Document:

a5465931ex10_6.htm

    Exhibit
      10.6

     

     

    Marketing
      Services Agreement

    

    This
      Marketing Services Agreement (the “Agreement”) is entered into and is effective
      this 23 day of August 2005 by and between Bio-Matrix Scientific Group, Inc.,
      a
      Delaware corporation with principal offices at 1010 University Avenue, Suite
      40,
      San Diego, California 92108 (the “Company”), and Cord Blood America, Inc., a
      Florida corporation with principal offices at 9000 Sunset Boulevard, Suite
      400,
      Los Angeles, California 90069 (“Marketer”).  The term “Parties,” as
      used in this Agreement, shall jointly refer to the Company and
      Marketer.

    

    WHEREAS:

    

    
      	
               

            	
              A.

            	
              The
                Company seeks to retain Marketer to provide certain marketing services
                on
                a non-exclusive basis and represent the Company and its products
                within
                the territory described and listed in Section 10.00 of this Agreement
                (the
                “Territory”) as more particularly set forth in this
                Agreement.

            

    

    

    
      	
               

            	
              B.

            	
              The
                Marketer is willing to provide product marketing services to the
                Company
                on a non-exclusive basis within the Territory as more particularly
                set
                forth in this Agreement.

            

    

    

    
      	
               

            	
              C.

            	
              The
                Company has provided requested access of information of Company’s products
                and services such that Marketer warrants and represents that it has
                had a
                sufficient opportunity to review and evaluate the Company and understand
                the Company’s products and
                services.

            

    

    

    
      	
               

            	
              D.

            	
              The
                Marketer acknowledges and agrees that it is in the business of providing
                the same or similar services to others who are in the same or a similar
                business as the Company and thereby Marketer understands applicable
                state
                and federal laws in connection with the services rendered to the
                Company
                under this Agreement.

            

    

    

    
      	
               

            	
              E.

            	
              The
                Company and Marketer, subject to the terms and conditions of this
                Agreement, hereby terminate all obligations that each party has or
                may
                have under any prior or contemporaneous oral or written understandings
                and
                each hereby enters into this
                Agreement.

            

    

    

    NOW
      THEREFORE THE PARTIES AGREE AS FOLLOWS:

    

    1.00  Marketing
      Services to the Company. In consideration of the fees earned and
      received by Marketer as set forth in Section 2.00 of this Agreement, together
      with other good and valuable consideration, the receipt and sufficiency of
      which
      is hereby acknowledged, Marketer shall provide, at its sole expense, the
      following services (the “Marketing Services”) to the Company during the term of
      this Agreement:

    

    1.01  Marketing
      Services.  Marketer shall, on a non-exclusive basis, market
      the Company’s services and promote the sale of the Company’s products and
      services within the Territory, consistent with accepted industry
      practices.  The Parties further agree that the Company shall retain
      the right, but not the obligation, to employ and direct its own sales and
      marketing staff to offer and sell the same or similar products and services
      within the Territory except that Marketer shall have an exclusive right, for
      a
      period not to exceed _six months, to market and sell and the Company’s products
      and services to such potential customers  within the Territory that
      Marketer shall identify by written notice (the “Notice”) to the Company within
      fifteen (15) days from the date of notification from Company that they will
      be
      employing and directing own sales efforts.  The Parties agree that the
      Notice shall be delivered to the Company, via First Class U.S. Mail, postage
      prepaid to the Company’s address shown on the first page of this Agreement.
      Exclusivity of contract may be terminated with a 30 day written notice by either
      party – fax notice is acceptable.

    

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    

    

    1.02  Coordination
      of Marketing Efforts.   The Marketer agrees that
      throughout the term of this Agreement, it shall review with the Company all
      current proposed marketing and promotion efforts, sales and marketing
      strategies, customer lists (with the names and addresses of each customer,
      amount purchased by each customer during each quarterly period, and the specific
      amount and identity of products sold to each customer), marketing and sales
      trends, and related information that Marketer collects or obtains, from time
      to
      time, as will allow the Company to reasonably assess and evaluate the efforts
      of
      Marketer and the efforts of the Company  in connection with the sale
      of the Company’s products and services.   The Marketer shall
      provide theCompany, at no cost or expense to the Company, with a written copy
      of
      all information and documents listed or described in this first sentence of
      this
      Section 1.03 within ten (10) business days from the date that Marketer receives
      a written request from the Company.  The Parties agree that the scope
      of the obligations imposed on the Marketer under this Section 1.03 shall be
      broadly construed to accomplish the purposes of this Agreement.  In
      the event the Company decides to employ and direct its own sales and marketing
      efforts, the Company will provide customer lists to Marketer under the same
      timelines and conditions as described in this Section 1.03 for
      Marketer.

    

    1.03  Control
      of Services by the Company.  The Parties agree that the
      Company shall, at all times, retain the right to limit or restrict the scope
      and
      extent of the marketing efforts that may be undertaken by Marketer so as to
      ensure that the Company and its products are not cast in an adverse light or
      otherwise would result in the Company in incurring injury to its reputation
      or
      any adverse publicity.  The Parties agree that all marketing and
      promotional materials and the activities to be employed by Marketer
      (collectively, the “Promotional Efforts”) shall be undertaken by Marketer only
      upon Marketer’s prior written receipt of the Company’s approval in advance of
      all Promotional Efforts described in this Agreement.

