Unassociated Document


     

    
      EXHIBIT 10.12


        

      
        	
                Corporation

              	
                DISTRIBUTION
      AGREEMENT

              


      

       

      Article
I. 

       

      This
Distribution Agreement ("Agreement") is made as of October 6, 2006 ("Effective
Date") by and between Boston Scientific Corporation, One Boston Scientific
Place, Natick, MA 01760 ("Buyer"), and Bovie Medical Corporation, 7100 30th
Avenue-North, St. Petersburg, FL  33710 ("Seller") for the purpose of
purchase, sale and delivery of Products (as defined in Section 1.1) in
accordance with this Agreement.  Buyer and Seller are herein referred
to collectively as “Parties” and individually as a “Party.”

       

      
        	MAILING
      ADDRESSES AND FAX NUMBERS FOR NOTICES, ETC. UNDER AGREEMENT
	 	 
	
                Seller:

                Bovie
      Medical Corporation

                7100
      30th
      Avenue North

                St.
      Petersburg, FL 33710

                Attn:  Moshe
      Citronowicz, COO

                Fax:  (727)
      344-3876

                 

              	
                with copy
      to:

                Bovie
      Medical Corporation

                7100
      30th
      Avenue North

                St.
      Petersburg, FL 33710

                Attn:
      General Counsel

                Fax:  (727)
      344-3876

              
	
                Buyer:

                Boston
      Scientific Corporation

                One
      Boston Scientific Way

                Marlborough,
      Massachusetts 01752-1242

                Attn:  President,
      Oncology

                Fax:  (508)
      683-5693

                 

              	
                with copy
      to:

                Boston
      Scientific Corporation

                One
      Boston Scientific Place

                Natick,
      Massachusetts  01760-1537

                Attn:  General
      Counsel

                Fax:  (508)
      650-8956

              


      

       

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

       

      1.           Purchase and
Sale.

       

      1.1           Products.  For
purposes of this Agreement, “Product” shall mean the
medical resection device having a sintered tip, manufactured by Seller, as more
particularly described in the Specifications (defined below) attached hereto as
Exhibit A.  Additional products, together with specifications and
pricing therefor, may be added to this Agreement by mutual agreement of the
Parties in accordance herewith.

       

      1.2           Exclusivity. Seller
will manufacture, offer and sell on an exclusive, worldwide basis Products to
and for Buyer during the term of this Agreement.  Seller shall not
offer or sell to any third party or for itself or its Affiliates or have made,
offered or sold on its behalf the Products.  Buyer shall purchase the
minimum quantity of Products, as described in Sections 1.3(b) and 1.3(f),
below.   For purposes of this Agreement, "Affiliate" means, as to
either Party, any other person or entity that, directly or indirectly, controls,
is under common control with, or is controlled by, that Party. For purposes of
this definition, "control" (including, with its correlative meanings, the terms
"controlled by" and "under common control with"), as used with respect to any
person or entity, shall mean direct or indirect ownership of more than 50% of
the stock or (partnership) shares of such person or entity.

       

      1.3           Ordering.

      


      (a)           Buyer
shall place all orders with Seller for Products under this Agreement on Buyer’s
form of purchase order. A copy of Buyer’s current purchase order form is
attached hereto as Exhibit B and is made a part hereof.  All Buyer
purchase orders shall set forth the Specifications (including relevant revision
level), quantities, and delivery schedule, and shall state such additional terms
and conditions as Buyer may deem appropriate.  If a Buyer purchase
order conflicts with this Agreement as to Specifications, terms or conditions,
the Specifications, terms and conditions of this Agreement shall
control.  No other terms or conditions (including those on Buyer’s
purchase order) and no modification, alteration or amendment of this Agreement
shall be binding on the Seller unless accepted in writing, in advance, by an
authorized officer of Seller.

       

      
      

       

      
        	BUYER:
      __________ 	
                Page 1 of
      24

              	
                SELLER:
      __________

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      (b)           Buyer
will deliver to Seller **   ** binding purchase order for
**   ** units for the **   ** calendar months of
Product (the **   ** Purchase
Order”).  Buyer shall deliver such
**   **Purchase Order to Seller with a mutually agreed lead-time
prior to the first Product delivery date set forth on that
**   ** Purchase Order.  The first calendar month of
the **   ** Purchase Order will be deemed to be the month in
which the **   ** Purchase Order is placed.  From time
to time, Buyer may also place additional purchase orders for
Product.  “Contract
Year” means the one-year period beginning on the Product Launch Date and
ending on the 12-month anniversary thereof, and each successive one-year period
thereafter, during the term of this Agreement.  Notwithstanding
anything herein to the contrary, Buyer shall purchase **   **
units of Product during the first **   ** Contract Years of the
term of this Agreement as follows: during the first Contract Year,
**   ** units in order quantities of at least 200 (as the
**   ** Purchase Order), **   ** respectively; and
during the **   ** Contract Year, a **   ** of the
**   ** between **   ** and the actual number of
units purchased by Buyer during Contract Year **   ** with no
single order quantity being **   **.  The quantity of
Product ordered by Buyer prior to the Product Launch Date (if any), subject to
the minimum per-order quantities set forth above, shall accrue to the
**   ** purchase requirement for the **   **
Contract Years.  “Product Launch Date” means the
date the Seller ships to Buyer Product for commercial resale (subject to all
required regulatory approvals), but no later than **   ** mutual
execution of the design transfer document required under applicable law; provided, however, that Seller
timely ships Product to Buyer in accordance with the **   **
Purchase Order.

      


      (c)           Within
five (5) Business Days after receipt of a purchase order from Buyer, Seller
shall acknowledge receipt and confirm whether the order can be supplied within
the delivery dates set forth therein.  Unless Seller advises Buyer to
the contrary, in writing and within **   **Business Days of the
date Seller receives Buyer’s sent purchase order, Seller shall be conclusively
presumed to have accepted the Specifications, quantities, due dates, and other
terms of such purchase order. For purposes of this Agreement a “Business Day” means any day,
other than Saturday, Sunday, or a legal holiday in Massachusetts or
Florida.

      


      (d)           Due
dates on the purchase orders are the dates that the Products must be received at
Buyer’s facility indicated on that purchase order. Orders arriving up
to**   ** Business Days early
or     **   ** Business Days late will
be considered on time.  As soon as it becomes apparent to Seller that
it cannot meet a due date on a purchase order, Seller shall notify Buyer in
writing of the expected delivery delay.

      


      (e)             Seller
shall invoice Buyer and Buyer shall pay all shipping, insurance and related
charges.  Seller shall pay premium freight charges in excess of normal
shipping charges to ensure timely deliver of Products ordered pursuant to a
purchase order if Seller is responsible for a delay in shipment unexcused by
Force Majeure (as set forth in Section 7.3).

      


      (f)           In
the **   **Contract Years, Buyer shall purchase
**   ** quantity of Product as set forth in Section 1.3(b),
above, at the unit transfer price set forth in Exhibit E (Transfer Pricing) for
that period.  Thereafter, during each of the next
**   ** Contract Years during the term of this Agreement, if
Buyer orders any Product, Buyer shall issue a binding purchase order for
**   ** units of Product, with a
**   **per-shipment quantity of **   ** units, for
delivery during the subsequent 12-month period.

      


      “Pricing Period” means the six
**   **period beginning on the commencement date of the first
Contract Year, and each successive **   ** period thereafter
during the term of this Agreement.

      
         

        
          	BUYER:
      __________ 	
                  Page 2 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      As set
forth in Exhibit E, for Products purchased during Contract Years
**   **and **   **, the price per unit of Product
purchased during such twenty-four (24) month period shall be (a)
**  ** for the first **   ** units purchased, and (b)
**   ** for all Product **   ** the first
**   ** purchased (whether purchased in Contract Year
**   **).

      


      The
initial pricing set forth in Exhibit E is based on the Specifications Revision
“A-1,” as set forth in Exhibit A.  Seller reserves the right to amend
the pricing in Exhibit E for the Product in accordance with changes to the
Specifications requested by Buyer; provided, that (i) Seller will provide Buyer
advance notice of any such price change, (ii) Seller will implement such changes
to the Specifications and amend such pricing, **   ** upon
Seller’s receipt of the **   ** Oncology division’s president’s
written approval thereof.

      


      During
each of Contract Years **   ** through **   **,
for each Pricing Period, Buyer will initially pay the Product transfer price
(set forth in Exhibit E) that corresponds to the forecasted quantity of Products
to be ordered for that Pricing Period as set forth in the**   **
rolling forecast delivered by Buyer in accordance with Section 1.6 of the
Agreement on the **   ** day of the **   ** month
immediately preceding the commencement of such Pricing
Period.  Within**   ** days following the end of each
of Pricing Period during Contract Years **   ** through
**   **, the Parties will compare the total amount actually paid
for Products by Buyer during that Pricing Period with the total amount which
should have been paid based upon the actual purchases of Products in such
Pricing Period using the applicable Product prices set forth in Exhibit E, as
amended.  Any difference will be paid to the appropriate Party within
forty-five (45) days following the end of the applicable Pricing
Period.

      


      (g)           Buyer
shall timely place and Seller shall timely fulfill binding purchase orders as
required under this Agreement.  However, if (i) Seller is unable to
fulfill such binding purchase orders, (ii) Product is recalled as permitted
under Section 3.11 (Product Recalls), or (iii) Buyer rejects or returns all or
any part of a shipment of Product as permitted under Section 3.4 (Product
Acceptance) or 3.12 (Product Returns), as applicable, Seller shall suspend
Buyer’s **   **obligations set forth in this Section 1.3 until
**   ** days after either (x) Seller is able to fulfill such
binding purchase orders, or (y) Seller satisfies its applicable obligations
under Section 3.4, 3.11, or 3.12.

      


      1.4           Shipping; Freight
Terms.  Subject to the terms set forth in Section 1.3, above,
Seller shall deliver Products that meet the Specifications in accordance with
the quantities, timing and shipping destination specified in Buyer’s purchase
orders utilizing Buyer’s appointed carriers and Buyer’s contracted
rates.  Seller shall deliver all Products to Buyer free and clear of
all liens and encumbrances or other defects in title.  All Products
shall be shipped **   **.

       

      


      1.5           Inventory;
Scheduling.

       

      (a)    Except
as expressly set forth herein, during the term of this Agreement, Buyer shall
purchase its Product requirements **   ** from Seller (including
Products required for engineering, testing, and clinical trials, if any) and
from **   ** manufacturer, person or entity, including, without
limitation, any division or Affiliate of Buyer.

      


      (b)    Buyer
shall provide Seller with firm purchase orders for Products in accordance with
the procedures and requirements set forth in Section 1.3; provided, however, that Buyer
shall have the right, exercisable only **   ** per any
**   **, up to **   ** prior to the date of
shipment, and with the prior written consent of Seller, which shall not be
unreasonably withheld, to issue binding, written change orders to delay up
to**   ** of the quantity of Products on such purchase orders by
no more than **   **) calendar days from their originally
scheduled shipment date. Buyer agrees to accept partial shipments of Products
from Seller should it, for any commercially reasonable reason, become necessary
to ship in advance of Seller’s ability to complete each order. Seller shall make
all commercially reasonable efforts to comply with any revisions to a purchase
order consistent with the provisions of this Agreement.

      
         

        
          	BUYER:
      __________ 	
                  Page 3 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (c)           Seller
shall maintain its production capacity with respect to finished products and raw
materials at **   **Percent **   ** of all
undelivered Product quantities on open purchase orders for the then-current
month. Seller will immediately notify Buyer in the event of any material
obsolescence, supply shortage, or other interruption or potential interruption,
in supply of any Products, or component or sub-assembly thereof, as soon as
Seller becomes aware of such.

