Document:

Exhibit 10.4(a)

 

SUPPLY AGREEMENT

 

BETWEEN

 

C.C.C. DEL URUGUAY S.A.

 

AND

 

NEVRO CORP

 

April 1, 2012

 

1

 

TABLE OF CONTENTS

 

	
1. Definitions
    	
3
    
	
2. Program Management
    	
5
    
	
3. Manufacture of Products
    	
5
    
	
4. Product Training
    	
5
    
	
5. Quality
    	
5
    
	
6. Component   Responsibilities
    	
6
    
	
7.   Consigned Components
    	
6
    
	
8. Engineering Change Order   (ECO)
    	
6
    
	
9. Yield Loss
    	
7
    
	
10. Purchase Orders and   Forecasts
    	
7
    
	
11. Increase, Rescheduling   and Cancellation of Purchase Orders
    	
7
    
	
12. Price and Payment Terms
    	
7
    
	
13. Shipment
    	
7
    
	
14. CCC Warranties and   Indemnification
    	
8
    
	
15. Acceptance and RMA   Process
    	
8
    
	
16. Nevro Warranties and   Indemnification
    	
9
    
	
17. Nevro Property
    	
9
    
	
18. Intellectual Property
    	
9
    
	
19.   Exclusivity/Non-Competition
    	
10
    
	
20. Term
    	
10
    
	
21. Termination
    	
11
    
	
22. Effect of Termination
    	
11
    
	
23. Liability Limitation
    	
11
    
	
24. Relationship of Parties   and Liability for Services Performed by Others
    	
11
    
	
25. Confidentiality
    	
12
    
	
26. Force Majeure
    	
13
    
	
27. Governing Law and   Arbitration
    	
13
    
	
28. Compliance with Laws
    	
13
    
	
29. Assignability
    	
13
    
	
30. Notice
    	
13
    
	
31. No Waiver
    	
13
    
	
32. Severability
    	
14
    
	
33. Entire Agreement
    	
14
    
	
34. Construction
    	
14
    
	
35. Counterparts
    	
14
    
	
EXHIBIT A — PRODUCTS
    	
16
    
	
EXHIBIT B — PROGRAM TEAM LIST
    	
17
    
	
EXHIBIT C — CONSIGNED TOOLING, EQUIPMENT AND SOFTWARE
    	
18
    
	
EXHIBIT D — QUALITY AGREEMENT
    	
19
    
	
EXHIBIT E — PRICE MODEL
    	
20
    

 

2

 

SUPPLY AGREEMENT

 

This supply agreement (“Agreement”) is entered into on April 1, 2012 (the “Effective Date”) by and between C.C.C. Del Uruguay S.A. (“CCC”), an Uruguay corporation with its principal place of business at General Paz 1371, Montevideo, Uruguay, CP 11400  and Nevro Corp (“Nevro”), a California corporation with its principal place of business at 4040 Campbell Avenue, Suite 210, Menlo Park, CA 94025.  CCC and Nevro are referred to collectively as the “Parties”, individually as a “Party”.

 

Whereas, Nevro conceived a Nevro System and engaged the services of CCC to develop the Nevro System under the Engineering Agreement; and

 

Whereas, Nevro desires to purchase certain Manufacturing Services from CCC; and

 

Whereas, CCC is in the business of providing engineering and Manufacturing Services; and

 

Whereas, the Parties desire to establish the terms and conditions that shall apply to Nevro’s purchase of certain Manufacturing Services from CCC.

 

In consideration of the foregoing and the agreements contained herein, CCC and Nevro hereby agree as follows:

 

1. Definitions

 

1.1                          “Approved Manufacturer List” shall mean the approved list of vendors in the Specifications for the supply of Components.

 

1.2                          “Bill of Materials” shall mean Nevro’s listing or reference for the Components included in or required for the manufacture/assembly of Products in accordance with the Specifications.

 

1.3                          “Change Order” shall mean a formal written request to increase, decrease, or reschedule deliveries in a Purchase Order.

 

1.4                          “Components” shall mean the parts, materials and supplies included in or required for each Product as stipulated in the Bill of Materials.

 

1.5                          “Confidential Information” shall mean all intellectual property, including software and other technical data, products and product designs, and information, materials and documents relating to products, product designs, product testing, markets, business plans, business opportunities and trade secrets, disclosed, orally or in any written form, by one party to another under the Agreement or the Engineering Agreement, but which is non public, private or proprietary in nature.  Confidential Information shall also include all summaries, analyses, documents, memoranda, notes and other writings, including all the terms, conditions and definitions of this agreement and any and all exhibits attached hereto, prepared by either party containing or based on other Confidential Information.

 

1.6                          “Days” shall mean calendar days, unless otherwise specified, including Saturdays, Sundays and United States Government recognized holidays. “Business Days” shall not include Saturdays, Sundays or United States and Uruguay Government recognized holidays.

 

1.7                          “Defect” or “Defective” shall mean a non-conformance to Nevro’s Specifications, Bills of Material, Approved Manufacturer List, or relevant workmanship standards as referenced in the Specifications or in this Agreement.

 

1.8                          “Device Master Record” shall mean the compilation of records containing the procedures and Specifications for the Product.

 

1.9                          “Disclosing Party” shall mean the Party disclosing its Confidential Information.

 

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1.10                   “Engineering Agreement” shall mean the Engineering Agreement entered into between the parties on December 30, 2008, as amended.

 

1.11                   “Engineering Change Order” (ECO) shall mean the document that details a change in the Specifications and/or design of a Product.

 

1.12                   [***] shall be as defined in Incoterms 2000 of the International Chamber of Commerce.

 

1.13                   “Facility” shall mean the manufacturing facility located at General Paz 1371, 11400 Montevideo, Uruguay.

 

1.14                   “Good Manufacturing Practice” (GMP) shall mean compliance with ISO13485:2003 and Quality System Regulations 21 CFR Part 820.

 

1.15                   “High Frequency Neurostimulator” shall mean a neurostimulator designed to deliver stimulation pulses [***] at a pulse rate greater than [***]Hz.

 

1.16                   “Incorporated CCC Property” shall mean any Pre-existing Property of CCC or any improvements to or derivatives of the Pre-Existing Property of CCC that is or are incorporated in any manner into any Resulting Property or a Product.