    

    1.04
      Determination & Selection of Products/Services.  The
      Parties agree that the Company shall have the sole and exclusive right to select
      and determine, in regards to stem cells from fatty tissue the form, nature,
      and
      extent of all products and services marketed by Marketer.

    

    1.05
      Quality.  Marketer shall perform all work under this
      Agreement in a professional and workmanlike manner and in conformity with the
      quality standards mutually established from time to time by the Parties
      hereto.

     

    
      
        	
                a.

              	 	
                2.00
                  Compensation to Marketer. Invoicing, Payment and
                  Collection: CBA will invoice and manage all receivables of
                  Bio-Matrix Services directly with customers procured by CBA.  In
                  turn, CBA will pay Bio-Matrix directly for Services executed in
                  the
                  enrollment. Funds collected will be placed in separate account
                  for mutual
                  disbursement to Bio-Matrix, Inc. and CBA based on the successful
                  collections completed each week.  Bio-Matrix will invoice and
                  manage all receivables for the storage of stem cells.  In
                  consideration of the services provided by Marketer as set forth
                  in Section
                  1.00 of this Agreement, the Company agrees that it the Marketer
                  will
                  retain 40% of the funds collected on the Marketer’s sales revenues (“Sales
                  Revenues”) generated through the efforts of Marketer within the Territory
                  during the term of this Agreement provided that, in each instance,
                  Marketer initiated and completed the sale efforts to any customer
                  (the
                  “Customer”) that reasonably resulted in said sales revenues (the “Sales
                  Commission”). The difference of collected revenues less 40% is to be paid
                  to the Company within thirty (30) days after the date at which
                  the
                  Marketer receives and collects payment due on account of said Sales
                  Revenues except that, in the event that the Marketer is required
                  to
                  deduct, refund, or return any monies previously received from any
                  customer
                  on any Sales Revenues (due to claim of defect or other claim made
                  by any
                  such Customer) for which a Net Proceed had been previously paid
                  or due to
                  Company, the Marketer shall have the right, upon written notice
                  to Company
                  (with an explanation and description of the facts and circumstances
                  relating to the Customer and the claim for refund) to deduct the
                  amount of
                  any said refund or return of monies from the amount that may be
                  due or
                  payable to Company.  In the event that one or more Customers of
                  Marketer make or assert repeated claims for deductions, refunds,
                  or return
                  of monies paid, the Company shall have the right, in its sole discretion
                  and after reasonable written notice to Marketer, refuse to sell
                  its
                  products and services to said
                  Customer.

              

      

    

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    2.           Commission.

     

    
      
        	 	
                a.

              	
                Amount
                  of Commission.  CBA will  earn  a
                  commission of 40% of the gross revenue for the collection charges
                  for
                  Bio-Matrix Services collected pursuant to each executed enrollment
                  form
                  for the Service in the Territory during the term hereof for which
                  Bio-Matrix determines, in its sole discretion, that CBA was the
                  procuring
                  cause.  

              
	 	 	 
	 	
                b.

              	
                Payment
                  Procedure.  All commissions due under the section
                  “Amount of Commission” will be paid to CBA from the proceeds collected
                  from successfully completed collections as outlined in Section
                  2.0. With
                  regard to any monies received by either party all taxes, fees or
                  other
                  levies that may be levied by any governmental authority shall be
                  solely
                  the responsibility of  that party. In the event that a
                  collection is unsuccessful and requires a refund to the client
                  both
                  Bio-Matrix and CBA will forego their fees for that collection to
                  fund the
                  refund. Commissions will not be earned and due until the client
                  has
                  started the stem collection process. 

              
	 	 	 
	 	
                c.

              	
                Commission
                  Rate in Accordance with Laws.  Notwithstanding any
                  other provision of this Agreement, Bio-Matrix's obligation to make
                  payment
                  is expressly subject to such payment not violating any applicable
                  law or
                  public policy of the Territory.  Under no circumstances shall
                  Bio-Matrix have an obligation to pay CBA any amount higher than
                  the
                  amount, if any, permitted under such laws, rules, regulations or
                  public
                  policies.

              

      

    

     

    3.00
      Marketing Support Efforts.  The Company shall have the right
      to establish and control the marketing and sales efforts of the Company’s
      products and services and Marketer agrees to cooperate with the Company in
      all
      said efforts.

    

    4.00  Recordkeeping
      RE: Net Sales & Inspection Rights.   The Parties
      hereto further agree that Marketer shall keep and maintain written records
      (the
“Records”) related to the calculation and determination of the amount of sales
      revenues it generates during the term of this Agreement.  All Records
      shall be maintained with such detail as the Company deems appropriate so as
      to
      allow the Company or its authorized representative to confirm the accuracy
      of
      Marketer’s determination of amounts marketed and sold by Marketer under this
      Agreement.  All Records shall be maintained for a period of two (2)
      calendar years from the calendar year in which said calculations and
      determinations were made.  At the Company’s request, Marketer shall
      permit the Company, or its designated representative, the right to inspect,
      examine and photocopy, all Records upon reasonable advance notice and during
      the
      regular business hours of Marketer.  Company shall assume and pay all
      costs relating to the photocopying of said Records.