       

      (d)           Within
the mutually agreed lead-time for the Initial Purchase Order set forth in
Section 1.3(b), above, Seller shall accumulate a finished goods inventory of
Products to be held in reserve equal to the average monthly quantity, based on
the **   **Purchase Order.  Thereafter, for each
subsequent month, Seller will hold in inventory an amount of finished Products
equal to the average monthly quantity of the then-current **   **
(defined below).  All Products **   **pursuant to this
Section shall be referred to herein as **   **  Seller
may only deplete Shelf Inventory when Buyer’s orders **   ** the
applicable **   **.  Seller will at all times
throughout the term of this Agreement maintain the agreed upon
**   **, except that Seller will replace any
**   ** taken from **   ** in accordance with
previous sentence within **   ** days of the date Seller takes
such **   ** from **   **.

       

       

      1.6           Estimates of
Requirements.

      


      (a)           
At the same time Buyer issues its **   ** Purchase Order, and by
the last day of each calendar month thereafter, Buyer shall deliver to Seller a
written, **   **forecast of Buyer's requirements for
Products.  The first **   ** of each such
**   ** forecast shall be **   ** upon Buyer (the
“Binding Forecast”) and
the remaining nine (9) months of each such forecast will be
**   ** and subject to adjustment. Seller shall, no later than
**   ** days after receipt of each **   **
forecast delivered pursuant to this Section, notify Buyer of any prospective
problems of which Seller is aware that might prevent Seller from meeting
Buyer’s
forecasted requirements or estimated delivery dates.  In the event
Seller so notifies Buyer of any issues in meeting quantities, Seller shall state
in writing the quantity of Products it estimates it can deliver and Buyer shall
only be required to purchase such revised quantity.

      


      (b)           In
addition to the forecasts delivered pursuant to Section 1.6(a), above, Buyer
will create a **   ** forecast for Products, the
**   ** of which will be **   ** this Agreement is
signed and delivered and which will be attached hereto as Exhibit
C.  For the avoidance of doubt, Exhibit C is being delivered for
planning purposes only and no portion of Exhibit C will be binding on either
Party hereto.

      


      (c)    Seller and
Buyer agree to cooperate with each other and work jointly to establish and
maintain a smooth and efficient timetable for the manufacture and supply of
Products to Buyer hereunder. Seller shall use commercially reasonable efforts to
supply Buyer with **   ** Product requirements, including, but
not limited to, the use of commercially reasonable efforts to accommodate "Rush"
orders from Buyer; provided, however, Seller shall
not be in breach of this Agreement for any failure or delay to supply quantities
of Products which exceed the**   ** Forecast for the
**   ** by more than **   **.

      


      1.7           
Materials Requirements
Process.

      


      (a)           **   **
**   ** weeks (“Long Lead Time Components”)
upon the Parties’ mutual finalizations of and approvals for, the Product
requirements, Specifications, design, and bill of materials, which list shall be
set forth as Exhibit D and attached hereto.  Seller shall use its best
efforts to reduce and minimize the number of Long Lead Time
Components.  Seller shall use reasonable efforts to update the list of
Long Lead Time Components every **   ** and to present an updated
list of Long Lead Time Components to Buyer.  Each revised list of Long
Lead Time Components shall be deemed an amendment to Exhibit D.  In
the event that Seller fails to present an updated list of Long Lead Time
Components, (i) the Parties shall continue to rely on the preceding list (as
updated in writing by the Parties) and (ii) Buyer will accept responsibility for
Long Lead Time Components ordered outside the lead times set forth in the list
provided that Seller can demonstrate to Buyer’s reasonable satisfaction that
such components were ordered in accordance with the then-current vendor lead
times. (Buyer acknowledges that lead times constantly change and the Seller
might not always be able to present Buyer with a current list of Long Lead Time
Components.)

      
         

        
          	BUYER:
      __________ 	
                  Page 4 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      (b)           Buyer
shall be financially liable for all Long Lead Time Components when ordered in
accordance with this Section 1.7 if Buyer terminates this Agreement without
cause or Seller terminates this Agreement pursuant to Section 7.1(a) or
(d).  Seller shall otherwise be financially liable for all Long Lead
Time Components. Specifically, Buyer’s  component  liability
for Long Lead Time Components shall be equal to Seller’s **   **
(**   ** is the **   ** paid by Seller for the
components, net of all credits and discounts, plus a materials margin equal to
**   **) of all components ordered in support of any
**   ** Forecast.  At Buyer’s request, Seller shall use
commercially reasonable efforts to minimize Buyer’s component liability by
attempting to return components to the vendor; provided, however,
that  Seller shall not be obligated to attempt to return to a vendor
components that are, in the aggregate, worth less than
**   **.

      


       

      2.           Pricing; Payment; Continuous
Improvement.

       

      2.1           Pricing;
Escalation.  Prices for the Products are set forth in Exhibit E
attached hereto, and include packaging (as set forth in the then-applicable
Specifications) and taxes.  Subject to the provisions of Section
1.3(f), such prices shall be fixed for the **   ** of this
Agreement.  Thereafter, Seller may adjust prices for each successive
**   ** period of this Agreement, according to the annual
Producer Price Index for Finished Goods (“PPIFG”) or its replacement if
so identified by the publisher, published by the United States Department of
Labor, Bureau of Labor Statistics (“BLS”); provided, that such
increases or decreases will be capped **   ** of the previous
**   ** Product transfer price.  Such PPIFG shall not
be seasonally adjusted. The frequency for periodic adjustments hereunder shall
be annual, using the first publication of the annual value in the month
following the anniversary month of each **   ** period of this
Agreement.  The adjustments shall be calculated using the “simple
percentage method” as set forth by the BLS.  Such PPIFG-based price
changes shall be in addition to price changes (if any) permitted under Section
1.3(f).

       

                 2.2           Payment.  Payment
will be due forty five (45) days from Buyer’s receipt of Seller’s invoice,
except to the extent Buyer in good faith disputes each
invoice.  Seller shall invoice Buyer at the time of shipment of the
applicable Product and as otherwise provided for hereunder.

       

      2.3           Continuous Improvement;
Seller Performance Business Reviews.  During the term of this
Agreement, Seller shall use commercially reasonable efforts (including
reasonable engineering support) to improve and enhance Product design, quality,
performance and manufacturing processes  (collectively, “Improvements”) so as to
maintain or increase the competitive advantage of the Products as compared to
similar products in the marketplace.  Improvements may result from
Seller’s own initiative (“Bovie
Improvements”) or the request or suggestion of Buyer (“BSC Improvements”) but, if a
proposed BSC Improvement or Bovie Improvement changes the Specifications or
requirements of a purchase order the proposed Improvement must be approved in
writing by Buyer prior to implementation as described in Section 3.1
hereof.  Buyer shall pay Seller for **   ** or
**   ** of **   ** materials,
**   ** and **   **, which are rendered unusable
by said BSC Improvements or any other changes approved by Buyer (collectively,
“**   **
Reimbursement”); provided, however, Buyer shall not be responsible for
**   **Reimbursements for **   **
Improvements.  BSC Improvements approved in accordance with this
Section 2.3 and Section 3.1 hereof shall be promptly incorporated into the
Specifications and Products in accordance herewith.  In order to
establish an effective system to identify and achieve productivity and quality
objectives, BSC Improvements and Bovie Improvements, Seller shall submit a
productivity report to key administrators designated by Buyer on a mutually
agreeable basis.  Seller’s and Buyer’s representatives will meet as
reasonably requested by Buyer for the specific purpose of driving mutual
productivity and quality objectives.

       

      2.4           Tooling and Capital
Equipment.  In addition to the price for each Product set forth
on Exhibit E, **   ** shall reimburse **   ** the
**   **, net of **   ** and
**   **, plus a **   ** management fee
(“Management Fee”), of tooling, machining, molding, and other capital
expenditures necessary or appropriate for the manufacturing of Product and that
are purchased solely for use in connection with **   **
(collectively, **   **).  Buyer will not be responsible
for paying for any **   ** unless Buyer approves the purchase of
such **   **in writing in advance of
purchase.    Payment for Manufacturing Equipment will be due
in accordance with Section 2.2. Seller will use **   ** solely in
connection with the manufacturing of Products for Buyer.  Buyer will
at all times have title to and own all **   **.  Seller
shall not take any action that would cause a lien or other encumbrance to be
placed on any **   ** At all times while the
**   ** is in Seller’s custody and control, Seller will maintain
adequate levels of loss insurance to cover loss or damage to the
**   **.

      
         

        
          	BUYER:
      __________ 	
                  Page 5 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      2.5           Payment of Start-up
Fee.  Upon the execution of this Agreement, Buyer shall pay
Seller a **   ** start-up fee of **   ** (“Start-up Fee”), which is in
addition to any other payments from Buyer due hereunder.

       

       3.           Quality Assurance;
Recordkeeping; Notification.  The following obligations of
Seller set forth in Sections 3.1 through 3.10 shall be collectively referred to
throughout this Agreement as the "QA
Standards".

       

      3.1           Changes.  Seller
shall not make any changes to its documentation, shipping, manufacturing process
(including vendors) or manufacturing location, pertaining to any Product, to any
Product (including materials, packaging, labeling and Directions for Use) or to
the Specifications unless approved by Buyer in writing in advance. All such
changes shall be submitted to Buyer no later than **   **prior to
Seller’s proposed date of implementation for such change.  If a
proposed change is approved by Buyer in writing in its sole discretion, Seller
shall be responsible for properly communicating and implementing such change,
including with respect to any of Seller’s vendors.  Seller shall
notify Buyer in writing and must receive approval by Buyer prior to any (a) use
of any nonconforming material in the manufacture of any Product, (b)
implementation of any Seller-authorized temporary deviation that could
affect the production, interconnectivity, sterility, or handling of any Product,
or (c) implementation of any Seller-initiated corrective action that could
affect the safety or efficacy of any Product.  Without limiting any
other of Seller’s obligations hereunder, Seller will assume full responsibility
and costs for any product development activities necessary to remedy any
non-conformance in Products (with respect to quantity, Specifications,
requirements and delivery dates), including costs to implement such changes on
all units in the field and in inventory.    Notwithstanding
anything in this Agreement to the contrary, Buyer shall pay Seller for
**   ** Reimbursements, as set forth in Section 2.3
above.

       

      3.2           Seller’s
Vendors.  At Buyer’s request, Buyer will perform a quality
system assessment of the vendors who provide Seller with raw
components/materials, sub-assemblies or contract services for
Products.   All such vendors who provide Seller with such
materials and services as of the Effective Date are set forth on Exhibit F
attached hereto, which Exhibit F will be amended from time to time as Seller’s
vendors change.  Buyer shall confirm in writing to Seller no later
than **   ** days after the Effective Date (and no later than
**   ** days after the date of any amendment to Exhibit F) the
vendors listed on Exhibit F with which Buyer’s Oncology Business (defined below)
has a pre-existing relationship (collectively, “Buyer’s
Vendors”).  Seller agrees to assist Buyer in arranging visits
and inspection of the plants at which Seller’s vendors manufacture any
component/material, sub-assembly or service for any Product.  Seller
shall not change the outsourcing of any sub-component of any Product unless
approved in writing in advance by Buyer in accordance with Section 3.1
hereof.  In addition, Seller shall obtain Buyer’s prior written
approval, which Buyer shall not unreasonably withhold, with respect to each
supplier, including a new supplier or a change to an existing supplier, of any
material, component, sub-assembly or service relating to any Product as
described in Section 3.1 hereof.  For avoidance of doubt, Seller shall
not incorporate into any Product any material, component or sub-assembly
purchased from a third-party supplier, or permit any third party to perform
services relating to a Product, unless approved in writing in advance by Buyer
in accordance with Section 3.1 hereof.  Buyer agrees, on behalf of its
Oncology Business, not to contract directly with any vendors listed on Exhibit
F, as amended, who supply Seller with Product components, for components of the
Product for sale by Buyer’s Oncology Business during, and for a period of
**   ** years after any termination or expiration of, this
Agreement for any reason except as set forth in the next sentence; provided that this
restriction in no way applies to or otherwise limits Buyer’s right to contract
directly with (a) **   **, (b) Buyer’s Vendors, or (c) any vendor
that Buyer introduces to Seller, and further, except as permitted in subclauses
(a), (b) and (c) of this sentence, Buyer’s Oncology Business will not accept via
intra-company transfer or otherwise such Product components purchased by Buyer
or its Affiliates from Seller’s vendors listed on Exhibit F, as
amended.  Notwithstanding the foregoing, such restriction on Buyer’s
Oncology Business’ contracting with Seller’s vendors as set forth in the
preceding sentence shall not apply in the event Seller breaches this Agreement
and Buyer terminates therefor pursuant to Sections 7.1(a), 7.1(b)(i), or 7.4,
hereof.  Seller agrees that, at such time as the Parties mutually
execute the design transfer document referenced in Section 1.3(b), Seller will
enter into, and during the balance of the term of this Agreement, will maintain,
a written supplier agreement with **   **for the supply of the
sintered tip incorporated into the Product, and a written understanding with
**   ** whereby Buyer would be able to visit and inspect
**   ** upon reasonable notice; provided, that Seller
agrees that it will not at any time during and for a period of
**   ** years after any termination or expiration of this
Agreement for any reason enter into an exclusive supply arrangement or any other
agreement or arrangement with **   ** that would limit
**   ** ability to sell or otherwise provide any components or
products to Buyer or its Affiliates.  As used herein, “Buyer’s
Oncology Business” means that part of Buyer’s business primarily responsible for
Buyer’s oncological business.