 

1.17                   “Intellectual Property” shall mean all rights held by a party in its technology, products and business information, all or some of which may constitute Confidential Information, and including but not limited to:  patent rights, copyrights, trademark rights, goodwill, inventions, improvements, discoveries, designs, modifications, data, business information, financial information, clinical information and data, regulatory information, trade secret rights, mask work, know how rights and other intellectual property and proprietary rights.

 

1.18                   “Inventory” shall mean the store of Components held by CCC at the Facility.

 

1.19                   “Manufacturing Services” shall mean full turnkey assembly, including development and deployment of manufacturing,  inspection and test processes, procurement of Components, assembly and test of Products to Specifications, quality control and quality improvement and value engineering.

 

1.20                   “Minimum Order Quantities” shall mean minimum order quantities required by Component vendors.

 

1.21                   “Nevro Controlled Components” shall mean Components for which Nevro shall manage price agreements with the vendors.

 

1.22                   “Nevro Property” shall mean any [***].

 

1.23                   “Nevro System” shall mean an implantable system intended to be completely introduced to a living body by surgical intervention to apply electrical stimulation for treatment of chronic pain.

 

1.24                   “Pre-existing Property” shall mean all rights of a party to designs, inventions (whether patentable or not), copyrights, trade marks, trade secrets, processes, software, devices and other intellectual property and confidential information owned or held by a party immediately prior to the Effective Date.

 

1.25                   “Product” shall mean the products set forth in EXHIBIT A, as identified by the Nevro part number or assembly identification specified in each Purchase Order issued under this Agreement and as described in the Device Master Record. There can be multiple versions of a Product, based on differences provided for in the Bills of Material.

 

1.26                   “Purchase Order” shall mean the Nevro purchase order submitted to CCC detailing the Product(s), revision level, quantity, pricing, and requested Shipment Date(s).

 

1.27                   “Receiving Party” shall mean the Party receiving Confidential Information.

 

[***] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION

 

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1.28                   “Resulting Property” shall mean all designs, data, information, inventions, improvements, discoveries (whether patentable or not), processes, software, and devices and any intellectual property rights in any of the foregoing (including but not limited to copyrights, trade marks, trade secrets, and patent rights) developed by either party as a result of this Agreement.

 

1.29                   “Safety Stock” shall mean the Nevro requested level of Components to be purchased by CCC, and paid for by Nevro,   in excess of the amount required to meet Nevro’s Purchase Orders, Minimum Order Quantities or Component lead times.

 

1.30                   “Shipment Date” shall mean the requested shipment date from the CCC manufacturing facility as specified in a Purchase Order, or as otherwise mutually agreed by the Parties.

 

1.31                   “Specifications” shall mean Nevro’s written specifications for the manufacture and testing of the Product including, but not limited to, the current revision number, Approved Manufacturer List (AML), Bills of Material, manufacturing procedures, schematics, testing procedures, drawings, and documentation.

 

1.32                   “Warranty Period” shall mean the period of [***] after acceptance by Nevro of Product.

 

2. Program Management

 

2.1                          Each Party shall appoint a program manager as the program liaison with the other Party in connection with the coordination and implementation of the manufacture of the Products and shall also provide ongoing support thereafter. The Parties agree to conduct periodic business reviews. The business reviews shall include, but shall not be limited to, quality, delivery, flexibility, service, and price. The program managers shall coordinate these reviews.

 

2.2                          Each Party shall provide a list of program team members. The list shall include name, title, phone number, and email address. The Program Team List is attached as EXHIBIT B.

 

3. Manufacture of Products

 

3.1                          During the term of this Agreement, CCC shall provide Nevro with Manufacturing Services at the Facility.

 

3.2                          CCC shall manufacture and build Products in accordance with the Specifications.

 

3.3                          CCC shall purchase all inventory as needed and standard production and test equipment as necessary to fulfill Purchase Orders.  Nevro may consign certain tooling, equipment and software that are unique to Products, attached as EXHIBIT C.

 

3.4                          CCC shall maintain manufacturing and test records in accordance with GMP.

 

4. Product Training

 

4.1                          During the term of this Agreement, CCC shall maintain a sufficient staff of trained personnel to adequately support all the requirements set forth in this Agreement.

 

5. Quality

 

5.1                          The Parties agree to the Quality Agreement attached as EXHIBIT D.

 

5.2                          Without limiting CCC’s other obligations under this Agreement, CCC agrees that the manufacture, test and quality control of the Products under the terms of this Agreement shall be in accordance with the standard CCC processes utilized for similar products manufactured by CCC, unless otherwise specified by the Quality Agreement.

 

5.3                          CCC agrees to maintain ISO 13485:2003 certification and comply with 21 CFR Part 820 in all Facilities producing Products.

 

[***] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION

 

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6. Component Responsibilities

 

6.1                          CCC shall maintain and manage adequate Inventory in order to meet Nevro’s Purchase Orders and Component lead times. CCC shall immediately notify Nevro in the event of any potential material delays or shortages that may impact Shipment Date.

 

6.2                          CCC may order Components above the quantities required to satisfy Purchase Orders in order to meet Minimum Order Quantities.

 

6.3                          Nevro may request that CCC establish a Safety Stock. The amount of Safety Stock will be as mutually agreed by the Parties. Nevro will pay CCC for all Safety Stock purchases.  In the case that Safety Stock is used for a specified Product, Nevro will receive a commensurate change to the overall pricing for that Product.

 

6.4                          Nevro shall be responsible for any Inventory purchased by CCC under the terms of this Agreement, including Safety Stock, which becomes unusable due to reduction in demand or obsolescence due to Engineering Change Orders, provided that CCC has made a reasonable effort to return such Inventory.

 

6.5                          CCC will invoice Nevro for all of the costs of transporting Components to the Facility including but not limited to freight and customs charges.

 

7. Consigned Components

 

7.1                          Nevro will supply certain consigned Components to CCC. Such consigned Components shall be delivered to CCC in sufficient time and in sufficient quantities based on Purchase Orders and in accordance with this Agreement, including normal yield levels, to allow CCC to meet scheduled Shipment Dates for the applicable Products.  All consigned Components shall be in good condition and in good working order.  Nevro assumes complete liability for the quality of all consigned Components and CCC shall not be responsible for any Defects or deficiencies therein.  CCC shall, upon receipt of the consigned Components, perform all necessary inspections of the consigned Components, in accordance with its standard procedures and shall notify Nevro in writing, not later than [***] Days from the date of receipt of the consigned Components, of any Defects found or of any discrepancy in quantities. CCC reserves the right, after receipt of the consigned Components, to timely inform Nevro of additional Defects which may be discovered or revealed by further inspection by or through the manufacturing process that could not be discovered at incoming inspection by CCC.

