Document:

Exhibit 10.1

 

BUSINESS
FINANCING MODIFICATION AGREEMENT

 

This Business Financing Modification
Agreement is entered into as of July 7, 2005, by and between AML
Communications, Inc. (the “Borrower”) and Bridge Bank, National Association (“Lender”).

 

1.             DESCRIPTION OF
EXISTING INDEBTEDNESS: Among other indebtedness which may be owing by
Borrower to Lender, Borrower is indebted to Lender pursuant to, among other
documents, a Business Financing Agreement, dated July 8, 2004 by and
between Borrower to Lender, as may be amended from time to time, (the “Business
Financing Agreement”).  Capitalized terms
used without definition herein shall have the meanings assigned to them in the
Business Financing Agreement.

 

Hereinafter, all
indebtedness owing by Borrower to Lender shall be referred to as the “Indebtedness”
and the Business Financing Agreement and any and all other documents executed
by Borrower in favor of Lender shall be referred to as the “Existing Documents.”

 

2.             DESCRIPTION OF
CHANGE IN TERMS.

 

A.            Modification(s)
to Business Financing Agreement:

 

1)             The
defined term “Termination Date” is hereby amended to read as follows:

 

“Termination Date” means the earlier
of (a) August 7, 2005, or (b) the date on which Lender elects to
terminate this Agreement pursuant to the terms herein.

 

2)             Section 2.3
is hereby amended in its entirety to read as follows:

 

2.3           Equipment
Advances.  Subject to the terms and
conditions of this Agreement, from the date of this Agreement through the
earlier of August 7, 2005 or the Termination Date, Borrower may request
Equipment Advances of up to an aggregate principal amount of $500,000 to
finance the acquisition of Equipment. 
Each Equipment Advance shall not exceed 100% of the invoice price of
Equipment (which is not to including soft costs) approved by Lender from time
to time.  On the last day of each month,
Borrower shall pay Lender all accrued Finance Charges on all outstanding
Equipment Advances during such month. Any Equipment Advances outstanding on the
earlier of (i) August 7, 2005 or (ii) the date that Borrower has
requested Equipment Advances in an aggregate principal amount of $500,000 (the “Term
Out Date”) shall be payable in thirty-six (36) equal monthly installments of
principal, plus all accrued Finance Charges, beginning the last day of the
month after the Term Out Date (or on the Term Out Date if it is the last day of
the month) and continuing on the same day of each month thereafter until all of
the Equipment Advances have been repaid in full, provided, if this Agreement is
terminated prior to all Equipment Advances are paid in full, all outstanding
principal balance plus all accrued Finance Charges of Equipment Advances shall
be due at the time of the termination. Once the Equipment Advances are termed
out, the Finance Charge Percentage for Equipment Advances shall be fixed at
such rate effective as of the Term Out Date. Equipment Advances may be prepaid,
but may not be reborrowed.

 

3)             The
first sentence of Section 15, entitled “Term and Termination” is
hereby amended to read as follows:

 

“This
Agreement shall become effective upon the execution and delivery hereof by
Borrower and Lender and shall continue in full force and effect until the
Termination Date.”

 

4)             Lender
hereby waives payment of the Facility Fee, which is due on the first
anniversary of the date of this Agreement.

 

3.             CONSISTENT CHANGES.  The Existing Documents are each hereby
amended wherever necessary to reflect the changes described above.

 

1

 

4.             INTENTIONALLY OMITTED.

 

5.             NO DEFENSES OF
BORROWER.  Borrower agrees that, as
of this date, it has no defenses against the obligations to pay any amounts
under the Indebtedness.

 

6.             CONTINUING
VALIDITY.  Borrower understands and
agrees that in modifying the existing Indebtedness, Lender is relying upon
Borrower’s representations, warranties, and agreements, as set forth in the
Existing Documents.  Except as expressly
modified pursuant to this Business Financing Modification Agreement, the terms
of the Existing Documents remain unchanged and in full force and effect.  Lender’s agreement to modifications to the
existing Indebtedness pursuant to this Business Financing Modification
Agreement in no way shall obligate Lender to make any future modifications to
the Indebtedness.  Nothing in this
Business Financing Modification Agreement shall constitute a satisfaction of
the Indebtedness.  It is the intention of
Lender and Borrower to retain as liable parties all makers and endorsers of
Existing Documents, unless the party is expressly released by Lender in
writing.  No maker, endorser, or
guarantor will be released by virtue of this Business Financing Modification
Agreement.  The terms of this paragraph
apply not only to this Business Financing Modification Agreement, but also to
any subsequent Business Financing modification agreements.

 

7.             INTENTIONALLY
OMITTED.

 

8.             COUNTERSIGNATURE.  This Business Financing Modification
Agreement shall become effective only when executed by Lender and Borrower.

 

	
  BORROWER:

  	
  LENDER:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  AML COMMUNICATIONS, INC.

  	
  BRIDGE BANK, NATIONAL ASSOCIATION

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Jacob Inbar

  	
   

  	
  By:

  	
  /s/ Lee Shodiss

  	
   

  
	
  Name:

  	
  Jacob Inbar

  	
   

  	
  Name:

  	
  Lee Shodiss

  	
   

  
	
  Title:

  	
  CEO & President

  	
   

  	
  Title:

  	
  Senior VP

  	
   

  
												

 

2Exhibit
10.1

 

*** Confidential Treatment Requested

 

Dated 10 February 2005

 

SUPPLIER NOVATION AND AMENDMENT
AGREEMENT

between

BIOSIL LIMITED

HUTCHISON INTERNATIONAL INC.

MEDICOR AESTHETICS

and

INTERNATIONAL INTEGRATED
INCORPORATED

 

2005

 

IMPORTANT NOTICE: THIS AGREEMENT HAS BEEN PREPARED BY
BRODIES LLP ACTING ON BEHALF OF BIOSIL LIMITED. 
OTHER PROSPECTIVE PARTIES SHOULD CONSIDER TAKING INDEPENDENT LEGAL
ADVICE ON THE TERMS OF THIS AGREEMENT AND SHOULD SIGN IT ONLY IF THEY ARE
PREPARED TO BE BOUND BY ITS TERMS.

 

 

 

 

Brodies LLP

15 Atholl Crescent

Edinburgh EH3 8HA

T: 0131 228 3777

F: 0131 228 3878

Ref: GSC.BIO2.22

 

 

CONTENTS

	
  Clause

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  1.

  	
  Definitions
  and interpretation

  	
   

  
	
  2.

  	
  Condition
  Precedent

  	
   

  
	
  3.

  	
  Re-constitution
  and novation of the 2001 Agreement

  	
   

  
	
  4.

  	
  Hutchison’s
  obligations and release

  	
   

  
	
  5.

  	
  Modifications
  to 2001 Agreement and Volume Change Control Procedures

  	
   

  
	
  6.

  	
  III
  guarantee

  	
   

  
	
  7.

  	
  No
  partnership/agency

  	
   

  
	
  8.

  	
  Further
  assurance

  	
   

  
	
  9.

  	
  Assignment

  	
   

  
	
  10.

  	
  Announcements

  	
   

  
	
  11.

  	
  Confidentiality

  	
   

  
	
  12.

  	
  Costs and
  expenses

  	
   

  
	
  13.

  	
  Entire
  agreement

  	
   

  
	
  14.

  	
  Variation

  	
   

  
	
  15.

  	
  Severance

  	
   

  
	
  16.

  	
  Notices

  	
   

  
	
  17.

  	
  Counterparts

  	
   

  
	
  18.

  	
  Rights of
  third parties

  	
   

  
	
  19.

  	
  Governing
  law and jurisdiction/arbitration

  	
   

  

 

 

 

Schedule 1            2001
Agreement

Schedule 2            Hutchison’s
Obligations

Schedule 3            Modifications
to 2001 Agreement

Schedule 4            Volume
Change Control Procedures

Schedule 5            PMA
Updates

Schedule 6            Data
Storage and Process

Schedule 7            Product
Change Control Procedures

Schedule 8            Guarantee

 

 

DATE:
10 FEBRUARY 2005

 

PARTIES:

 

1                                          BIOSIL LIMITED (registered in the Isle of Man
under number 50222) whose registered office is at Global House, Isle of Man
Business Park, Douglas, Isle of Man, British Isles (“Biosil”);

 

2                                          HUTCHISON
INTERNATIONAL INC.,
a corporation incorporated under the laws of the State of Louisiana
(corporation number 72-1324212) and having its principal place of business at
7949 Jefferson Hwy, Suite E, Baton Rouge, Louisiana 70809, United States of
America (“Hutchison”);

 

3                                          MEDICOR
AESTHETHICS, a
corporation incorporated under the laws of the Nevada (corporation number E0016512005-8) and having its principal executive offices at
6000 S. Eastern Avenue, Suite 9D, Las Vegas, Nevada 89119, United States of
America (“Aesthetics”); and

 

4                                          INTERNATIONAL
INTEGRATED INCORPORATED, a corporation incorporated under the laws of the British Virgin
Islands and having its principal executive offices at 4560 S.Decatur Blvd, Las
Vegas, Nevada 89103, United States of America (“III”).

 

INTRODUCTION
AND BACKGROUND:

 

1                                          This Agreement is supplemental to
the 2001 Agreement (as hereinafter defined) which was entered into between
Biosil and Hutchison and which related (inter
alia) to a project to obtain regulatory approval for the manufacture
of the Products by Biosil and for their sale by Hutchison in the Territory under
Hutchison’s own brand label.

 

2                                          By notice dated 22 July 2004 Biosil
(acting through its attorneys, Messrs McGlinchey Stafford PLLC) lawfully
terminated the 2001 Agreement with stated effect from 23 July 2004.

 

3                                          Aesthetics is a wholly owned
subsidiary of III and has been in discussions with Biosil with a view to
agreeing terms upon which the 2001 Agreement might be reconstituted with effect
from the Effective Date and immediately then transferred by way of novation
from Hutchison to Aesthetics subject to the modifications set out in this
Agreement.

 

4                                          Hutchison has agreed to transfer by
way of novation its rights and obligations under the 2001 Agreement to Aesthetics
upon the terms set out in this Agreement.

 

5                                          On the basis that Hutchison’s
rights and obligations under the 2001 Agreement will be transferred on the
Effective Date by way of novation to Aesthetics on the terms set out in this
Agreement and that III will guarantee to Biosil the due performance of Aesthetics’
obligations (which III has agreed to do), Biosil has agreed to reconstitute the
2001 Agreement.

 

 

AGREEMENT:

 

1                                         Definitions and interpretation

 

1.1                                 In this Agreement (except where the
context otherwise requires):-

 

1.1.1                                           Capitalised terms not otherwise defined herein bear the same meanings
are as ascribed to them in the 2001 Agreement;

 

1.1.2                                           Subject to Clause 1.1.1, the following words shall have the
following meanings:-

 

1.1.2.1                                            “2001
Agreement” means the Supplier Agreement as
amended in terms of Clause 23(1) of that Agreement by the Letters.  Copies of the Supplier Agreement and the
Letters are included in Schedule 1;

 

1.1.2.2                                            “Business
Day” means any day which is not a Saturday,
a Sunday or a bank or public holiday in the Isle of Man;

 

1.1.2.3                                            “Change”
means a change or variation to the terms of
this Agreement and/or the 2001 Agreement which is agreed or determined in terms
of the Volume Change Control Procedures;

 

1.1.2.4                                            “Condition
Precedent”
means the condition precedent referred to in Clause 2.1;

 

1.1.2.5                                            “Effective Date” means
the date on which the Condition Precedent is fulfilled, subject always to the
provisions of Clause 2.2;

 

1.1.2.6                                            “GMP” means Good
Manufacturing Practice as set forth in the Quality Systems Regulations
established under the US Food, Drug and Cosmetics Act;

 

1.1.2.7                                            “Group” means, in
relation to any party, that party and any holding company or subsidiary of that
party and any subsidiary of that holding company;

 

1.1.2.8                                            “Guarantee” means the
Guarantee in the form set out in Schedule 8;

 

1.1.2.9                                            “Letters” means letters
from Biosil to Hutchison dated 27 June, 22 October, 12 November, 25 November
(all 2002), 28 February, 23 May, 28 August and 20 November (all 2003) and 27
January 2004 all of which were agreed by Hutchison amending the terms of the
Supplier Agreement in terms of Clause 23(1) thereof;

 

1.1.2.10                                      “PMA” has the same
meaning as “US Regulatory Approvals” (a defined term in the 2001 Agreement);

 

 

1.1.2.11                                      “Product Change Control Procedures” means the change control procedures relating to the Products which
are contained in Schedule 7;

 

1.1.2.12                                      “Registered Name”
means the name of the person(s) in which the Registrations (or any of them)
have been applied for, or have been granted (as appropriate), for regulatory
purposes, from time to time.  To be
clear, save where a Registration has been applied for, or is being held in the
Registered name of Biosil, the application for, or granting of, a registration
in a Registered Name does not confer legal or beneficial ownership of that
Registration on the Registered Name;

 

1.1.2.13                                      “Schedules” means the
schedules to this Agreement;

 

1.1.2.14                                      “Supplier Agreement”
means the Supplier Agreement dated 17 September 2001 between Biosil and
Hutchison;

 

1.1.2.15                                      “Termination Notice”
means the notice dated 22 July 2004 in terms of which Biosil (acting through
its attorneys, Messrs McGlinchey Stafford PLLC) lawfully terminated the 2001
Agreement with stated effect from 23 July 2004; and

 

1.1.2.16                                      “Volume
Change Control Procedures” means the volume change
control procedures contained in Schedule 4.

 

1.1.3                                           In this Agreement (except where the context otherwise requires):-

 

1.1.3.1                                            any reference to a clause or a Schedule is to the relevant clause or
Schedule of or to this Agreement and any reference to a paragraph is to the
relevant paragraph of the Schedule in which it appears;

 

1.1.3.2                                            the index and clause headings are included for convenience only and
shall not affect the interpretation of this Agreement;

 

1.1.3.3                                            use of the singular includes the plural and vice versa;

 

1.1.3.4                                            use of any gender includes the other genders;

 

1.1.3.5                                            any reference to “persons” includes natural persons, firms,
partnerships, companies, corporations, associations, organisations,
governments, states, foundations and trusts (in each case whether or not having
separate legal personality);

 

1.1.3.6                                            the words “subsidiary” and “holding company” have the meanings given
to them by section 736 of the Companies Act 1985 (of Parliament) and, to be
clear, “company” includes any corporation or body corporate, wherever incorporated;

 

1.1.3.7                                            any reference to a person being an “associate” of another shall be
interpreted in accordance with section 435 of the Insolvency Act 1986 (of
Parliament), and a person shall be regarded as “connected” or “associated” with
any person which is an associate of his and with any company of which any
director is an associate of his;

 

1.1.3.8                                            any reference to a statute, statutory provision or subordinate
legislation shall (except where the context otherwise requires) be construed as
referring to:

 

1.1.3.8.1                                                      such legislation as amended and in force from time to time and to
any legislation which (either with or without modification) re-enacts,
consolidates or enacts in rewritten form any such legislation; and

 

1.1.3.8.2                                                      any former legislation which it re-enacts, consolidates or enacts in
rewritten form;

 

1.1.3.9                                            any reference to a document being “in the agreed form” means a
document in a form agreed by the parties and initialled by, or on behalf of,
all of them for the purpose of identification as such;

 

1.1.3.10                                      any reference to an Isle of Man legal term for any action, remedy,
method of judicial proceeding, legal document, legal status, court, official or
any legal concept or thing shall, in respect of any jurisdiction other than the
Isle of Man, be deemed to include a reference to what most nearly approximates
in that jurisdiction to the Manx legal term; and

 

1.1.3.11                                      any phrase introduced by the terms “including”, “include”, “in
particular” or any similar expression shall be construed as illustrative and
shall not limit the sense of the words preceding those terms.

 

1.1.4                                           The Schedules form part of this Agreement and shall have effect as
if set out in full in the body of this Agreement and any reference to this
Agreement includes the Schedules.

 

2                                         Condition Precedent

 

2.1                                 Save in respect of the rights and obligations of the parties in
terms of Clauses 11, 12, 16, 17, 18 and 19 which shall come into effect on the
date of this Agreement, the coming into force of this Agreement is subject to
and conditional in all respects on the fulfilment of the Condition Precedent, that
is the valid and effective execution by the proposed parties thereto of the
Guarantee.

 

2.2                                 If the Condition Precedent has not been fulfilled:

 

2.2.1                                           by 1700 (UK time) on 25 February 2004; or

 

 

2.2.2                                           within such longer period as Biosil and III may (prior to the date
referred to in Clause 2.1) agree between them in writing;

 

this Agreement shall forthwith lapse and be of no
further force and effect and no party shall have any rights against any other
party under this Agreement except in respect of any breach by any of them of
the provisions of Clauses 11, 12, 16, 17, 18 and 19 and the parties shall be
released from all obligations under this Agreement, but without prejudice to
any rights or obligations which may have already accrued prior to such lapse.