      
         

        
          	BUYER:
      __________ 	
                  Page 6 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      3.3           Product
Conformity.  Seller will manufacture Products in accordance
with the then-current (a) Specifications, (b) applicable regulations relating to
the current Good Manufacturing Practices (as defined by the Food, Drug and
Cosmetic Act, as amended) and similar protocols (“cGMP”), (c) the United States
Food and Drug Administration (“FDA”) quality system
regulations (“QSR”),
including master device and lot history records, ISO 13485 requirements,
ISO14971 requirements, MDD requirements and CMDCAS requirements, and (d) other
pertinent rules and regulations of FDA and similar regulatory bodies in other
applicable jurisdictions set forth in the Specifications, as
amended.  In the event that Seller is required or deems it desirable
to obtain ISO Quality System Certification, Seller shall promptly notify Buyer
in writing of Seller’s selection (or change in registrar) for obtaining ISO
Quality System Certification. Seller shall maintain a current Declaration of
Conformity status with EU Notified Bodies per MDD requirements when Buyer is
distributing in European markets.  During the term of this Agreement,
Seller will maintain or cause to be maintained the Product manufacturing
facility’s registration as a certified medical device manufacturing facility and
will maintain such facility registration with all applicable regulatory bodies
or cause such facility to be maintained such that the facility would pass an
audit for compliance with cGMP and QSR.  Seller shall maintain ongoing
quality assurance and testing policies sufficient to satisfy its obligations
under this Agreement, and Seller's standard quality assurance
policies.  Any non-conformance in Product, material or process which
Seller wishes to use “as is” or rework will require prior written approval from
Buyer.    Seller will assume full responsibility and its
costs for any product development activities necessary to remedy any
non-conformance in Products arising exclusively from defects in Product design,
manufacture or materials, or from deviation from quality standards (but not in any way from
Product claims, which are the sole
responsibility of Buyer), which non-conformance is not approved by Buyer
in accordance with the requirements of the preceding sentence. Seller shall be
responsible for obtaining and maintaining any required regulatory filings and
registrations set forth in the Specifications, as amended, including ISO
registration (“CE Mark”)
and 510(k) filings with the FDA (collectively, the “Regulatory Filings”) for the
Products under Seller’s notified body or through other applicable Regulatory
Authorities (defined below and set forth in the Specifications, as amended);
provided, that
Buyer will have the right to review any Regulatory Filings and provide comments
on such filings (which Seller will consider in good faith) before they are
submitted by Seller; and further, provided, that Buyer
will at all times upon notice to Seller have the right to make any Regulatory
Filings with Regulatory Authorities outside of the United States in Buyer’s name
and Seller will provide Buyer with access to all documents necessary or
appropriate for Buyer to make such Regulatory Filings and with authorization to
use such documents and the information contained therein to make Regulatory
Filings as the distributor of Products. Upon termination or expiration of this
Agreement, Buyer may purchase from Seller physical and legal ownership of all
Regulatory Filings for the Product, including all documents and communications
to and from the pertinent Regulatory Authorities. Products will bear Seller’s
regulatory registration mark(s), including Seller’s CE
Mark.   As used in this Agreement, “Regulatory Authority” means
any national supra-national, foreign, regional, state or local regulatory
agency, department, bureau, notified body, commission, council or other
governmental entity, including FDA, as set forth in the Specifications, as
amended.

      
         

        
          	BUYER:
      __________ 	
                  Page 7 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      3.4           Product
Acceptance.  Each shipment of Product from Seller to Buyer
shall be inspected by Seller prior to shipment and shall contain such quality
control certificates reasonably requested by Buyer certifying, among other
things, that the Products are in conformity with Specifications.  All
Products are subject to final inspection and acceptance at Buyer within
**   **Business Days of delivery.  Buyer shall notify
Seller within **   ** Business Days of delivery of any apparent
defective material or workmanship or non-conformity of any Product to the
Specifications or applicable purchase order.  If Buyer fails to notify
Seller within thirty **   ** of delivery of an apparent defect,
Buyer will be deemed to have accepted the Product; provided, that the
warranty contained in Section 8 hereof shall survive such
acceptance.  Without prejudice to any other right or remedy of Buyer,
in case any Product is defective in material or workmanship or otherwise not in
conformity with the Specifications or the requirements of Buyer’s purchase
order, Buyer will have the right to reject it; provided, however, that Buyer
shall notify Seller of any rejection hereunder, and the basis for it, in
writing, within the **   ** Business Day timeframe set forth
above.  Any Product that has been rejected must be replaced by and at
the expense of Seller promptly after notice.  Buyer will return all
rejected Products to Seller at Seller’s expense. Seller
shall investigate the cause for the rejection and provide to Buyer in writing
all proposed corrective actions associated with the cause for
rejection.  From time to time during the term of this Agreement, Buyer
may also request final inspection testing results from Seller, in addition to
the quality control certificates, as evidence that the supplied Product meets
Specifications.  Seller will timely and fully respond to all such
requests.

       

      3.5           Complaints and Corrective
Action.

       

      (a)           As
used in this Section:

       

      (1)           “Complaint” means any written,
electronic or oral communication, that alleges deficiencies related to the
identity, quality, durability, reliability, safety, effectiveness or performance
of a Product after it is released for distribution (marketed).

       

      (2)           “Complaint Investigation” means
a documented process for determining the root cause (or the most probable cause)
of a Complaint.

       

      (3)           “Medical Device Report” or
“MDR” means a report
filed with FDA to communicate an event when Seller or Buyer becomes aware (as
such phrase is defined in 21 CFR 803.3(c)) of information that reasonably
suggests that one of its marketed Products:

       

      
        	
                 
      

              	
                (i)

              	
                May
      have caused or contributed to a death, Serious Injury or serious
      deterioration in the state of health of a user or patient;
    or

              


      

       

      
        	
                 
      

              	
                (ii)

              	
                Has
      malfunctioned (see definition of Reportable Malfunction in 21
      CFR  803.3 (n)) and that the Product or a similar device
      marketed by the manufacturer or importer would be likely to cause or
      contribute to a death or Serious Injury of a user or patient if the
      malfunction were to recur.

              


      

       

      (4)           “Medical Device Vigilance
Report” or “MDV”
means the official notification provided to regulatory authorities outside of
the United States of adverse events deemed reportable pursuant to the local laws
and/or regulations.

       

      (5)           “Serious Injury” means an
injury or illness that:

       

      
        	
                 
      

              	
                (i)

              	
                Is
      life threatening (i.e. when continued use of the device is likely to have
      resulted in the death of a patient or when a patient was at substantial
      risk of dying at the time of the adverse event);
  or

              


      

       

      
        	
                 
      

              	
                (ii)

              	
                Results
      in permanent impairment or damage to a body structure or body function, or
      necessitates medical or surgical intervention to preclude permanent
      impairment or permanent damage to a body structure or body
      function.

              


      

      
         

        
          	BUYER:
      __________ 	
                  Page 8 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (b)           Buyer
will be the initial contact for all Complaints from its
customers.  Buyer may require Seller to perform Complaint
Investigations related to the manufacturing, Seller’s design, or packaging of
Products in order to investigate the cause of any such Complaints and to
determine any required corrective actions.  In connection with every
Complaint Investigation, Seller will perform a lot history or device history
review of the affected Product.  If the Complaint is accompanied by or
followed by return of the subject Product to Buyer, Buyer will return to Seller
the Product that is the subject of the Complaint; provided, Buyer may
at its option perform an initial evaluation of the returned Product to determine
the root cause of failure.  Seller will maintain records of all such
Complaint Investigations as required by cGMP and other applicable rules and
regulations of any Regulatory Authority. No later than **   **
business days after Seller’s receipt of a written request from Buyer to perform
a Complaint Investigation including receipt of the allegedly defective Product
(unless such Product is unavailable), Seller will provide Buyer with an initial
report of such Complaint Investigation, and no later than **   **
days after Seller’s receipt of a written request from Buyer to perform a
Complaint Investigation including receipt of the allegedly defective Product
(unless such Product is unavailable), Seller shall perform and provide to Buyer
a written report of such Complaint Investigation, including a complete
investigation that contains a root cause analysis and corrective action
recommendations. In the event of an MDR or MDV, Buyer may require Seller to
expedite the Complaint Investigation in order to comply with any applicable
regulatory filing requirements of any Regulatory Authority.

       

      (c)           Seller
will be responsible for filing all required Complaint reports (including MDRs
and/or MDVs) with the appropriate Regulatory Authorities.  In any
event, Buyer retains the right to file all required Complaint reports, including
MDR and MDV reports; provided, however, that Buyer
shall immediate notify Seller, in writing, of its intention to file such
reports.

       

      (d)           Seller
will maintain a cross-reference from Seller’s Complaint response to Buyer’s
associated Complaint file numbers.  Seller will complete all corrective
actions, including any corrective actions identified in a response to Buyer
pursuant to this Section 3.5 or any corrective actions reasonably requested by
Buyer, within a mutually agreed upon timeframe, and upon request of Buyer,
provide written evidence of such completion.

       

       

      3.6           Inspection;
Access.  Buyer shall have the right to have employees and other
representatives of Buyer (including external auditors and representatives of
Buyer’s notified body) present at any plant or production facility relating to
or used in connection with the manufacturing of Product during normal business
hours to conduct an initial and periodic inspections of such facilities and
manufacturing procedures for compliance with ISO, cGMP and QSR, and the
Specifications and to inspect Seller’s inventory of Products, work-in-process,
raw materials to be used for Products, production records, design history file,
quality manuals, regulatory dossiers and such other matters as may be pertinent
to proper quality assurance of Products to be delivered
hereunder.  Buyer agrees to give Seller **   **
Business Days’ prior notice of any such inspection
“for cause” and **   ** prior notice for any other
inspection.  Seller shall immediately use its best efforts to take
such action as is required to correct any deficiencies identified by Buyer or
its representatives relating to the production of any Product.  Seller
is not currently a party to, and shall not enter into, any third-party
manufacturing agreement relating to any Product that does not grant to Buyer and
its representatives, as third-party beneficiaries, rights to inspect the plant
or plants at which Product components or materials are manufactured on the terms
set forth in this Section.  Seller further agrees to use its best
efforts to provide such documentation or conduct such analyses as Buyer or its
representatives may reasonably request in connection with any regulatory
submission or audit hereunder.  In accordance with applicable laws and
regulations governing regulatory inspections, Seller shall permit authorized
representatives of relevant regulatory authorities, including FDA, to inspect
any plant and production facilities relating to or used in connection with the
manufacture of any Product.