 

7.2                          CCC will provide Nevro with a written statement of the Consigned Components used by CCC at the end of each calendar month.

 

8. Engineering Change Order (ECO)

 

8.1                          An ECO is required when the form, fit or function of the design of the Product and/or Specifications are affected by a related change by or on behalf of Nevro.  Nevro shall provide ECOs to CCC by way of e-mail, hard-copy, or fax.  CCC agrees to promptly implement any change in the Specifications or the design of a Product as reasonably requested by Nevro pursuant to an ECO. Nevro shall reimburse CCC’s reasonable costs of implementation.

 

8.2                          CCC shall provide a written response to Nevro if such changes affect the per-unit price and/or parameters related to the shipment of a Product.  The pricing model will be adjusted for the effect of the ECO when implemented.

 

8.3                          CCC shall not implement any changes to the design or Specifications (including any deviations from the Approved Manufacturer List or the Bill of Materials) of any Product or materials used to produce a Product, without Nevro’s prior written approval. CCC shall not implement any changes to equipment, manufacturing and quality assurance procedures, or methods and techniques used to produce a Product without notifying Nevro in writing prior to such change.

 

[***] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION

 

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8.4                          Documentation reasonably supporting the unusability of any Inventory as a result of an ECO shall be provided by CCC; however, Nevro has the sole authority in its reasonable judgment to determine whether or not such Inventory is unusable.

 

9. Yield Loss

 

9.1                          [***] shall be responsible for yield loss.  [***] with respect to yield loss shall be for [***].

 

9.2                          Following the end of each calendar quarter [***] for the [***]. CCC will also provide a report on the steps that are being taken by CCC to address the causes of the yield loss to accompany such invoice.

 

10. Purchase Orders and Forecasts

 

10.1                   During the term of this Agreement, Nevro shall issue quarterly Purchase Order(s) by the last day of each calendar quarter for Shipment Dates in the quarter two quarters in the future. By way of example, on or before December 31st Purchase Orders will be issued for Shipment Dates in the third quarter starting July 1st.  Each successive quarter, Purchase Orders shall be issued for an additional quarter. The terms and conditions of this Agreement shall supersede printed terms on any Purchase Order, quotation, acknowledgement, confirmation or invoice.

 

10.2                   CCC shall provide written Purchase Order acceptance within [***] business days of receipt of the Purchase Order.

 

10.3                   Nevro will pay a deposit for [***] of the amount set forth in Exhibit E as CCC BOM plus the LOP for a Product times the quantity ordered on the Purchase Order to CCC as a down payment deposit to be applied against the invoice issued upon shipment of the Product to Nevro. When CCC purchases Components as set forth in Exhibit E as BOM Nevro, Nevro will pay as a deposit [***] to be applied against the invoice issued upon shipment of the Product to Nevro.

 

10.4                   Nevro shall issue quarterly rolling monthly forecast by the last day of each calendar quarter for the 3 quarters immediately following the Purchase Order coverage period. The forecast quantities for the last two quarters of the forecast are non-binding. When a Purchase order is issued for the first quarter of the forecast, CCC will accept such Purchase Order provided that the quantities ordered may not vary up or down from such forecast quantity by more than [***] unless otherwise agreed by the Parties.

 

11. Increase, Rescheduling and Cancellation of Purchase Orders

 

11.1                   CCC shall use its commercially reasonable efforts to accommodate increases, decreases or reschedules of the quantities in a Purchase Order requested by Nevro. Any additional costs of such change will be borne by Nevro.

 

12. Price and Payment Terms

 

12.1                   All prices are [***] at [***], provided that [***]. The pricing model for the Products shall be as set forth in EXHIBIT E of this Agreement.

 

12.2                   All CCC invoices shall be in U.S. dollars and due and payable net [***] days after the date of shipment.

 

13. Shipment

 

13.1                   CCC shall notify Nevro of shipments by CCC to Nevro.  Nevro may specify carrier and mode of transportation for each Shipping Order or provide a standing instruction; provided, if Nevro does not so specify, CCC may select the carrier and mode of transportation reasonably required to meet Nevro’s delivery requirements.

 

13.2                   CCC shall ship all Products on the committed Shipment Date.  If circumstances arise that prevent CCC from such timely shipment of Products, CCC shall (i) immediately notify Nevro of the nature of the problem, the methods taken to overcome the problem and the estimated time of delay, (ii) expedite shipment of such Products when the problem is overcome.

 

[***] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION

 

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13.3                   All Products shall be packaged and prepared for shipment in a manner which conforms to the Specifications and is acceptable to common carriers for shipment.  CCC shall mark the outside of each pallet per Specifications.  Each shipment shall be accompanied by a packing slip which shall include Nevro item/part numbers and Nevro’s Purchase Order number the shipment is against.

 

14. CCC Warranties and Indemnification

 

14.1                   CCC warrants that for the Warranty Period each Product will, when properly used, conform to all material respects with the relevant Specifications under this Agreement.  This warranty is made only to Nevro and CCC shall have no liability to any third party, directly or indirectly, with respect to any Product as a result of such warranty.  CCC shall have no obligation to Nevro under this warranty or otherwise, to the extent that (a) the Product is used in connection with an activity other than that for which Nevro is selling the Products; (b) the Product has been modified by any party other than CCC or its authorized agents; (c) the failure is due to incorrect use or handling of the Products by Nevro or third parties after Nevro accepts such Product; or (d) Nevro has not complied with Section 15.1.

 

14.2                   CCC further represents and warrants that (i) it has and shall transfer good and clear title to the Products, free and clear of all liens, claims and encumbrances, and the right to grant the rights granted hereunder, (ii) CCC , to its knowledge, does not and shall not infringe on any Intellectual Property of any third party in connection with its performance under this Agreement, and (iii) CCC has the right and power to enter into this Agreement.