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    
5.00  Terms
      and Definitions.  For purposes of this Agreement, the Parties
      agree that the following terms and definitions shall apply:

    

    6.00  Marketer’s
      Customer.  “Marketer’s Customer” is defined as being any
      person or entity  for whom sales revenues were initially developed or
      initiated by Marketer and for whom Marketer initiated and generated sales
      revenues for the Company by the Marketer during the term of this
      Agreement.

    

    7.00  Company’s
      Customer. “Company’s Customer” is any person or entity for whom sales
      revenues were initially developed or initiated by the
      Company during the term of this Agreement.

    

    8.00  Documentation
      RE: Customer Determination & Matter of Customer
      Lists  (Most of this is redundant from Section 1.03 The
      Parties hereto further agree that each party shall retain full and unrestricted
      ownership of all information relating to the customers identified on any list
      provided to the other party under this Agreement.

    

    9.00
      Term and Termination.  The term Agreement commences upon
      execution by both Parties and continues for a period of one (1) year thereafter
      and the Parties hereto agree that this Agreement shall automatically continue
      in
      force after the one year period for successive one year renewal terms subject
      to
      the right of either party to terminate the Agreement upon sixty (60) days
      written notice to the other party at the address shown above or at such other
      address as either party may later identify in writing to the other party as
      the
      address for receiving any notice under this Agreement.  For purposes
      of this Agreement, any notice under this Agreement shall be in writing and
      shall
      be delivered by Federal Express (or similar express overnight delivery service),
      prepaid by the party giving said notice with said notice deemed delivered and
      received by the other party three (3) calendar days from the date at which
      said
      notice is received by Federal Express for delivery to the party to whom it
      is
      addressed.

    

    10.00
      Territory. The territory agreed upon by this Agreement shall be all of
      the entire United States of America (including Puerto Rico and the Virgin
      Islands) and any other possessions, trust territories, or administrative regions
      administered under the exclusive or joint control of the United
      States.

    

    11.00
      Product Liability Indemnification.  Except for claims,
      losses, or damages primarily resulting from or arising out of any acts which
      result or arise out of Marketer’s active negligence or the negligence of
      Marketer’s Customers, the Company agrees to defend, indemnify and hold harmless
      Marketer and their affiliates from and against any and all product liability
      claims, losses, liabilities, judgments, and all costs and expenses, whether
      brought as express or implied warranty, negligence or strict liability actions,
      including the cost of defending (which shall include reasonable attorneys’ fees
      as reasonably determined by the Company in its sole discretion) any proceedings
      resulting in whole or in part from the manufacture, purchase, sale, storage,
      transportation, or foreseeable use of the products and services of the Company
      up to a maximum of  five thousand dollars ($5,000) per
      claim.

    

    12.
      00 Indemnification for Proprietary Right Infringement. Marketer
      specifically agrees to indemnify and hold the Company harmless from and against
      any and all claims, actions, demands, damages (whether actual, compensatory,
      punitive or statutory), losses, liabilities, judgments, and all costs and
      expenses, including reasonable attorneys’ fees, of whatever nature instituted or
      brought by or awarded to any person or entity arising in any manner from
      Marketer’s infringement or alleged infringement of patent, trademark, copyright,
      design, trade dress, trade secret or other proprietary rights of any third
      party.

    

    13.00
      Insurance. Both Company and Marketer shall obtain and maintain their
      own product liability insurance in such amounts as reasonably determined by
      the
      Company and Marketer, providing protection for the Company and Marketer, with
      each naming the other additionally insured in the amounts of coverage specified
      below, protecting the Company and Marketer from any claims, demands, causes
      of
      action, losses or damages, including reasonable attorney’s fees, arising in
      whole or in part from any alleged defect in the products or
      services  of the Company or the manufacture, purchase, sale, storage,
      transportation or foreseeable use of the products or services.  The
      insurance policy for such insurance coverage shall provide that it may not
      be
      canceled without at least sixty (60) days prior written notice to the
      Marketer.  Company further agrees to furnish to the
      Marketer  and reciprocally, Marketer to the Company within sixty (60)
      days of the date of this Agreement, or before such other date as may be mutually
      agreed upon by the parties, an insurance carrier’s certificate naming the
      Marketer as an additional insured and showing that Company obtained or currently
      has the requisite insurance coverage, that the policy is in effect, and setting
      forth the amount of coverage, number of policy and date of expiration and
      reciprocally, Marketer to the Company.  The Company further agrees
      that such insurance policy shall provide coverage for personal injuries and
      property damage arising out of each occurrence in the amount of at least one
      million dollars ($1,000,000.00), with a general aggregate amount of two million
      dollars ($2,000,000) and an additional umbrella policy with five million dollars
      ($5,000,000) of coverage and reciprocally, Marketer to the
      Company.  If Company fails to furnish said certificate within the time
      provided by this Section 1300 of this Agreement, The Marketer shall after
      written notice to Company, have the right to cancel and terminate this
      Agreement, provided that Company is allowed thirty (30) days to cure any breach
      of its obligations under this Section 13.00 after receipt of said written notice
      and reciprocally, Marketer to the Company.