       

       

      3.7           Records.  For
the **   ** after delivery to Buyer of each Product, or such
longer period as may be required by cGMP and other applicable rules and
regulations of any Regulatory Authority or by law, Seller shall:  (a)
maintain traceability records for each Product, including the manufacture date
and lot number of each unit of Product and each component and material
comprising the Product; (b) maintain records subject to 21 CFR 820 Subpart M
(such as the Device Master Record, quality system record and Complaint files);
and (c) provide Buyer a copy of such records without charge upon Buyer’s
request. Upon
termination or expiration of this Agreement, such records shall be placed in
escrow on terms mutually agreed to by the Parties.

      
         

        
          	BUYER:
      __________ 	
                  Page 9 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      3.8           Required
Notification.  Each Party hereto shall immediately notify the
other Party by fax, with confirming notice by Overnight Delivery, as soon as a
Party becomes aware of any:  (a) defect or condition which renders or
may render any Product ineffective or dangerous; (b) Product that is not in
compliance with the Specifications (including manufacturing process, labeling or
packaging) or other QA Standards; (c) breach by either Party of the terms of
this Agreement; (d) regulatory, FDA or ISO inspections or other communications
with regulatory, FDA or ISO authorities related to a Product or that would in
any way impact the Product or either Party’s performance hereunder; or (e)
infringement by any party of intellectual property rights applicable to the
Product.  Without limiting the generality of the foregoing, each Party
will notify the other Party immediately if it becomes aware of any death or
bodily injury caused by a Product (or suspected to be caused by a Product) or
any malfunction of a Product.

       

       

      3.9           EEO
Laws.  Seller acknowledges that Buyer is an equal employment
opportunity/affirmative action employer subject to Executive Order 11246, the
Vietnam Era Veterans Readjustment Assistance Act, Section 503 of the Vocational
Rehabilitation Act, and their implementing regulations (collectively, "EEO Laws").  Seller
may be governed by these laws and implementing regulations which are
incorporated into this Agreement by reference.  By acceptance of this
Agreement, Seller certifies that it complies and will continue to comply with
all applicable EEO Laws, and it shall not discriminate on the basis of race,
age, color, religion, gender, sexual orientation, disability, veteran status,
national origin or any other characteristic protected by federal, state or local
law.

       

       

      3.10           Quality Plan. 
Seller and Buyer shall establish a quality plan which will define the quality
practices, the resources and the activities relevant to Products that are
designed and/or manufactured for Buyer.  This plan will define how the
quality requirements will be met and will be approved in writing by both
Parties.

       

       

      3.11           Product
Recalls.

       

       

      (a)           If,
in the judgment of Seller or Buyer, any Product defect or any government action
requires a recall of, or the issuance of an advisory letter regarding, any
Product, either Party shall undertake such recall or issue such advisory letter
only after notification to and consultation with the other
Party.  Each Party shall notify the other Party within
**   ** of becoming aware (as such phrase is defined
in 21 CFR 803) of any issue that could lead to a field action related to
the Products.  The Parties shall endeavor to reach an agreement prior
to making any recall or issuing any advisory letter regarding the manner, text
and timing of any publicity to be given in such matters in time to comply with
any applicable legal or regulatory requirements, but such agreement will not be
a precondition to any action that either Party deems necessary to protect users
of Products or to comply with any applicable governmental orders or
mandates.  The Parties agree to provide reasonable assistance to one
another in the event of any recall or issuance of any advisory
letter.  Notwithstanding anything in this Agreement to the contrary,
Buyer shall have the right to manage any Product recall.

       

       

      (b)           In
the event of a recall of Product, Seller shall correct any deficiency relating
to its manufacturing, packaging, testing, labeling, storing or handling of
Product, if applicable, or cause the vendor of any material, component, or
sub-assembly incorporated into Product to do likewise with respect to such
material, component, or sub-assembly, and shall, at Seller’s option, either (i)
at its cost replace each unit of Product recalled (including units held in
inventory by Buyer or its customers) with a corrected Product within a
reasonable period of time, or (ii) refund the Buyer’s purchase price
thereof.  Seller shall promptly pay or reimburse Buyer for its costs
and expenses (i.e., shipping, quality control testing, and notification)
incurred by Buyer as a result of any recall or advisory letter; provided, however, that if the
recall is related to requirements or Specifications (i.e., materials, design or
process changes, and Product claims) originating with Buyer, then Buyer will pay
the costs and expenses incurred for such recall.

      
         

        
          	BUYER:
      __________ 	
                  Page 10 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      3.12           Product
Returns.  Seller shall accept returns of Product shipped by
Seller if:  (a) the request to return such Product is received within
**   ** of invoice date (or, if later, the date that shipment is
received); (b) the Product is returned in new condition, salable and in its
original packaging, and (c) the reason for the return is directly related to
defective product quality.  Nothing express or implied in this Section
3.12 shall be deemed to modify or diminish the right of Buyer to reject Products
in accordance with the provisions of Section 3.4 or limit the warranty for
Products set forth in Section 8.

       

       

      3.13           Compliance with
Laws.  Seller will comply with all applicable laws and
regulations of the Regulatory Authorities set forth in the Specification, as
amended, pertaining to the testing, manufacture, labeling or packaging of
Products or pertaining to performance by Seller of its obligations under this
Agreement, including the maintenance of ongoing quality assurance and testing
procedures to comply with applicable regulatory requirements.  Without
limiting the generality of the foregoing, Seller will (a) report to every
applicable Regulatory Authority within any relevant time periods all events that
are required to be reported (including any death or serious bodily injury caused
by a Product); and (b) deliver, within the permitted time periods, all annual or
other periodic reports required to be delivered to every applicable Regulatory
Authority.  Seller represents and warrants that it is the legal
manufacturer of the Product.

       

      3.14           Product Specifications;
Packaging and Labeling.  All Products delivered by Seller
hereunder shall be in full compliance with the Specifications therefor and shall
be ready for end-user sale, including all packaging, labeling,
instructions-for-use and sterilization set forth therein, as
amended.  All Products shall be labeled (including bar coding/UPN
numbers) in accordance with the work instructions, procedures and label
text/graphics specified in writing from time to time by Buyer and mutually
approved by Buyer and Seller. Buyer shall give Seller at least
**   ** advance written notice of any change to its labeling
procedures prior to the date when such changes are to take
affect.  Notwithstanding anything in this Agreement to the contrary,
Buyer shall pay Seller for **   ** Reimbursements, as set forth
in Section 2.3 above. All Products will be marked to make it clear that they
have been manufactured by Seller and are being distributed by
Buyer.  Buyer may include Product as a component in any kit or
collection of products.  Buyer maintains the right to over-label
Products as it deems necessary or appropriate in accordance with work
instructions, procedures, and label text/graphics, which are mutually approved
by both Parties hereto.  Seller is not responsible for any
over-labeling or any consequences thereof.    As used in
this Agreement, “Specifications” for the
Product means the specifications set forth on Exhibit A, as revised from time to
time pursuant to the next sentence, and as provided by Seller and approved by
Buyer, including the part number, revision level, controlled drawing, and
packaging and sterilization instructions for the Product and all requirements of
any applicable laws and regulations of the Regulatory Authorities, specified
therein.  The Parties understand that the Specifications may need to
be revised from time to time up to the Product Launch Date.  Each
version (each, a “Revision Level”) of the Specifications will be labeled with a
Revision Level number (“Revision Level Number”), starting with “A-1,” and
continuing sequentially with “A-2,” “A-3,” etc., and each revision of the
Specifications will be so labeled and attached to this
Agreement.  Each subsequent Revision Level will replace and supersede
all former Revision Levels for all purposes hereunder, except with respect to
Article 4 of this Agreement.  Attached to this Agreement as Exhibit A
as of the Effective Date is Revision Level “A-1.”

       

       

      4.           Confidential Information;
Intellectual Property.

       

      4.1           Confidential
Information.

       

      (a)           "Confidential Information"
means all information disclosed by or on behalf of either Party hereto (a
“Disclosing Party”) to the other Party hereto (a “Receiving Party”), or any of
the Receiving Party’s employees, officers, directors, Affiliates,
subcontractors, agents, successors or assigns (collectively “Representatives” and together
with the Disclosing Party, the “Disclosing Group”), including
information  (i) relating to the matters that are the subject of this
Agreement, including the terms, existence and nature of this
Agreement,  (ii) all other information regarding the Disclosing
Party’s past, present or future research, technology, know-how, ideas, concepts,
designs, products, markets, customer information, computer programs, prototypes,
processes, machines, articles of manufacture, compositions of matter, business
plans and operations, technical information, drawings, specifications (including
Specifications), (iii) BSC Improvements or Bovie Improvements (as applicable),
and (iv) any knowledge or information developed by the Disclosing Party as a
result of work in connection with this Agreement that directly relates to the
Product, except information which is:  (i) at the time of disclosure,
or thereafter becomes lawfully part of the public domain through no act or
omission by the Receiving Party; (ii) lawfully in the possession of Receiving
Party prior to disclosure by or on behalf of Disclosing Party, as shown by
written records; (iii) lawfully disclosed to the Receiving Party by a third
party which did not acquire the same under an obligation of confidentiality from
or through the Disclosing Group; or (iv) independently developed by the
Receiving Party without use of Confidential Information, as shown by written
records.  If a Receiving Party believes in good faith that it is
required by law to disclose any Confidential Information, it shall provide
notice to the Disclosing Party, prior to making such disclosure so as to allow
Disclosing Party time to undertake legal or other action, to prevent such
disclosure or otherwise obtain confidential treatment of such
disclosure.

      
         

        
          	BUYER:
      __________ 	
                  Page 11 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (b)           A
Receiving Party shall not, without the prior consent of the Disclosing Party,
disclose any Confidential Information to anyone for any reason at any time or
use any Confidential Information for any purpose except as requested by the
Disclosing Party.  The Receiving Party shall limit dissemination of
Confidential Information to only those Receiving Party Representatives having a
"need to know."  A Receiving Party shall not, except as permitted
under this Agreement:  (i) appropriate or use a Disclosing Party’s
Confidential Information in Receiving Party’s own manufacture of Products for
itself or for any third party or for any other purpose; or (ii) by virtue of
either this Agreement or its supply or purchase of Products, as applicable,
obtain any title to, or any interest or license in, any Confidential Information
of a Disclosing Party.

       

      (c)           Neither
Party shall issue a press release or other public announcement concerning this
Agreement (or any term sheet, bids, negotiations or other related information),
the transactions contemplated herein, or the relationship between the Parties
without the prior written approval of an authorized representative of the other
Party, which approval shall not be unreasonably withheld or
delayed.

       

      (d)           Neither
Party shall:  (i) disclose to the other Party any confidential or
proprietary information belonging to any third party without the consent of such
party; or (ii) represent as being unrestricted any designs, plans, models,
samples, or other writings or products that the Disclosing Party knows or has
reason to know are covered by valid patent, copyright, trade secret, or other
form of intellectual property protection.

       

      4.2           Buyer’s
Property.      All tangible property
provided to Seller in connection with this Agreement, including: Product
requirements, drawings, standard operating protocols, quality testing and other
documentation, all samples, Buyer’s Confidential Information, all reports,
brochures, manuals, sales literature, all equipment and tooling, provided by
Buyer to test, manufacture or assemble the Products, and all Manufacturing
Equipment (collectively, “Buyer’s Property”) shall be
and remain the exclusive property of Buyer unless otherwise agreed in
writing.  Seller shall:  (a) keep and maintain in its
custody and subject to its control any Buyer’s Property that it receives or
develops during the term of this Agreement, for the sole benefit of Buyer; (b)
use Buyer’s Property solely in furtherance of fulfilling its obligations to
Buyer under this Agreement; and (c) return or surrender to Buyer all Buyer’s
Property within fifteen (15) days after termination or expiration of this
Agreement or otherwise upon written request by Buyer provided; however, such
return of Buyer’s Property does not interfere with Seller’s performance
hereunder.