 

14.3                   CCC agrees to indemnify Nevro and hold Nevro harmless from and against any and all claims, third party losses, liabilities, third party damages, expenses and costs (including reasonable attorney’s fees and court costs) finally awarded against Nevro, that results from or arises out of a breach or alleged breach of any of these representations and warranties in section 14.2 or incurred in the settlement or avoidance of any such claim. This indemnity shall not apply if (i) Nevro fails to give CCC prompt notice of any such claim or threatened claim and such failure materially prejudices CCC, or (ii) Nevro does not provide reasonable assistance to CCC at CCC’s expense with respect to such claim.

 

14.4                   CCC MAKES NO OTHER WARRANTIES, EXPRESSED OR IMPLIED, WITH RESPECT TO THE COMPONENTS, PRODUCTS OR ANY SERVICES PROVIDED UNDER THIS AGREEMENT, AND DISCLAIMS ALL OTHER WARRANTIES INCLUDING THE WARRANTIES OF MERCHANTABILITY, AND FITNESS FOR A PARTICULAR PURPOSE.

 

14.5                   The terms of Section 14 and Section 15 shall apply to all Products manufactured by CCC for Nevro, regardless of whether such Products were manufactured before or after the Effective Date, excluding any Products that CCC provided as non-verified Deliverables under the Engineering Agreement that were not intended for commercial distribution by Nevro.

 

15. Acceptance and RMA Process

 

15.1                   Notwithstanding any prior inspection or payment by Nevro, Nevro may reject all or any portion of any shipment of Products that are not conforming to the CCC Warranty as set forth herein, as determined by Nevro following quality control tests and inspection or as otherwise found to be Defective, provided such return is within the Warranty Period set forth in herein.  Any Defective Products may be returned to CCC and CCC will, upon their confirmation of the Product as Defective Product, at its sole expense (including shipping and handling expenses),  either (i) repair the applicable Defective Products within a reasonable time; (ii) replace the applicable Defective Products within a reasonable time; and/or (iii) and if neither of (i) or (ii) is feasible within a reasonable time, CCC will refund the amount of the payments paid for the Product; provided that (i) Nevro obtains a return authorization from CCC prior to returning the Products (and CCC shall provide Nevro with an RMA number promptly upon request), and the failure analysis, or summary thereof, conducted by Nevro shall accompany the Product or shall otherwise be promptly be delivered to CCC. If the Product returned to CCC are not covered by the Warranty (because the return was outside the Warranty period or was found not to be Defective Product) [***].

 

[***] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION

 

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16. Nevro Warranties and Indemnification

 

16.1                   Nevro represents and warrants to CCC that (i) to its knowledge, Nevro Intellectual Property provided to CCC hereunder does not infringe the proprietary rights of any third party, and (ii) Nevro has the right and power to enter into this Agreement.  As the sole remedy and liability for any breach of the foregoing representations and warranties,

 

16.2                   Nevro agrees to indemnify CCC and hold CCC harmless from and against any and all claims, third party losses, liabilities, third party damages, expenses and costs (including reasonable attorney’s fees and court costs) finally awarded to CCC, that result from a breach or alleged breach of any of third party Intellectual Property infringement claim in violation of this warranty.  This indemnity shall not apply (i) if CCC fails to give Nevro prompt notice of any such claim or threatened claim and such failure materially prejudices Nevro, or (ii) unless Nevro is not given the opportunity to assume control of the defense or settlement, and (iii) CCC does not provide reasonable assistance to Nevro at Nevro’s expense with respect to such claim.

 

16.3                   NEVRO MAKES NO OTHER WARRANTIES WITH RESPECT TO THE NEVRO INTELLECTUAL PROPERTY, NEVRO COMPONENTS, NEVRO PROPERTY, THE LICENSES GRANTED HEREUNDER OR OTHER MATERIALS OR DOCUMENTATION PROVIDED BY NEVRO HEREUNDER AND DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING THE WARRANTIES OF NON-INFRINGEMENT, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR ARISING FROM A COURSE OF DEALING, USAGE OR TRADE PRACTICE.

 

17. Nevro Property

 

17.1                   Any Nevro Property shall reside and/or remain the property of Nevro and shall (i) be clearly marked or tagged as the Property of Nevro, (ii) be and remain personal property, and not become a fixture to real property, (iii) be subject to inspection by Nevro at any time, (iv) be used solely for the purpose of providing Manufacturing Services to Nevro, (v) be kept free by CCC from any and all liens and encumbrances, (vi) not be modified in any manner by CCC without the prior written approval of Nevro, and (vii) be maintained by CCC in accordance with Nevro’s maintenance procedures and guidelines, including, if applicable, but not limited to periodic calibration procedures.  Nevro will pay all maintenance costs of Nevro Property.  Nevro shall retain all rights, title and interest in Nevro’s Property and CCC agrees to treat and maintain the Nevro’s Property with the same degree of care as CCC uses with respect to its own property, but no less care than reasonable care.  CCC shall bear all risk of loss or damage to Nevro’s Property until it is returned or delivered to Nevro. Upon Nevro’s request, CCC shall deliver all of Nevro’s Property to Nevro in good condition, normal wear and tear excepted, without cost to Nevro (except freight costs); Nevro shall determine the manner and procedure for returning the Nevro’s Property, and shall pay the corresponding freight costs.  CCC agrees to execute all documents, or instruments evidencing Nevro’s ownership of Nevro’s Property as Nevro may require from time to time.

 

18. Intellectual Property

 

18.1                   The parties acknowledge and agree that all Pre-existing Property is the property of the respective party or its licensors and that, except as expressly set out herein, nothing in this Agreement shall convey or otherwise grant any rights in or to any Pre-existing Property from one party to the other.