 

3                                         Re-constitution and novation of the 2001 Agreement

 

3.1                                 In consideration of the various covenants, agreements and
undertakings of the parties contained within this Agreement, as from the
Effective Date, the following shall occur simultaneously:-

 

3.1.1                                           The terms of the 2001 Agreement are re-constituted with the intent
that they shall be in full force and effect as if the Termination Notice had
not been given so that, subject to the provisions of Clauses 3.1.2 and 3.1.3,
the obligations of Biosil and Hutchison thereunder are binding and enforceable
in accordance with the terms of the 2001 Agreement;

 

3.1.2                                           Hutchison transfers to Aesthetics, and Aesthetics accepts, the
rights and obligations of Hutchison in terms of the 2001 Agreement and Aesthetics
undertakes to Biosil that it will perform the rights and obligations of
Hutchison under the 2001 Agreement, as modified in terms of Clause 3.1.3, and
shall be bound by its terms in every way as if Aesthetics had been a party to
it in place of Hutchison;

 

3.1.3                                           The terms of the 2001 Agreement are modified (as between Biosil and Aesthetics)
in accordance with the provisions of Clause 4.

 

3.2                                 In the event of any ambiguity, inconsistency or conflict between
this Agreement and the terms of the 2001 Agreement, the terms of this Agreement
shall have precedence over the 2001 Agreement.

 

4                                         Hutchison’s obligations and release

 

4.1                                 Without prejudice to the transfer by Hutchison to Aesthetics of its rights
and obligations under the 2001 Agreement in terms of Clause 3.1.2, and to the
corresponding obligations of Biosil to Aesthetics in terms of the 2001
Agreement, Hutchison undertakes to Biosil and separately to Aesthetics and III that
it will comply with the obligations set out in Schedule 2.

 

4.2                                 Without prejudice to the rights which are transferred by Hutchison
to Aesthetics pursuant to Clause 3.1.2 of this Agreement and to Biosil’s
corresponding obligations to Aesthetics in terms of the 2001 Agreement, Hutchison
hereby releases Biosil from its obligations to Hutchison under the 2001
Agreement as from the Effective Date.

 

4.3                                 In the event that

 

 

4.3.1                                           Hutchison duly and punctually performs its obligations under Clause
3.1; and

 

4.3.2                                           Aesthetics duly and punctually pays to Biosil the sums referred to
in paragraph 1.2 of Schedule 3; and

 

4.3.3                                           the Panel Approval Date occurs prior to 1 September 2005; and

 

4.3.4                                           if directed by Biosil to do so, Hutchison completes the transfer of
the Registrations (to Biosil’s satisfaction but not otherwise) from the
Registered Name of Hutchison to Biosil (or a person nominated by Biosil in
writing) in accordance with the requirements of paragraph 3 of Schedule 2;

 

(but not otherwise), Biosil agrees that it will

 

4.3.5                                           forthwith release Hutchison from any claim to damages that it might
otherwise be entitled to bring against Hutchison arising out of the termination
of the 2001 Agreement and for the breaches by Hutchison of the 2001 Agreement
set out in the Termination Notice; and

 

4.3.6                                           agree to the discharge of the security interest and termination of
the UCC financing statement referred to in Clause 7(6) of the 2001 Agreement,
but pending such discharge and termination, Hutchison shall continue to be
bound by the provisions of Clause 7(6) of the 2001 Agreement insofar as it
relates to the creation, maintenance and enforcement of security interests,
rights and remedies.

 

5                                         Modifications to 2001 Agreement and Volume Change Control Procedures

 

5.1                                 With effect from the Effective Date the terms of the 2001 Agreement
are modified as between Biosil and Aesthetics in accordance with the provisions
of Schedule 3.

 

5.2                                 Biosil and Aesthetics shall comply with the Volume Change Control
Procedures in connection with any Change or proposed Change.

 

6                                         III guarantee

 

6.1                                 In consideration for Biosil agreeing to the re-constitution of the
2001 Agreement and the transfer, by way of novation, of the rights and
obligations of Hutchison to Aesthetics, III guarantees to Biosil on demand the
due and punctual observance and performance by Aesthetics of all of the
obligations of Aesthetics arising under or pursuant to this Agreement and the
2001 Agreement (whether such obligations arise before or after the Effective
Date) and to include all payment obligations.

 

6.2                                 The obligations of III hereunder shall not be discharged or affected
in any way by any lack of, or limit on, the power or authority of Aesthetics or
any irregularity, unenforceability or invalidity of any of the obligations of Aesthetics
hereby guaranteed or by any time or other indulgence or concession being
granted to Aesthetics in respect of such guaranteed obligations (whether or not
III has knowledge thereof or consents thereto) or any other act, deed or matter
of any description.

 

 

6.3                                 The guarantee by III is a continuing guarantee and shall remain in
full force and effect until all obligations of Aesthetics guaranteed herein
have been discharged in full.  The
guarantee is in addition to and shall not prejudice nor be prejudiced by any
other guarantee, indemnity or other security or right against III or any third
party which Biosil may have for the due performance of such guaranteed
obligations.

 

6.4                                 Biosil may without any consent from III and without affecting the
liability of III hereby hold over, renew, modify or release any security or
guarantee now or hereafter held from or obligation of Aesthetics or any other
person in respect of the liabilities hereby guaranteed and compound with or
alter, replace, extend or renew this Agreement and/or the 2001 Agreement and
the liability of III hereby shall continue in full force and effect
notwithstanding such act or event.

 

6.5                                 III waives any right it may have of requiring Biosil to proceed
first against Aesthetics under this Agreement and/or the 2001 Agreement.  Any settlement or discharge between III and
Biosil shall be conditional upon any security or payment to Biosil by Aesthetics
or any other person not being invalidated, voided or reduced (in whole or in
part) by virtue of any provisions or enactments relating to bankruptcy,
insolvency, administration, moratorium periods, receivership or liquidation for
the time being in force in any applicable jurisdiction and Biosil shall be
entitled to recover the value or amount of any such security or payment from III
subsequently as if such settlement or discharge had not occurred.

 

6.6                                 To be clear, III acknowledges that it does not acquire any rights
under the 2001 Agreement.

 

7                                         No partnership/agency

 

Nothing in this Agreement is intended to or shall operate
to create a partnership or joint venture of any kind between the parties or any
of them, or to authorise any party to act as agent for any other, and no party
shall have authority to act in the name or on behalf of or otherwise to bind
any other in any way (including but not limited to the making of any
representation or warranty, the assumption of any obligation or liability and
the exercise of any right or power).

 

8                                         Further assurance

 

8.1                                 Aesthetics undertakes to Biosil that it shall do or procure to be
done all such further acts and things and execute or procure the execution of
all such other documents as Biosil may from time to time reasonably require for
the purpose of giving Biosil the full benefit of the provisions of this
Agreement and the 2001 Agreement.

 

8.2                                 Without prejudice to the generality of its obligations under Clause 8.1,
in the event that Aesthetics is either unwilling or unable to comply with its obligations
under paragraph 4.2 of Schedule 3 or to perform a specific act or acts required
to fulfil an obligation in terms of this Agreement or the 2001 Agreement, Aesthetics
irrevocably appoints Biosil as its attorney to take all such steps and do such
things in the name of Aesthetics as may be required in order to fulfil such
obligations including, but without prejudice to the generality of the
foregoing, executing any document or documents that may be reasonably necessary
therefor.

 

 

9                                         Assignment

 

9.1                                 Hutchison shall not, without the prior written consent of Biosil and
Aesthetics, assign, transfer, charge or deal in any other manner with this
Agreement and/or the 2001 Agreement or any of its rights or obligations under
them, or purport to do any of the same, or sub-contract any or all of its
obligations under this Agreement and /or the 2001 Agreement.

 

9.2                                 Subject to clause 9.4, Aesthetics shall not, without the prior
written consent of Biosil, assign, transfer, charge or deal in any other manner
with this Agreement or any of its rights or obligations under it, or purport to
do any of the same, or sub-contract any or all of its obligations under this
Agreement.

 

9.3                                 Biosil shall not, without the prior written consent of Aesthetics,
assign, transfer, charge or deal in any other manner with this Agreement or any
of its rights or obligations under it, or purport to do any of the same, but
shall be entitled to sub-contract any or all of its obligations under this
Agreement to a reputable sub-contractor without such consent provided, however,
that Biosil agrees it shall be responsible for the acts and omissions of such
sub-contractors as if they were the acts and omissions of Biosil.

 

9.4                                 Aesthetics shall be entitled to engage reputable consultants and
other contractors (including III and other members of the Aesthetics Group or
associates) to assist it to perform its obligations under this Agreement and/or
the 2001 Agreement provided that:-

 

9.4.1                                           Aesthetics agrees that it shall be responsible for the acts and
omissions of such consultants and contractors as if they were the acts and
omissions of Aesthetics;

 

9.4.2                                           Aesthetics notifies Biosil of the engagement of each consultant and
contractor and provides Biosil with such information in relation to the
consultant or contractor concerned (and the services such consultant or
contractor is to perform) as Biosil may reasonably request; and

 

9.4.3                                           Aesthetics ensures that it complies with the requirements of
paragraph 5.4 of Schedule 3 in relation to such consultants and contractors.

 

9.5                                 Each party is entering into this Agreement for its benefit and not
for the benefit of another person.

 

10                                  Announcements

 

None of the parties shall make any announcement
relating to this Agreement or its subject matter without the prior written
approval of the other parties except as required by law or by any legal or regulatory
authority.

 

11                                  Confidentiality

 

11.1                           Subject to the provisions of Clause 11.2, none of the parties shall
issue any press release or publish any circular to shareholders or any other
public document containing, or make any statement containing or otherwise
disclose to any person who is not a party or a representative or

 

 

                                                adviser of such party, information relating to or connected with or
arising out of this Agreement, the 2001 Agreement or the matters contained in
them, including information relating to the business or affairs of the other
parties without obtaining the previous approval of the other parties to its
contents and the manner of its presentation and publication or disclosure (such
approval not to be unreasonably withheld or delayed).

 

11.2                           The provisions of Clause 11.1 do not apply to:-

 

11.2.1                                     any announcement relating to or connected with or arising out of
this Agreement, the 2001 Agreement or the matters contained within them,
required to be made by any party by virtue of any applicable law or regulation
and for the purposes of this provision Aesthetics and/or III may disclose such
information to MediCor Ltd (“MediCor”), their ultimate parent company, to the
extent strictly necessary to enable MediCor to make such an announcement for
the MediCor Group notwithstanding it is not a party to this Agreement; or

 

11.2.2                                     any information which is or becomes generally available to the
public other than as a result of disclosure by either party, its
representatives or advisers contrary to its obligations hereunder; or

 

11.2.3                                     any information which is, was or becomes available to the relevant
party otherwise than pursuant to this Agreement and free of any restrictions as
to its use or disclosure.

 

11.3                           The provisions of this Clause 11 shall continue to apply
notwithstanding termination of this Agreement.

 

12                                  Costs and expenses

 

Each party shall pay its own costs relating to the
negotiation, preparation, execution and implementation by it of this Agreement
and of each document referred to in it.

 

13                                  Entire agreement

 

13.1                           This Agreement, the 2001 Agreement and the documents referred to in
them, constitute the entire agreement and understanding of the parties and
supersede any previous agreement between the parties relating to the subject
matter of this Agreement.

 

13.2                           Each of the parties acknowledges and agrees that in entering into
this Agreement, and the documents referred to in it, it does not rely on, and
shall have no remedy in respect of, any statement, representation, warranty or
understanding (whether negligently or innocently made) of any person (whether
party to this Agreement or not) other than as expressly set out in this
Agreement.

 

13.3                           Nothing in this clause shall operate to limit or exclude any
liability for fraud.

 

 

14                                  Variation

 

Subject to the provisions of the Volume Change Control
Procedures and the Product Change Control Procedures to they extent that they
may result in such a variation, no variation of this Agreement, the 2001
Agreement or of any of the documents referred to in them shall be valid unless
it is in writing and signed by or on behalf of

 

14.1                           (in the case of variations to Clause 3 and Schedule 2 of this
Agreement), Hutchison, Aesthetics and Biosil;

 

14.2                           (in the case of a variation to Clause 5 of this Agreement), III, Aesthetics
and Biosil;

 

14.3                           (in the case of a variation to any other provisions of this
Agreement, the 2001 Agreement or of any of the documents referred to in them),
Biosil and Aesthetics only.

 

15                                  Severance

 

15.1                           If any provision of this Agreement shall be found by any court or
administrative body of competent jurisdiction to be invalid or unenforceable,
such invalidity or unenforceability shall not affect the other provisions of
this Agreement which shall remain in full force and effect.

 

15.2                           If any provision of this Agreement is so found to be invalid or
unenforceable but would be valid or enforceable if some part of the provision
were deleted, the provision in question shall apply with such modification(s)
as may be necessary to make it valid and enforceable.

 

15.3                           The parties agree, in the circumstances referred to in Clause 15.1
and if Clause 15.2 does not apply, to attempt to substitute for any invalid or
unenforceable provision a valid and enforceable provision which achieves to the
greatest extent possible the same effect as would have been achieved by the
invalid or unenforceable provision.

 

16                                  Notices

 

16.1                           Any notice or other communication (with the exception of routine
communications which may also be made by e-mail) given under this Agreement
shall be in writing and signed by or on behalf of the party giving it and shall
be served by delivering it personally or sending it by pre-paid recorded
delivery or registered post (or registered airmail in the case of an address
for service outside the country of origin) or fax to the address and for the
attention of the relevant party set out in Clause 16.2 (or as otherwise
notified by that party hereunder). Any such notice shall be deemed to have been
received:-

 

16.1.1                                     if delivered personally, at the time of delivery;

 

16.1.2                                     in the case of pre-paid recorded delivery or registered post, 72
hours from the date of posting;

 

16.1.3                                     in the case of registered airmail, five days from the date of
posting; and

 

 

16.1.4                                     in the case of fax, at the time of transmission.

 

Provided that if deemed receipt occurs before 9am on a
Business Day the notice shall be deemed to have been received at 9am on that
day, and if deemed receipt occurs after 5pm on a Business Day, or on a day
which is not a Business Day, the notice shall be deemed to have been received
at 9am on the next Business Day. For the purpose of this Clause, “Business Day”
means any day which is not a Saturday, a Sunday or a public holiday in the
place at or to which the notice is left or sent.

 

16.2                           The addresses and fax numbers of the parties for the purposes of
Clause 16.1 are:

 

Biosil:

 

Address:  Global
House, Isle of Man Business Park, Douglas, Isle of Man, British Isles

 

For the attention of: 
Managing Director

 

Fax number: +44 (0)1624 661656

 

Hutchison:

 

Address:  7949
Jefferson Hwy, Suite E, Baton Rouge, Louisiana 70809 USA

 

For the attention of: John Hutchison, President

 

Fax number:  +1
(225) 927 6874

 

Aesthetics:

 

Address:  6000
S. Eastern Avenue, Suite 9D, Las Vegas, Nevada 89119 USA

 

For the attention of: Chief Operating Officer

 

Fax number: +1 (702) 260 4646

 

III:

 

Address:  4560
South Decatur Boulevard, Suite 300, Las Vegas, Nevada 89013-5253 USA

 

For the attention of: 
Chief Operating Officer/ Chief Executive Officer

 

Fax number:  +1
(702) 932 4561

 

or such other address or facsimile number as may be
notified in writing from time to time by the relevant party to the other
parties.

 

16.3                           In proving such service it shall be sufficient to prove that the
envelope containing such notice was addressed to the address of the relevant
party set out Clause 16.2 (or as otherwise notified by that party hereunder)
and delivered either to that address or into the custody of the postal
authorities

 

 

                                                as a pre-paid recorded delivery, registered post or airmail letter,
or that the notice was transmitted by fax to the fax number of the relevant
party set out in Clause 16.2 (or as otherwise notified by that party
hereunder).

 

16.4                           Save for routine communications which may be made by e-mail, service
of notices or communications by e-mail will not to be considered to be valid
for the purposes of this Agreement or the 2001 Agreement.

 

17                                  Counterparts

 

This Agreement may be executed in any number of
counterparts, each of which, when executed and delivered, shall be an original,
and all the counterparts together shall constitute one and the same instrument.

 

18                                  Rights of third parties

 

No term of this Agreement shall be enforceable by a
third party (being any person other than the parties and their permitted
successors and assignees).

 

19                                  Governing law and jurisdiction/arbitration

 

19.1                           This Agreement shall be governed by and construed in accordance with
Isle of Man law except that Biosil’s security interest, rights and remedies
under paragraph 7 of Schedule 3 shall be subject to the laws of the State of Nevada.

 

19.2                           Each party irrevocably agrees to submit to the non-exclusive
jurisdiction of the Isle of Man courts over any claim or matter arising under
or in connection with this Agreement or the legal relationships established by
this Agreement.

