exv10w4



 






Exhibit 10.4



CERTAIN INFORMATION WITHIN THIS EXHIBIT HAS BEEN OMITTED AND THE NON-PUBLIC INFORMATION HAS BEEN
FILED WITH THE SECURITIES EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.




First Amendment to the Distribution Agreement




between




INFECTIO DIAGNOSTIC (I.D.I) INC and CEPHEID of November 4, 2003




This is the first amendment (“Amendment”) to the Distribution Agreement between Infectio
Diagnostic (I.D.I.), Inc. and Cepheid of November 4, 2003 appointing Cepheid as a
nonexclusive distributor of IDI Manufactured Products (hereinafter the “2003 Agreement”).
This Amendment is made as of 01 June 2005 (the “Effective Date”) and is by and between
GeneOhm Sciences Canada, Inc. (formerly Infectio Diagnostics, (I.D.I.) Inc.), a wholly owned
subsidiary of GeneOhm Sciences, Inc. and Cepheid who are sometimes referred to herein
individually as a “Party,” and collectively as the “Parties.”



WHEREAS the Parties wish to amend the Agreement;



NOW THEREFORE, the Parties agree as follows:




	 	1.	 	New Paragraph 2.5 is added as follows:





2.5 Field Action or Product Recall. If IDI notifies
Cepheid that a field action or product recall is required, Cepheid
agrees that it shall as expeditiously as possible issue a written
field action or product recall notice to all affected customers.
Cepheid will reasonably cooperate with IDI in regard to any such
notification.




	 	2.	 	New paragraph 2.6 is added as follows:





2.6 Duties of IDI.




     2.6.1 IDI shall sell IDI Manufactured Products that materially
conform to their published product specifications ordered by
Cepheid. IDI will endeavor to provide Cepheid with the best
possible dating based on purchase orders received and manufacturing
schedules.




     2.6.2 IDI reserves the right at any time to change the
specification or design of any IDI Manufactured Product without
prior notice or approval. In the event of any such change in
specifications or design for which IDI submits a regulatory filing,
IDI will, to the extent possible, provide Cepheid prior notice of at



			
	 	 	 
	CONFIDENTIAL
	 	First Amendment to Distribution Agreement (IDI Products)





 




The symbol [***] is used to indicate that a portion of the exhibit has been omitted and filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to the omitted portion.







 









 









	 	 	 	least 6 months. IDI shall be under no obligation to make any change
in any IDI Manufactured Products in the stock of Cepheid or any IDI
Manufactured Products shipped to but not received by Cepheid unless
the change is made to correct a safety or operational deficiency, or
is required by the U.S. Food and Drug Administration (FDA) in which
case IDI shall immediately notify Cepheid of such modification and
Cepheid shall return to IDI all such products in its inventory, or
that it subsequently receives, if requested by IDI and shall
cooperate with IDI to notify and, where appropriate, request the
return or destruction of any affected IDI Manufactured Products
already shipped to Cepheid, and IDI shall immediately replace any
such returned or destroyed products with such modified products.
	 
	 	3.	 	Paragraph 3.1 shall be deleted and replaced with the following:





3.1 Sales Process. Cepheid shall order IDI Manufactured
Products by submitting written purchase orders to IDI separately for
products that are to be delivered to Cepheid in Sunnyvale, CA
(hereinafter Cepheid US) and Cepheid SA in France, for distribution
by those organizations in their respective territories. Such IDI
Manufactured Products delivered to Cepheid US will not be
re-delivered by Cepheid US to Cepheid SA, without identifying to IDI
the shipment, in order to provide for proper pricing under Exhibit
C. Cepheid will endeavor to specify delivery dates at least thirty
(30) days from the date of the purchase order. IDI will endeavor to
ship, but will not guarantee shipment of, purchase orders submitted
with specified delivery dates less than thirty (30) days from the
date of the purchase order. Purchase orders shall specify, at a
minimum: (a) a description or identification of the IDI
Manufactured Product(s) and the quantity of each IDI Manufactured
Product ordered, (b) the delivery date (as applicable), (c) the
applicable price, and (d) the instruction for invoicing, including
the address to which invoices shall be sent for payment. All
purchase orders shall be accepted by IDI and no purchase orders
shall be modified or cancelled without written agreement by both
Parties. At the beginning of each month, Cepheid shall provide IDI
a revised 12 month rolling forecast, of which the first month will
have a binding minimum purchase obligation of [***] percent
([***]%). Should Cepheid’s needs in the first month increase beyond
the forecast, IDI will endeavor to meet this increase need but makes
no guarantees above forecast amounts.