 

18.2                   CCC hereby grants to Nevro, its successors and assigns, a perpetual, fully paid, world-wide, sublicensable, non-exclusive license under the Incorporated CCC Property and all intellectual property rights therein, to make, use, sell, offer for sale, and import the Incorporated CCC Property and all intellectual property rights therein, in connection with such Resulting Property, the “Resulting Property” as defined under the Engineering Agreement (which shall be deemed for purposes of this Agreement to include any designs, data, information, inventions, improvements, discoveries (whether patentable or not), processes, software, and devices and any intellectual property rights in any of the foregoing (including copyrights, trade marks, trade secrets, and patent rights) developed in connection with the development or manufacture of Products by CCC before the Effective Date, collectively, “EA Resulting Property”), or Product, and any improvements, derivatives or successor works of or to any of the foregoing, as Nevro considers appropriate including, without limitation, to use, manufacture, sell, offer for sale, import, display, copy, perform, modify, alter and support the Incorporated CCC Property.  The license granted to Nevro includes the rights to future improvements to or derivatives of the Incorporated CCC Property, but unless otherwise specified in this Agreement (including any exhibits thereto) or otherwise agreed by the Parties, it does not require CCC to take any actions or perform any activities to incorporate it to any Product in connection with the Resulting Property or Products, and any

 

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improvements, derivatives or successor works thereof or thereto. Nothing in this Agreement will be deemed to grant Nevro the right to market, sub-license or otherwise use the Pre-Existing Property of CCC other than in connection with one or more Products or the Resulting Property, the EA Resulting Property, or any improvements, derivatives or successor works of any of the foregoing.

 

18.3                   The parties acknowledge and agree that all Resulting Property, the EA Resulting Property and all intellectual property rights therein, excluding the Incorporated CCC Property and the changes or improvements incorporated to it during the term of this Agreement or the Engineering Agreement, are and shall be solely owned by Nevro. CCC shall promptly disclose any such items to Nevro.  CCC hereby assigns, and shall cause all of its employees, agents, affiliates, subcontractors and other authorized representatives to assign, to Nevro any interest it or they may have in any such Resulting Property, EA Resulting Property (to the extent not already assigned under the Engineering Agreement) and all intellectual property rights therein.  CCC agrees to cooperate with Nevro for the purpose of filing and prosecuting patent applications, including the execution of any and all legal papers which are necessary or desirable to affect the intent of this Section.

 

18.4                   The rights and obligations of the parties under this section shall survive the termination of this Agreement and shall remain in full force and effect thereafter.

 

18.5                   Upon request by Nevro, CCC will cooperate to transfer to Nevro or its designee all documents, information, data, prototypes, and other technology, and will grant to Nevro and its designee all rights, in each case necessary for Nevro or its designee to manufacture and sell Products or improvements to or derivatives thereof, and will make its personnel reasonably available to Nevro or its designee, as necessary to enable Nevro or its designee to manufacture the Products in the manner CCC manufactured the Products during the term of and pursuant to this Agreement.  Nevro shall reimburse CCC’s reasonable cost of providing any services requested by Nevro and described in the previous sentence.

 

18.6                   Nothing in this Section 18 or otherwise in this Agreement negates, modifies or otherwise adversely affects any assignment of or grant of license to Intellectual Property by CCC to Nevro under the Engineering Agreement.

 

19. Exclusivity/Non-Competition

 

19.1                   CCC agrees that it shall not, directly or indirectly, through its affiliated companies, distributors, resellers or agents of any type or nature or otherwise, develop, manufacture, market, distribute or sell any products that utilize any Resulting Property, the “Resulting Property” as defined under the Engineering Agreement, or any Intellectual Property gained directly or indirectly from Nevro during the performance of this Agreement or the Engineering Agreement unless specifically authorized in writing by Nevro.

 

19.2                   If Nevro issues forecasts for Product in 2012 for quantities greater or equal to [***] IPG units, or [***] IPG units per year thereafter, and provided that Nevro takes delivery of at least [***] IPG units in 2012 and [***] IPG units thereafter, CCC agrees that it shall not, at any time during such years, directly or indirectly, through its affiliated companies, distributors, resellers or agents of any type or nature or otherwise, develop, manufacture, market, distribute or sell any High Frequency Neurostimulator.

 

20. Term

 

20.1                   This Agreement shall become effective on the Effective Date and shall continue for a period of 3 years unless terminated at an earlier date in accordance with the provisions herein set forth. Thereafter, this Agreement shall automatically be renewed for additional one (1) year terms, unless terminated by either Party upon written notice delivered to the other Party not later than ninety (90) days prior to the last day of the applicable term The Parties agree that, notwithstanding the number of renewals, the Parties do not intend to convert this Agreement into a contract of indefinite duration.

 

[***] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION

 

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21. Termination

 

21.1                   Either Party may immediately terminate this Agreement by providing written notice to the other Party, upon the occurrence of any of the following events:

 

(a)                                 if the other Party ceases to do business, or otherwise terminates its business operations, excluding any situation where all or substantially all of such other Party’s assets, stock or business to which this Agreement relates are acquired by a third party (whether by sale, acquisition, merger, operation of law or otherwise);

 

(b)                                 if the other Party breaches any material provision of this Agreement and fails to cure such breach within sixty (60) days of written notice describing the breach;

 

(c)                                  if the other becomes insolvent, makes an assignment for the benefit of creditors, files a petition in bankruptcy, permits a petition in bankruptcy to be filed against it, presents a petition or has a petition presented by a creditor for its winding up, or enters into any liquidation or call any meeting of its creditors, or admits in writing that it is unable to pay its debts as they mature, or if a receiver or examiner is appointed for a substantial part of its assets; or

 

(d)                                 as mutually agreed in writing by the Parties.

 

22. Effect of Termination

 

22.1                   Expiration or termination of this Agreement shall be without prejudice to any rights or obligations that accrued to the benefit of either party prior to such expiration or termination.  Upon expiration or termination without cause or by mutual agreement, CCC shall continue to fulfill, subject to the terms of this Agreement, all Purchase Orders and ECOs placed by Nevro and accepted by CCC in accordance with this Agreement prior to the effective date of termination.  Upon expiration or termination of this Agreement for any reason, CCC shall promptly turn over to Nevro all Products and related documentation, whether or not completed, and both Parties shall promptly turn over to the respective Party the Confidential Information. All Components remaining at the conclusion of Purchase Order fulfillment will be invoiced to Nevro and returned to Nevro with any remaining Consigned Components. Any remaining balance of Nevro deposits with CCC will be offset against amounts owing to CCC.  The obligations under sections 14, 16, 17, 18, 19.1, 22, 23, 24, 28, 29, 30, 31, 32, 33, 34 and 35 shall survive the termination or expiration of this Agreement.

 

22.2                   In case of termination due to breach by CCC all remaining Purchase Order deposits paid by Nevro will be returned by CCC within [***] business days.