 

19.3         Each
party irrevocably consents to any process in any legal action or proceedings
arising out of or in connection with this Agreement being served on it in
accordance with the provisions of this Agreement relating to service of
notices.  Nothing contained in this
Agreement shall affect the right

 

 

to serve process in any other manner permitted by law:  IN WITNESS WHEREOF these presents have been
executed by the parties the day, month and year first before written:

 

EXECUTED AND DELIVERED by BIOSIL LIMITED acting by JOHN ALAN
ALSOP, one of its directors, and who subscribed this Agreement in the presence
of:

 

	
  JEAN BELL

  	
   

  	
  Witness signature

  	
   

  	
   

  
	
  JEAN BELL

  	
   

  	
  Witness name

  	
   

  	
  [Signed “J A Alsop”]

  
	
  1 GREENFIELD COTTAGE

  	
   

  	
  Witness address

  	
   

  	
   

  
	
  MAIN ROAD

  	
   

  	
   

  	
   

  	
   

  
	
  ONCHAN

  	
   

  	
   

  	
   

  	
   

  
	
  ISLE OF MAN

  	
   

  	
   

  	
   

  	
   

  

 

EXECUTED AND DELIVERED by HUTCHISON INTERNATIONAL, INC.
acting by JOHN HUTCHISON, its President, and who subscribed this Agreement in
the presence of:

 

	
  JAN GRAHAM

  	
   

  	
  Witness signature

  	
   

  	
   

  
	
  JAN GRAHAM

  	
   

  	
  Witness name

  	
   

  	
  [Signed “John Hutchison”]

  
	
  2545 FAIRGATE

  	
   

  	
  Witness address

  	
   

  	
   

  
	
  BATON ROUGE LA

  	
   

  	
   

  	
   

  	
   

  
	
  70816 US

  	
   

  	
   

  	
   

  	
   

  

 

EXECUTED AND DELIVERED by MEDICOR AESTHETICS, acting by DONALD
K MCGHAN, its Chairman, and who subscribed this Agreement in the presence of:

	
  GREGORY K BAKER

  	
   

  	
  Witness signature

  	
   

  	
   

  
	
  GREGORY K BAKER

  	
   

  	
  Witness name

  	
   

  	
  [Signed “Donald McGhan”]

  
	
  139 PARK LAKE TRACE

  	
   

  	
  Witness address

  	
   

  	
   

  

 

HELENA A/a 35080

EXECUTED AND DELIVERED by INTERNATIONAL INTEGRATED INCORPORATED
acting by THEODORE ROBERT MALONEY, its President and Chief Executive Officer,
and who subscribed this Agreement in the presence of:

	
  GREGORY K BAKER

  	
   

  	
  Witness signature

  	
   

  	
   

  
	
  GREGORY K BAKER

  	
   

  	
  Witness name

  	
   

  	
  [Signed “T R Maloney”]

  
	
  139 PARK LAKE TRACE

  	
   

  	
  Witness address

  	
   

  	
   

  

 

Helena A/a 35080

 

SCHEDULE 1 — 2001 AGREEMENT

 

 

 

 

 

	
  Signed by:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  JOHN A ALSOP

  	
   

  	
  JOHN C HUTCHISON, PRESIDENT

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  DONALD K MCGHAN

  	
   

  	
  T R MALONEY

  	
   

  

 

 

 

THIS AGREEMENT is made the 17th day
of September, 2001

 

BETWEEN

 

BIOSIL LIMITED, a company incorporated
under the Companies Act 1931 (Company No 50222) and having its registered
office at Global House, Isle of Man Business Park, Douglas, Isle of Man,
British Isles (hereinafter called “Biosil”) of the one part, and

 

HUTCHISON INTERNATIONAL
INC., a
corporation incorporated under the laws of the State of Louisiana (Corporation
No 72-1324212) and having its principal place of business at 7949
Jefferson Hwy, Suite E, Baton Rouge, Louisiana 70809, USA (hereinafter
called “Hutchison”) of the other part.

 

WHEREAS 

 

1.                                       Biosil is a specialist in the design and manufacture of a large
range of silicone products for medical applications.

 

2.                                       Hutchison is a marketing company that wishes to sell the implantable
products specified in this Agreement within the Territory under its own label.

 

3.                                       At the request of Hutchison, Biosil has designed the Products (as
hereinafter defined), has devised a process of manufacture for the Products and
has given Hutchison all assistance that Hutchison has required with a view to
obtaining regulatory approval for the sale of the Products by Hutchison in the
Territory. In doing so, Biosil has created Intellectual Property in both the
Products and the process of their manufacture which is proprietary to Biosil.

 

4.                                       Biosil is to manufacture the Products (as hereinafter defined) for
Hutchison and will supply them exclusively to Hutchison for marketing within
the Territory under Hutchison’s brand label.

 

WHEREBY IT IS AGREED as follows:

 

1.                                      DEFINITIONS AND
INTERPRETATION 

 

In this
Agreement the following definitions shall apply:

 

(1)                                  “Approval Date’ means the date or dates upon which the Products can
be lawfully marketed, distributed and sold in the Territory or any part
thereof;

 

(2) “Commencement
Date” means 1 September 2001;

 

(3) “Delivery”
means despatch and “Delivery Time” means the date of despatch;

 

 

(4) “Direct
Competitor” means any person (including, for the avoidance of doubt, any
company or other body corporate) who is authorized by the appropriate
Regulatory Authorities to distribute and/or sell breast implants of any kind in
the Territory and any holding company, subsidiary, associated company or other
person associated with, or otherwise interested in, such a person. For the
avoidance of doubt, for the purposes of this definition a company will be an
associated company of; and a person will be associated with, or interested in,
a person who is a Direct Competitor if the Direct Competitor has the power to
secure, solely or in conjunction with others, either directly or indirectly,
that the affairs of the company or person concerned are conducted in accordance
with the wishes of the Direct Competitor;

 

(5) “FDA” means the United States
Department of Health & Human Resources, Food and      Drug
Administration or any successor body thereto;

 

(6) “Intellectual
Property” means any patent, copyright, design, trade mark (whether registered
or unregistered), trade names or any other industrial, intellectual property,
or similar, right subsisting in any part of the world including those
subsisting in respect of the Products, and applications for any of the
foregoing;

 

(7) “Materials”
includes any notes, calculations, specifications, reports, design, drawings,
models, prototypes, including information stored in electronic form;

 

(8) date
when applications for Pre-Market Approval for the Products have been approved by
the FDA Review Panel. If the application is not referred to the FDA Review
Panel then the Panel Review Date shall be deemed to have occurred 45 days after
the Submission Date;

 

(9) “Products”
shall mean the products listed in Schedule I together with such other
product or products as the parties shall agree from time to time and “Products’
shall be construed accordingly;

 

(10) “Quarter”
means the period of three months commencing

 

(a) for
the period prior to the Approval Date, on the Panel Approval Date, and each
consecutive period of three months thereafter, and any shorter period
commencing on a day following the end of a Quarter and ending on the Approval
Date; and

 

b) thereafter,
on the Approval Date and each consecutive period of three months thereafter,
and any shorter period commencing on a day following the end of a Quarter and
ending on termination of this Agreement;

 

and
“Quarterly” has a corresponding meaning;

 

 

(11)
“Registration” means all applications for, and all registrations, permissions,  consents, approvals or licenses (including,
without limitation, those required to be made with or given by (as appropriate)
any Regulatory Body including (for the avoidance of doubt) the US Regulatory
Approvals from the FDA) required to enable the Products to be lawfully
marketed, distributed and sold in any part of the Territory and “Registrations”
shall be construed accordingly;

 

(12) “Regulatory
Body” means any government department or any body constituted under any
applicable law for licensing or
other regulatory purposes relating to the Products and whose approval,
permission or consent is required to enable the Products to he lawfully
marketed, manufactured, distributed and sold in any part of the world;

 

(13) “Specification” means the Product
specifications determined by Biosil in terms of clause 10(3);

 

(14)  when applications for the Pre-Market Approval
for the Products are submitted
to the FDA and in relation to Canada means the date when applications for
approval to market the Products are delivered to the Canadian Federal Drug
Directorate;

 

(15) “The Territory” shall, subject to clause
11(2), mean:

 

Countries: United States of
America; and 
Canada

 

(16) “Us Regulatory Approvals” means any
Pre-Market, or subsequent, Approvals issued by the FDA in respect of the
Products listed in Schedule 1.

 

Words
importing one gender include all other genders and words importing the singular
include the plural and vice versa.

 

2.                                      THE PRODUCTS 

 

(1) On or
after the Panel Approval Date, Biosil shall during the period of this Agreement
manufacture in accordance with the Specification, and supply to Hutchison, and Hutchison
shall purchase from Biosil on a consignment basis, such volumes of the Products as may be ordered by
Hutchison under this clause 2 and clauses 8 and 11(2).

 

(2) The
maximum delivery time for Products shall be 12 weeks from receipt and acknowledgement
in writing by Biosil of a duly completed
order from Hutchison.

 

(3) Only
orders and order instructions (e.g. deliveries, priorities) received in writing
and signed by Hutchison authorized personnel will be accepted by Biosil.
Amendments to orders will only be considered if requested in writing by
Hutchison authorized personnel. For the purposes of this provision and Clause 6(2) ”authorized
personnel” are those

 

 

individuals
whom Hutchison have designated in writing as being individuals who have
authority to place orders for the Products with Biosil on Hutchison’s behalf.

 

(4) Hutchison
shall, not less than two weeks before the beginning of each Quarter, place with
Biosil an order for the number of Products to be delivered to Hutchison during
that Quarter.

 

(5) Deliveries
will be despatched on a fortnightly basis.

 

(6) The
volume of Products for which orders are placed Quarterly will not exceed 30%
above the annual target for the year of this Agreement in which the order is
placed (in terms of clauses 5 and 11(2) (as applicable)) divided by 4. In
addition, the volume of each size of Product for which orders are placed Quarterly will not exceed 30% above the quantity forecast by
Hutchison for the year of this Agreement in which the order is placed (in terms
of Clause 8(4)) divided by 4.

 

(7) Increases
in requirements exceeding 30%
above the animal targets will require a minimum of 6 months’ notice and will be
subject to confirmation and agreement by both parties in writing.

 

3.                                      PACKAGING AND MARKING OF THE
PRODUCTS

 

(1) Hutchison
will be responsible for the costs of all design, origination and artwork for
any container, package insert or label required in the assembly of the Product
and shall pay Biosil additional costs incurred by Biosil for any changes to
design or printing of any container or package insert.

 

(2) Hutchison
will be responsible for all mark name or names on the Products and for all
packaging and literature designs for the Products and their promotion and for
ensuring that the said designs do not infringe or abuse the Intellectual
Property of any third parties. Hutchison shall be solely responsible for
infringement or any alleged infringement of Intellectual Property rights of
third parties.

 

(3) Hutchison
will ensure that all promotional materials are marked accordingly with all
Patent Numbers and required quality or registration numbers relevant at the
time and that such promotional materials do not make any claims for the
Products as to performance,
design or quality, that are inconsistent with those given by Biosil or with the
terms of any Registrations. 

 

4.                                      TERMS OF SUPPLY 

 

(1) The
supply of the Products by Biosil to Hutchison shall be on an exclusive basis
for the Territory.

 

 

(2) The
supply of the Products from Biosil to Hutchison shall be governed by Biosil’s
terms and conditions of sale as amended from time to time, except in so far as
they are inconsistent with the express terms of this Agreement in which ease
the terms of this Agreement shall prevail. Delivery of Products hereunder by
Biosil shall be ex-works and the Products shall be at Hutchison’s risk from the
date that delivery takes place or, where Hutchison fails to take delivery on
the due date, from the date on which delivery ought to have taken place.

 

(3) Without
prejudice to Hutchison’s right to contract for such work with third parties
(other than with Direct Competitors which shall not be permitted under any circumstances) any extra requirements
for Biosil to perform including, but not limited to, master file access,
testing, biocompatibility studies, validations, information for Registrations,
compilation and submission of dossiers, will be by separate agreement and
subject to Hutchison agreeing to pay an additional charge to Biosil such charge
not being less than the actual cost to Biosil of meeting the requirements in
question. All sub- contracted work will be charged to Hutchison at a price
equal to the cost to Biosil plus additional 5%.

 

(4) In
consideration of the goods, services and other assistance provided by Biosil to
Hutchison, at Hutchison’s request, up to and including the Commencement Date,
Hutchison shall pay to the bank account of Biosil (details of which appear
below) the aggregate sum of £475,000 in three installments as follows on the
dates shown and upon receipt of such payments, Biosil will issue a receipt

 

	
  Payment

  	
   

  	
   

  	
  Date

  
	
  118750

  	
   

  	
  Panel
  Approval Date or 4 January 2002 whichever shall first occur

  
	
   

  	
   

  	
   

  
	
  118750

  	
   

  	
  Approval
  Date for the United States

  
	
   

  	
   

  	
   

  
	
  237500

  	
   

  	
  Anniversary
  of the date of this Agreement

  

 

In the event
that this Agreement is lawfully terminated by Biosil or in the event of
termination of this Agreement in terms of clause 16(3) before any or all
of the installments have become due for payment in terms of the foregoing
provisions of this clause then all such sums shall become immediately due for
payment without demand by Biosil on the date of termination.

 

Such payments
shall be free and clear of, and without deduction for, any taxes or charges imposed
by or under the authority of any Government or public authority and, for the
avoidance of doubt, a failure to pay such sums on the due dates for payment
shall he deemed to be a breach which is not capable of remedy. For the purposes
of this provision time shall be deemed to be of the essence.

 

 

Biosil’s bank
account to which the payments are to be made is as follows:-

 

	
  Account Name: Biosil limited - Scotland

  	
   

  	
   

  
	
  Account Number: 01415636

  	
   

  	
   

  
	
  Sort Code: 3 0-12-80

  
	
  Name and address of bank:

  	
   

  	
  Lloyds TSB
  plc

  
	
   

  	
   

  	
  P0 Box 8

  
	
   

  	
   

  	
  Victory
  House

  
	
   

  	
   

  	
  Douglas

  
	
   

  	
   

  	
  Isle of Man
  lM99 IAII

  
	
   

  	
   

  	
  British
  Isles

  
					

 

For the
avoidance of doubt, this provision wi11 survive termination of this Agreement.

 

5.                                      Prices 

 

(1) The
prices payable to l3iosil for the Products shall be initially those set out in
Schedule 2 to this agreement.

 

(2) The
prices payable under clause 5(1) above may be increased by 60 days prior
written notice to that effect given by Biosil to Hutchison provided that the
first review of such prices should take place (but without prejudice to the
exercise at any time of Biosil’s discretion in terms of clause 5(3) below) not earlier than I January 2003.
Increased prices notified to Hutchison by Biosil shall take effect immediately
upon the expiry of the 60 day notice period and will apply to any Products
ordered after the expiry of the 60 day notice period.

 

(3) Biosil
shall use its reasonable endeavors to restrict price increases to Hutchison to
once per calendar year, but Biosil reserves the right, in its absolute
discretion, to increase prices at any time in accordance with clause 5(2) above.

 

(4) Prices
will not be increased above 6% per annum without evidence to justify an
increase above this level.

 

(5) All
charges after delivery in terms of sub-clause 4(2) together with the cost
of all relevant export and import documentation and customs duty (if any) shall
be for the account of and shall be paid by Hutchison.

 

6.                                      PA YMENT 

 

(1) Hutchison
shall pay the Mi prices specified in clause 5 above for all Products supplied
to it by Biosil within 60 days of the date of Biosils invoice for such
Products, Invoices will be raised at time of despatch. If the price is not then
paid, Biosil may subject to the provisions of clause 17(1)(a) (and for the
avoidance of doubt a failure to pay (other than

 

 

a “persistent
failure to pay” as defined below) is a breach which is capable of remedy)
terminate this Agreement and may maintain an action for the price even though property
in any Products supplied has not then passed to Hutchison. Such payment shall
be free and clear of, and without deduction for, any taxes or charges imposed
by or under the authority of any Government or public authority. The maximum
amount allowable as unsecured credit at any one time will be £ 300,000. Biosil
reserves the right to review and change credit terms without notice. If the
maximum amount allowable as unsecured credit is outstanding at any time Biosil
shall be entitled to suspend further deliveries of the Products until such time
as a sufficient amount of unused credit is available which exceeds the price of
the deliveries to he made.

 

(2) Invoices
will be raised on a monthly basis for additional research and development or
regulatory work which Biosil carries out, or for fees from subcontractors in
respect of sub-contracts entered into by Biosil, as a result of a purchase
order issued by authorized personnel, and whether such work or sub- contracts
relate to any extra requirements of Hutchison in terms of clause 4(3) or
otherwise. Such invoices shall be payable within 60 days of the date of Biosil’s
invoice and Biosil may terminate this Agreement by notice in writing subject to
the provisions of clause l7(l)(a) (and for the avoidance of doubt a
failure to pay (other than a “persistent failure to pay” as defined below) is a
breach which is capable of remedy) in the event that such invoice is not paid
in full on or by the due date for payment.

 

(3) A
“persistent failure to pay? will occur if Hutchison without reasonable cause
(which shall not include, for the avoidance of doubt) an inability to pay for
any reason whatsoever) fails to pay Biosil invoices in full within the 60 day
periods referred to in clauses 6(1) and (2) on three or more occasions
in any continuous period of 12 months whilst this Agreement subsists. In the
event of a persistent failure to pay occurring Biosil may terminate this
Agreement forthwith by notice in writing to Hutchison and may maintain an
action for payment of the invoices even though the property in any Products
supplied has not then passed to Hutchison.

 

7.                                      TITLE RETENTION; GRANT OF SEC1JRJTY INTEREST

 

(1) Notwithstanding
that risk in the Products shall pass to Hutchison upon delivery, full legal and
equitable title and interest in all and any Products shall remain in Biosil and
shall not pass to Hutchison until Biosil shall have received payment in hill of
all amounts due and owing from Hutchison to Biosil for the time being
(including any interest accounting and owing to Biosil) and from time to time
in respect of all such Products and all other Products supplied by Biosil to
Hutchison at any time. Consistent with applicable Louisiana law, and to secure
payment and performance of all of Hutchison’s present and future obligations in
favor of Biosil. whether under this Agreement, or otherwise, of every nature
and kind, Hutchison grants Biosil a continuing security interest in all of
Hutchison’s rights, title, and interest in all Products supplied and delivered
to Hutchison and in proceeds thereof, and in all general intangible rights of
Hutchison with respect thereto, and with respect to the sale and distribution
thereof, including without limitation,

 

 

all
Registrations and approval rights of Hutchison with respect thereto. Hutchison
agrees that Biosil shall have all of the default and enforcement rights and
remedies provided under Chapter 9 of the Louisiana Commercial Laws (La. R.S.
10:9-101, et seq.). Nothing herein shall detract from the provisions of
clause 15(5).