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    
13.05
      General Indemnification.  Both Parties agree to indemnify,
      defend, and hold harmless each other, their successors, assigns, agents,
      employees, affiliates and representatives, against any and all claims, actions,
      causes of action, demands, damages (whether actual, compensatory, punitive
      or
      statutory), losses, liabilities, judgments, and all costs and expenses,
      including reasonable attorneys’ fees, of whatever nature instituted or brought
      by or awarded to any person or entity as a result of a breach of any term or
      provision of this agreement on the part of a party against whom indemnification
      is sought.

    

    14.00
      Confidentiality.  The Parties each separately acknowledge and
      agree that they will develop and be exposed to information that is confidential
      and proprietary to the other.  Such information includes, without
      limitation, the names and product requirements of certain customers, marketing
      plans, pricing data, product designs, manufacturing methods and processes,
      software, other such intangible information, whether developed by Marketer
      or by
      the Company with respect to any products discussed by either or both of them
      or
      acquired and supplied hereunder (collectively, the “Confidential
      Information”).  All of the Confidential Information shall be
      considered “trade secrets” of the originator.   The Parties shall
      not misappropriate, use, or divulge any of the Confidential Information of
      the
      other, used or useful in connection with each company’s business. Each party
      shall deem the confidential information of the other confidential to the extent
      not generally known within the trade, agree to make use of such information
      of
      the other only in the performance of its respective duties under this Agreement,
      to maintain such information in confidence and to disclose the information
      only
      to persons with a need to know who in turn will be required to sign a
      confidentiality agreement with respect to the confidentiality of the other
      party.

    

    15.00
      Licensing and Use of Names and Logos.  The Parties hereto
      further agree that each holds and shall continue to hold and own all
      intellectual property rights to the marks and logos held or used by them prior
      to this Agreement and each  hereby fully gives all consents to the
      other for the use of said marks (the “Marks”) pursuant to this Agreement, under
      the following conditions:

    

    
      	
               

            	
              (i)

            	
              Marketer
                shall use the Marks only as expressly provided in this
                Agreement.

            

    

    

    
      	
               

            	
              (ii)

            	
              Marketer
                agrees that the Company controls the nature and quality (“Standards”) of
                all the products and services on which the Marks are affixed by the
                Company, and Marketer shall not use the Marks in any manner, including
                on
                any products to which the Company objects as not meeting the standards
                established by the Parties hereto by subsequent written
                agreement.

            

    

    

    
      	
               

            	
              (iii)

            	
              The
                Company has reviewed and approved the products and services (as they
                currently exist and as they exist, from time to time, in the future)
                and
                shall not object to the use of the Marks by Marketer as long as the
                current standards of the Company are maintained and this Agreement
                is in
                full force and effect.

            

    

    

    
      	
               

            	
              (iv)

            	
              The
                Company shall have the right to, from time to time, inspect the products
                and services to ensure that the standards established by the Parties
                hereto are maintained and promptly notify Marketer in writing if
                the
                Company determines that said standards are not being
                met.  Marketer shall thereafter discontinue its use of the Marks
                until it demonstrates to the Company’s satisfaction that it is in
                compliance with said standards. The parties will thereafter resolve
                it for
                their mutual benefit.

            

    

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

     

    
      	
               

            	
              (v)

            	
              The
                license granted herein will terminate contemporaneously with the
                termination of this Agreement.  Marketer shall thereafter
                forever discontinue its use of the
                Marks.

            

    

    

    
      	
               

            	
              (vi)

            	
              Marketer
                shall not intentionally promote or advertise its relationship with
                the
                Company or suggest that the Company endorses Marketer’s products or
                services without the Company’s written
                permission.

            

    

    

    16.00  Assignment.  Marketer
      shall not assign, delegate or subcontract any of its rights or obligations
      under
      this Agreement except with the prior written consent of the
      Company.  Any purported assignment, delegation, or subcontracting
      without such consent shall be null and void and a breach of this
      Agreement.  In the event of any assignment, delegation, or
      subcontracting with such consent, Marketer shall remain liable for performance
      of all of its obligations under this Agreement.

    

    17.00
      Notices.  Unless otherwise provided by this Agreement, all
      notices permitted or required hereunder shall be in writing and shall be deemed
      delivered and received when personally delivered or two (2) business days after
      being sent by certified United States mail, with return receipt requested,
      or
      one (1) day after being sent by Federal Express or equivalent overnight delivery
      service, to the parties at the following addresses or to such other address
      as
      the parties may from time to time designate in writing to the address shown
      on
      the first page of this Agreement (of the party to whom notice is to be
      given).

    

    18.00  Further
      Assurance.  Each of the parties shall hereafter execute all
      documents and do all acts reasonably necessary to effect the provisions of
      this
      Agreement.

    

    19.00
      Successors.  The provisions of this Agreement shall be deemed
      to obligate, extend to and inure to the benefit of the successors, assigns,
      transferees, grantees, and indemnities of each of the parties to this
      Agreement.