 

22.3                   In case of termination due to breach by Nevro all remaining Purchase Order deposits paid by Nevro can be applied to future shipments but [***].

 

22.4                   The Parties agree to make every effort to complete the final transfer of Products, Inventory, Confidential Information and complete all financial transactions within [***] days from the date of termination.

 

23. Liability Limitation

 

23.1                   EXCEPT FOR LIABILITY UNDER THE WARRANTIES HEREIN, NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR THE LOSS OF, OR DAMAGE TO, OR LOSS OF USE OF, FACILITIES OR OTHER PROPERTY, BUSINESS INTERRUPTION, LOSS OF REVENUE, LOSS OF PROFITS, LOSS OF DATA OR TRANSMISSIONS, OR OTHER SPECIAL OR PUNITIVE OR DAMAGES OF ANY KIND WHATSOEVER, RESULTING OR ARISING FROM OR RELATING TO THIS AGREEMENT AND WHETHER OR NOT THE OTHER PARTY IS ADVISED OF THE POSSIBILITY OF ANY OF THE FOREGOING.

 

24. Relationship of Parties and Liability for Services Performed by Others

 

24.1                   CCC and its subcontractor(s) shall be deemed to be independent contractors of Nevro, and this Agreement does not create a general agency, joint venture, partnership, employment relationship, or franchise between CCC and Nevro.

 

[***] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION

 

11

 

Each Party assumes full responsibility for the actions and negligence of its employees, agents or other personnel assigned by it to perform work pursuant to this Agreement, regardless of their place of work, and shall be solely responsible for payment of salary, including withholding of federal and state income taxes, social security, workers’ compensation and the like.

 

25. Confidentiality

 

25.1                   The parties acknowledge and agree that, from time to time, either of the parties may disclose Confidential Information only to the other for the purpose of better carrying out their obligations or to allow the receiving party to better carry out its obligations hereunder.  The parties shall only use Confidential Information for the purposes of this Agreement and shall otherwise keep confidential and not disclose to any other person any of the Confidential Information except as expressly permitted hereof.

 

25.2                   The parties may disclose Confidential Information to their respective directors, officers, employees, authorized agents and professional advisers to the extent such persons have a need to know such information for the purpose of performing each party’s duties and obligations hereunder, provided that party advises each such individual of the terms of this Agreement and ensures that each such individual receives and hold such information as if that individual were a party to this Agreement.  A party may, from time to time, designate in writing individuals as authorized representatives of that party to whom Confidential Information may be provided directly by the disclosing party, and any Confidential Information so provided will be deemed to have been provided to the other party and be subject to this Agreement.  A Disclosing Party may, from time to time, require the Receiving Party to provide evidence to its reasonable satisfaction that all persons permitted by this paragraph to have access to the Disclosing Party’s Confidential Information have executed Agreements, the terms of which are reasonably satisfactory to the Disclosing Party, are consistent with the terms of this Agreement and which may be enforced by the Disclosing Party providing for the assignment of intellectual and other property rights to the Receiving Party or Disclosing Party, as appropriate and non-disclosure of Confidential Information.

 

25.3                   The obligations of a party concerning the other party’s Confidential Information shall not apply to information which:

 

(a)                                 is or becomes widely known (defined as being published in industry/medical journals or literature), other than by reason of a breach of this Agreement or, to the knowledge of the Receiving Party, a breach of a similar Agreement;

 

(b)                                 is or has been independently developed by the Receiving Party without reference to or based upon the other party’s Confidential Information;

 

(c)                                  the Disclosing Party agrees in writing need not be kept confidential;

 

(d)                                 is required by law or court of competent jurisdiction to be disclosed by the Receiving Party provided such party first gives prompt notice of the requirement to disclose to the Disclosing Party to allow that party to obtain an appropriate order or other protection against the publication of such information; or

 

(e)                                  is required by any regulatory authority or notified body.

 

25.4                   All Confidential Information provided hereunder shall remain the property of the Disclosing Party.  The Receiving Party shall, within ten days of a written request to do so, return to the Disclosing Party all Confidential Information that has been provided in tangible form and shall, unless prohibited by law, destroy or otherwise render unintelligible all other Confidential Information. Notwithstanding the foregoing, each party will be allowed to keep one copy of the Confidential Information in order to ensure continued compliance with the terms of this Agreement.

 

25.5                   The parties acknowledge that monetary damages would not be sufficient remedy for a breach of obligation of confidentiality in this Agreement and agree that each party shall be entitled to seek and obtain appropriate equitable remedies, including injunctive relief, to prevent the unauthorized use or disclosure of any Confidential Information.

 

25.6                   The obligations under this Section shall continue for a period of [***] years following the last day on which CCC performs any services under this Agreement.

 

[***] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION

 

12

 

26. Force Majeure

 

26.1                   The failure or delay of either party to perform fully any of its obligations under this Agreement solely by reason of acts of God; acts of civil or military authority; civil disturbance; war; embargo; strikes or other labor disputes (excluding those related to a Party’s workforce); fire; a delay or default caused by common carriers; or similar circumstance beyond its reasonable control which cannot reasonably be foreseen or provided against (“Force Majeure”) will be deemed not to be a breach of this Agreement so long as the Party so prevented from complying with this Agreement has not contributed to such Force Majeure, has used its best efforts to avoid such Force Majeure or to ameliorate its effects, and continues to take all actions within its power to comply as fully as possible with the terms of this Agreement.  In the event of any such Force Majeure, full performance of the obligations affected will be deferred until the Force Majeure ceases.  This section will not apply to excuse a failure to comply with the terms of this Agreement arising from any commercial dispute between a party and a third party or the failure by a party to secure any materials, supplies, labor or other input for any reason not caused by Force Majeure.