 

(2) During
such time as title in the Products remains in Biosil, and/or so long as Biosil
retains a security interest with respect to the Products, Hutchison shall not
remove, obscure, or delete any mark placed on the Products by Biosil which may
enable the Products to be identified and Hutchison agrees that it will deliver
up the Products at its own expense to Biosil forthwith upon request during such
time as title to them remains in Biosil.

 

(3) If during such time as title in the
Products remains in Biosil, and/or so long as Biosil retains a security
interest with respect to the Products, any of the Products are incorporated in
or attached to or used as material for or in the manufacture of other goods,
the property in the whole of such goods shall vest in and remain with Biosil
and Hutchison shall hold such goods as consignee of and to the order of Biosil
until Biosil has received payment in full in respect of the Products and
Biosil4s rights in relation to the Products (including its rights under this
Agreement) shall extend to such goods.

 

(4) During
such time as title in the Products remains in J3iosil, and/or so long as Biosil
retains a security interest with respect to the Products, Hutchison shall have
power to deal with or use the Products (and other goods in which the Products
are incorporated) as consignee of Biosil in the normal course of its business
and to dispose of the Products or such goods by way of bona tide sale at fill
market value.

 

(5) If Hutchison shall sell the Products
or goods incorporating the Products it shall hold all the proceeds of sale in
trust for Biosil until payment of all amounts due to Biosil.

 

(6) Hutchison
authorizes Biosil to complete and file a UCC financing statement in the
appropriate filing office to complete perfection of Biosil’s security interest
granted under this Agreement. Hutchison agrees to notify Biosil in writing
should Hutchison ever change its corporate name, or reorganize under the laws
of another state.

 

(7) Hutchison
warrants that it is not insolvent at the time of entering into this appoint a
receiver or to petition for a winding up or to exercise any other rights over or against its assets or to take any
action analogous to the foregoing in any applicable jurisdiction.

 

(8) For
the avoidance of doubt nothing in this clause 7 shall oblige Biosil to accept
the return from Hutchison of any of the Products supplied to it by Biosil for
credit or otherwise notwithstanding that title in such Products remain in
Biosil.

 

8.                                      PURGIASE TARGETS 

 

(1) In
this clause and clause 11(2) the following expressions have the following

 

 

meanings:”
year of this Agreement” shall mean each successive period of 12 months
commencing on 1 January in each year whilst this Agreement subsists save
that the first Year of this Agreement will commence on the Approval Date and
will end on 31 December next following and a “Product” for the purposes of
determining the Minimum Numbers shall be Product sold on an arms length basis
at the frill price as determined by clause 5 (i.e. not samples etc);

 

“Minimum
Number of Products’1 shall mean the number of Products to be purchased by
Hutchison from Biosil in each year of this Agreement as determined in
accordance with the following provisions of this clause and clause 11(2) and
the phrase “Minimum Number” shall be construed accordingly.

 

(2) For
the purposes of clause 8(5), the Minimum Number of Products to be purchased by
Hutchison from Biosil in each year of this Agreement shall, unless otherwise
agreed in writing by the parties hereto! be the figure (if any) set opposite
each year of this Agreement as listed in clause 8(3) below:-

 

	
  (3) (a)

  	
  Products -

  	
  Hutchison branded Saline Inflatable Mammary Implants
  (HTL,HSL,HTH.HSH)

  
	
   

  	
   

  	
   

  
	
   

  	
  Territory -

  	
  These targets are for the United States of America only. They exclude
  Canada (see clause 11(2)).

  

 

	
  Year of Agreement

  	
   

  	
  Minimum Number of Products

  	
   

  
	
  1st (2002)

  	
   

  	
  ***

  	
   

  
	
  2nd (2003)

  	
   

  	
  ***

  	
   

  
	
  3rd (2004)

  	
   

  	
  ***

  	
   

  
	
  4th (2005)

  	
   

  	
  ***

  	
   

  
	
  5th (2006)

  	
   

  	
  ***

  	
   

  
	
  6th (2007)

  	
   

  	
  ***

  	
   

  
	
  7th (2008)

  	
   

  	
  ***

  	
   

  

 

 

(b) Notwithstanding
clause 8(3) (a) within 10 days of the Panel Approval Date for the
United States of America, Hutchison shall place an order with Biosil to
purchase a minimum of 500 Products
per month in the period commencing at the start of the calendar month after the
Panel Approval Date and ending on either (I) the Approval Date or (ii) 31 December 2001,
whichever is later. Thereafter the Minimum Number of Products to be purchased
by Hutchison from Biosil in each Year of this Agreement shall, unless otherwise
agreed in writing by the parties hereto, be as set out in clause 8(3)(a). 

 

(c) Furthermore,
in order to ensure that orders are placed by Hutchison with Biosil on a regular
basis, but without prejudice to Hutchison’s obligations to purchase the annual
Minimum Numbers of Products pursuant to this clause 8, from and after the
Approval

 

 

Date or 31 December 2001
(whichever is later) Hutchison shall place an order with Biosil to purchase a
minimum of 1,000 Products per month to commence in the calendar month
immediately following and for each
subsequent month during the period of this Agreement. For the avoidance of
doubt, any Products so ordered in any year of this Agreement will count towards
meeting the Minimum Number of Products to be purchased in that year.

 

(d) The
Minimum Number of Products to be purchased by 1-lutchison as set out in
clause 8(3) (a) above for first Year of this Agreement has been
calculated on the basis that it will subsist for a full calendar year. In the
event that the first year of this Agreement does not so subsist the Minimum
Number of Products to be purchased for that year will be number of the weeks
are full weeks that would have
been available had the year consisted of a full calendar year.

 

(e) The
Minimum Number of Products to be purchased for any year of this Agreement shall
not be less than the actual number of
Products purchased for the previous year.

 

(f) Minimum
Numbers for any additional Products or Territories shall be agreed separately
in writing and in default of agreement
shall be such targets as Biosil may determine acting reasonably.

 

(4) Hutchison
shall confirm to Biosil in writing at least three months in advance of each
year of this Agreement the forecasted number of units of each Product to be
purchased by Hutchison during that year of this Agreement. Hutchison will also
specify at the same time what size(s) of unit of each Product it forecasts it
will purchase during that year and the quantities of each size it forecasts it
will require. The annual Minimum Number of Products broken down by size(s) of Products to be purchased
shall be reviewed

 

(a) during the first four Years of this
Agreement by both panics before the end of the 6th month of each Year; and

 

(b) thereafter during the three month
period before the start of each year of this Agreement;

 

and the
Minimum Number of Products broken down by size(s) of Products to be purchased
for that year may be adjusted following such review by agreement between the
parties.

 

(5) In the event that a Minimum Number of
Products has not been specified for the purpose of clause 8(3) or agreed
for the purpose of clause 8(4), Biosil may by notice in writing at any time
before the expiry of 6 months from the start of any year of this Agreement specify for the purpose of
sub-clause (6) below, the Minimum Number of Products for each year of this
Agreement from the year of this Agreement then current to the final year of
this Agreement.

 

 

(6) If
Hutchison shall fail to purchase from Biosil in any year of this Agreement the
Minimum Number of Products as specified in clause 8(3) above or determined in accordance with clause 8(5) above as the target for
that year, or 13 clause l7(1)(a)) to terminate this Agreement by giving 30 days written notice to
Hutchison and for the purposes of clause 1 7(l)(a) such a failure shall be
deemed to be a breach capable of remedy.

 

9.                                      DUTIES OF HUTCHISON 

 

Hutchison hereby undertakes and agrees with Biosil that it will at all
times while this Agreement is in force observe and perform the terms and
conditions hereof and will:

 

(1) At
its own cost, use its best endeavors to introduce, sell, and at all times to
actively promote and extend the sale of all Products in all parts of the
Territory. This provision is of the essence of this Agreement and the basis on
which Biosil has consented to enter into
it, and any failure by Hutchison to carry out the provisions of this sub-clause
shall be deemed to be a breach of this Agreement which shall not be deemed to
be capable of remedy.

 

(2) Without
prejudice to the requirements of clauses 8 and 11(2) with regard to
purchase targets, purchase from Biosil such quantities of the Products as will
enable Hutchison to maintain sufficient stocks of the Products to meet all
reasonably foreseeable demands for the Products in the Territory.

 

(3) Will
comply with all Registration requirements for the sale of and use of the
Products in the Territory. For Registration purposes, Biosil reserves the right to communicate direct to
the Regulatory Bodies to supply all data required by them for the Territory and
will liaise with Hutchison in relation to such communications. Such work will
be by separate appointment and subject to additional costs in terms of clause 4
(3).

 

(4) Will not allow any Product to be sold or supplied outside the
Territory and shall ensure that all purchasers of the Products from Hutchison
agree that the Products shall not be re-sold or supplied outside the Territory.
In particular, if Hutchison seek to sell or supply the Products on or through
the Worldwide Web it will take all practicable measures required from time to
time to ensure that this provision is complied with.

 

(5) In all correspondence and other dealings relating directly or
indirectly to the sale or other disposition of the Products, Hutchison will
clearly indicate that it is acting on its own account.

 

(6) Will not represent itself impliedly or expressly to be the
agent of Biosil nor incur any liability on behalf of Biosil nor in any way
purport either to pledge Biosils credit or to accept any order or to make any
contract binding upon Biosil. 

 

 

(7) In relation to the Intellectual
Property rights of Biosil from time to time Hutchison will:

 

(a)                                  not
cause or permit anything which may damage or endanger such rights or Biosil’s
title thereto or assist or allow others to do so;

 

(b)                                 immediately
bring to the attention of Biosil any improper or unlawful use or infringement
of any such rights (or any suspicion of such use or infringement) which come to
its notice;

 

(c)                                  take
such reasonable action as Biosil may direct at the expense of Biosil in
relation to such use or infringement; and

 

(d)                                 without
prejudice to the generality of the foregoing, use every effort to safeguard
such rights and the interests of Biosil.

 

(8) Will
not alter the Products and will comply fully with the legal and health
requirements for the sale of and use of and traceability of, the Products in
the Territory.

 

(9) Notwithstanding
any termination of this Agreement, Hutchison will adopt documented procedures
for maintaining forward traceability, for complaint handling, for the reporting
of adverse incidents, for issuing advisory notices and recalling Products and
for record retention. Hutchison will retain for an indefinite period all
records including batch/control numbers for all Products sold and will comply
fully with Biosils instructions for any recall of Products or Biosil’s requests
for information regarding traceability of any Product, or any advisory notices
Biosil instruct to be issued.

 

(10) Will
be responsible for the planning, permissions, monitoring, reporting, funding
and insurance coverage for any clinical trials that might be needed for
Registration purposes.

 

(11)Prior to
the Commencement Date or which subsequently take place in accordance with
clause 9(13) below.

 

(12) Will keep
Biosil fully and promptly informed about all aspects pertaining to the sales
and performance of the Products (whether the information be positive or
negative) and of all post-market reports or information received which relate
to the efficacy, function or design of the Products or any factors which may
effect production processes or future design changes or developments of the
Products.

 

(13) On a
Quarterly ( 3 monthly ) basis detail to Biosil reports, returns and other
information in writing in accordance with Hutchison’s obligations under this
Agreement. In particular, Hutchison will timeously provide Biosil with all of
the

 

 

information in
writing that it requires in order to be able to discharge its obligations and
responsibilities under clauses 10(4) and (5).

 

(14) Keep
accurate lists of sales of Products and customers purchasing the Products and
to provide a copy of this information to Biosil should either Biosil be
required under any applicable law or by any Regulatory Body to produce the same
or in the event that this Agreement is lawfully terminated.

 

(15)Will, in
dealing with or handling the Products or returned Products, follow the
reasonable instructions of Biosil. arid will provide storage for the Products
to an approved standard (which meets relevant requirements (if any) of any
applicable Registrations) so as to ensure no contamination or infection thereof
and no deterioration in the quality or appearance thereof.

 

(16) Will
provide purchasers of Products in the Territory with the benefits of a
guarantee against defects in manufacture in the same terms mutatis mutandis as
the warranty given by Biosil in clause 12(1) and (2) below.

 

(17) Will
offer its customers at its own expense the benefit of its own additional
warranty to replace a Product together with a reasonably monetary amount, to be
determined by Hutchison after consultation with Biosil, to pay towards
reoperation costs.

 

(18) Will
promptly submit in advance to Biosil for approval draft copies of all reports,
applications or submissions to any government department or Regulatory Body
which have been compiled for Registration or other purposes such draft copies
and will make such alterations or changes as Biosil may reasonably require in
so far as they make reference to Biosil data and/or Intellectual Property. In
particular, Hutchison acknowledges that such Intellectual Property rights as
subsist in the Product and the process of their manufacture belong to Biosil
and Hutchison will ensure that it takes all steps (pursuant to its obligations
in terms of clause 9(7) above) as Biosil may require to safeguard its
rights in such Intellectual Property and, without prejudice to the generality
of the foregoing, will ensure that such Intellectual Property is clearly marked
as confidential. In addition, Hutchison will ensure that it properly notifies
any Regulatory Body in the Territory to whom it makes any report, application
or submission of the rights given to Biosil under this Agreement with respect
to Registrations including the US Regulatory Approvals. Hutchison will submit
to Biosil copies of all final reports, applications, submissions or other
documentation prepared by or on behalf of Hutchison for Registration or other
legal purposes together with copies of all correspondence with Regulatory
Bodies on Registration matters.

 

(19) Will give
Biosil every assistance in defending any product liability, or intellectual
Property infringement, claims against Biosil arising from the sale of Products
in the Territory.

 

 

(20) Will
confirm in writing to Biosil both the Submission Date and the Panel Approval
Date within 3 days of their occurring.

 

10.                               DUTIES OF BIOSIL 

 

(1) Biosil
will produce, maintain, control and own the technical dossier (containing inter
alia the detailed audit information relating to the design and manufacture of
the Products) for the Products and all Materials produced by Biosil which
concern the Products.

 

(2) Biosil
will design and manufacture the Products in accordance with the requirements of
FDA 21 CFR Part 820 and any other applicable laws or regulations in the
Territory provided that such other requirements are notified by Hutchison to
Biosil with a sufficient lead time before orders for Products meeting such
requirements are placed for Biosil to carry out the work required to meet such
requirements.

 

(3) Drawings,
manufacturing methods, which may reasonably be expected of them in order to
perform in accordance with the terms of this Agreement

 

(4) Subject
to due compliance by Hutchison of its obligations to provide reports, returns
and information pursuant to clauses 9(11) and (12), ]3iosil will be responsible
for the investigation of Products which have been returned in accordance with
Biosil Quality Procedure (QP035) and advising Hutchison of the need for the
issue of advisory notices (via Hutchison) and initialization of Product recalls
in accordance with Biosil Quality Procedure (QP025) as updated from time to
time.

 

(5) Subject
to due compliance by Hutchison of its obligations to provide reports, returns
and information pursuant to clauses 9(11) and (12), Biosil will retain all
records in accordance with Biosil Quality Procedure (QP28) as updated from Lime
to time.

 

(6) Biosil
will be responsible for reporting to Regulatory Bodies any significant changes
regarding quality systems, products or processes as required in accordance with
FDA 21CFR Part 820.

 

(7) Biosil
will allow reasonable access to Regulatory Bodies to any technical
documentation or records held by Biosil for the purpose of verifying
conformance with any Registration requirements in accordance with the terms of
this Agreement.

 

(8) Biosil
will supply Hutchison with copies of certifications and any conformity
assessments carried out on Biosil and Hutchison will retain such copies for
review purposes.

 

 

(9) Biosil
will give all reasonable assistance in defending any product liability, or any
Intellectual Property infringement, claims against Hutchison arising from the
sale of the Products in the Territory.

 

11.                               RESTRICTIONS 

 

(1) Hutchison
undertakes that while this Agreement is in force it will not be concerned or
interested either directly or indirectly in the manufacture, supply,
reasonably) considers are the same as or similar to, or competitive with the
Products, or which either alone or in conjunction with some other product
perform, or are designed to perform, the same or a similar function to, or
which might otherwise interfere
with the sale of any of, the Products.

 

(2) Canada
will be removed from the scope of this Agreement unless the Submission Date for
Canada has occurred within 90 days of the Approval Date for the United States
of America and Minimum Numbers of Products for the year of this Agreement then
current and each of the remaining years to be bought by Hutchison for sale in
Canada have been agreed within 2 months of the Submission Date for Canada. In
the event that Minimum Numbers for sales in Canada are so agreed then the terms of clause 8(3)(a) shall
be deemed to be repeated for Canada as if Canada were the Territory and the
Minimum Number of Products to be purchased for Canada were the Minimum Numbers
so agreed for Canada and the remaining provisions of clause X shall apply
separately to these purchase targets in respect of Canada.

 

12.                               WARRANTIES ANI) INDEMNITIES 

 

(1) Biosil
warrants to Hutchison that all Products supplied: 

(a)                                  will conform to any
relevant description, sample or specifications issued by Biosil. 

(b)                                 will be free from
defects in materials or workmanship. 

