2
[***]
 
 

5.0
Deviations and Out of Specification Management

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Ref
Description of Activity
M
V
5.1
[***]
 
 
5.2
[***]
 
 
5.3
[***]
 
 
5.4
[***]
 
 
5.5
[***]
 
 

6.0
Materials

Ref
Description of Activity
M
V
6.1
[***]
 
 
6.2
[***]
 
 
6.3
[***]
 
 
6.4
[***]
 
 
6.5
[***]
 
 

7.0
Lot Number Assignment & Expiration Dating Assignment

Ref
Description of Activity
M
V
7.1
[***]
 
 
7.2
[***]
 
 
7.3
[***]
 
 

8.0    Testing, Analysis and Assay Validation
Ref
Description of Activity
M
V
8.1
[***]
 
 
8.2
[***]
 
 
8.3
[***]
 
 
8.4
[***]
 
 
8.5
[***]
 
 

9.0    Product Release
Ref
Description of Activity
M
V
9.1
[***]
 
 
9.2
[***]
 
 
9.3
[***]
 
 
9.4
[***]
 
 
9.5
[***]
 
 
9.6
[***]
 
 

10.0    Records Required for Release and submitted to Vericel

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Ref
Description of Activity
M
V
10.1
[***]
 
 
10.2
[***]
 
 

11.0
Product Complaints and Adverse Events

Ref
Description of Activity
M
V
11.1
[***]
 
 
11.2
[***]
 
 
11.3
[***]
 
 
11.4
[***]
 
 
11.5
[***]
 
 

12.0     Product Recall and Withdrawal
Ref
Description of Activity
M
V
12.1
[***]
 
 
12.2
[***]
 
 
12.3
[***]
 
 

13.0    Storage, Transportation, and Distribution
Ref
Description of Activity
M
V
13.1
[***]
 
 
13.2
[***]
 
 
13.3
[***]
 
 

14.0
Contract Manufacturing/Testing

Ref
Description of Activity
M
V
14.1
[***]
 
 
14.2
[***]
 
 
14.3
[***]
 
 
14.4
[***]
 
 

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Attachment 2

Certificate of Analysis
[to be attached]

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

[matricel.jpg]
Form
Formblatt
Document:
QS-FO-1008
ACI-Maix Certificate of Analysis
Release:
Page: 1 of 2

[acipicture.jpg]

Certificate of Analysis

Lot number:                        Expiration date:                

BULK MATERIAL TESTING

Test
Specification
Result
[***]
[***]
 
[***]
[***]
 
[***]
[***]
 
[***]
[***]
 
[***]
[***]
 
[***]
[***]
 
[***]
[***]
 
[***]
[***]
 
[***]
[***]
 

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

[matricel.jpg]
Form
Formblatt
Document:
QS-FO-1008
ACI-Maix Certificate of Analysis
Release:
Page: 2 of 2

FINISHED PRODUCT TESTING

Test
Specification
Result
[***]
[***]
 
[***]
[***]
 
[***]
[***]
 
[***]
[***]
 
[***]
[***]
 
[***]
[***]
 
[***]
[***]
 
[***]
[***]
 
[***]
[***]
 

[***]

Manufacturing Manager:             Date:    

Quality Assurance Manager:             Date:    

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Certificate of Compliance
[to be attached]

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

[matricela01.jpg]
Form
Formblatt
Document:
QS-FO-1010
ACI-Maix Certificate of Compliance
Release:
Page: 1 of 1

Certificate of Compliance

Lot number:                        Expiration date:                    

[***]

[***]

[***]

[***]

[***]

[***]

[***]

Manufacturing Manager:             Date:    

Quality Assurance Manager:             Date:    

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Appendix 1 - List of Contacts

Vericel
 
Name
Telephone Number
e-mail
Title
1
 
 
 
[***]
2
 
 
 
[***]

Matricel
 
Name
Telephone Number
e-mail
Title
1
 
 
 
[***]
2
 
 
 
[***]
3
 
 
 
[***]

KEY: M = Matricel, V = Vericel    

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Annex 2:     Shrinkage
The Parties hereby agree to the following provisions regarding shrinkage:
(a)
Dry ACI-Maix-Membrane Products are [***]. To be acceptable for use in the Final
Product (“Usable ACI-Maix-Membrane Product“), the minimum acceptable surface
area of ACI-Maix-Membrane Products after hydration and before cell seeding is
[***] (“Minimum Acceptable Surface Area After Hydration”). [***] cannot be
utilized in Final Product and will need to be discarded (“Unusable
ACI-Maix-Membrane Product”).

(b)
At the time of execution of this Agreement, an appropriate shrinkage
specification for inclusion in the Quality Service Agreement has not been
determined by the Parties.

(c)
Vericel and Matricel will jointly develop a work plan [***]. At the successful
completion of this work, the Specifications and Quality Service Agreement shall
be amended to include the jointly defined shrinkage release criterion.

(d)
For the time period between the execution of this Agreement and the execution of
the amendment to the Specifications and Quality Service Agreement [***] the
following provisions shall apply:

(ii)
[***].

(iii)
[***].

(iv)
[***].

a.
[***].

b.
[***].

[***].

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Annex 3:    [***]

[***].

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

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH
“[***]”. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION
REQUESTING CONFIDENTIAL TREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

Annex 4:    Initial Forecast

[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]