       

      4.3           Intellectual
Property.

       

      (a)           Buyer
and Seller acknowledge and agree that (i) the performance of engineering
services; and (ii) the development of designs, concepts, inventions, prototypes
and the like, and intellectual property relating thereto, by Seller prior to the
Effective Date, either solely or in cooperation with others including Buyer,
which relate solely to any medical device having a sintered, conductive metal
tip, are within the scope of this Agreement and the results of such services and
development are the exclusive property of Buyer and included within the
definition of BSC Intellectual Property provided in Section
4.3(b).  Consideration for such services and development has been
accounted for in the price of the Products herein.

      
         

        
          	BUYER:
      __________ 	
                  Page 12 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (b)           Except
for Seller’s intellectual property related solely to electrosurgical generators
(e.g., RF energy generation, monitoring and control), (i) all intellectual
property, both domestic and foreign, including any and all tangible and
intangible trade secret rights, patents rights (including registrations,
applications, renewals, extensions, continuations, divisions, reexaminations and
reissues), processes, know-how, prototypes, Specifications, drawings, designs,
tools, industrial property rights, inventions, Improvements (excluding
manufacturing processes), developments or discoveries, conceived or made by
Buyer or Seller, whether patentable or not, related solely to any medical device
having a sintered, conductive metal tip, (ii) Buyer’s Confidential Information,
and (iii) Buyer’s Property (except Manufacturing Equipment) (collectively,
“BSC Intellectual
Property”), shall be the exclusive property of Buyer, and Seller shall
cooperate in assigning, and hereby does assign, all right, title, and interest
in and to such BSC Intellectual Property to Buyer.  All copyrightable
works developed by Seller, either alone or with others, related to BSC
Intellectual Property, are “works made for hire” and are hereby assigned to and
shall belong exclusively to Buyer, and any and all copyright rights to such
works, including the right to copy or reproduce the works, create further
derivative works, file for copyright registration, and renew such rights, are
hereby assigned to, and shall be the exclusive property of, Buyer.

      


       

      (c)   Seller
agrees to cooperate with Buyer in the preparation, prosecution, filing and
maintenance of the BSC Intellectual Property during the term of this Agreement
and thereafter, and Buyer agrees to pay Seller reasonable compensation for such
cooperation.

       

      (d)   To
the extent there is jointly invented and jointly owned intellectual property,
each Party hereto agrees to cooperate with the other Party with the preparation,
prosecution, filing and maintenance of the intellectual property during the term
of this Agreement and thereafter beyond that provided by the
Agreement.  Each Party agrees to pay the other Party reasonable
compensation for such cooperation beyond the term of this
Agreement.

       

      (e)   During
the term of this Agreement, and any extension thereof, Buyer hereby grants to
Seller a **   ** license to use the BSC Intellectual Property
solely for the purpose of fulfilling its obligations hereunder.  No
other license is granted by Buyer therein or in any other of Buyer’s
intellectual property.  Buyer reserves to itself exclusive ownership
and rights in the BSC Intellectual Property, except to the extent of the limited
license granted in this section.

       

      (f)   Seller
agrees that there shall be no consideration provided by Buyer to Seller not
expressly contemplated in this Agreement for Seller’s manufacturing know-how and
other intellectual property used by Seller in the manufacture and delivery of
Product to Buyer.

       

      4.4           Co-Branding

      


      (a)           All
labeling, packaging, materials for advertising and marketing, websites, and user
and technical documentation for Products (collectively, “Materials”) will be co-branded
with both the Boston Scientific and Bovie names (the “Co-Brand”).  Unless
otherwise mutually agreed to by the Parties in writing, the Co-Brand shall be
present on all Materials in a size and format to be mutually agreed upon by the
Parties, but in all cases so that each name is prominent and reasonably legible
to the naked eye.  The Parties will work in good faith to agree to one
or more standard Co-Brand templates for use on the Materials, which Templates
shall specify the acceptable visual characteristics of the Co-Brand for use on
Materials, and as long as one of these templates is used, Buyer may use the
Co-Brand without the further prior approval of Seller.  Any deviation
from the template will require the prior written approval of Seller, which
approval shall not be unreasonably withheld.

      
         

        
          	BUYER:
      __________ 	
                  Page 13 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      (b)           Buyer
will use Seller’s trademarks as adjectives and not as nouns or verbs, and not in
the plural or possessive form.  In advertising and marketing
materials, Buyer shall distinguish Seller’s trademark from surrounding text by
using bold, italics or the appropriate visual tools, or by capitalization or the
use of quotation marks, and will use the proper trademark symbol in connection
with Seller’s trademarks.

      


      (c)           Seller
hereby grants to Buyer a **   ** license to use Seller’s
trademarks solely in connection with the marketing, distribution, import,
export, use, offer to sell and sale of the Products.

      


      (d)           Seller
will take such actions as are reasonably necessary to prosecute and maintain its
trademarks and shall inform Buyer of any changes in or additions to any
trademark used in the Co-Brand materials.

      


      (e)           Except
as required under this Agreement, and as set forth in this Section 4.4
(Co-Branding), in no event will Seller be permitted to use Buyer’s trademarks
without the prior written consent of Buyer.

      


      (f)           Combining
the Parties’ trademarks is permitted only as mutually agreed to by the Parties
for purposes of the Co-Brand.

      


       

      5.           Insurance and
Indemnification.

       

      5.1           Insurance.  Seller
shall: (a) during the term of this Agreement, maintain commercial general
liability insurance, **   **; and (b) immediately notify Buyer in
writing of any change or cancellation relating to such policy.  Prior
to execution of this Agreement, Seller shall provide Buyer with a certificate of
insurance evidencing such insurance.

       

      5.2           Indemnification.

       

      (a)           Seller
shall indemnify, defend and hold harmless Buyer and its Affiliates and their
respective directors, officers, employees and agents from and against any claim,
action, suit, demand, damage, expense or losses (including
reasonable attorneys’ fees) (collectively, "Claims") resulting from or in
any way relating to: (i) the gross negligence, intentional misconduct, or
violation of law by Seller or Seller Representatives in the performance of, or
its failure to perform, any of Seller’s obligations under this Agreement; (ii)
any material breach of Seller’s representations, warranties, covenants or
obligations under this Agreement, including Seller’s obligation to deliver
Product under this Agreement; or (iii) infringement or alleged infringement of
any third party intellectual property rights with respect to any Product
provided by Seller to Buyer hereunder to the extent that infringement is found
by a court of competent jurisdiction to result from the use or sale of a Bovie
Improvement or the incorporation of Bovie Intellectual Property into a
Product.

       

      (b)           Buyer
shall indemnify, defend and hold harmless Seller and its Affiliates and their
respective directors, officers, employees and agents from and against any Claims
resulting from or in any way relating to:  (i) the gross negligence,
intentional misconduct, or violation of law by Buyer in the performance of, or
its failure to perform, any of Buyer’s obligations under this Agreement; (ii)
any material breach of Buyer’s representations, warranties, covenants or
obligations under this Agreement, or (iii) infringement or alleged infringement
of any third party intellectual property rights with respect to any BSC
Intellectual Property (including Specifications or requirements provided by
Buyer to Seller hereunder), except to the extent that infringement is found by a
court of competent jurisdiction to result from Buyer’s use, manufacture, offer
to sell, or sale of Bovie’s Intellectual Property or Bovie’s Improvements
incorporated into a Product.

       

      (c)           Each
Party’s obligations to the other Party under this Section 5.2 are conditioned
upon the Party seeking indemnification:  (i) providing notice to the
indemnifying Party of any Claims promptly, but not later than thirty (30) days
after the Party knows of such Claim; (ii) permitting the indemnifying Party to
assume full responsibility for the defense of such Claim; (iii) assisting the
indemnifying Party in defense of such Claim; and (iv) not compromising or
settling any such Claim without the indemnifying Party’s prior
consent.  Notwithstanding the foregoing, a Party's failure to give
the notice specified in Section 5(c)(i), or delay in giving such notice, shall
not affect such Party's right to indemnification under this Section 5.2 except
to the extent that the indemnifying Party has been prejudiced by such failure or
delay.  In addition, the indemnifying Party may not settle a claim
without the indemnified Party’s consent unless such settlement includes a full
release or license for both past and future sales of Product at no additional
cost to the indemnified Party.

      
         

        
          	BUYER:
      __________ 	
                  Page 14 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      6.           Remedies.  Termination
of this Agreement, or the exercise of any other remedy, shall not be deemed to
be an exclusive remedy hereunder, and shall be in addition to any other remedies
available at law or in equity (including a Party’s right to obtain specific
performance and other equitable relief for other Party’s material
breach).

       

      7.           Term.

       

      7.1           Term;
Termination.  The initial term of this Agreement shall commence
on the Effective Date and expire on the fifth (5th) 12-month anniversary of the
Product Launch Date of the Product.  This Agreement will automatically
renew for additional **   **-year periods, unless notice of
cancellation is delivered by either Party at least **   ** days
prior to the end of the then current term.  Notwithstanding the above,
this Agreement shall terminate:

       

      (a) subject
to Section 7.1(b), **   ** days after notice of a material breach
from one Party to the other, but only if such breach remains uncured at the end
of such **   ** period; provided, however, that this
Agreement shall terminate immediately upon notice of breach to a Party if the
same or similar material breach was the subject of a previous notice of breach
pursuant to which a **   ** cure period was previously provided
to such Party;

       

      (b) subject
to the Force Majeure provisions of Section 7.3, immediately upon notice from
Buyer if:  (i) Seller does not satisfy Buyer’s binding purchase order
requirements for any **   ** consecutive months; (ii) Buyer
determines in good faith that **   ** or more of any particular
Product manufactured and delivered to Buyer during a calendar month is
defective, or does not meet the Specifications for such Product, anytime after
**   ** of the term of this Agreement; (iii) Buyer believes in
good faith that Seller's quality assurance policies do not comply with Section
3; or (iv) Buyer
reasonably determines that any material breach hereunder does or may negatively
impact the performance of any of Buyer’s Products, Buyer’s reputation, patient
safety or the safety of any other persons or the environment;

       

      (c) in
accordance with Section 7.3 or 7.4 hereof;

       

      (d)           immediately
upon notice from a Party if the other Party has become the subject of voluntary
or involuntary bankruptcy, receivership, or insolvency proceedings;

       

      (e)           following
**   ** written notice from Buyer of its intent to terminate for
convenience;

       

      (f) immediately
upon notice from Seller if Buyer fails to make payments to Seller in accordance
with the provisions of Section 2.2, above.

       

      7.2           Fulfillment Upon
Termination.  (a) Upon termination (except pursuant to Section
7.1(e), above) or expiration of this Agreement, Seller shall be obligated to
fulfill any then open binding purchase orders, and Buyer shall be obligated to
purchase (a) all Products on open binding purchase orders not yet purchased, and
(b) all then-existing Shelf Inventory; provided, however, that in no
event shall Buyer be required to purchase any Product (including work-in-process
or raw materials or Shelf Inventory) after any termination of this Agreement by
Buyer pursuant to Section 7.1(a), (b), (c) or (d) .

       

      (b) Upon
termination pursuant to Section 7.1(e), above, in Contract
**   **, if Buyer has not purchased the **   **
quantity of Product units for Contract **   **, as set forth in
Section 1.3, above, Buyer shall immediately purchase or, at its election, pay
for in cash the transfer price of the number of Product units equal to the
difference between **   **  and the actual number of
Product units purchased to that point in time by Buyer. Upon termination
pursuant to Section 7.1(e), above, after Contract **   **, Buyer
shall be obligated to purchase (a) all Products on then open binding purchase
orders not yet purchased, and (b) all then-existing Shelf
Inventory.