(c)                                  will be of
satisfactory quality.

 

(2) If
any Products covered by the warranty given in sub-clause (I) above do not
conform with the terms of such warranty, Hutchison shall be entitled to require
Biosil to take back such Products and to replace them with Products conforming
to the said warranty, provided that such Products are returned with all
traceability data attached.

 

(3) Hutchison
agrees that any Product returned from a third party who claims it is defective,
will not be accepted as defective until it has first been returned by Hutchison
to Biosil for inspection, in accordance with l3iosil’s returns procedures as
notified by Biosil to Hutchison from time to time, after which time a report
shall be issued to Hutchison. Only in the event that such report agrees that
the Product is defective will Biosil replace the Product with a non-defective
Product.

 

 

In contact
with human tissue will not be accepted back unless it is accompanied by a
decontamination certificate from the third party.

 

13.                               CONFIDENTIALITY 

 

(1)In this
clause 13 the following terms have the following meanings:

 

“1997
Agreement” means the contract customer agreement between Biosil and Hutchison
dated 1 July 1997 whose terms are superseded by this Agreement;

 

“Confidentiality
Agreement” means the confidentiality agreement between Biosil and Hutchison
executed by the parties on 6 and 13 September 2000;

 

“Confidential
Information” includes technical data, chemical characterizations, designs,
know-how, test data, biocompatibility data, specifications, formulae,
formulations, processes, operating and testing procedures, regulatory data and
submissions, and any other information marked as or identified as
“Confidential”, any of which may be disclosed electronically or in documentary
or other tangible form or orally or by demonstration or visual inspection. For
the avoidance of doubt “Confidential Information” excludes information or data
which relates to the sales and clinical performance of the Products by
Hutchison;

 

“Permitted Purpose”

 

a)                                      for
Hutchison means the use of Confidential information for the purpose of
assisting Hutchison in completing its master file / design file and obtaining
regulatory or other official approvals to allow lawful sale of the Products
within the Territory and

 

b)                                     for
Biosil means the use of the Confidential Information for the purpose of obtaining
regulatory or other approvals to allow lawful sale of the Products by Hutchison
in the Territory and to assist in obtaining regulatory or other official
approvals for the lawful sale of its own products in other territories.

 

(2) Each
party, including their agents, hereto undertakes both while this Agreement is
in force and at any time thereafter not to disclose to any third party any
information relating to the business or the other except in so far as may be
necessary for the proper performance of this Agreement or the extent that such
information is generally available to the public.

 

(3) Each
party in receipt of Confidential Information disclosed hereunder (the
“Recipient”) undertakes with the party disclosing that Confidential Information
directly or indirectly (the “Discloser”) to

 

 

(a) maintain
it in confidence, not to disclose any of it to any third party other than for
the Permitted Purpose or unless compelled to do so by a valid order of a court
having appropriate jurisdiction without the prior written permission of the Discloser and not to use any of it
other than for the Permitted Purpose unless otherwise agreed in writing with
the Discloser.

 

(b) return to the Discloser all Confidential
Information disclosed and all samples supplied under this Agreement within 10
days of a request for their return by the Discloser.

 

(4) The
Recipient shall limit dissemination of Confidential Information within its
organization to those of its employees who need to receive it for the Permitted
Purpose and shall ensure that such employees are made aware of the Recipient’s
obligations hereunder and arc bound to uphold them.

 

(5) The
Recipient may not disclose any Confidential Information received hereunder to
any of its subsidiary, holding or associate companies which is not a party to
this Agreement unless and until such company has entered into an Agreement
under which it gives undertakings which are equivalent to those given by the
Recipient hereunder.

 

(6) A
disclosure of Confidential Information by the Recipient to a third party for
the Permitted Purpose in terms of clause 13(3)(a) above shall only he made
if that third party gives undertakings to the Recipient which are equivalent to
those given by the Recipient hereunder, A duplicate original of the Agreement
executed between the Recipient and the third party shall be mailed immediately
to the Discloser upon execution, The requirement for the Recipient to obtain
such undertakings shall not apply in the case of a disclosure to a third party
which is a Regulatory Body or a notified body which has responsibility for
approving or regulating the lawful sale or marketing of products of the
Recipient in any particular jurisdiction.

 

(7) The
Recipients obligations hereunder shall not apply or shall cease to apply to any
information which:

 

(a) the
Recipient can demonstrate to the written satisfaction of the Discloser by
written records was known to it prior to disclosure hereunder otherwise than as
a result of a previous confidential disclosure by the Discloser; 

(b) is in the public domain or comes into the public domain through no
fault of Recipient; 

(c) is disclosed to the Recipient without restriction on disclosure by a
third party under no obligation of confidentiality to the Discloser with
respect thereto.

 

(8) Specific
information which is not itself within any of the exceptions specified in
clause 13(7) above shall not be brought within any of those exceptions
simply because it is embraced by general information which is so within.

 

 

(9) The
fact that information may itself come within any of the exceptions specified in
clause 13(7) above shall not prevent the fact of its adoption or use by
the Discloser from remaining Confidential information.

 

(10) The
disclosure of Confidential Information hereunder and the extent of such
Confidential Information disclosed is at the complete discretion of the
Discloser.

 

(11) No
license of any patent, copyright, know-how or other intellectual Property right
is granted to the Recipient by this Agreement, and no license shall be deemed
to have arisen or be implied by way of estoppels or otherwise provided that
(for the avoidance of doubt) Hutchison shall be entitled to sell the Products
within the Territory in accordance with this Agreement.

 

(12) The
parties agree that the terms of this Agreement shall apply to all Confidential
Information disclosed by the parties to each other pursuant to the terms of the
1997 Agreement and the Confidentiality Agreement notwithstanding the date of
this Agreement.

 

(13) All
obligations of the parties under the foregoing provisions of this clause 13 
 of this Agreement.

 

(14)
Notwithstanding the other provisions of this clause 13, in the event that this
Agreement expires without being renewed other than through the fault of Biosil
or is lawfully terminated by Biosil under clause 17

 

(a) Biosil
may use any Confidential Information disclosed by Hutchison to it for the
purpose of obtaining regulatory or other official approvals to allow sale of
the Products by Biosil (or any third party nominated by Biosil) within the
Territory; and

 

(b) Hutchison
will forthwith disclose to l3iosll such Confidential Information in its
possession as Biosil may reasonably require for such purposes.

 

14,                               INTELLECTUAL PROPERTY RIGHTS

 

(1) All
Intellectual Property and Materials owned by Biosil and Hutchison as at the
date of this Agreement shall remain vested in them. 

 

(2) Where
any new Material is created for the purpose of this Agreement by either party
then, save to the extent that such Material embodies the Intellectual Property
of the other party, the rights in the Intellectual Property in such new
Material shall belong to the party which creates it. 

 

 

(4) The
issuing of a charge for payment for the compilation of Material or work
undertaken as per clause 4(3) will not constitute a transfer of
Intellectual Property or rights.

 

(5) Any
Intellectual Property devised jointly by Biosil and Hutchison pursuant to the
terms of this Agreement shall be owned jointly by the parties and the rights of
the panics to use such Intellectual Property shall be regulated by the
following provisions of this clause 14.

 

(6) Each
party grants to the other a royalty-free license to use its Intellectual
Property and any Intellectual Property which is jointly owned in terms of
clause 14(5). The terms of such licenses are as follows:-

 

(a) in
the case of the license from Biosil to Hutchison the license shall subsist for
the duration of this Agreement or any renewal thereof and the Intellectual
Property which is licensed shall only be used by Hutchison for the purposes of
fulfilling its obligations under this Agreement and for no other purpose;

 

(b) subject
to paragraph (c) in the case of the license from Hutchison to Biosil the
license shall be irrevocable and without limit in point of time and Biosil may
use the Intellectual Property licensed to it for the purposes of obtaining
regulatory or other official approvals to allow sale by Biosil (or any third
party nominated by Biosil) of its products in any part of the world other than
the Territory;

 

(c) In
the event that this Agreement expires without being renewed other than through
the fault of Biosil or is lawfully terminated by Biosil under clause 17, the
license granted by Hutchison to Biosil hereunder shall extend so that Biosil
may additionally use the Intellectual Property licensed to it for the purposes
of obtaining regulatory or other official approvals to allow sale of the
Products by Biosil (or any third party nominated by Biosil) in the Territory
and may market, manufacture, distribute and sell products incorporating such
Intellectual Property in any part of the world including the Territory In the
event that this provision applies, Hutchison will forthwith disclose to Biosil
any Materials relating to the Intellectual Property licensed to Biosil under
such irrevocable license as Biosil may reasonably require.

 

(7) On termination or expiry of this Agreement Hutchison shall at
Biosil’s sole option:

 

(a) deliver
up to Biosil all Materials provided by Biosil together with any copies of them
which remain in its possession, power or control; or

 

(b) within
7 days destroy any Materials created for the purpose of this Agreement which
embody any of the Intellectual Property of Biosil.

 

 

 

15.                               REGISTRATIONS

 

Biosil acknowledges that the Registrations shall be applied for, and
registered, in the sole name of Hutchison subject only to the rights of Biosil
under this clause 15. Hutchison hereby undertakes and agrees with Biosil:

 

(1) that Hutchison will not allow any
Registrations to lapse arid will apply timeously for any renewal of such
Registrations;

 

(2) subject
in all circumstances to the provisions of clause 1 7(3), that it shall not sell or otherwise dispose of the
Registrations to a Direct Competitor under any circumstance nor shall it sell
or otherwise dispose of the Registrations to any other third party other than
on terms

 

(a) which
oblige that third party to assume all rights and obligations of Hutchison to
Biosil under this Agreement as if that third party had been the original party
thereto instead of Hutchison; and

 

(b) which
are directly enforceable by Biosil against the third party;

 

(3) that
Hutchison will at all times act in accordance with the laws of the Territory
and not commit any act which would adversely affect the Registrations;

 

(4) that
where this Agreement expires without renewal other than through the fault of
Biosil, is lawfully terminated by Biosil (other than where clause 15(5) below applies) or on the
occurrence of an event in relation to Hutchison of the type mentioned in clause
17(3) in circumstances where Biosil does not terminate the Agreement:

 

(a) Biosil
shall be entitled to the full right, title and interest in and to all
Registrations (whether effected in joint names or otherwise) and  Hutchison shall hold the benefit of such
Registrations in trust for Biosil;

 

(b) Hutchison
will take all such steps and do such things as may be required in order to
transfer to Biosil the benefit of the Registrations under the laws of the
Territory including, but without prejudice to the generality of the foregoing,
executing any document or documents required to effect such transfers under the
laws of the Territory in compliance with all formalities of the laws of the
Territory;

 

(c) in
the event that any or all of the Registrations are not capable of transfer,
Hutchison will co-operate fully with Biosil in securing equivalent
Registrations for Biosil or for such party as Biosil may nominate;

 

 

(5) In
the event of the occurrence or an event of the type set out in clause 17(1) (b) affecting
Hutchison, Hutchison shall forthwith notify Biosil in writing that the event
has occurred and shall offer to sell all Registrations to Biosil

 

(a) at a
price of US$ 8,000,000 where the event occurs in the first year after the
Commencement Date; and

 

(b) at a
price, where the event occurs in subsequent years. of US$8,000000 less USS
714,000 for each anniversary of the Commencement Date that has passed prior to
the occurrence of the event unless and until such time as the price is reduced
to US$3,000,000 whereupon the such price shall remain at US$3,000,000 for the
remainder of the period of this Agreement.

 

In the event
that Biosil declines to accept Hutchison’s offer Hutchison shall be free to
sell all (but not pan) of the Registrations to a third party (other than a
Direct Competitor) on a bona fide arms length basis at a price which is not
less than the price at which they were offered to Biosil provided that, before
it sells to such third party

 

(i)                                     Hutchison
discloses to Biosil that it has received an offer from the third party for the
Registrations and discloses the identity of such third party and the price
offered for the Registrations; and

 

(ii)                                  Hutchison
offers to Biosil a right of first refusal to purchase the Registrations on the
same tents as those offered by the third party and Biosil declines to purchase
on such terms;

 

(6) that
it will provide Biosil with copies of all Registrations, all applications for
Registrations and all correspondence from, and all approvals, consents or
licenses, including any updates or renewal demands issued by any Regulatory
Body, government department or other body in the Territory which relate to
Registration matters; and

 

(7) that
it will keep Biosil fully informed of any matters that may affect Registrations
and provide J3iosil with such information as Biosil may request from time to
time in relation to Registration matters.

 

16.                               TERM OF AGREEMENT 

 

(1) Subject to the provisions for
earlier termination herein contained, this Agreement shall
continue in force until 31 December 2008.

 

(2) Provided
that both parties have met their obligations in accordance with this Agreement,
this Agreement may be renewed for a further period of 7 years, subject to a

 

 

review of
terms and performance targets during the final year of this Agreement in
advance of the second 7 year term.

 

(3) Unless
otherwise agreed in writing by both parties, this Agreement will automatically
terminate if the Panel Approval Date for sales of the Products in the United
States of America has not occurred by 1 July 2002, or if any Registrations
are suspended for any reason for a period longer than 3 months. Where
the approval given by the FDA Review Panel on the Panel Approval Date is
subject to conditions or qualifications, this Agreement will automatically
terminate if these conditions or qualifications are not acceptable to both
parties (acting reasonably).

 

17.                               TERMINATION 

 

(1) Either
party may terminate this Agreement forthwith by notice in writing to the other
if such other:-

 

(a) Shall
have committed a breach of this Agreement which in the ease of a breach capable
of remedy, shall not have been remedied within
30 days of the receipt by the party in default of a notice from the
innocent party identifying the breach and requiring its remedy save that the
innocent party shall not be entitled to terminate this Agreement pursuant to
this provision in circumstances where it would not have been practicable to
remedy such breach within the said 30 day period, if and for so long as the
party in breach has within the 30 day period taken all practicable steps to
remedy the breach as soon as possible after receiving the notice and continues
to do so after the 30 day period has expired until the breach is remedied.

 

(b) Is
unable to pay its debts or enters into liquidation whether compulsorily or
voluntarily (other than for the purpose for effecting a reconstruction or
amalgamation) or compounds with or convenes a meeting of its creditors or has a
receiver appointed of all or any part of its assets or takes or suffers any
similar action in consequence of a debt, or ceases for any reason to carry on
business or any similar occurrence under the laws of any jurisdiction affects
Hutchison.

 

(2) Biosil
shall be entitled to terminate this Agreement forthwith by notice in writing to
Hutchison, if Hutchison at any time challenges the validity of any Intellectual
Property of Biosil.

 

(3) Either
party shall be entitled to terminate this Agreement forthwith by notice in
writing to the other if a Direct Competitor acquires an interest in, or is
involved (directly or indirectly) in the control or management of; the other
party, its business or assets (including, for the avoidance of doubt, the
Registrations).

 

(4) Biosil
shall be entitled to terminate this Agreement forthwith by notice in writing to
Hutchison in the event that any of the Registrations are revoked, or made
subject to

 

 

conditions or
restrictions which have the effect that Biosil cannot be reasonably expected to
perform its obligations under this Agreement.

 

18.                               CONSEQUENCES OF TERMINATION 

 

Upon the
termination of this Agreement howsoever arising:

 

(1) The
rights of either party against the other which have accrued up to the date of
termination shall not be affected, but Hutchison shall not be entitled to any
compensation, damages or payment for goodwill, which may have been established,
or to any similar payment, notwithstanding any statutory or enacted provision
or rule of law to the contrary;

 

(2) Any
provision of this Agreement which is expressly or by implication to continue in
effect after such termination shall not be affected and shall remain in full
force and effect;

 

(3) Save as may be
necessary to enable Hutchison to sell off stocks of Products pursuant to the
provisions of clause 18(1) above, Hutchison shall at its own expense
promptly return to Biosil any documents or papers relating to the business of
Biosil which it has in its possession; and

 

(4) Hutchison
will pay to Biosil upon demand for any stocks of Products held or of materials,
work in progress, parts, packing, labels etc purchased specifically for the
production of the Products. The value of such stocks will be determined at the
absolute discretion of Biosil.

 

19.                               ASSIGNMENT 

 

(1) Subject
to clause 19(2), neither path’ hereto shall assign, sub-contract, transfer or
charge any of its rights or obligations under this Agreement. 

 

(2) If
Hutchison is entitled to sell the Registrations to a person as provided in
clause 15(2), then as a condition of such a sale
of the Registrations, Hutchison shall transfer the whole of its rights and
obligations under this Agreement to the purchaser on terms which are directly
enforceable by Biosil against the purchaser and which oblige the purchaser to
assume the rights and obligations of Hutchison under this Agreement as if the
purchaser had been the original party to this Agreement instead of Hutchison.
In such event, Hutchison shall be relieved of further obligation hereunder. 

 

20.                               FORCE MAJEURE

 

Neither party
shall be liable to the other for any default hereunder where the same is due to
causes beyond the control of the party in default, provided that any party
seeking to rely on this provision shall give written notice to the other
containing MI particulars of

 

 

the act or
matter which it claims has put the due performance of its obligations under
this Agreement beyond its control and provided further that this clause shall
cease to apply when such act or matter has ceased to have effect on the
performance of this Agreement. 

