exhibit10_1.htm


     

    
      
        ***
Confidential treatment requested on certain portions of this agreement. An
unredacted version of this agreement has been filed separatelly with the
Securities and Exchange Commission.

      

    

     

    Exhibit
10.1

     

    AMENDMENT

    TO

    TOLL
MANUFACTURING AGREEMENT

    


    


    This Amendment (this “Amendment”) to
the Toll Manufacturing Agreement, dated as of July 31, 2008 (“Amendment
Effective Date”), is made by and between KCI Manufacturing (“KCI”) and Avail
Medical Products, Inc.(“Avail”).  Avail and KCI are referred to herein
as the “Parties”.

    


    RECITALS

    


    WHEREAS, KCI and Avail are party to
that certain Toll Manufacturing Agreement by and between KCI and Avail (the
“Toll Agreement”); and

    


    WHEREAS, the Parties wish to amend the
Toll Agreement as set forth herein.

    


    AGREEMENT

    


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

    


    1.           Section
4 of the Toll Agreement is hereby amended by deleting Section 4 in its entirety
and replacing it with the following:

    


    “4.           Exclusivity
Terms.

     

    
      	
              (a)  

            	
              Absent
      a written contrary agreement between the Parties, which both parties
      represent does not exist as of the November 30, 2007 [***] shall be deemed
      "Exclusive Products".  In the event that KCI Manufacturing
      develops Different Products (as defined in Section 1 above), such
      Different Products shall not be Products without express agreement by KCI
      Manufacturing designating such Different Product as
      Products.  In the Parties’ mutual spirit of goodwill and
      cooperation contemplated by this Agreement, unless KCI Manufacturing is
      contractually prevented from doing so by a confidentiality agreement or
      other written agreement that expressly bars KCI Manufacturing from doing
      so, KCI Manufacturing agrees to disclose to Avail the details of the
      Different Products and manufacturing plans for them, and to grant Avail
      the opportunity to submit proposals for the Processing Services related to
      such Different Products in sufficient time prior to KCI Manufacturing’s
      commencement of the manufacture, or marketing launch of the Different
      Products by KCI Manufacturing, for Avail to adequately prepare and for KCI
      Manufacturing to analyze such proposal.  Subject to Section 4(b)
      below, throughout the Exclusivity Period, KCI Manufacturing agrees to
      obtain Products exclusively with Avail for Processing
      Services.

               

            


    

    
      	
              (b)  

            	
              Notwithstanding
      the foregoing, KCI Manufacturing shall have the right to manufacture and
      commercialize the Products in unlimited quantities and for any purpose,
      conditioned upon [***].  In such event, Avail agrees to continue
      providing the Processing Services with respect to all Exclusive Products
      ordered by KCI Manufacturing or its Affiliates.  The exercise by
      KCI Manufacturing of its rights under this Section 4(b) shall not be
      deemed a conversion of this Agreement under Section 22.”

               

            


    

    3.           Section
15 is hereby amended by deleting Section 15 in its entirety and replacing it
with “Intentionally Omitted”.

    


    4.           Section
22 is hereby amended by deleting Section 22 in its entirety and replacing it
with the following:

    


    
      	
               
      

            	
              “22.

            	
              Term and Termination
      or Conversion.  The term of this Agreement shall commence
      on November 30, 2007 and shall continue for a period of five (5) years
      thereafter (the "Initial Term").  At the end of the Initial
      Term, the term will automatically extend for separate but successive
      additional twelve (12) month terms if neither Party has provided the other
      with a notice of termination three (3) months or more prior to the end of
      the then current term.  A termination by Avail pursuant to the
      immediately preceding sentence shall constitute an “Avail Termination
      Without Cause.” In addition, KCI Manufacturing may terminate or convert
      this Agreement to a non-exclusive agreement at its sole option, in the
      event that Avail:  (i) materially breaches this Agreement, (ii)
      seeks protection from its creditors under the bankruptcy or insolvency
      laws of its jurisdiction of incorporation or domicile, or becomes
      involuntarily subject to the jurisdiction of a Court under the bankruptcy
      or insolvency laws of its jurisdiction of incorporation or domicile; (iii)
      fails in a material way to manufacture Products in accordance with the QSR
      of the FDA and in accordance with any and all applicable international
      regulations or standards and fails to cure or remedy such situation within
      ninety (90) days unless the US FDA, or similar foreign counterpart,
      requires action that takes longer than ninety (90) days to execute, in
      which case Avail shall have the time necessary to comply with such
      regulations or standards; (iv) manufactures and/ or distributes any
      Product involved in a Class I "recall" subject to the conditions specified
      in sections 17 and 25 and as defined in
      the regulations promulgated by the FDA) and (v) failure to meet Product
      shipping or inventory level standards in accordance with Sections 7 and 8,
      or Product quality standards in accordance with Section
      17.  Each of the foregoing occurrences (i) through (v) shall
      constitute an “Avail Event of Default”. Avail may terminate this Agreement
      in the event that KCI Manufacturing (i) materially breaches this Agreement
      or (ii) seeks protection from its creditors under the bankruptcy or
      insolvency laws of its jurisdiction of incorporation.  Each of
      the foregoing occurrences, (i) and (ii) shall constitute a “KCI Event of
      Default”.  Either Party may elect to terminate or convert this
      Agreement if the other Party is not able to cure an Avail Event of Default
      or KCI Event of Default, as the case may be, within thirty (30) days of
      written notice of such an Avail Event of Default or KCI Event of Default,
      as the case may be,; such termination shall be deemed a “Termination or
      Conversion With Cause” and the Agreement shall be “Terminated or Converted
      With Cause.” Only in the event of an Avail Termination Without Cause or in
      the event of Termination or Conversion With Cause by KCI Manufacturing,
      Avail shall supply Products to KCI Manufacturing at the pricing in effect
      as of conversion or termination for a period of one (1) year after any
      conversion or termination of this Agreement (subject to price changes
      permitted in this Agreement), and Avail shall make available to KCI
      Manufacturing a list of vendors who supply Product components, and do such
      things, as may be reasonably requested by KCI Manufacturing to enable KCI
      Manufacturing to manufacture the Products in the same manner as previously
      manufactured by Avail.  For purposes of this Agreement, the term
      “conversion” and “convert” shall mean the conversion of this Agreement to
      a non-exclusive agreement.  Upon termination of this Agreement,
      Avail agrees to deliver to KCI Manufacturing all finished Product
      produced, acquired or committed in accordance with outstanding purchase
      orders and forecasts, in addition to all Raw Materials in Avail’s
      possession.”

            


    

    


    5.           On
or before September 15, 2008, [***] instructions of KCI.

    


    Except as expressly amended by this
Amendment, the Toll Agreement shall remain in full force and
effect.  This Amendment may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.

     

     

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          ***
Confidential treatment requested on certain portions of this agreement. An
unredacted version of this agreement has been filed separatelly with the
Securities and Exchange Commission.

        

      

    

    
       

    

     

    
      


      IN
WITNESS WHEREOF, The parties have duly executed this Amendment effective as of
the Amendment Effective Date set forth herein.

      


      
        	
                KCI
      MANUFACTURING

              	
                AVAIL
      MEDICAL PRODUCTS, INC.

              
	 
      	 
      
	
                /s/ John
      Elwood

              	
                /s/ Daniel C.
      Croteau

              
	
                By:  John
      Elwood

              	
                By:  Daniel C.
      Croteau

              
	
                Title:  Director

              	
                Title:  President

              
	
                31
      – July – 2008

              	 
      


      

      


      


      (Signed Copy on
File)