 

27. Governing Law and Arbitration

 

27.1                   This Agreement shall be governed by and construed under the laws of the State of New York, U.S.A., without regard for conflict of laws principles.  Any controversy or claim arising out of or relating to this Agreement, or its breach, shall be subject to binding arbitration in New York, New York, under the Commercial Arbitration Rules of the American Arbitration Association by one arbitrator appointed in accordance with such Rules, provided, however, that neither party shall be precluded from seeking injunctive relief or other provisional relief in any court of law. The language of the arbitration shall be English. Judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction. The federal and state courts within the State of New York, U.S.A., shall have exclusive jurisdiction and venue to adjudicate any action for injunction or other provisional relief arising out of this Agreement.  However, Nevro may, in its sole discretion, seek to adjudicate in a court in any other jurisdiction any permitted dispute for injunction or other provisional relief arising out of this Agreement.  CCC hereby expressly consents to (i) binding arbitration as described above; (ii) the personal jurisdiction of the federal and state courts within New York, (iii) service of process being effected upon it by major rapid delivery courier service sent to the address set forth at the beginning of this Agreement, and (iv) the uncontested enforcement of a final judgment from such arbitrator or court in any other jurisdiction wherein CCC or any of its assets are present.  The parties expressly exclude the application of the United Nations Convention on Contracts for the International Sale of Goods.  It is not intended that any third party should be a beneficiary under this Agreement pursuant to the Contracts (Rights of Third Parties) Act 1999.

 

28. Compliance with Laws

 

28.1                   CCC shall comply with all applicable laws and regulations in the performance of its duties and tasks under this Agreement.

 

29. Assignability

 

29.1                   CCC shall not have any right or ability to assign, transfer, or sublicense any obligation or benefit under this Agreement by operation of law or otherwise, without Nevro’s prior written consent.  Nevro may assign this Agreement to any of Nevro’s affiliated companies or to an entity that succeeds to all or substantially all of its business or assets to which this Agreement relates, provided Nevro delivers CCC a prompt, written notice of such assignment.

 

30. Notice

 

30.1                   Notices under this Agreement shall be sufficient only if personally delivered by a major rapid delivery courier service return receipt requested to a Party at its addresses first set forth herein or as amended by notice pursuant to this subsection.

 

31. No Waiver

 

31.1                   No waiver of any term or condition of this Agreement shall be valid or binding on either Party.  The failure of either Party to enforce at any time any of the provisions of the Agreement, or the failure to require at any time performance

 

13

 

by the other Party of any of the provisions of this Agreement, shall in no way be construed to be a present or future waiver of such provisions, nor in any way affect the validity of either Party to enforce each and every such provision thereafter.

 

32. Severability

 

32.1                   In the event that any provision of this Agreement is found to be entirely or partially invalid, illegal, or unenforceable, the validity, legality, and enforceability of any of the remaining provisions shall not in any way be affected or impaired and a valid, legal, and enforceable provision of similar intent and economic impact shall be substituted therefore.

 

33. Entire Agreement

 

33.1                   This Agreement consists of the terms and conditions stated above, including the Exhibits, is the entire Agreement between the Parties, and supersedes all proposals, oral or written, all negotiations, conversations, or discussions between or among Parties relating to the subject matter of this Agreement and all past dealing or industry custom.  Any term, condition or other provision in any Purchase Order, quotation, confirmation, invoice, document, or other oral or written communication that is in any way inconsistent or in conflict with or in addition to the Agreement shall be void and is hereby expressly rejected by the Parties, unless it is clearly labeled and intended specifically as an amendment to this Agreement in particular and is agreed upon in writing and signed for and on behalf of both Parties.

 

34. Construction

 

34.1                   The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.  The term “including” as used herein shall mean “including without limitation.”

 

35. Counterparts

 

35.1                   The Agreement may executed by facsimile, pdf, and in any number of counterparts, each of which shall be deemed an original but all of such together shall constitute one and the same instrument.

 

14

 

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the Effective Date.

 

 

	
C.C.C. DEL URUGUAY S.A.
    	
 
    	
NEVRO CORP
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
By:
    	
/s/ Julio Arzuaga
    	
 
    	
By:
    	
/s/ Andrew Galligan
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Name: 
    	
Julio Arzuaga
    	
 
    	
Name:
    	
Andrew Galligan
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Title:
    	
General Manager
    	
 
    	
Title: :
    	
CFO
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Date:
    	
March 15, 2012
    	
 
    	
Date:
    	
March 7, 2012
    
						

 

15

 

EXHIBIT A — PRODUCTS

 

Implantable Neurostimulator

 

External Neurostimulator

 

Patient & Clinical Communicator

 

Battery Charger

 

Programmer Wand

 

16

 

EXHIBIT B — PROGRAM TEAM LIST

 

CCC:

 

	
Name
    	
 
    	
Phone Number
    	
 
    	
E-mail Address
    	
 
    	
Title/Responsibility
    
	
[***]
    	
 
    	
[***]
    	
 
    	
[***]
    	
 
    	
[***]
    

 

Nevro:

 

	
Name
    	
 
    	
Phone Number
    	
 
    	
E-mail Address
    	
 
    	
Title/Responsibility
    
	
[***]
    	
 
    	
[***]
    	
 
    	
[***]
    	
 
    	
[***]
    

 

[***] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION

 

17

 

EXHIBIT C — CONSIGNED TOOLING, EQUIPMENT AND SOFTWARE

 

Special Test Equipment:

 

[***]

 

[***] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION

 

18

 

EXHIBIT D — QUALITY AGREEMENT

 

[Provided separately]

 

19

 

 EXHIBIT E — PRICE MODEL

 

The price for the Product will be calculated as follows:

 

Step 1 [***]

 

[***] Items priced in local currency will be translated at a recent exchange rate for inclusion in the priced Bill of Materials. [***] that will be invoiced to Nevro for the following quarter.

 

At the end of each quarter CCC will calculate any purchase price [***]. Any currency variances on items priced in local currency in the bill of Materials will also be calculated. CCC will issue an invoice or a credit memo for the variances to Nevro.

 

Step 2 [***]

 

The amount of the [***] will be as set forth herein.

 

[***]

 

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

 

[***]

 

At the end of each quarter CCC will adjust the amount [***] by the amount of the change, if any, to the [***] published by [***] responsible for the [***]. ([***]) provided by [***]).

 

At the end of each quarter CCC will calculate the dollar amount [***] translated at a recent exchange rate. The US dollar amount will be the [***] that will be invoiced to Nevro for the following quarter.

 

If the currency rate between the Uruguayan pesos and US dollar varies by more than [***]% in any quarter then CCC will calculate a currency variance amount. CCC will issue an invoice or a credit memo for the variances to Nevro.

 

Step 3 Price per Product Purchased

 

The addition of Step 1 and Step 2 will be the price per unit of Product for the upcoming quarter.