      
         

        
          	BUYER:
      __________ 	
                  Page 15 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      7.3           Force
Majeure.  If a Party’s performance is delayed because of war or
similar unrest, terrorism, fire, act of God or other similar cause that is
beyond its control and which such Party could not have reasonably prevented,
such delay in performance shall not be considered a breach of this Agreement;
provided, however that if such
delay continues for **   ** or more, then:  (a) the
other Party may upon notice cancel all or any portion of unfilled orders; and
(b) that other Party may immediately terminate this Agreement.

       

      7.4           Failure to
Supply.  If Seller fails to meet its binding supply obligations
under any binding purchase orders provided by Buyer pursuant to Section 1.3, and
such failure:

       

      (a) remains
uncured for more than **   **, then such shortfall shall be sold
to Buyer at a price discount of **   **, and this discount will
remain in effect for **   ** consecutive months after the failure
to supply has been cured; and

       

      (b) results
in less than the specified number of Product units being delivered to Buyer for
any **   ** months, whether consecutive or not, at any time
during the term of this Agreement, then Buyer may terminate this Agreement
immediately upon written notice and initiate a manufacturing transfer pursuant
to Section 7.5 hereof to be completed by Seller at Seller’s
expense.

       

       

      7.5 Manufacturing Transfer.  In
the event of any termination of this Agreement, Seller shall physically transfer
to Buyer, at Buyers expense, all of Buyer’s Property held by
Seller.  Buyer may purchase from Seller, all tooling developed by
Seller and not previously charged to Seller.

       

      8. Warranty.

       

      In
addition to any other representations and warranties of Seller herein, Seller
represents and warrants to Buyer that all Products supplied to Buyer hereunder
shall: (a) conform to the Product Specifications, (b) be manufactured, labeled,
packaged and tested in accordance with the applicable regulatory approvals
therefor and the applicable laws and regulations relating to the manufacture,
labeling, packaging and testing of Products, and (c)  be free from
defects in design, materials and workmanship.  Seller shall provide
all end-users of all Products a limited warranty that reasonable care has been
used in the design and manufacture of the Products.  If a Product does
not conform to the warranties set forth above, Seller will replace the Product,
issue Buyer a refund, or issue Buyer a credit toward future purchases, solely at
Seller’s discretion.

       

      9. Miscellaneous.

       

      9.1           Seller
is an independent contractor of Buyer, and neither Party has the power to bind
the other.  Subject to the limitations of Force Majeure set forth in
Section 7.3, above, time is of the essence in performance
hereunder.

       

      9.2           Neither
Party shall assign this Agreement or its obligations hereunder, whether
voluntarily or involuntarily, without the express prior written consent of the
other Party, except that either Party hereto may assign all of its rights and
obligations under this Agreement to any purchaser, directly or indirectly, of
(a) in the case of Seller, all or substantially all of Seller’s assets (or
stock), and (b) in the case of Buyer, all or substantially all of Buyer’s
Oncology Business assets (or stock), without the other Party’s
consent.  Any permitted assignee hereunder is deemed to have assumed
the assignor’s performance obligations in favor of the non-assigning
Party.

       

      9.3           This
Agreement is fully binding upon either Party’s successors and permitted
assigns.

       

      9.4           All
requests, approvals, consents and notices must be in writing and will be
effective as of the date actually received and, unless otherwise specified in
this Agreement, shall be sent as follows: (i) certified mail - return receipt
requested; (ii) a nationally recognized overnight delivery service that
guarantees overnight delivery and requires the signature of recipient; or (iii)
facsimile, transmission confirmed; to the addresses and fax numbers indicated on
the first page of this Agreement; provided, however, that a copy
is also sent one of the foregoing methods of subsection (i) or (ii),
above

      
         

        
          	BUYER:
      __________ 	
                  Page 16 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      9.5           This
Agreement:  (i) is governed by the laws of The State of New York,
without reference to its internal principles of conflicts of laws; (ii) together
with all Exhibits thereto (which are hereby incorporated into this Agreement) is
the entire and exclusive set of terms and conditions for transactions made with
respect to the Products; (iii) supersedes conflicting terms of purchase orders,
invoices or other documents issued under it; and (iv) may only be modified by a
writing signed by both Parties.

       

      9.6           Headings
of the articles, sections and subsections of this Agreement, and the name of
this Agreement, are for reference purposes only and shall not limit or affect
the meaning or construction of the terms and conditions
hereof.  Whenever the words “include”, “includes” or “including” are
used in this Agreement, they shall be deemed in each instance to be followed by
the words “without limitation.”

       

      9.7           No
failure of either Party to enforce any right under this Agreement shall be
deemed a waiver thereof.

       

      9.8           For
purposes of clarity, nothing in this Agreement shall restrict: as to Buyer, the
right to pursue alternative **  ** technology or Dissimilar Devices
(defined below) from third parties or, as to Buyer or Seller, from
developing alternative **  **  technology or Dissimilar
Devices internally or from selling any such Dissimilar Devices.  As used
herein, a "Dissimilar
Device" is a medical device whose manufacture, use, importation, offer
for sale, or sale, would not, if performed by a party other than Buyer (or its
licensee) infringe BSC Intellectual Property.

       

      9.9           All
obligations and rights which are by their nature continuing, including the
obligations contained in Sections 3.7 and 7.2 and Sections 4 through 6, and 8,
shall survive the expiration or termination of this Agreement.

      


       

      


       

      


       

      


       

      [BALANCE
OF THIS PAGE INTENTIONALLY LEFT BLANK]

       

       

       

       

      
         

        
          	BUYER:
      __________ 	
                  Page 17 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      10.           Additional Representations
and Warranties.  Each Party hereby represents and warrants to
the other that:  (a) the execution and delivery of and performance
under this Agreement by such Party does not, and will not, conflict with or
violate any other agreement or obligations with third parties or any
restrictions of any kind or any law to which it is bound or subject; and (b) it
has the unrestricted right to disclose any information it submits to the other
Party, free of all claims of third parties, and that such disclosures do not
breach or conflict with any confidentiality provisions of any agreement to which
it is a party.
Each Party hereto further hereby represents and warrants that (x) it owns
or has sufficient license and right to intellectual property used in connection
with or incorporated into the Product; and (y) the manufacture, use,
importation, offer for sale, and sale of the Product does not and will not
infringe the intellectual property rights of any third party.

       

      
        


        
          
            	
                     

                    ACCEPTANCE OF AGREEMENT 
  

                  


          

           

        

      

      By
signing below the undersigned acknowledge and accept all terms and conditions of
this Agreement.

       

      
        
          	SELLER:  
      BOVIE MEDICAL
      CORPORATION 	 	BUYER:  BOSTON SCIENTIFIC
      CORPORATION	 
	 	 	 	 	 	 
	By:	
                  /S/ Moshe
      Citronowicz

                	 	By: 	
                   

                	 
	 	
                  (Signature) 

                	 	 	
                  (Signature)

                	 
	Print
    Name: 	Moshe
    Citronowicz	 	Print
    Name: 	Dave McClellan	 
	Title: 	Vice
    President/COO	 	Title:	President, Oncology
      Division	 
	Date
    Signed: 	10/06/06 	 	Date Signed:	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	By:	 	 
	 	 	 	 	
                  (Signature)

                	 
	 	 	 	Print Name:	Ghislain
    Gackiere	 
	 	 	 	Title: 	Finance
    Director	 
	 	 	 	Date Signed:	 	 


        

      

       

      
        
           

          
            	BUYER:
      __________ 	
                    Page 18 of
      24

                  	
                    SELLER:
      __________

                  


          

           

        

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

      

      EXHIBIT
A: PRODUCT AND PRODUCT SPECIFICATIONS

       

       

      
        See
attached.

      

      
         

        
          	BUYER:
      __________ 	
                  Page 19 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
B:  BUYER’S FORM OF PURCHASE ORDER

       

       

      PURCHASE
ORDER

       

      


      
        	
                Boston
      Scientific

                Corporate
      Headquarters

                One
      Boston Scientific Place

                Natick,
      MA 01760

                USA

              	 
      	
                Page
      1

                 

                Purchase
      Order No.

                6056307

              
	 
      	 
      	
                This
      number must appear on all invoices, packages and
      correspondence

              
	 
      	
                Ship
      to Address:

              	 
      
	 
      	 
      	 
      
	 
      	
                Boston
      Scientific

                Corporate
      Headquarters

                One
      Boston Scientific Place

                Natick,
      MA 01760

                USA

              	 
      
	 
      	 
      	 
      
	 
      	
                Bill
      to Address:

              	 
      
	 
      	 
      	 
      
	 
      	
                Boston
      Scientific

                Corporate
      Headquarters

                One
      Boston Scientific Place

                Natick,
      MA 01760

                USA

              	 
      
	 
      	 
      	
                Tax
      Exemption No.

              
	
                Telephone:

              	
                5086478600

              	 
      	
                04-2695240

              
	
                FAX:

              	
                5086479416

              	 
      	 
      
	 
      	 
      	 
      	 
      
	
                Date
      Ordered:

              	
                FOB

              	 
      	
                Mode
      of  Transportation

              
	
                9-28-2006

              	
                VNCR:
      FOB: Ship Point - Collect

              	 
      	 
      
	 
      	 
      	 
      	 
      
	
                Buyer
      No.

              	 
      	
                Confirm
      To:

              	 
      
	
                06B
      NAT

              	 
      	
                John
      Q. Public

              	 
      
	 
      	 
      	 
      	 
      
	
                Terms
      of Payment

              	 
      	 
      
	
                Within
      45 days Due net

              	 
      	 
      
	 
      	 
      	 
      
	 
      
	
                Item

              	
                Port
      Number

              	 
      	
                Description

              	 
      	 
      	 
      
	 
      	
                Quantity

              	
                UOM

              	
                Due
      Date

              	
                Unit
      Price

              	
                Taxable

              	
                Revision
      Total

              
	 
      
	
                00010

              	 
      	 
      	
                (Test
      Purchase Order)

              	 
      	 
      	 
      
	 
      	
                1.00
      EA

              	 
      	 
      	
                150.00/100

              	
                Y

              	
                0.00

              
	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                Balance
      Due: 0.03

                Item
      Text:

                ***
      Item Canceled ***

                ***
      Item Canceled ***

              	 
      	 
      	 
      	 
      
	 
      	 
      	
                TOTAL
      ORDER:

              	
                0.00

              
	 
      	 
      	
                CURRENCY:

              	
                USD

              
	 
      	 
      	 
      	 
      
	 
      	 
      	
                Authorized
      Signature

                JOHN
      SMITH

              
	 
      	 
      	
                BUYER

              
	 
      	 
      	 
      


      

      No
changes or substitutions can be made to DSC specified components or he
processing of those components without prior notification and approval of the
purchasing department.

      


      VENDOR
COPY

      
         

        
          	BUYER:
      __________ 	
                  Page 20 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
C:  NON-BINDING 12-MONTH FORECAST

       

       

      


      Surgical
Resection

      


      
        	
                Year
      1

              	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	
                Month 1

              	
                Month 2

              	
                Month 3

              	
                Month 4

              	
                Month 5

              	
                Month 6

              	
                Month 7

              	
                Month 8

              	
                Month 9

              	
                Month 10

              	
                Month 11

              	
                Month 12

              	
                Totals

              
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                Units

              	
                **   **

              	
                **   **

              	
                **   **

              	
                **   **

              	
                **   **

              	
                **   **

              	
                **   **

              	
                **   **

              	
                **   **

              	
                **   **

              	
                **   **

              	
                **   **

              	
                **   **

              


      

      
         

        
          	BUYER:
      __________ 	
                  Page 21 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
D: LONG LEAD TIME COMPONENTS

       

       

      (To
be provided as set forth in Section 1.7(a))

      
         

        
          	BUYER:
      __________ 	
                  Page 22 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       EXHIBIT
E:  TRANSFER PRICES

       

      


      


      
        	
                Units Purchased in Contract Years 1-2 (in
      aggregate)

              	
                Price per Unit*

              
	 
      	 
      
	
                **   **

              	
                **   **

              
	 
      	 
      


      

      


      


      
        	
                Units Purchased in Contract Years 3-5
      (annually)

              	
                Price per Unit*

              
	 
      	 
      
	
                **   **

              	
                **   **

              
	 
      	 
      


      

      


      *Note:
use of this Exhibit, including the determination of applicable pricing, is
subject to the provisions of Section 1.3 of the Agreement.