 

21.                                 NOTICES

 

Any notices
shall, unless otherwise expressly stated, be in writing and shall be given by
sending the same by e-mail, registered post or facsimile transmission to the
respective parties as follows:-

 

	
   

  	
  Biosil:

  	
  Address as above

  
	
   

  	
  FAO:

  	
  Mr J. A. Alsop

  
	
   

  	
  Fax No:

  	
  441624661656

  
	
   

  	
  E-mail:

  	
  john@biosil.co.uk

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Hutchison:

  	
  Mr. J. Hutchison

  
	
   

  	
  Fax No:

  	
  0012259276874

  
	
   

  	
  E-mail:

  	
  hutchisonimplants@earthlink.net

  

 

or to such
other address as may be designated in writing from time to time. Any notice
sent by registered post shall be deemed (in the absence of evidence of earlier
receipt) to have been delivered 7 days after its despatch. Any notice given by
e-mail or facsimile transmission shall be deemed to have been delivered on the
next working day following transmission.

 

22.                                 JURISDICTION

 

Except as
otherwise provided below, this Agreement shall be governed by Isle of Man law
in every particular including formation and interpretation and shall be deemed
to have been made in the Isle of Man and all parties agree to submit to the
non-exclusive Jurisdiction of the Isle of Man Courts and any proceedings will
be in the English Language. Biosil’s security interest rights and remedies
under clause 7 of this Agreement shall be subject to the laws of the State of
Louisiana (U.S.A.).

 

23.                                 ENTIRE AGREEMENT, VARIATION
AND GENERAL

 

(1) This
Agreement constitutes the entire understanding of the parties and there are no
promises, terms, conditions or obligations whether oral or written, express or
implied, other than those contained or referred to herein and no amendment
shall be valid unless accepted in writing by both parties.

 

(2) In
the event that any provision of this Agreement is declared by any judicial or
other competent authority to be voids voidable, illegal or otherwise
unenforceable in whole or part the other provisions of this Agreement and the
remainder of the affected provision

 

 

shall remain
in full force and effect unless Biosil in Biosil’s discretion decides that the
effect of such declaration is to defeat the original intention of the parties
in which event Biosil shall be entitled to terminate this Agreement by 30 days’
notice in writing to Hutchison.

 

AS WITNESS whereof the hands of
the duly authorized representatives of the parties have been set the day, month
and year first before written.

 

SIGNED by and on behalf of

 

BIOSIL LIMITED

 

J.A. Alsop, Signature

 

in the presence of Witness: 

Full Name: Brenda Haslam
Signature of Witness 

Address: 6 Seafield Crescent Onchan, Isle of Man

Occupation: Secretary

 

 

SIGNED by and on behalf of 

HUTCHISON INTERNATIONAL

 

John Hutchison, Siganture

 

in the presence of Witness: 

Full Name: Carol Denn Signature of Witness 

Address: H51 Florida St. – 8th Floor – Bank One Centre, Baton Rouge,
LA 70802 

Occupation: Legal Secretary

 

 

SCHEDULE 1
- PRODUCTS

 

Hutchison Branded Saline Inflatable Mammary Implants

 

	
  Anterior Diagram Valve

  	
   

  
	
   

  	
   

  
	
  Textured Shell 

  	
  HTL / HTH

  
	
   

  	
   

  
	
  Smooth Shell 

  	
  HSL / HSH

  
	
   

  	
   

  
	
  Various sizes of each

  	
   

  

 

 

SCHEDULE 2
- PRICES

 

	
  CAT NO’S

  	
   

  	
  PRODUCT

  	
   

  	
  PRICE£

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HTL
  

  	
   

  	
  Hutchison
  Branded Saline Inflatable Mammary Implants (Low Profile):

  	
   

  	
  ***

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HTH
  

  	
   

  	
  Hutchison
  Branded Saline Inflatable Mammary Implants (High Profile):

  - Textured Shell

  	
   

  	
  ***

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HSL
  

  	
   

  	
  Hutchison
  Branded Saline Inflatable Mammary Implants (Low Profile):

  	
   

  	
  ***

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HSH
  

  	
   

  	
  Hutchison
  Branded Saline Inflatable Mammary Implants (High Profile):

  - Smooth Shell

  	
   

  	
  ***

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HSL-S/HSH-S
  

  	
   

  	
  Sizers
  for the above Inflatable Implants:

  	
   

  	
  ***

  

 

 

SCHEDULE 2 —
HUTCHISON’S OBLIGATIONS

Without
prejudice to, and in pursuance of, its obligations under the 2001 Agreement,
Hutchison agrees that

1                                         Confidentiality

1.1                                 It will comply with the provisions of Clause 13 of the 2001
Agreement without limit in point of time notwithstanding the transfer of its
obligations generally thereunder by way of novation to Aesthetics except that
Hutchison shall not be entitled to use or disclose Confidential Information,
whether directly or indirectly, for any purpose except as permitted in terms of
this Schedule 2.

1.2                                 It will forthwith (and in any event within 21 days of the Effective
Date) disclose to Biosil and separately 
to Aesthetics all Confidential Information in its possession or under
its power or control which relates to the Registrations and its communications
with Regulatory Bodies, such Confidential Information to include:-

1.2.1                                           copies of all confidentiality/non-disclosure agreements in place
with third parties; and

1.2.2                                           copies of all contracts Hutchison has in place with third parties
undertaking any outstanding work for the PMA submission process.

1.3                                 It will forthwith (and in any event within 21 days of the Effective
Date) provide to Biosil and separately to Aesthetics a report on the status of
each of the PMA application modules which it has submitted to the FDA in
relation to the Products providing a comprehensive report on all matters
relevant to the status of the applications made for PMA, to include the
following:-

1.3.1                                           filing status for the PMA including:-

1.3.1.1                                            dates of submission for all PMA modules and all PMA Amendments;

1.3.1.2                                            approval for each module;

1.3.1.3                                            timeline for submitting final PMA module;

1.3.1.4                                            timeline for FDA PMA filing decision;

1.3.2                                           status of all outstanding PMA deficiencies including:-

1.3.2.1                                            details of PMA deficiencies, including copies of all correspondence
with FDA relating to these;

1.3.2.2                                            corrective action being taken;

1.3.2.3                                            parties undertaking the corrective action;

1.3.2.4                                            timelines for completion of corrective action and submission of data
to FDA to address outstanding deficiencies;

1.3.3                                           the exact whereabouts and format of raw data comprised within each
module;

1.3.4                                           copies of all submitted PMA modules including copies of all:-

1.3.4.1                                            subsequent PMA amendments;

1.3.4.2                                            correspondence with FDA since each of the original module
submissions.

1.4                                 It will forthwith (and in any event within 7 days of receiving a
request from Biosil or Aesthetics so to do) disclose to Biosil and separately
to Aesthetics any other Confidential Information in its possession or under its
control which Biosil or Aesthetics reasonably require for the purposes
contemplated by this Agreement (in the case of Biosil and Aesthetics) and for
obtaining regulatory or other approvals to allow sale by Biosil (or any third
party nominated by Biosil) of its products in any part of the world other than
the Territory.

1.5                                 It grants to both Aesthetics and Biosil (insofar as Biosil needs the
same) separately an irrevocable royalty free, perpetual licence to use any such
Confidential Information as it provides to them pursuant to the provisions of
this paragraph 1, to be used:-

1.5.1                                           by Biosil for the purpose of obtaining regulatory or other approvals
to allow sale by Biosil (or any third party nominated by Biosil) of its
products in any part of the world other than the Territory; and

1.5.2                                           by Aesthetics for the purpose of obtaining regulatory or other
approvals to allow sale of the Products by Aesthetics in the Territory.

1.6                                 Forthwith upon completion of its obligations in terms of this Schedule
2 or earlier where it no longer needs to hold the same to perform such
obligations, Hutchison will return to Biosil (or to any third party nominated
in writing to Hutchison by Biosil for such purposes) all Confidential
Information in its possession which was disclosed to it by Biosil in terms of
the 2001 Agreement and, if requested to do so by Biosil, Hutchison will provide
Biosil with a sworn affidavit by an appropriately authorised officer of
Hutchison confirming that in relation to Biosil’s Confidential Information, Hutchison
has complied with its obligations under this paragraph.

2                                         Intellectual property

2.1                                 Biosil and Aesthetics shall each have a perpetual, irrevocable,
royalty free licence on the terms set out in Clause 14(6) of the 2001 Agreement
(to include a licence in terms of Clause 14(6)(c) thereof restricted, in the
case of Aesthetics, for use for the purposes of seeking regulatory approvals to
allow sale of the Products in the Territory) to use Hutchison’s Intellectual
Property to which that clause would have applied (had the 2001 Agreement not
been novated to Aesthetics in terms of this Agreement).

2.2                                 Hutchison shall forthwith (and in any event within 21 days of the
Effective Date) deliver to Aesthetics any Materials relating to the
Intellectual Property licensed to Biosil and Aesthetics under paragraph 2.1 above.

2.3                                 Hutchison shall forthwith (and in any event also within 21 days of
the Effective Date) deliver to Aesthetics any other Materials in its
possession, power or control which are relevant to the 2001 Agreement.

3                                         Transfer of PMA

3.1                                 Biosil is the legal and beneficial owner of, and entitled to the
full right title and interest in and to, the Registrations and Hutchison
acknowledges and declares that it holds the benefit of such Registrations
(including those where it is the Registered Name) in trust for Biosil
absolutely.

3.2                                 Upon receipt by Hutchison of a written direction from Biosil
requiring Hutchison to transfer the Registrations into the Registered Name of
Biosil (or another person nominated by Biosil) Hutchison shall provide full
co-operation with Biosil to enable the Registrations to be transferred into the
Registered Name of Biosil or such nominee (as appropriate), and without
limiting this general obligation, will take all such steps and do such things
as Biosil requires in order to transfer the benefit of the Registrations to
Biosil (or such other nominated person) under the laws of the Territory to
include executing any document or documents required to effect such transfer
under the laws of the Territory in compliance with all the formalities of the
laws of the Territory.  In the event that
any or all of the Registrations are not capable of transfer, Hutchison will
co-operate fully with Biosil, and will take all such steps and do such things
as Biosil may require, to secure equivalent Registrations for Biosil or for
such other person as Biosil may nominate.

4                                         Further Assurance and Other Assistance

4.1                                 Without prejudice to the foregoing provisions of this Schedule, it
will promptly provide to both Biosil and Aesthetics such co-operation and
assistance as they may require for the purposes contemplated by this Agreement,
the 2001 Agreement and, in particular, to assist in obtaining GMP approval and
the US Regulatory Approvals from the FDA as soon as practicable after the
Effective Date.

4.2                                 In the event that it is either unwilling or unable to comply with
its obligations under this Agreement and, in particular, this Schedule, it
irrevocably appoints Biosil as its attorney to take all such steps and do such
things in the name of Hutchison as may be required in order to fulfil its
obligations under this Agreement including, but without prejudice to the
generality of the foregoing, executing any document or documents that it may be
necessary or desirable to execute for the purpose of discharging such obligations.

Signed by:

JOHN A ALSOP                                                                                                        JOHN
C HUTCHISON, PRESIDENT

DONALD K MCGHAN                                                                                                    T
R MALONEY

SCHEDULE 3 —
MODIFICATIONS TO 2001 AGREEMENT

The terms of
the 2001 Agreement are modified as follows and the terms of the 2001 Agreement
shall be construed accordingly.

1                                         Panel Approval Date and GMP

1.1                                 For the purposes of Clause 16(3) of the 2001 Agreement, the 2001
Agreement will automatically expire if the Panel Approval Date for sales of the
Products in the United States of America has not occurred by 1 September 2005
(or such other date as Biosil and Aesthetics may otherwise agree in
writing).  This date (or any subsequent
date agreed by Biosil and Aesthetics from time to time) is called the “Extension Date.”

1.2                                 In consideration for Biosil agreeing to re-constitute the 2001
Agreement on the terms set out in this Agreement and, in addition, continuing
to dedicate certain manufacturing facilities at its factory premises in
Cumbernauld, Scotland, exclusively for production of the Products, Aesthetics
agrees to make the following payments to Biosil:-

1.2.1                                           US$250,000 on the last date of execution of this Agreement;

1.2.2                                           a further US$125,000 payment on 1 March 2005; and

1.2.3                                           a final US$125,000 payment on 1 July 2005.

1.3                                 If requested to do so, Aesthetics agrees that it will, at its own
cost and expense, provide Biosil with such advice and assistance as Biosil
reasonably requires in connection with its application for GMP.

1.4                                 Aesthetics agrees that a failure to pay any sum due in terms of
paragraph 1.2 of this Schedule within seven days of its due date for payment
will be deemed to be a breach of the 2001 Agreement which is not capable of
remedy and which, without further notice, will entitle Biosil to terminate this
Agreement and the 2001 Agreement pursuant to Clause 17(1)(a) of the 2001
Agreement on the grounds of Aesthetics’ material breach.

1.5                                 In the event that the Extension Date passes without agreement having
been reached between Biosil and Aesthetics to extend the Extension Date then
the 2001 Agreement shall automatically expire without fault being attributed to
any party and the provisions of the 2001 Agreement shall be applied
accordingly.

2                                         Letters

2.1                                 Subject to the exceptions listed in paragraph 2.2 below, the terms
set out in the Letters shall not apply (as between Aesthetics and Biosil) and
are superseded by this Agreement.  To be
clear, the parties acknowledge that the payments and reductions against prices
previously agreed in terms of the 27 January 2004 letter that forms part of the
2001 Agreement do not apply.

2.2                                 The following Letters (or parts of them, as indicated) are not
superseded by this Agreement and remain in full force and effect as between
Biosil and Aesthetics:-

2.2.1                                           Letter of 27 June 2002 in its entirety save that the order for the
first 1,000 Products should be received within 7 days of the date of GMP
approval;

2.2.2                                           The second paragraph, point (b) of the Letter of 25 November 2002;
and

2.2.3                                           Letter of 28 February 2003 in its entirety.

3                                         Pricing, Payment and Purchase Targets

3.1                                 For the purposes of Clause 8(3)(a) of the 2001 Agreement, the
Minimum Number of Products for each year of this Agreement are now as follows:-

                                                Year of this
Agreement                                                                      Minimum Number of Products

                                                1st (2005)                                                                                                                               *
* *

                                                2nd (2006)                                                                                                                              *
* *

                                                3rd (2007)                                                                                                                               *
* *

                                                4th (2008)                                                                                                                               *
* *

                                                5th (2009)*                                                                                                                            *
* *

                                                6th (2010)*                                                                                                                            *
* *

                                                7th (2011)*                                                                                                                            *
* *

* Subject to renewal of the 2001 Agreement in
accordance with the provisions of Clause 16(2).

The Minimum Number of Products for any year of this
Agreement may be the subject of adjustment in accordance with the Volume Change
Control Procedures.

3.2                                 In the event that the number of Products purchased by Aesthetics in
any year of this Agreement exceeds the Minimum Number of Products for that year
by the percentages specified in the left hand column in the table below then Aesthetics
shall be entitled to a reduction against the prices (exclusive of VAT) that
would otherwise be payable under the 2001 Agreement in respect of the numbers
of Products purchased in excess of the specified percentages, such discount to
be calculated in accordance with the right hand column in the table below.  To be clear, however, the discounts indicated
are not cumulative.

Additional Products Purchased

Above Minimum Number of Products (%)                     Discount
Against Price

***                                                                                                         ***

***                                                                                                         ***

***                                                                                                         ***

***                                                                                                         ***

3.3                                 Aesthetics shall pay the prices for all Products or additional work
ordered by it:-

3.3.1                                           prior to the Approval Date against a pro forma invoice basis (ie
with payment in advance before an order is accepted); and

3.3.2                                           after the Approval Date within 30 days of the date of Biosil’s
invoice for such Products.

3.4                                 To the extent necessary, Clauses 6(1) and 6(2) of the 2001 Agreement
shall be deemed amended accordingly but will otherwise remain in full force and
effect.  Furthermore, Aesthetics agrees
that in the event that Aesthetics fails to pay any sum due in terms of
paragraph 3.3.2 of this Schedule within the 30 day period therein mentioned
than Biosil may serve a default notice on Aesthetics giving Aesthetics a
further 7 days to make payment.  If Aesthetics
fails to pay such sum within that further 7 day period then Aesthetics will be deemed
to be in breach of the 2001 Agreement and such breach be deemed to be incapable
of remedy and therefore, without further notice, Biosil will be entitled to
terminate this Agreement and the 2001 Agreement pursuant to Clause 17(1)(a) of
the 2001 Agreement on the grounds of Aesthetics’ material breach.

3.5                                 In terms of Clause 5(4) of the 2001 Agreement, Biosil agrees that
prices will not be increased above 6% per annum and the words “without evidence
to justify an increase above this level”, will be deemed deleted.  The prices payable for the Products referred
to in Clause 5(1) of the 2001 Agreement will not be increased prior to the
first anniversary of the Approval Date. 
Notwithstanding the foregoing provisions of this clause, in the event
that Biosil proposes that the prices be increased by an amount which, although
below the 6% per annum figure previously mentioned above, exceeds the increase
in price which would have been applied had prices been increased by an amount
equal to the change in the Producer Price Index (Chemical and Allied Products —
WPU06) as of the immediately preceding year of this Agreement as published by
the United States Bureau of Labor Statistics then the following provisions will
apply:-

3.5.1                                           Biosil will notify Aesthetics of the price increase that is to take
effect in terms of Clause 5(2) of the 2001 Agreement;

3.5.2                                           If Aesthetics wishes to object to such price increase then it shall
notify Biosil accordingly in Writing within 30 days of receipt of the notice
from Biosil in terms of paragraph 3.5.1;

3.5.3                                           Upon receipt of such notice from Aesthetics, Biosil may withdraw the
proposed increase in prices within the original 60 day period set out in
paragraph 3.5.1 above but if it chooses not to do so then within 30 days of the
price increase taking effect in accordance with Clause 5(2) Aesthetics may give
not less than 12 months’ prior written notice to Biosil to terminate the 2001
Agreement without fault being attributed to any party and the provisions of the
2001 Agreement shall be applied accordingly.