	 	4.	 	Paragraph 3.2 shall be deleted and replaced with the following:





3.2 Prices.



			
	 	 	 
	CONFIDENTIAL
	 	First Amendment to Distribution Agreement (IDI Products)





 




The symbol [***] is used to indicate that a portion of the exhibit has been omitted and filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to the omitted portion.










 









 









	 	 	 	IDI will transfer the IDI Manufactured Products to Cepheid at its
respective destinations, at the pricing detailed in Exhibit C of
this Agreement, which pricing may change from time-to-time upon
written agreement between the Parties (“Transfer Price”). For IDI
Manufactured Products not listed in Exhibit C, the Parties agree to
discuss transfer pricing at least thirty (30) days prior to
commercial launch. Unless otherwise agreed, for the first thirty
(30) days post launch the initial Transfer Price will be [***]%
below IDI’s list price, and thereafter the Parties will agree on a
set Transfer Price based on market acceptance, demand and transfer
prices for comparable products, but in no instance will the Transfer
Price be higher than [***]% off IDI’s list price.
	 
	 	5.	 	Old paragraph 3.3 shall be renumbered as 3.3.1 and shall
otherwise remain intact.
	 
	 	6.	 	New Section 3.3 shall be titled “Customer Complaints.”
	 
	 	7.	 	New paragraph 3.3.2 shall be added as follows:





3.3.2 Regulatory




     i. Cepheid shall collect and forward to IDI all details of any
Customer Complaints regarding IDI Manufactured Products on at least
a [***] basis, and [***] if necessary. Such Complaint information
may exclude specific information related to the identity of the
customer. IDI shall use reasonable commercial efforts to assess and
resolve such complaints. When requested by IDI, Cepheid shall use
its reasonable commercial efforts to assist IDI in further
investigation of Customer complaints and shall provide IDI with any
information regarding Cepheid’s internal investigation activities,
including, but not limited to, investigational protocols and the
resulting data.




     ii. Cepheid shall notify IDI expeditiously, but in no event
later than [***] days after receipt, of information that reasonably
suggests that an IDI Manufactured Product (a) may have caused or
contributed to a death or serious injury; or (b) has malfunctioned
and, if the malfunction recurs, is likely to contribute to a death
or serious injury. Cepheid shall use its reasonable commercial
efforts to cooperate with and assist IDI in the investigation of any
such report.




     iii. The Parties agree that the obligations of i and ii herein
shall be applicable to any approved sub-distributors as amendments
to existing agreements, or as obligations to be contained in future
agreements.



			
	 	 	 
	CONFIDENTIAL
	 	First Amendment to Distribution Agreement (IDI Products)





 




The symbol [***] is used to indicate that a portion of the exhibit has been omitted and filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to the omitted portion.









 









 










	 	8.	 	New paragraph 3.3.3 shall be added as follows:





3.3.3 Medical Device Vigilance. Cepheid will comply with
the European Commission Guidelines On A Medical Devices Vigilance
System. Cepheid will notify IDI as expeditiously as reasonable
under the circumstances and directly in such matters in compliance
with the European Commission Guidelines On A Medical Devices
Vigilance System.