    

    20.00  Independent
      Counsel.  Each of the parties to this Agreement acknowledges
      and agrees that it has been represented by independent counsel of its own choice
      throughout all negotiations which preceded the execution of this Agreement
      and
      the transactions referred to in this Agreement, and each has executed this
      Agreement with the consent and upon the advice of said independent
      counsel.  Each party represents that he or it fully understands the
      provisions of this Agreement, has consulted with counsel concerning its terms
      and executes this Agreement of his or its own free choice without reference
      to
      any representations, promises or expectations not set forth herein.

    

    21.00
      Integration.  This Agreement, after full execution,
      acknowledgment and delivery, memorializes and constitutes the entire agreement
      and understanding between the parties and supersedes and replaces all prior
      negotiations and agreements of the parties, whether written or
      unwritten.  Each of the parties to this Agreement acknowledges that no
      other party, nor any agent or attorney of any other party has made any promises,
      representations, or warranty whatsoever, express or implied, which is not
      expressly contained in this Agreement; and each party further acknowledges
      that
      he or it has not executed this Agreement in reliance upon any belief as to
      any
      fact not expressly recited hereinabove.

    

    22.00  Attorneys
      Fees.  In the event of a dispute between the parties
      concerning the enforcement or interpretation of this Agreement, the prevailing
      party in such dispute, whether by legal proceedings or otherwise, shall be
      reimbursed immediately for the reasonably incurred attorneys' fees and other
      costs and expenses by the other parties to the dispute.

    

    23.00
      Interpretation.  Wherever the context so requires: the
      singular number shall include the plural; the plural shall include the singular;
      and the masculine gender shall include the feminine and neuter
      genders.

    

    24.00  Captions.  The
      captions by which the sections and subsections of this Agreement are identified
      are for convenience only, and shall have no effect whatsoever upon its
      interpretation.

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    
25.00  Severance.  If
      any provision of  this Agreement is held to be illegal or invalid by a
      court of competent jurisdiction, such provision shall be deemed to be severed
      and deleted; and neither such provision, nor its severance and deletion, shall
      affect the validity of the remaining provisions.

    

    26.00  Counterparts.  This
      Agreement may be executed in any number of counterparts.

    

    27.00
      Expenses Associated With This Agreement.  Each of the parties
      hereto agrees to bear its own costs, attorneys fees and related expenses
      associated with this Agreement.

    

    28.00
      Arbitration.  Any dispute or claim arising to or in any way
      related to this Agreement shall be settled by arbitration in San Diego,
      California applying the laws of the State of California as if this Agreement
      were fully executed and performed solely within the State of
      California.  All arbitration shall be conducted in accordance with the
      rules and regulations of the American Arbitration Association
      ("AAA").  AAA shall designate an arbitrator from an approved list of
      arbitrators following both parties' review and deletion of those arbitrators
      on
      the approved list having a conflict of interest with either
      party.  Each party shall pay its own expenses associated with such
      arbitration (except as set forth in Section 22.00 Above).  A demand
      for arbitration shall be made within a reasonable time after the claim, dispute
      or other matter has arisen and in no event shall such demand be made after
      the
      date when institution of legal or equitable proceedings based on such claim,
      dispute or other matter in question would be barred by the applicable statutes
      of limitations.  The decision of the arbitrators shall be rendered
      within 60 days of submission of any claim or dispute, shall be in writing and
      mailed to all the parties included in the arbitration.  The decision
      of the arbitrator shall be binding upon the parties and judgment in accordance
      with that decision may be entered in any court having jurisdiction
      thereof.

    

    IN
      WITNESS WHEREOF, the parties have executed this Agreement at the date
      first written above.

    

    
      
        	
                FOR
                  COMPANY:

              
	 
	
                        /s/
                  David R. Koos

              
	
                By:
                  ____________________________

              
	
                       David
                  R. Koos, President  & Chief Executive
                  Officer

              
	 
	 
	
                FOR
                  MARKETER:

              
	 
	
                      /s/
                  Matthew Schissler

              
	
                By:__________________________

              
	
                     Matthew
                  Schissler, Chief Executive
                  Officer

              

      

    

    [Signature
      Page to Marketing Services Agreement.]

     

    7Exhibit 10.1

THE CONFIDENTIAL PORTIONS OF THIS EXHIBIT,
WHICH HAVE BEEN REMOVED AND REPLACED WITH
AN ASTERISK, HAVE BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AN EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 405
PROMULGATED UNDER THE SECURITIES ACT OF 1933 AND
RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.

                                SUPPLY AGREEMENT

                                     between

               Cardiac Pacemakers, Inc. (d/b/a Boston Scientific)

                                       and

                                 Greatbatch Ltd.