3.6                                 Biosil shall not be under any obligation to commence the manufacture
of Products unless and until:-

3.6.1                                           GMP or any other required approvals have been granted by the FDA;
and

3.6.2                                           Aesthetics can demonstrate (to Biosil’s reasonable satisfaction)
that it is in a position to comply with all of its obligations under the 2001
Agreement which are relevant to the sale of the Products in the Territory
including final labelling and packaging requirements.  The provisions of Clause 8(3)(b) and (c) of
the 2001 Agreement shall be construed accordingly.

4                                         Registrations and Intellectual Property Rights

4.1                                 III and Aesthetics each acknowledge that Biosil is the legal and beneficial
owner of the Registrations as of the Effective Date, to include the
application(s) for US Regulatory Approvals which is/are ongoing in the United
States of America and that Biosil will be the legal and beneficial owner of all
such Registrations including any US Regulatory Approvals, once granted by the
FDA, for which any applications are made or continued (whether in the
Registered Name of Hutchison, III, Aesthetics or otherwise) in the period after
the Effective Date.

4.2                                 III and Aesthetics will provide Biosil with all necessary
co-operation and assistance to ensure that any Registrations in existence as of
the Effective Date are transferred into the Registered Name of Biosil or any
person (including Aesthetics) that Biosil may nominate for such purpose.  In the event that any such Registrations are
transferred into the Registered Name of III or Aesthetics, III and Aesthetics each
acknowledge that they will hold them in trust for the benefit of Biosil
absolutely.

4.3                                 Biosil agrees that Aesthetics shall be entitled to continue to apply
for all Registrations on Biosil’s behalf, such applications to be progressed in
the Registered Name of Aesthetics or Hutchison at the sole cost and expense of Aesthetics.

4.4                                 In the event that the Registrations are held in the Registered Names
of

4.4.1                                           Hutchison, Aesthetics or III then Aesthetics and III each agree with
Biosil that they will be responsible at their own cost and expense for
maintaining the Registrations and for complying with all legal and regulatory requirements
in the Territory in relation thereto;

4.4.2                                           Biosil (or any person nominated by Biosil other than III or Aesthetics)
then Biosil agrees with Aesthetics that it will be responsible at its own cost
and expense for maintaining the Registrations and for complying with all legal
and regulatory requirements in the Territory in relation thereto;

and in either case, Biosil, Aesthetics and III agree
that they will promptly provide the other with such assistance at their own
cost and expense as the other may reasonably require in order to maintain the
Registrations and for complying with all such legal and regulatory requirements.

4.5                                 Biosil and Aesthetics agree that they will comply with the Product
Change Control Procedures set out in Schedule 7.

4.6                                 Biosil agrees with Aesthetics that, as manufacturer of the Products,
it shall be responsible for complying with all regulatory requirements
incumbent on such a manufacturer which pertain to the Registrations and III and
Aesthetics each agree that they will promptly provide Biosil at their own cost
and expense with such reasonable assistance as Biosil may request for such
purposes.

5                                         Communications

5.1                                 Aesthetics and III each acknowledge and agree that Biosil, as legal
and beneficial owner of the Registrations, shall be entitled (acting through
its employees and agents) to access, inspect and use all information held by Aesthetics
or III or their respective employees, contractors or agents pertaining to the
status of all Registrations including the application(s) for PMA from the
FDA.  Aesthetics and III each separately
undertake to Biosil that they will promptly provide Biosil with such of that
information as Biosil may request of III or Aesthetics from time to time.
Without prejudice to that general obligation, Aesthetics will provide Biosil
regular updates containing the information detailed in Schedule 5 in accordance
with the terms of that Schedule.

5.2                                 Aesthetics undertakes to give Biosil reasonable prior advance notice
of any scheduled meetings arranged between Aesthetics and the FDA relating to
the Products and/or the Registrations and Biosil will, at its option, have the
right to send a representative or representatives from either its own personnel
or personnel of its agents to attend any such meetings with Aesthetics.  In determining what constitutes a “reasonable”
period of notice, regard shall be had to all the circumstances, including the
scheduling requirements of the FDA and the requirement for Biosil to be able to
send personnel from the Isle of Man or the United Kingdom to the United States
to attend such meetings and the travelling time that this will take.

5.3                                 Aesthetics undertakes that it will ensure that all data relevant to
the Registrations will be stored at agreed location(s) and that Biosil will
have full unrestricted access to such information, through its employees and/or
agents.  The current location(s) for the
storage of such data, and the general nature of the data stored at each one,
are set out in Schedule 6.  Biosil agrees
that Aesthetics may also store data relevant to the Registrations at its
principal executive offices at 6000 S. Eastern Avenue, Suite 9D, Las Vegas, NV
89119 provided that Aesthetics complies with the notification requirements laid
down in the following provisions of this paragraph.  Other storage location(s) may be agreed by
Biosil and Aesthetics from time to time. 
A summary of all such data (together with details of where and with whom
it is stored) will be compiled and kept updated and sent to Biosil either (i) as
part of the regular update referred to in paragraph 5.1 (for so long as such
updates are to be produced in terms of Clause 6.1) or (ii) where such updates
no longer have to be produced, as and when any of the details contained in the
latest update change from time to time or, in the event, that such details have
not changed, confirmation in writing every three months that this is the case.  The summary will contain sufficient detail to
enable Biosil to determine where and with whom any particular data relevant to
the Registrations is stored at any particular time and Biosil may require Aesthetics
to provide it at any time with such further information (in writing) that it
may reasonably request in relation to such summaries.

5.4                                 Aesthetics will provide Biosil with copies of all non-disclosure
agreements/confidentiality agreements that it enters into with third parties
(including, for example, consultants and associates) pursuant to which
Confidential Information of Biosil may be disclosed.  Aesthetics will ensure that any such
non-disclosure agreements/confidentiality agreements will comply with the
requirements for them set out in the 2001 Agreement in all respects and, if
requested to do so by Biosil, Aesthetics will provide Biosil with a sworn
affidavit by an appropriately authorised officer of Aesthetics confirming that
in relation to Biosil’s Confidential Information, Aesthetics has complied in
all respects with requirements of this Agreement and the 2001 Agreement.  In the event that Aesthetics wishes to
disclose Confidential Information of Biosil to its associates or consultants on
terms that would otherwise not comply with the requirements for non-disclosure
agreements/confidentiality agreements set out in the 2001 Agreement then
Aesthetics may apply to Biosil for consent to enter into such an agreement and
for dispensation from meeting the said requirements of the 2001 Agreement.  Biosil may request that Aesthetics provide to
it such further information as Biosil reasonably requires to consider such
application.  In determining whether to
give its consent, Biosil may have regard to all the circumstances including the
nature of the Confidential Information which would be disclosed and the
identity of the third party consultant or associate concerned.

5.5                                 Biosil agrees with Aesthetics that it will provide Aesthetics with
such information and assistance as Aesthetics reasonably requires to assist it
in progressing any applications for Registrations save that Aesthetics
acknowledges that Biosil shall not be obliged to provide information and
assistance to Aesthetics to the extent that Biosil considers (on reasonable
grounds) that the provision of such information and/or assistance would, or
would be likely to, give Aesthetics or any member of the Aesthetics Group competitive
advantage in connection with areas of its business, or businesses of other
members of the Aesthetics Group, which are competitive with the business of
Biosil or any of its associates.  In
circumstances where Biosil considers that it will not provide information
and/or assistance to Aesthetics or any member of the Aesthetics Group for the
reasons set out in the foregoing provisions of this paragraph then Biosil will
provide such information and/or assistance in such manner and to such person or
persons as it determines is required in order to progress the application for
Registrations.  By way of example, Biosil
may determine to provide information directly to the relevant Regulatory Body
rather than to Aesthetics.

6                                         Branding

6.1                                 III and Aesthetics each agree that the Products shall only be sold
in the Territory under either the “Hutchison” brand name or such other brand
name as Biosil has previously approved in writing.  In determining whether to grant such
approval, Biosil may grant or withhold such approval in its absolute discretion
and may make the granting of such approval subject to such conditions as Biosil
thinks fit.

6.2                                 Notwithstanding paragraph 6.1, Biosil agrees that Aesthetics shall
be entitled to indicate on the Product packaging and promotional material that
the Products are being distributed in the Territory by Aesthetics, a MediCor
Group company, such indication to be in form, size, location and context to be
approved in advance by Biosil, such approval not to be unreasonably withheld or
delayed.

7                                         Grant of Security Interest

7.1                                 For the purposes of this paragraph 7, the following terms have the
following meanings:-

7.1.1                                           “Obligors” means
Aesthetics and III and a reference to an “Obligor” shall be construed
accordingly;

7.1.2                                           “Uniform Commercial Code” means the Uniform Commercial Code as in effect in the State of
Nevada from time to time or, by reason of mandatory application, any other
applicable jurisdiction.

7.2                                 As collateral security for the due and punctual observance and
performance of all of the obligations of Aesthetics and III under this
Agreement (including, without limitation, prompt payment in full of all sums when
due (whether at stated maturity, by acceleration or otherwise)), each Obligor
hereby pledges and grants to Biosil a security interest in all of such Obligor’s
right, title and interest in and to the following property, whether, at the
date of this Agreement, owned or hereafter acquired by such Obligor and whether
existing at the date of this Agreement or hereafter coming into existence (all
such property being collectively, the “Collateral”):

7.2.1                                           all accounts and general intangibles (each as defined in the Uniform
Commercial Code) of such Obligor constituting a right to the payment of money,
whether or not earned by performance, including all payment intangibles and moneys
due and to become due to such Obligor in repayment of any loans or advances, in
payment for goods (including Inventory and Equipment (each as defined below))
sold or leased or for services rendered, in payment of tax refunds and in
payment of any guarantee of any of the foregoing (collectively, the “Accounts”);

7.2.2                                           all instruments, chattel paper or letter-of-credit rights (each as
defined in the Uniform Commercial Code) of such Obligor evidencing,
representing, arising from or existing in respect of, relating to, securing or
otherwise supporting the payment of, any of the Accounts (collectively, the “Instruments”);

7.2.3                                           all inventory (as defined in the Uniform Commercial Code) and all
other goods of such Obligor (including, without limitation, any Products
acquired from Biosil under the 2001 Agreement and this Agreement) that are held
by such Obligor for sale, lease or furnishing under a contract of service, that
are so leased or furnished or that constitute raw materials, work in process or
material used or consumed in its business, including all spare parts and
related supplies, all goods obtained by such Obligor in exchange for any such
goods, all products made or processed from any such goods and all substances,
if any, co-mingled with or added to any such goods (collectively, the “Inventory”);

7.2.4                                           all equipment (as defined in the Uniform Commercial Code) and all
other goods of such Obligor that are used or bought for use primarily in its
business, including all spare parts and related supplies, all goods obtained by
such Obligor in exchange for any such goods, all substances, if any, co-mingled
with or added to such goods and all upgrades and other improvements to such
goods, in each case to the extent not constituting Inventory (collectively, the
“Equipment”);

7.2.5                                           all documents (as defined in the Uniform Commercial Code) or other
receipts of such Obligor covering, evidencing or representing Inventory or
Equipment (collectively, the “Documents”);

7.2.6                                           all contracts and other agreements of such Obligor relating to the
sale or other disposition of all or any part of the Inventory, Equipment or
Documents and all rights, warranties, claims and benefits of such Obligor
against any Person arising out of, relating to or in connection with all or any
part of the Inventory, Equipment or Documents of such Obligor, including any
such rights, warranties, claims or benefits against any Person storing or
transporting any such Inventory or Equipment or issuing any such Documents;

7.2.7                                           all other accounts or general intangibles of such Obligor not
constituting Accounts, including, to the extent related to all or any part of
the other Collateral, all books, correspondence, credit files, records,
invoices, tapes, cards, computer runs and other papers and documents in the
possession or under the control of such Obligor or any computer bureau or service
company from time to time acting for such Obligor;

7.2.8                                           all other tangible and intangible property of such Obligor; and

7.2.9                                           all proceeds and products in whatever form of all or any part of the
other Collateral, including all proceeds of insurance and all condemnation
awards and all other compensation for any casualty event with respect to all or
any part of the other Collateral (together with all rights to recover and
proceed with respect to the same), and all accessories to, substitutions for
and replacements of all or any part of the other Collateral.

7.3                                 Without prejudice to Biosil’s other rights and remedies, the Obligors
agree that:-

7.3.1                                           Biosil shall be entitled to complete and file UCC financing
statements (or other corresponding filings) in the appropriate filing office
and to take such other action as is required to complete the perfection of
Biosil’s security interests granted under this Agreement; and

7.3.2                                           Biosil shall have all of the default and enforcement rights and
remedies provided under the Uniform Commercial Code and the laws of the State
of Nevada generally in respect of such security interests.

8                                         Competitive Restrictions

8.1                                 Biosil and Aesthetics each represents and warrants to the other
that, as at the Effective Date, no Direct Competitor has an interest in them,
or is involved (directly or indirectly) in the control or management of them,
their business or assets (including, for the avoidance of doubt, the
Registrations).

 

Signed by:

JOHN A ALSOP                                                                                                        JOHN
C HUTCHISON, PRESIDENT

DONALD K MCGHAN                                                                                                    T
R MALONEY

 

SCHEDULE 4 — VOLUME CHANGE
CONTROL PROCEDURES

1                                          The provisions of this Schedule 4 shall apply in the event that at
any time during the period of the 2001 Agreement there shall occur a “Material Market Change” being an event (or series of related
events) which has or have the effect of increasing or decreasing the size of
the market in the Territory for saline inflatable mammary implants (such as the
Products) from time to time (the “Market”) by
more than 30%.  In terms of measuring the
size of the Market for these purposes, Biosil and Aesthetics agree that the
appropriate measurement shall be the number of procedures carried out over a continuous
period of twelve months using saline inflatable mammary implants.  As at the Effective Date, Aesthetics and
Biosil agree that the size of the Market is approximately 225,000 procedures
which equates to 450,000 units of saline inflatable mammary implants.

2                                          In the event of a Material Market Change, Aesthetics or Biosil may
notify a request for a Change to the other, giving details of the proposed
Change together with an evaluation report on the proposed Change which will
cover:-

2.1                                 details of the event or events giving rise to the Material Market
Change;

2.2                                 details of the effect that the Material Market Change has had, or is
having, on the size of the Market together with supporting evidence including,
wherever possible, supporting independent analysis or research from reputable
industry analysts or bodies (including relevant Regulatory Bodies).

2.3                                 the adjustment that it is proposed should be made to the level of
the Minimum Number of Products to be purchased by Aesthetics from Biosil in
accordance with the terms of this Agreement in consequence of the change to the
size of the Market resulting from the Material Market Change and the proposed
date on which such Change shall take effect. 
Such proposed date may be before the date of receipt of the notification
of a request for Change only if the following conditions are satisfied:

2.3.1                                           the proposed date on which any Change would take effect must be in
the same year of this Agreement in which the notification of the request for
Change is received by the Recipient; or

2.3.2                                           the proposed date on which any Change would take effect may be in the
year of this Agreement which immediately precedes the year of this Agreement in
which the notification of the request for Change is received by the Recipient
provided that the request for Change is received by the Recipient within the
first three months of that latter year of this Agreement;

and (in either
case) provided that the effect of such Change in the period prior to receipt by
the Recipient of notification of the request for Change is restricted to
adjusting the level of the Minimum Number of Products which were to be
purchased by Aesthetics from Biosil in such period in accordance with the terms
of the 2001 Agreement for the purposes of Clause 8(6) of the 2001 Agreement only
and, to be clear, not for the purposes of calculating reductions in prices
which might otherwise have applied in terms of paragraph 3.2 of Schedule 3.

2.4                                 any impact of the proposed Change on other aspects of this Agreement
or the 2001 Agreement.

In this Schedule, the party requesting the Change is
termed the “Proposer” and the party who
receives the request is termed the “Recipient”.

3                                          The Recipient will consider the Proposer’s evaluation report and
will notify the Proposer within twenty (20) Business Days of receipt of the
complete report whether the Recipient accepts the request for Change.  If the Recipient accepts in writing the
request for Change then the Change will be implemented and the terms of the
Agreement and/or the 2001 Agreement (as appropriate) will be amended in
accordance with the terms of the request by

3.1                                 adjusting the level of the Minimum Number of Products;

3.2                                 amending any other terms of this Agreement and/or the 2001 Agreement

as proposed in the request for Change and the terms of
this Agreement and/or the 2001 Agreement will be modified accordingly.