 

Step 4 Invoices

 

CCC will invoice Nevro using the price per product calculated herein. Nevro shall pay the invoice less the amount of any deposits paid by Nevro for the Products.

 

[***] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION

 

20Exhibit 10.4(b)

 

AMENDMENT TO SUPPLY AGREEMENT

 

This Amendment to Supply Agreement (“Amendment”) is entered into as of March 20, 2013 (“Amendment Effective Date”) by and between C.C.C. Del Uruguay S.A. (“CCC”), an Uruguay corporation with its principal place of business at General Paz 1371, Montevideo, Uruguay, CP 11400, and Nevro Corp. (“Nevro”), a Delaware corporation with its principal place of business at 4040 Campbell Avenue, Suite 210, Menlo Park, CA 94025.  CCC and Nevro are referred to collectively as the “Parties”, individually as a “Party”.

 

WHEREAS, the Parties entered into a Supply Agreement dated effective April 1, 2012 (“Agreement”);

 

WHEREAS, that Agreement, among other things, provided in Section 18 that CCC granted to Nevro a perpetual, fully paid, world-wide, sublicenseable non-exclusive license to all “Incorporated CCC Property” (as defined in the Agreement), and agreed to cooperate to transfer to Nevro or its designee all information necessary for Nevro or its designee to manufacture Products in the same manner as CCC manufactures Products;

 

WHEREAS, Nevro now wishes to exercise its rights under the Supply Agreement to sublicense its rights to a second source, to have that second source manufacture Products;

 

WHEREAS, Nevro has requested CCC’s support and assistance to transfer the manufacturing IP, technology and know-how necessary to complete manufacture the Implantable Neurostimulator, and the Parties have agreed to execute an Agreement for Manufacturing Conversion as of on or about the Amendment Effective Date;

 

WHEREAS, the Parties now wish to amend the Agreement as follows:

 

NOW, THEREFORE, in consideration of the foregoing and the agreements contained herein, the Parties hereby agree as follows:

 

1.                        Section 18.5 shall be amended by inserting, after the end of the last sentence in that section, the additional sentence:  “Any and all consideration that may be due or become payable to CCC under this section shall be deemed satisfied and fully paid-up through the payments defined in the Agreement for Manufacturing Conversion and the additional Purchase Commitment consideration provided for in section 19.2 as amended.”

 

2.                        The title of section 19 shall be amended by adding “/Purchase Commitment” thereto.

 

3.                        Section 19.2 of the Agreement shall be replaced in its entirety by the following provisions:

 

(a)(i) If Nevro issues orders to CCC (according to the terms of the Agreement) for quantities greater or equal to [***] IPG units per full calendar year for calendar years 2013 and 2014 (the “Purchase Commitment”), then the parties agree that Nevro and its Second Source (as that term is defined in the Agreement for Manufacturing Conversion) will have the transferable (whether by sublicense or assignment) right, including as provided for in Section 18 of the 

 

[***] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION

 

 

Agreement, to practice any and all Confidential Information (as that term is defined in the Agreement for Manufacturing Conversion) that was and will be transferred by CCC to the Second Source, to manufacture and sell the Device (as that term is defined in the Agreement for Manufacturing Conversion) or its successors; and provided further that if Nevro fulfills the Purchase Commitment as set forth herein, unless excused under subsection (b), then the right to practice all Confidential Information as provided for in this subsection will also be fully paid-up, perpetual and non-terminable.

 

(a)(ii)  If Nevro issues orders to CCC (according to the terms of the Agreement) for quantities greater or equal to [***] IPG units per full calendar year in calendar year 2013 and thereafter (the “Exclusivity Undertaking”), then CCC shall not, directly or indirectly, through its affiliated companies, distributors, resellers or agents of any type or nature or otherwise, develop, manufacture, market, distribute or sell any High Frequency Neurostimulator.

 

(b) The foregoing rights in subsection (a)(i) shall terminate if Nevro does not fulfill the Purchase Commitment, and the foregoing rights in subsection (a)(ii) shall terminate if Nevro does not fulfill the Exclusivity Undertaking; provided, however, that non-compliance by Nevro with the Purchase Commitment and Exclusivity Undertaking shall be excused if the failure to fulfill for any particular calendar year is due to (1) a recall, field action, regulatory, licensing or quality issue concerning Nevro IPGs manufactured by CCC or concerning CCC as a manufacturing entity that does not allow CCC to manufacture and/or delivery the minimum quantities required by the Purchase Commitment or Exclusivity Undertaking, or (2) force majeure.

 

(c)(i) If Nevro does not meet the Purchase Commitment for each year as specified in subsection (a)(i), unless excused pursuant to subsection (b), and if Nevro nonetheless wishes to continue to exercise and benefit from the rights described in subsection (a)(i), then Nevro shall [***].

 

(c)(ii) If Nevro does not meet the Exclusivity Undertaking for each year as specified in subsection (a)(ii), unless excused pursuant to subsection (b), and if Nevro nonetheless wishes to continue to exercise and benefit from the rights described in subsection (a)(ii), then Nevro shall [***].

 

(d) The Parties agree that Nevro’s satisfaction of the Purchase Commitment for a particular calendar year shall also be deemed to satisfy the Exclusivity Undertaking for that same calendar year; and vice versa.

 

4.                                      Unless otherwise defined herein, all defined or capitalized terms in this Amendment shall have the meanings defined within the Supply Agreement or Agreement for Manufacturing Conversion.

 

5.                                      Other than as amended herein, all other terms of the Supply Agreement shall remain in full force and effect.

 

[***] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION

 

 

6.                                     This Amendment may executed by facsimile, pdf, and in any number of counterparts, each of which shall be deemed an original but all of such together shall constitute one and the same instrument.

 

IN WITNESS WHEREOF, the Parties hereto have executed this Amendment as of the Amendment Effective Date.

 

	
C.C.C. DEL URUGUAY   S.A.
    	
 
    	
NEVRO   CORP.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
By:
    	
/s/   Julio Arzuaga
    	
 
    	
By:
    	
/s/   Andrew Galligan
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Name:
    	
Julio   Arzuaga
    	
 
    	
Name:
    	
Andrew   Galligan
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Title:
    	
General   Manager
    	
 
    	
Title:   
    	
Vice   President, Finance and CFO
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Date:
    	
March 21,   2013
    	
 
    	
Date:
    	
March 21,   2013

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