                                   2007 - 2010

                                     - 1 -
<PAGE>

                                TABLE OF CONTENTS

1.0    INTRODUCTION............................................................3

2.0    DEFINITIONS.............................................................4

3.0    CONTRACT TERM...........................................................6

4.0    FORECASTS, ORDERS AND SAFETY STOCK......................................7

5.0    PRICING.................................................................8

6.0    PRODUCT PURCHASE AND SALE...............................................9

7.0    DELIVERY...............................................................10

8.0    PRODUCT QUALITY AND INSPECTION.........................................10

9.0    INVOICES AND PAYMENT...................................................13

10.0   WARRANTY AND LIMITATION OF LIABILITY...................................13

11.0   PROCESS AND/OR DESIGN CHANGE...........................................17

12.0   BUSINESS REVIEWS AND CERTIFICATIONS....................................17

13.0   BUSINESS EXIT AND TERMINATION..........................................18

14.0   CONFIDENTIAL INFORMATION...............................................19

15.0   INTELLECTUAL PROPERTY..................................................21

16.0   FORCE MAJEURE..........................................................22

17.0   MISCELLANEOUS..........................................................24

EXHIBIT A - LOW AND MEDIUM RATE BATTERIES.....................................27

EXHIBIT B - HIGH RATE BATTERIES...............................................30

EXHIBIT C - WET TANTALUM CAPACITORS...........................................33

EXHIBIT D - CASE HALVES.......................................................37

EXHIBIT E - FILTERED FEEDTHROUGHS.............................................40

EXHIBIT F - BATTERY AND CAPACITOR PRICING ADJUSTMENTS FOR
 INCREASED COMMITMENT.........................................................41

EXHIBIT G - *.................................................................42

EXHIBIT H - BSC-DESIGNATED THIRD PARTY SUPPLIERS..............................44

                                     - 2 -
<PAGE>

                          Supplier Partnering Agreement

THIS AGREEMENT is effective 01 July 2007 and is by and between GREATBATCH LTD.,
a New York corporation located at 9645 Wehrle Drive, Clarence, New York 14031
("GB") and CARDIAC PACEMAKERS, INC., a Minnesota corporation and subsidiary of
BOSTON SCIENTIFIC CORPORATION ("BSC"), located at 4100 Hamline Avenue North, St.
Paul, Minnesota 55112-5798 ("BSC"). GB and BSC are also each referred to as a
"Party" and collectively as the "Parties".

Whereas, BSC purchases certain Products for use in medical devices; and

Whereas, GB agrees to manufacture/provide and sell such Products to BSC and its
Affiliates in accordance with, and subject to, BSC's specifications and other
terms and conditions set forth in the Agreement.

Whereas, the Parties desire to continue and expand their relationship based on a
philosophy of continuous improvement geared toward world-class benchmarks in
quality, cost, inventory levels, delivery, technology and service.

NOW, THEREFORE, incorporating the above recitals and in consideration of the
mutual covenants below, GB and BSC hereby agree as follows:

1.0  INTRODUCTION

     1.1  BSC and GB wish to enter into this Supplier Partnering Agreement. The
          Parties desire to terminate:

             1.1.1  The Battery Supply Agreement between Wilson Greatbatch Ltd.
                    and Cardiac Pacemakers Inc. dba Guidant entered into April
                    10, 2003 including the 1st Amendment to Battery Supply
                    Agreement entered into August 16, 2004 and the 2nd Amendment
                    to Battery Supply Agreement entered into December 12, 2006;

             1.1.2  The Capacitor Supply Agreement between Wilson Greatbatch
                    Technologies, Inc. and Guidant/CRM entered into September
                    15, 2001 as amended by the Wet Tantalum Capacitor 2005
                    Pricing Proposal dated November 4, 2004, the Supplement to
                    Wet Tantalum Capacitor 04 November 2004 Pricing Proposal
                    dated November 8, 2004, Wet Tantalum Capacitor Pricing
                    Agreement dated April 6, 2005, and Amendment No. 1 to the
                    Wet Tantalum Capacitor Pricing Agreement effective December
                    12, 2006;

             1.1.3  The * dated January 29, 2007, effective February 1, 2007 and
                    later extended by a revised * dated April 16,2007; and

                                     - 3 -
<PAGE>

               1.2  BSC and GB wish to continue the existing Filtered
                    Feedthrough Supply Agreement entered into February 10, 2005
                    as amended by the Fourth Amendment to Filtered Feedthrough
                    Supply Agreement effective October 1, 2006 until such time
                    as Parties can agree to the detail of Exhibit E of this
                    Agreement or the expiration of the existing agreement.

               1.3  Any financial and other obligations owing by one Party to
                    the other under the foregoing agreements, and any
                    obligations therein with respect to warranty, limitation of
                    liability, and confidentiality, will not be terminated by
                    virtue of Article 1.1

2.0  DEFINITIONS

     2.1  As used in this Agreement, the following defined terms will have the
          meanings provided for in this Article 2.0:

     2.2  "Affiliate" means:

             2.2.1  any other entity/person of which the securities or other
                    ownership interests representing 50% (fifty percent) or more
                    of the equity or 50% (fifty percent) or more of the ordinary
                    voting power or 50% (fifty percent) or more of the general
                    partnership interests are, at the time of such
                    determination, owned, controlled or held, directly or
                    indirectly, by such entity/person; or

            2.2.2   any other entity/person, which at the time of such
                    determination, is controlling, controlled by or under common
                    control with, such entity/person.

             2.2.3  As used herein, the term "control," whether used as a noun
                    or verb, refers to the possession, directly or indirectly,
                    of the power to direct, or cause the direction of, the
                    management or policies of a entity/person, whether through
                    the ownership of voting securities, by contract or
                    otherwise.

     2.3  "Agreement" means this Agreement and all attached and incorporated
          Exhibits.