      
         

        
          	BUYER:
      __________ 	
                  Page 23 of
      24

                	
                  SELLER:
      __________

                


        

         

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
F:  SELLER’S VENDORS

       

       

      The
following list is tentative as of the Effective Date, and Seller reserves the
right to amend this list upon finalization and approval of the Specifications
and Bill-of-Materials for the Product.

       

      


      1.           **   **

      2.           **   **

      3.           **   **

       

      
        	BUYER:
      __________ 	
                Page 24 of
      24

              	
                SELLER:
      __________

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT A (ver.
A-1)

       

       

       

       

      


      BOVIE
–

      Resection
Device

      


      Product
Specifications

      


      


      


      BOVIE MEDICAL
CORPORATION

      CONFIDENTIAL

      FOR INTERNAL USE
ONLY

    

     

     

    
      
        


         

        BOVIE
MEDICAL CONFIDENTIAL

        THIS
DOCUMENT IS THE PROPERTY OF BOVIE MEDICALCORPORATION AND MUST BE ACCOUNTED
FOR.  INFORMATION HEREIN IS CONFIDENTIAL.  DO NOT REPRODUCE,
USE, OR CONVEY ANY PORTION OF THIS DOCUMENT TO UNAUTHORIZED PERSONS, WITHOUT
PROPER AUTHORIZATION.



      
        
          
             


          

          
             


            
              

            

          

          
             


          

        

      

      


      Table of
Contents

       

      
        
          	
                  1 
       INTRODUCTION

                	
                  4

                
	
                  1.1

                	
                  Purpose

                	
                   4

                
	
                  1.2

                	
                  Scope

                	
                   4

                
	
                  2  
      APPLICABLE
      DOCUMENTS

                	
                   4

                
	
                  2.1

                	
                  Standards

                	
                   4

                
	
                  3.0  
      GENERAL
      DESCRIPTION

                	
                   4

                
	
                  3.1

                	
                  Concept
      Drawing

                	
                   5

                
	
                  3.2

                	
                  Application

                	
                   5

                
	
                  3.2.1

                	
                  Intended
      Use

                	
                   5

                
	
                  3.2.2

                	
                  Intended
      Users

                	
                   6

                
	
                  3.3

                	
                  Quality
      System Requirements

                	
                   6

                
	
                  3.3.1

                	
                  US
      Requirements

                	
                   6

                
	
                  3.3.2

                	
                  Canadian
      Requirements

                	
                   6

                
	
                  3.3.3

                	
                  European
      Classifications

                	
                   7

                
	
                  3.3.4

                	
                  Quality
      System Requirements

                	
                   7

                
	
                  4  
      PRODUCT
      DOCUMENT STRUCTURE

                	
                   7

                
	
                  4.1

                	
                  Project
      Documentation

                	
                   7

                
	
                  4.2

                	
                  Model
      Number Format

                	
                   7

                
	
                  5  
      PRODUCT
      REQUIREMENTS

                	
                   8

                
	
                  5.1

                	
                  Electrical
      and Mechanical

                	
                   8

                
	
                  5.1.1

                	
                  Insulated
      Handle

                	
                   8

                
	
                  5.1.2

                	
                  Shaft
      and Electrode Tip

                	
                   9

                
	
                  5.1.3

                	
                  Shipping
      and Handling

                	
                   10

                
	
                  5.1.4

                	
                  Sterilization

                	
                   10

                
	
                  6 
       Protection
      Against Hazards

                	
                   10

                
	
                  7  
      Packaging

                	
                   10

                
	
                  7.1

                	
                  Labeling

                	
                   10

                
	
                  7.2

                	
                  Packaging
      Configuration

                	
                   11

                
	
                  7.3

                	
                  Manufacturing

                	
                   11

                
	 
      	 
      	 
      


        

      

       

    

     

    BOVIE
MEDICAL CONFIDENTIAL

    
      THIS
DOCUMENT IS THE PROPERTY OF BOVIE MEDICALCORPORATION AND MUST BE ACCOUNTED
FOR.  INFORMATION HEREIN IS CONFIDENTIAL.  DO NOT REPRODUCE,
USE, OR CONVEY ANY PORTION OF THIS DOCUMENT TO UNAUTHORIZED PERSONS, WITHOUT
PROPER AUTHORIZATION.

    

    


    
      
        
           


        

        
          2

          
            

          

        

        
           


        

      

    

    


    List
of Tables

     

    
      	
              Table
      One – Standards

            	
              Page
      4

            
	
              Table
      Two – Device Classifications

            	
              Page
      6

            
	
              Table
      Three – Model Number Format

            	
              Page
      7

            


    

    


    


    List
of Figures

    
      	
              Figure
      One – Concept Drawing

            	
              Page
      5

            


    

     

    

      BOVIE
MEDICAL CONFIDENTIAL

      THIS
DOCUMENT IS THE PROPERTY OF BOVIE MEDICALCORPORATION AND MUST BE ACCOUNTED
FOR.  INFORMATION HEREIN IS CONFIDENTIAL.  DO NOT REPRODUCE,
USE, OR CONVEY ANY PORTION OF THIS DOCUMENT TO UNAUTHORIZED PERSONS, WITHOUT
PROPER AUTHORIZATION.

       

    

    
      
        
           


        

        
          3

          
            

          

        

        
           


        

      

    

     

    
      
        	
                1

              	
                INTRODUCTION

              


      

       

    

    
      
        	
                1.1

              	
                Purpose

              


      

       

    

    This
Product Specification defines preliminary product requirements and constitutes a
part of the Design Inputs for the Resection Device Project for Boston Scientific
Corporation (“BSC”).

     

    
      
        	
                1.2

              	
                Scope

              


      

       

    

    This
Product Specification sets forth the requirements, provided by BSC, for the
Resection Device, (the “Device”).

     

    
      
        	
                2

              	
                APPLICABLE
      DOCUMENTS

              


      

       

    

    The
following is a list of all documents and other sources of information referenced
in this Product Specification.

     

    
      
        	
                2.1

              	
                Standards

              


      

       

    

     

    
      	
              Standard

            	
              Version/Date

            	
              Description

            
	
              21
      CFR Part 820

            	 
      	
              Medical
      Devices, Current Good Manufacturing Practices, Final Rule, Quality System
      Regulation.

            
	
              HF-18

            	
              2001

            	
              AAMI/ANSI
      Electrosurgical Devices

            
	
              10993-1

            	
              3;
      Date 8-1-03

            	
              AAMI/ANSI/ISO
      Biological evaluation of medical devices – Part 1: Evaluation and
      Testing

            
	
              EN
      980

            	
              2003

              04/16/2003

            	
              Graphical
      symbols for use in the labeling of medical devices

            
	
              EN
      ISO 14971

            	
              2000
      AMD 1 2003

              03/01/2003

            	
              Medical
      devices – Application of risk management to risk management to medical
      devices (ISO 14971:2000)

            
	
              ISTA
      2A 2006

            	
              2006

            	
              Performance
      Test for Packaged-Products Weighing 150 lbs (68 kg) or
  Less

            


    

     

    Table 1 -
Applicable Standards for Medical Devices (US)

     

    
      3.0
GENERAL DESCRIPTION 

        
          

        

      

    

    


    The
Device is a sterile, single use electrosurgical device intended to be used in
conjunction with an electrosurgical generator for the delivery of radiofrequency
(“RF”) current and sterile saline for hemostatic sealing and coagulation of soft
tissue in accordance with instructions and user procedures provided by
BSC.  The device is not intended for any other unspecified uses.

    
 

    


    
      BOVIE
MEDICAL CONFIDENTIAL

      THIS
DOCUMENT IS THE PROPERTY OF BOVIE MEDICALCORPORATION AND MUST BE ACCOUNTED
FOR.  INFORMATION HEREIN IS CONFIDENTIAL.  DO NOT REPRODUCE,
USE, OR CONVEY ANY PORTION OF THIS DOCUMENT TO UNAUTHORIZED PERSONS, WITHOUT
PROPER AUTHORIZATION.

       

    

    
      
        
           


        

        
          4

          
            

          

        

        
           


        

      

    

     

    
      3.1
Concept Drawing 

        
          

        

      

       

    

     

    Figure
1

     

    3.2
Application 

      
        

      

    

     

    
      3.2.1
Intended Use 

        
          

        

      

       

    

    The
Device is a sterile, single use electrosurgical device intended to be used in
conjunction with an electrosurgical generator for the delivery of radiofrequency
current and sterile saline for hemostatic sealing and coagulation of the soft
tissue in accordance with instructions and user procedures provided by BSC. The
device is not intended for any other unspecified uses.

    


    
       

      BOVIE
MEDICAL CONFIDENTIAL

      THIS
DOCUMENT IS THE PROPERTY OF BOVIE MEDICALCORPORATION AND MUST BE ACCOUNTED
FOR.  INFORMATION HEREIN IS CONFIDENTIAL.  DO NOT REPRODUCE,
USE, OR CONVEY ANY PORTION OF THIS DOCUMENT TO UNAUTHORIZED PERSONS, WITHOUT
PROPER AUTHORIZATION.

    

     

    
      
        
           


        

        
          5

          
            

          

        

        
           


        

      

    

     

    
      3.2.2
Intended Users 

        
          

        

      

       

    

    Users of
this Device will be healthcare professionals such as medical doctors and nurses,
who are qualified and trained in electrosurgical procedures.

     

    
      3.3
Quality System Requirements 

        
          

        

      

       

    

    The
Device has the following classifications for FDA, CMDR, and MDD
classification.

     

    
      	
              Device

            	
              US
      Classification

            	
              Canada
      Classification

            	
              MDD
      Classification

            
	
              Resection
      Device

            	
              II

            	
              III

            	
              IIb

            


    

     

    Table 2 -
Device Classifications

     

    
      3.3.1
US Requirements 

        
          

        

      

       

    

    To market
medical products, the Food and Drug Administration (FDA) must determine that a
medical device is substantially equivalent to similar marketed medical
devices.  The Bovie Regulatory department intends to use the
dissecting sealer device manufactured by TissueLink as a predicate
device.

     

    
      3.3.1.1
Classification

        
          

        

      

       

    

    The
Device’s classification is Class II.

     

    
      3.3.1.2
Safety and Effectiveness requirements 

        
          

        

      

       

    

    The
Device will meet electrical safety requirements (ANSI/AAMI
HF-18:2001).

     

    
      3.3.1.3
Quality System Requirements 

        
          

        

      

       

    

    Quality
system requirements are specified as part of 21 CFR Part 820, Quality System
Regulation.

     

    
      3.3.2
Canadian Requirements 

        
          

        

      

       

    

    To market
medical products in Canada, a license application must be presented to Health
Canada. Once the license application is approved, the medical product can be
labeled and made available for sale in the Canadian provinces.

     

    
      3.3.2.1
Classification 

        
          

        

      

       

    

    Class
III

     

     

    
      BOVIE
MEDICAL CONFIDENTIAL

      THIS
DOCUMENT IS THE PROPERTY OF BOVIE MEDICALCORPORATION AND MUST BE ACCOUNTED
FOR.  INFORMATION HEREIN IS CONFIDENTIAL.  DO NOT REPRODUCE,
USE, OR CONVEY ANY PORTION OF THIS DOCUMENT TO UNAUTHORIZED PERSONS, WITHOUT
PROPER AUTHORIZATION.