4                                          In the event that the Recipient does not accept the terms of the
evaluation report and/or the nature or terms of any proposed Change in
consequence thereof then the Proposer and the Recipient will enter into
discussions in good faith with a view to resolving the matters in dispute
between them.  In the event that the
Proposer and the Recipient have been unable to agree on the terms of the
evaluation report and/or the nature or terms of any Change in consequence
thereof within a further period of twenty (20) Business Days following their
rejection by the Recipient, the Proposer or the Recipient may refer the dispute
forthwith to the decision of an independent expert (acting as an expert and not
as an arbiter) mutually nominated by the Proposer and the Recipient or, failing
agreement as to nomination within ten (10) Business Days, nominated by the
President (or other appropriate officer) for the time being of the American
Society of Plastic Surgeons, whom failing the President (or other appropriate
officer) of the American Society for Aesthetic Plastic Surgery, on the
application of either the Proposer and the Recipient.  In determining the dispute the expert shall be
entitled to adopt such procedures and to take such evidence (whether by way of
written submissions or by oral evidence from witnesses or howsoever) as he
shall think fit and the expert shall notify the Proposer and the Recipient of
his decision as expeditiously as possible and in any event within 20 Business
Days of the dispute being referred to him.

5                                          The decision of the expert shall be final and binding on the
Proposer and the Recipient save in the case of manifest error or a decision
which no reasonable independent expert would have come to.

6                                          The costs of such independent expert shall be payable as he shall
direct.

7                                          Notwithstanding the other provisions of this Agreement in the event
that at any time the size of the Market is reduced to a level at which Biosil or
Aesthetics concludes (acting reasonably) that it is no longer commercially
viable for it to continue manufacturing or distributing the Products, Biosil or
Aesthetics

7.1                                 shall be entitled by not less than 6 months’, in the case of Biosil,
or 12 months’, in the case of Aesthetics, prior written notice to terminate the
Agreement without fault being attributed to any party and the provisions of the
2001 Agreement shall be applied accordingly and, in particular, neither party
shall have any liability arising out of such termination; and

7.2                                 in the event of such termination by Biosil, Biosil agrees that in
the event Aesthetics wishes to continue selling the Products in the Territory
after the termination of this Agreement then, in the period referred to in
paragraph 2.9.1, it will enter into commercial discussions in good faith with Aesthetics
with a view to seeking to agree a commercial basis on which Aesthetics might
acquire the Registrations (on a “first refusal” basis).

 

Signed by:

JOHN A ALSOP                                                                                                        JOHN
C HUTCHISON, PRESIDENT

DONALD K MCGHAN                                                                                                    T
R MALONEY

 

SCHEDULE 5 — PMA
UPDATES

 

Biosil and Aesthetics
shall provide the other with a written status summary of activities every 10
Business Days until such time as the FDA provides notice of “fileability”
status of the Registrations.  The first
such summaries will be produced and provided within 10 Business Days of the
Effective Date.

 

Signed by:

JOHN A ALSOP                                                                                                        JOHN
C HUTCHISON, PRESIDENT

DONALD K MCGHAN                                                                                                    T
R MALONEY

 

SCHEDULE 6 — DATA
STORAGE AND ACCESS

 

	
  Registrations
  Submission Modules

  	
  Nature
  of Data

  	
  Name of
  Person with Whom Held

  	
  Address
  (full postal address and ZIP code)

  	
  Contact
  Details

  
	
  Mechanical
  Data

   

  Chemistry
  Data

   

  Clinical
  Data

   

  Toxicology
  Data

   

  Manufacturing
  Data

  	
  All
  data relevant to the Mechanical Data, Chemistry Data, Clinical Data,
  Toxicology Data and Manufacturing Data modules

  	
  Hutchison
  International Inc.

  	
  7949 Jefferson Hwy, Suite E, Baton Rouge, Louisiana
  70809, United States of America

  	
  Name:  Larry Walsh

  Phone: +1 927-6800

  Fax: +1
  (225) 927 6874

  E-mail:  llwalsh1950@aol.com

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

  

 

 

Signed by:

JOHN A ALSOP                                                                                                        JOHN
C HUTCHISON, PRESIDENT

DONALD K MCGHAN                                                                                                    T
R MALONEY

SCHEDULE 7 — PRODUCT
CHANGE CONTROL PROCEDURES

 

1                                          According to its documented quality procedures, Biosil evaluates
every proposed change to its processes used to manufacture the Products or to
the design of the Products.  Each such
evaluation shall be determined by Biosil to be a Type I or Type II change as
defined herein.

1.1                                 A Type I change is a change solely to the manufacturing process and
is determined by Biosil to have no affect on the design, safety or
effectiveness (as defined in 21 CFR 814.39) of the Products and would not be
apparent to the user of the Product.

1.2                                 A Type II change is a change to the manufacturing process or design
of the Product which is determined by Biosil to affect the design, safety or
effectiveness (as defined in 21 CFR 814.39) of the Products or which may be
apparent to the user of the Product.

For the purposes of this Schedule, a “user”
of the Product is any person who is involved in the implantation processing,
excluding the patient.

1.3                                 Biosil shall ensure that its documented quality procedures for such
Type I changes meet all requirements for FDA compliance, including ensuring
that such changes are appropriately reflected in its Master Access File or
other documentation provided to the FDA as part of its filings for the
Registrations.

1.4                                 Biosil may, at its sole discretion, inquire of Aesthetics concerning
Aesthetics’ opinions concerning any such Type I change.

1.5                                 Prior to implementing a Type I change, Biosil shall notify Aesthetics
of its intent to implement a Type I change and, if applicable, that it has
elected not to disclose the nature of the process change to Aesthetics.

2                                          For changes classified by Biosil as Type II

2.1                                 Biosil shall obtain the formal, written approval of Aesthetics or
its designated affiliate prior to implementing such change, such approval not
to be unreasonably withheld or delayed. 
For the purposes of this Schedule a “designated affiliate” means III or any
member of the Aesthetics Group which is a wholly owned subsidiary of Aesthetics
and which (in either case) has been engaged by Aesthetics pursuant to Clause 9.4
of this Agreement to manage a Quality System for the Products which would be
affected by the change in question.

2.2                                 Biosil shall establish and maintain documented quality procedures
that include formal, written notification to Aesthetics or its designated
affiliate of such proposed Type II changes. 
The notification shall be in sufficient technical detail to allow Aesthetics
or its designated affiliate to fully evaluate the impact of the proposed Type
II change on the marketability of the Product.

2.3                                 Biosil shall use its best efforts to determine the regulatory
reporting requirements concerning such change, and Biosil shall include its
determination in its notification to Aesthetics of proposed Type II changes.

2.4                                 Aesthetics or its designated affiliate shall evaluate the proposed
Type II change with regard to its market impact and shall notify Biosil in
writing of its approval or disapproval.

2.5                                 Biosil shall ensure that such changes are appropriately reflected in
its Master Access File or other documentation provided to the FDA as part of
its filings for the Registrations.

2.6                                 Biosil recognizes the value in notifying Aesthetics of such change
in the early stages of the change process, and Aesthetics recognizes the value
in a reasonable and timely response to the notification.

2.7                                 Aesthetics and its designated affiliates will not unreasonably
withhold or delay giving its approval to proposed Type II changes and if Aesthetics
or any designated affiliate determines to withhold its approval Aesthetics
shall notify Biosil forthwith accordingly giving its reasons (in reasonable
detail) for withholding approval.

2.8                                 If Biosil is the Registered Name, Biosil shall report changes to the
FDA in compliance with FDA requirements.

2.9                                 If Aesthetics, its designated affiliate, or Hutchison is the
Registered Name, Aesthetics shall report changes to the FDA in compliance with
FDA requirements.  Biosil shall be
responsible for any necessary amendments to its Master Access File.

2.10                           In the event that the proposed Type II change requires the
submission of a Supplement to the PMA, the parties shall cooperate in
generating appropriate data and documentation, and the party with registered
responsibility for the PMA shall submit the required documentation, except that
Biosil shall be responsible for any necessary amendments to its Master Access
File.

3                                          Biosil shall make no changes to its processes used to manufacture
the Products or to the design of the Products that do not comply with the
procedures contained in this Schedule.

4                                          Aesthetics and III each acknowledge that any information provided by
Biosil to it (or any of its designated affiliates) pursuant to the provisions
of this Schedule 7 is Confidential Information for the purposes of Clause 13 of
the 2001 Agreement and that, in particular, Aesthetics will comply with its
obligations under that clause in relation to such information accordingly.  In particular, Biosil shall not be under any
obligation to supply such information directly to a designated affiliate unless
the designated affiliate has entered into a non-disclosure undertaking in
favour of  Biosil beforehand in terms
which are acceptable to Biosil (acting reasonably).  Aesthetics, itself, may only disclose such
information to a designated affiliate where such disclosure is in accordance
with the provisions of clauses 13(5) and/or 13(6) of the 2001 Agreement.

Signed by:

JOHN A ALSOP                                                                                                        JOHN
C HUTCHISON, PRESIDENT

DONALD K MCGHAN                                                                                                    T
R MALONEY

 

SCHEDULE 8

GUARANTEE

 

Signed by:

JOHN A ALSOP                                                                                                        JOHN
C HUTCHISON, PRESIDENT

DONALD K MCGHAN                                                                                                    T
R MALONEY

 

 

 

 

 

GUARANTEE

between

MEDICOR LTD

and

BIOSIL LIMITED

 

 

 

 

 

 

 

2005

 

THIS IS AN IMPORTANT DOCUMENT WHICH CONFERS
LEGAL RIGHTS AND OBLIGATIONS ON THE PARTIES TO IT. YOU SHOULD TAKE INDEPENDENT
LEGAL ADVICE BEFORE SIGNING THIS DOCUMENT AND SIGN ONLY IF YOU WANT TO BE
LEGALLY BOUND BY ITS TERMS.

 

 

Brodies

15 Atholl Crescent

Edinburgh EH3 8HA

T: 0131 228 3777

F: 0131 228 3878

Ref: GSC.BIO2.22

 

10 February 2005

GUARANTEE

between

5                                          MEDICOR LTD., a corporation incorporated under
the laws of the State of Delaware (corporation number 3327048) and having its
principal executive offices at 4560 S.Decatur Blvd, Las Vegas, Nevada
89103-5253, United States of America (“the Guarantor”); and

6                                          BIOSIL LIMITED (registered in the Isle of Man
under number 50222) whose registered office is at Global House, Isle of Man
Business Park, Douglas, Isle of Man, British Isles (“Biosil”).

NOW IT IS HEREBY AGREED as follows:-

7                                          In this Agreement

7.1                                 capitalised terms not otherwise defined herein have the meanings
ascribed to them in the Agreement.

7.2                                 Unless the context otherwise requires, the following terms have the
following meanings:

7.2.1                                           “the Agreement” means
the Supplier Novation and Amendment Agreement among Biosil, III, Aesthetics and
Hutchison dated of even date herewith;

7.2.2                                           “Guarantor’s Group”
means the Guarantor and any company (including, without limitation, Aesthetics
or III) that is from time to time (i) a holding company, (ii) a subsidiary, or
(iii) a subsidiary of a holding company, of the Guarantor and for these
purposes the expressions “holding company” and “subsidiary” have the meanings
given to them in the United Kingdom Companies Act 1985 (as amended);

7.2.3                                           “Guarantee Limitation Date” means the date which falls immediately after the expiry of a period
of 12 calendar months after the occurrence of the Approval Date;

7.2.4                                           “Hutchison” means Hutchison International Inc., a corporation incorporated under the laws of the State of
Louisiana (corporation number 72-1324212) and having its principal place of
business at 7949 Jefferson Hwy, Suite E, Baton Rouge, Louisiana 70809, United
States of America;

7.2.5                                           “Aesthetics” means a corporation incorporated under
the laws of the Nevada (corporation number E0016512005-8)
and having its principal executive offices at 6000 S. Eastern Avenue, Suite 9D,
Las Vegas, Nevada 89119, United States of America; and

7.2.6                                           “III” means International Integrated Incorporated, a corporation incorporated
under the laws of the British Virgin Islands and having its principal executive
offices at 4560 S.Decatur Blvd, Las Vegas, Nevada 89103-5253, United States of
America.

8                                          In consideration of Biosil agreeing to enter into the Agreement with
Aesthetics and III, the Guarantor hereby guarantees to Biosil for itself on
demand (and subject only as herein provided, undertakes as its direct and
unconditional primary obligation), but, in so far as it is applicable, subject
to the provisions of Clause 4 hereof, in so far as it is applicable, the due
and punctual observance and performance of all the obligations of Aesthetics
and III arising under or pursuant to the Agreement including, without prejudice
to the foregoing generality, all payment obligations.

9                                          The obligations of the Guarantor hereunder shall not be discharged
or affected in any way by any lack of, or limit on, the power or authority of
Aesthetics or III or any irregularity, unenforceability or invalidity of any of
the obligations of Aesthetics or III hereby guaranteed, or by any time or other
indulgence or concession being granted to Aesthetics or III in respect of such
guaranteed obligations (whether or not the Guarantor has knowledge thereof or
consents thereto) or any other act, deed or matter of any description.

10                                    The guarantee obligations contained in Clause 2 shall not apply to
any obligations of Aesthetics and III arising under or pursuant to the
Agreement on or after the Guarantee Limitation Date but the Guarantee shall
remain in full force and effect as regards all obligations of Aesthetics or III
arising under or pursuant to the Agreement prior to the Guarantee Limitation
Date including, without prejudice to the foregoing generality, all payment
obligations.  The guarantee is in
addition to and shall not prejudice nor be prejudiced by any other guarantee,
indemnity or other security or right against the Guarantor or any third party
which Biosil may have for the due performance of such guaranteed obligations.

11                                    Biosil may without any consent from the Guarantor and without
affecting the liability of the Guarantor hereby hold over, renew, modify or
release any security or guarantee now or hereafter held from or obligation of
Aesthetics or III or any other person in respect of the liabilities hereby
guaranteed and compound with or alter, replace, extend or renew the Agreement
and the liability of the Guarantor hereunder shall continue in full force and
effect notwithstanding such act or event.

12                                    The Guarantor waives any right it may have of requiring Biosil to
proceed first against Aesthetics or III under the Agreement.

13                                    Any settlement or discharge between the Guarantor and Biosil shall
be conditional upon any security or payment to Biosil by Aesthetics or III or
any other person not being invalidated, voided or reduced (in whole or in part)
by virtue of any provisions or enactments relating to bankruptcy, insolvency,
administration, moratorium periods, receivership or liquidation for the time
being in force and Biosil shall be entitled to recover the value or amount of
any such security or payment from the Guarantor subsequently as if such
settlement or discharge had not occurred.

14                                    If any obligations under this Guarantee become due for performance
by the Guarantor under this Guarantee (including without prejudice to the
foregoing generality all payment obligations), the Guarantor shall not, so long
as performance remains outstanding by Aesthetics or III under the Agreement with
respect to such obligation, without Biosil’ prior written consent:

14.1.1                                     in respect of any obligation performed by it under this Guarantee
(including, without limitation, any amount paid by it under this Guarantee)
seek to exercise any legal right or remedy against Aesthetics or III including,
without limitation, repayment by subrogation, indemnity or otherwise; nor

14.1.2                                     claim payment of any other moneys for the time being due to it by
Aesthetics or III on any account whatsoever or exercise any other right or
remedy which it may have in respect thereof; nor

14.1.3                                     in the event of the liquidation or insolvency of Aesthetics or III,
prove in competition with Biosil in respect of any moneys owing to it by
Aesthetics or III on any account whatsoever (but, if so instructed by Biosil,
the Guarantor shall so prove in accordance with such instructions).

15                                    The Guarantor represents and warrants to Biosil that it has the
capacity, power and authority to enter into this Guarantee and to perform its
obligations thereunder and that the obligations of the Guarantor under this
Guarantee represent obligations on the Guarantor which are legally binding and
enforceable against the Guarantor in accordance with their terms.

16                                    Biosil and the Guarantor each irrevocably agree to submit to the
non-exclusive jurisdiction of the Isle of Man courts over any claim or matter
arising under or in connection with this Agreement or the legal relationships
established by this Agreement.

17                                    Biosil and the Guarantor each irrevocably consent to any process in
any legal action or proceedings arising out of or in connection with this
Guarantee being served on it in accordance with the provisions of the Agreement
relating to service of notices.  The
address and fax number for the Guarantor for the purposes of applying the
provisions of the Agreement are as follows:

Address:  4560
South Decatur Boulevard, Suite 300, Las Vegas, Nevada 89013-5253 USA

For the attention of: 
Chief Operating Officer/ Chief Executive Officer

Fax number:  +1
(702) 932 4561

or such other address or facsimile number as may be
notified in writing from time to time by the Guarantor to Biosil.

Nothing contained in this Guarantee shall affect the
right to serve process in any other manner permitted by law:  IN WITNESS WHEREOF these presents have been
executed by the parties the day, month and year first before written:

EXECUTED AND DELIVERED by MEDICOR LTD acting by Theodore
Robert Maloney, its president and chief executive officer, and who subscribed
this Agreement in the presence of:

 

 

DONALD K
MCGHAN

Witness
signature

DONALD
K MCGHAN                                                                                                                                   T
R MALONEY

Witness
name                                                                                                                                              President
and CEO

4560 SO.
DECATUR BLVD.

Witness
address

SUITE 300

LAS VEGAS, NV.
89103

 

 

 

EXECUTED AND DELIVERED by BIOSIL LIMITED acting by John Alan
Alsop, one of its directors, and who subscribed this Agreement in the presence
of:

 

 

JEAN BELL

Witness
signature

JEAN
BELL                                                                                                                                                               J
A ALSOP

Witness
name                                                                                                                                                                 Director

1 GREENFIELD
COTTAGE

Witness
address

MAIN ROAD,
ONCHAN, ISLE OF MAN

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