     2.4  "Batteries" means lithium iodine low rate batteries, lithium silver
          vanadium oxide high rate batteries, QMR/QHR silver vanadium
          oxide/carbon monofluoride batteries medium and high rate batteries,
          lithium ion batteries and other similar power sources.

     2.5  "Buyer-Managed Purchase Order" means BSC's purchase order for Products
          not managed via Kanban.

                                     - 4 -
<PAGE>

     2.6  "Capacitors" means a capacitor for use in an Implantible Cardioverter
          Defibrillator ("ICD").

     2.7  "Case Half" means the drawn titanium, aluminum, and/or stainless steel
          enclosures used in medical devices, medical device components and
          similar or related products as listed on attached Exhibit D.

     2.8  "Confidential Information" is defined in Article 14.0.

     2.9  "Contract Year" means each calendar year during the Term, with the
          initial Contract Year being the portion of calendar year 2007
          remaining after the Effective Date.

     2.10 "Effective Date" means 01 July 2007.

     2.11 "Feedthroughs (FT)" means a subassembly consisting of: (a) an outer
          electrically conductive member (usually referred to as a flange or
          ferrule), (b) an inner electrically conductive member or members
          (usually represented as a metallic wire or pin, or multiple wires or
          pins), and (c) a nonconductive material fused or brazed between the
          inner and outer members (usually a glass or ceramic material) such
          that they are electrically insulated and hermetically sealed as listed
          on attached Exhibit E.

     2.12 "Filtered Feedthrough (FFT)" means an assembly consisting of (a)
          Feedthrough and (b) feedthrough type capacitor composed of ground
          electrodes interleaved with conductive active electrodes, one for each
          active feedthrough pin as listed on attached Exhibit E.

     2.13 "Force Majeure" is defined in Article 16.0.

     2.14 "High Rate Battery" means a battery for use in an ICD.

     2.15 "Intellectual Property" means U.S. and foreign Patent Rights,
          trademarks, service marks and registrations thereof and applications
          therefore, copyrights and copyright registrations and applications,
          mask works and registrations thereof, know-how, trade secrets,
          inventions, discoveries, ideas, technology, data, information,
          processes, drawings, designs, licenses, computer programs and
          software, and technical information including but not limited to
          information embodied in material specifications, processing
          instructions, equipment specifications, product specifications,
          confidential data, electronic files, research notebooks, invention
          disclosures, research and development reports and the like related
          thereto, all amendments, modifications, and improvements to any of the
          foregoing. "Patent Rights" means in addition to the above items
          protectable under U.S. and foreign patent laws, all reissues,
          reexaminations, divisionals, continuations, substitutions, extensions,
          and applications with respect thereto.

                                     - 5 -
<PAGE>

     2.16 "Kanban Purchase Order" means BSC Purchase Orders set-up for Products
          on an as needed basis.

     2.17 "Non-Recurring Engineering Charges (NRE)" means tooling, engineering
          and qualification testing costs associated with the development of
          Products by GB for BSC including but not limited to Products included
          in the Agreement in Exhibits A, B, C, D, and E.

     2.18 "Product" means Batteries, Capacitors, Case Halves, and Feedthroughs
          (including Filtered Feedthroughs) as listed on the attached Exhibits
          A, B, C, D, and E.

     2.19 "Purchase Order" means both Buyer-Managed Purchase Orders and Kanban
          Purchase Orders.

     2.20 "Qualification" means Product performance testing conducted according
          to an approved and controlled protocol to ensure that the Products
          meet Specifications. Products used to perform the Qualification must
          be manufactured using validated equipment and processes per GB
          procedures.

     2.21 "Qualified" means the Product has fully met the Specifications through
          Qualification.

     2.22 "Renewal Term" means a period of four (4) years.

     2.23 "Specifications" means with respect to Products listed on Exhibits A,
          B, C, D, and E the requirements and protocols developed by GB or
          provided to GB by BSC prior to the date of this Agreement, relative to
          the design, physical characteristics, function, performance,
          manufacture, packaging and quality of such Products.

     2.24 "WIP" or "Work In Process" means materials for the manufacture of a
          Product that is currently being processed in an operation, or
          inventory that has been processed through one operation and is
          awaiting another operation. WIP represents the value of materials,
          labor, and overhead that has been issued to manufacturing but has not
          yet produced a stockable item and may include finished products
          awaiting final inspection.

3.0  CONTRACT TERM

                                     - 6 -
<PAGE>

     3.1  The Term of this Agreement commences on the Effective Date and ends on
          December 31, 2010 (the "Initial Term"). It may be extended pursuant to
          Article 3.2 or earlier terminated pursuant to Article 13.2. Pricing is
          set forth in Exhibits A, B, C, D, and E is in effect as of the
          Effective Date.

     3.2  The Term of this Agreement may be extended for one or more Renewal
          Terms (each a "Renewal Term"); provided that the Products and pricing
          for each Renewal Term will be subject to the mutual written agreement
          of the Parties reached no later than * prior to the last day of the
          Initial Term or then current Renewal Term (whichever is applicable).

     3.3  Parties agree to begin agreement review and negotiations at least *
          prior to the last day of the Initial Term or then current Renewal Term
          (whichever is applicable).