	 	9.	 	Paragraph 4.1 shall be deleted and replaced with the following:





4.1 Invoicing and Payment Terms. On a monthly basis IDI shall issue
invoices to Cepheid, consistent with the then-current prices set
forth in Section 3.2 and Exhibit C of this Agreement for IDI
Manufactured Products, and Cepheid shall pay IDI within forty-five
(45) days of the date of receipt of such invoice. Cepheid will pay
all amounts due under this Agreement in immediately available funds
and U.S. currency, free of any currency controls or other
restrictions. Within [***] ([***]) days of the end of each calendar
month, Cepheid will provide IDI a statement itemizing the quantities
of IDI-MRSA 200 test kit(s) sold in the previous calendar month to
accounts which satisfy both of the following requirements: (i) an
existing supply contract with an effective date prior to December
31, 2004; and, (ii) a verified commercial transaction for the
purchase of at least one IDI MRSA 200 test kit executed prior to
December 31, 2004 (“Grandfathered Accounts”). Within [***] ([***])
days of the receipt of such statement, IDI will issue a credit note
to Cepheid for each kit sold to Grandfathered Accounts, or will
provide Cepheid with notice of any disagreement with such statement.
If necessary, as determined by IDI, Cepheid agrees to provide
sufficient identifying information for each Grandfathered Account so
as to allow IDI to keep accurate records. Said credit note will
automatically be applied to Cepheid’s next invoice, unless otherwise
requested in writing, and shall be equal to, on a per test basis,
the difference of the Grandfathered Price (hereinafter defined in
Exhibit C) and the then current per test price of the IDI MRSA 200
test kit, as specified in Section 3.2 and Exhibit C of this
Agreement.




	 	10.	 	New Paragraph 9.4 is added as follows:





9.4 Limited Warranties




     9.4.1 Returns: All returns require the prior
approval of IDI. IDI shall issue a Return Authorization
(RA) Number, and all shipments of returned IDI



			
	 	 	 
	CONFIDENTIAL
	 	First Amendment to Distribution Agreement (IDI Products)





 




The symbol [***] is used to indicate that a portion of the exhibit has been omitted and filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to the omitted portion.




 









 







	 	 	 	Manufactured Products and associated documentation must
reference the RA Number. Items returned to IDI without
prior approval or without reference to a valid RA Number
shall be returned to Cepheid at Cepheid’s expense.
	 
	 	11.	 	New Exhibit C shall be added as follows:





Exhibit C

Pricing




     The following prices shall be in effect as of the effective date of this Amendment.




	 	(i)	 	For Delivery to Cepheid in the United States:





	 	 	 	 	 	 	 
	 	 	IDI MRSA 200 Test Kit	 	IDI MRSA 48 Test Kit	 	IDI Step-B Kit
	             Transfer Price (per test):

	 	$[***] (USD)	 	$[***] (USD)	 	$[***] (USD)







	 	(ii)	 	For delivery to Cepheid in Europe:



	 	 	 	 	 	 	 
	 	 	IDI MRSA 200 Test Kit	 	IDI MRSA 48 Test Kit	 	IDI Step-B Kit
	              Transfer Price (per test):
	 	$[***] (USD)	 	$[***] (USD)	 	$[***] (USD)







	 	(iii)	 	Grandfathered Price (per test): $[***] (USD)





     The Parties, through their authorized officers, have executed this Agreement as of the Effective Date.



	 	 	 
	GeneOhm Sciences Canada, Inc.

	 	Cepheid
	 
	 	 
	By: /s/ Peter Klemm

	 	By: /s/ Joseph H. Smith
	 
	 	 
	Name: Peter Klemm

	 	Name: Joseph H. Smith
	 
	 	 
	Title: CEO

	 	Title: Sr. Vice President, General Counsel
	 
	 	 
	Date Signed: 9/30/05

	 	Date Signed: 9/30/05






			
	 	 	 
	CONFIDENTIAL
	 	First Amendment to Distribution Agreement (IDI Products)





 



The symbol [***] is used to indicate that a portion of the exhibit has been omitted and filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to the omitted portion.