       

    

    
      
        
           


        

        
          6

          
            

          

        

        
           


        

      

    

     

    
      3.3.2.2
Safety and Effectiveness requirements 

        
          

        

      

       

    

    Safety
and effectiveness requirements closely correspond to the essential requirements
of the Medical Device Directive.  A list of Health Canada recognized
standards has been issued as of April 11, 2002 in Policy on Recognition and Use
of Standards under Medical Device Regulations.

     

    
      3.3.2.3
Quality System Requirements 

        
          

        

      

       

    

    Health
Canada requires manufacturers of Class II, III and IV device to demonstrate that
their devices are manufactured in accordance with internationally recognized
standards.  Demonstration of compliance with the quality system
requirements will be required at the time an application is made for a medical
device license.

     

    
      3.3.3
European Classifications 

        
          

        

      

       

    

    
      3.3.3.1
Classification 

        
          

        

      

       

    

    The
Device is classified IIb (Rule 9 ) in accordance with the Medical Devices
Directive Annex IX.

     

    (Reference:
Guidelines for the Classification of Medical Devices – MEDDEV 2.4/1 Rev. 8, July
2001)

     

    
      3.3.3.2
Conformance Assessment Route 

        
          

        

      

       

    

    The
Device assessment route will be via Annex II (full quality assurance
system).

     

    
      3.3.4
Quality System Requirements 

        
          

        

      

       

    

    Bovie
Medical Corporation (“Bovie”) has been certified to ISO13485

     

    
      
        	
                4

              	
                PRODUCT
      DOCUMENT STRUCTURE

              


      

       

    

    
      
        	
                4.1

              	
                Project
      Documentation

              


      

       

    

    Documents
will be in standard Bovie document format.

     

    
      
        	
                4.2

              	
                Model
      Number Format

              


      

       

    

    The
following table lists the Device’s model number and corresponding product /
catalog code.

     

    
      	
              Catalog
      #

            	
              Comments

            
	
              TBD

            	
              Laparoscopic  Monopolar
      Device

            
	
              TBD

            	
              Open
      Abdominal Monopolar Device

            


    

     

    Table Three

     

     

    BOVIE
MEDICAL CONFIDENTIAL

    THIS
DOCUMENT IS THE PROPERTY OF BOVIE MEDICALCORPORATION AND MUST BE ACCOUNTED
FOR.  INFORMATION HEREIN IS CONFIDENTIAL.  DO NOT REPRODUCE,
USE, OR CONVEY ANY PORTION OF THIS DOCUMENT TO UNAUTHORIZED PERSONS, WITHOUT
PROPER AUTHORIZATION.

    


    
      
        
           


        

        
          7

          
            

          

        

        
           


        

      

    

     

    
      
        	
                5

              	
                PRODUCT
      REQUIREMENTS

              


      

       

    

    The
following section will describe requirements for the insulated handle and shaft
with electrode tip.

     

    
      
        	
                5.1

              	
                Electrical
      and Mechanical

              


      

       

    

    The
Device hardware is comprised of two (2) major components: (i) an Insulated
Handle and (ii) a Shaft with Electrode Tip. RF energy is passed through the
Insulated Handle through the Shaft to the Electrode Tip by a powered lead from
an electrosurgical generator.

     

    
      
        	
                5.1.1

              	
                Insulated
      Handle

              


      

       

    

    The Insulated Handle encases the controlling
mechanism for the flow of saline, and activation and selection of the RF current
for the Device.

     

    5.1.1.1
Insulated Handle and Power Cord Insulation Resistance

     

    The
insulation of the Insulated Handle and Power Cord shall meet Requirements of
Section 4.2.5.4 Dielectric withstands of accessories ANSI/AAMI
HF-18:2001

     

    5.1.1.2
Insulated Handle Ergonomics

     

    The
Insulated Handle shall be designed for comfortable and efficient hand
operation.  It will incorporate an over-mold to give the body an
elegant feel and soft touch.

     

    5.1.1.3 Insulated Handle Electrical
Cord

     

    The
Insulated Handle Electrical Cord shall be approximately ten (10) feet in length
and incorporate a 3-prong electrical plug.

     

    5.1.1.4
Insulated Handle Flow Control Mechanism

     

    The
Device will have a flow control mechanism, either on the tubing or in the handle
itself so the flow can be regulated by the user within the sterile
field.

     

    5.1.1.5 Insulated Handle Tubing
Length

     

    The
tubing length should be approximately seven (7) feet in length and incorporate
an I.V. spike on the end to attach directly to a hanging IV bag.

     

    5.1.1.6
Insulated Handle Tubing Material

     

    The
tubing material should be a material that will resist kinking but should not
have so strong a memory as to pull the probe off of the sterile
field.

     

    5.1.1.7 Insulated Handle Activation
Buttons

     

     

    BOVIE
MEDICAL CONFIDENTIAL

    THIS
DOCUMENT IS THE PROPERTY OF BOVIE MEDICALCORPORATION AND MUST BE ACCOUNTED
FOR.  INFORMATION HEREIN IS CONFIDENTIAL.  DO NOT REPRODUCE,
USE, OR CONVEY ANY PORTION OF THIS DOCUMENT TO UNAUTHORIZED PERSONS, WITHOUT
PROPER AUTHORIZATION.

    


    
      
        
           


        

        
          8

          
            

          

        

        
           


        

      

    

     

    The
Device should have a Cut and Coagulation Mode. “Cut”/”Coag” buttons must be easy
to operate.

     

    5.1.1.8
Insulated Handle Compatibility

     

    
      	
               
      

            	
              ·

            	
              The
      Insulated Handle should have compatibility with standard RF generators
      used for electrocautery and standard grounding
  pad.

            


    

     

    
      	
               
      

            	
              ·

            	
              The
      Insulated Handle should have compatibility with standard 0.9% saline I.V.
      bag.

            


    

     

     

    
      
        	
                5.1.2

              	
                Shaft
      and Electrode Tip

              


      

       

    

    The Shaft
and Electrode Tip provide the actual working portion of this
system.

     

    5.1.2.1
Saline Flow Rate of Device

     

    The
Saline flow rate prior to use will be
**       **

     

    5.1.2.2
Device (Shaft) Length

     

    The
Device should be straight and have two (2) lengths: one for laparoscopic
monopolar procedures (approximately thirty-two (32) cm) and one for open
monopolar procedures (approximately fourteen (14) cm).

     

    5.1.2.3
Shaft Configuration

     

    The Shaft
will be hollow to allow for fluid to flow to the sintered stainless steel tip.
The inside diameter of the Shaft should be equal to the inside diameter of the
tubing that feeds fluid to the Shaft to minimize any flow restriction in the
fluid circuit.

     

    5.1.2.4
Tip Material

     

    The Tip
shall be made of **       **

     

    .

     

    5.1.2.5
Tip Strength

     

    The
porous blade tip to shaft tensile bond strength (axial mode) must be greater
than **       **

     

     after
being subjected to a full-power simulated use duty cycle.

     

    The
porous blade tip to shaft bond strength in an flexural mode must be greater than
**       **

     

     

    
      BOVIE
MEDICAL CONFIDENTIAL

      THIS
DOCUMENT IS THE PROPERTY OF BOVIE MEDICALCORPORATION AND MUST BE ACCOUNTED
FOR.  INFORMATION HEREIN IS CONFIDENTIAL.  DO NOT REPRODUCE,
USE, OR CONVEY ANY PORTION OF THIS DOCUMENT TO UNAUTHORIZED PERSONS, WITHOUT
PROPER AUTHORIZATION.

       

    

    
      
        
           


        

        
          9

          
            

          

        

        
           


        

      

    

     

    . after
being subjected to a full-power simulated use duty cycle.

     

    5.1.2.6
Tip performance

     

    
      	
               
      

            	
              ·

            	
              Bovie
      will exert its best efforts to meet the design goal that tip cutting
      performance be superior to competitive devices with respect to cutting
      speed. Tip will have the ability to coagulate soft tissue when performed
      in a suitable simulated use
environment.

            


    

     

    
      
        	
                5.1.3

              	
                Shipping
      and Handling

              


      

       

    

    4.1.3.1
Shipping Temperatures

     

    Tropical
(Wet and Dry) Conditions and Winter (Frozen) Conditions per ISTA
2A.

     

    4.1.3.2
Transportation Testing

     

    The Final
Product Packaging Configuration for the Device shall meet the finished device
requirements after being subjected to Simulated Transportation Conditioning per
ISTA 2A.

     

    
      
        	
                5.1.4

              	
                Sterilization

              


      

       

    

    5.1.4.1
Withstand 2x ETO Sterilization.

     

    5.1.4.2
EN 550: 1994 – Sterilization of Medical Devices – Validation and routine control
of ethylene oxide sterilization.

     

    5.1.4.3
AAMI/ANSI/ISO 11135 -1994 Medical Devices – Validation and routine control of
ethylene oxide sterilization.

     

    
      
        	
                6

              	
                Protection
      Against Hazards

              


      

       

    

    A
Hazard/Risk Analysis will be performed throughout the design
process.  The Hazard/Risk Analysis will be documented and filed as
part of the design history file.

     

    
      
        	
                7

              	
                Packaging

              


      

       

    

    
      
        	
                7.1

              	
                  Labeling

              


      

       

    

    
      7.1.1
Package must be labeled in accordance with both BSC and Bovie Labeling
Standards.

    

    


    
      7.1.2
BSC and Bovie branding, including mutually approved trademarks, will be on
the Handle and/or the shaft.

    

    


    7.1.3 The
Device is to have a three (3) year shelf life under normal storage
conditions.

     

     

    
      BOVIE
MEDICAL CONFIDENTIAL

      THIS
DOCUMENT IS THE PROPERTY OF BOVIE MEDICALCORPORATION AND MUST BE ACCOUNTED
FOR.  INFORMATION HEREIN IS CONFIDENTIAL.  DO NOT REPRODUCE,
USE, OR CONVEY ANY PORTION OF THIS DOCUMENT TO UNAUTHORIZED PERSONS, WITHOUT
PROPER AUTHORIZATION.


    

    
      
        
           


        

        
          10

          
            

          

        

        
           


        

      

    

     

    
      
        	
                7.2

              	
                Packaging
      Configuration

              


      

       

    

    
      	
               
      

            	
              ·

            	
              The
      Tip and Shaft protector shall be included into the
  Design.

            


    

    
      	
               
      

            	
              ·

            	
              The
      Scratch Pad shall be packaged with the
Device.

            


    

    
      	
               
      

            	
              ·

            	
              The
      Device will be packaged in a Sterile
Pouch.

            


    

    
       

      
        	
                7.3

              	
                Manufacturing

              


      

       

    

    Final
assembly and packaging will be performed by
Bovie.   

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    APPROVALS

    


    
      	
              Author

            	    
      	 
      	 
      
	 
      	
              Thomas
      Feldhaus

            	 
      	
              Date

            
	
              Sales
      & Marketing

            	  
        	 
      	  
        
	 
      	
              Rick
      Pfahl

            	 
      	
              Date

            
	
              Regulatory

            	   
          	 
      	  
        
	 
      	
              Rick
      Kozloff

            	 
      	
              Date

            
	
              Quality

            	   
        	 
      	  
      
	 
      	
              John
      Woody

            	 
      	
              Date

            
	
              Manufacturing

            	    
      	 
      	 
       
	 
      	
              Lillian
      Eshem

            	 
      	
              Date

            
	
              Engineering

            	    
        	 
      	 
        
	 
      	
              Fred
      Baron

            	 
      	
              Date

            


    

     

    

      BOVIE
MEDICAL CONFIDENTIAL

      THIS
DOCUMENT IS THE PROPERTY OF BOVIE MEDICALCORPORATION AND MUST BE ACCOUNTED
FOR.  INFORMATION HEREIN IS CONFIDENTIAL.  DO NOT REPRODUCE,
USE, OR CONVEY ANY PORTION OF THIS DOCUMENT TO UNAUTHORIZED PERSONS, WITHOUT
PROPER AUTHORIZATION.

    

    

      
        
          
          

        

        
          12