4.0  FORECASTS, ORDERS AND SAFETY STOCK

     4.1  Purchase Orders for Products and Forecasts

             4.1.1  By * of each Contract Year, BSC will provide GB with a
                    non-binding forecast indicating BSC's forecasted purchases
                    of Products from GB for the next *, which will include an
                    identification of Products, and anticipated quantities and
                    delivery dates.

             4.1.2  By * of each Contract Year, BSC will provide GB with a
                    revised non-binding forecast and * for the following *.
                    Greatbatch will acknowledge these Purchase Orders within *
                    days or prior to BSC's holiday shutdown whichever comes
                    first.

             4.1.3  All Purchase Orders will set forth at a minimum: (i) an
                    identification of Products ordered, (ii) quantities ordered,
                    (iii) proposed delivery dates (Buyer-Managed Purchase Orders
                    only), and (iv) shipping instructions.

             4.1.4  On or about the *, BSC will submit to GB in writing a
                    rolling * forecast of anticipated needs. The first * of the
                    * rolling forecast will be considered binding and the last *
                    of the * rolling forecast will be considered non-binding.
                    Upon completion of * of a *, BSC will provide a non-binding
                    * forecast for the * in the subsequent forecast.

     4.2  Modification of Orders. The delivery dates and quantities within a
          Buyer-Managed Purchase Order by BSC cannot be modified or canceled
          within * of scheduled completion except upon the written mutual
          agreement of the Parties. Mutually agreed change orders will be
          subject to all provisions of this Agreement, whether or not the change
          order so states.

                                      - 7 -
<PAGE>

     4.3  Notwithstanding the foregoing, BSC may in its sole discretion by
          written notice to GB cancel orders for and deliveries of any Products
          against Buyer-Managed Purchase Orders which are not shipped within *
          following the shipping date set forth in the applicable Greatbatch
          Purchase Order Acknowledgement and in the event of such cancellation
          by BSC, BSC may then make such appropriate adjustments to any
          outstanding orders and forecasts as it deems advisable in light of any
          shortfalls in supply which relate to such cancellation.

     4.4  Standard Lead Time. The standard lead time for production quantities
          of fully qualified Products is defined in the Exhibit appropriate to
          that Product. GB will use all commercially viable means to meet BSC's
          delivery requirements. GB will notify BSC, in writing, of any changes
          to these standard lead times.

     4.5  Safety Stock. GB agrees to maintain a minimum of * inventory as Safety
          Stock based on the most recent * submission. This Safety Stock is the
          amount of Product and components required to enable GB to process the
          Products to completion, ship to BSC within * of receipt of BSC Kanban
          release, and replenish Safety Stock Product. All Safety Stock
          requirements above the minimum level will be requested by the BSC
          buyer in the forecast for that particular Product and approved by GB
          in writing.

             4.5.1  Greatbatch will use best commercial effort to increase
                    Safety Stock within * of said change in Safety Stock
                    requirement.

             4.5.2  BSC and GB agree to work together to minimize inventory
                    obsolescence costs for Products under Kanban Purchase
                    Orders. BSC will be responsible for all finished goods
                    inventory, WIP, Product-specific, non-returnable purchased
                    material and any non-cancelable purchase orders outstanding
                    with GB's suppliers necessary to sustain the Safety Stock
                    levels provided for in this Article 4.5. GB will be
                    responsible for billing BSC for obsolescence costs no later
                    than three (3) months after written notification from BSC
                    that a part is obsolete.

5.0  PRICING

     5.1  Pricing. The pricing for Products are set forth on Exhibits A, B, C,
          D, and E.

     5.2  Price Adjustments for Increased Commitment. For those Products priced
          in Exhibit B (High Rate Batteries) and Exhibit C (Wet Tantalum
          Capacitors), BSC may choose to increase business commitment to realize
          improved pricing from GB as outlined in those Exhibits and in Exhibit
          G.

     5.3  Price Adjustments for Significant Cost Impact.

                                     - 8 -
<PAGE>

             5.3.1  The price for any Product may be adjusted up or down as of
                    the * of each * during the Term of this Agreement, by mutual
                    consent, if there is significant impact to GB's final cost
                    to manufacture the Product as contemplated within the
                    Product Exhibits. If GB determines that a price increase or
                    decrease under this Article 5.3 is required or permissible,
                    GB will deliver written notice to BSC setting forth the
                    basis for such determination by * of each Contract Year.

             5.3.2  The price for any Product may be adjusted up or down in the
                    event that a Product redesign results in a change in the
                    cost of the Product.

             5.3.3  If Specification changes occur BSC and GB will work in good
                    faith to minimize obsolescence costs.

                    5.3.3.1 *

                    5.3.3.2 *

                    5.3.3.3 *

6.0  PRODUCT PURCHASE AND SALE

     6.1  Manufacture and Supply. On and subject to the terms and conditions of
          this Agreement, during the Term: (a) GB will deliver and sell Products
          to BSC in the quantities ordered by BSC from time to time by delivery
          to GB of BSC's purchase order and delivery instructions and (b) BSC
          will purchase not less than the percentage of its requirements for
          each of the Products as set forth in the Exhibits to this Agreement
          pending the Food and Drug Administration's (FDA) approval and the
          market release of the finished ICD and/or pacemaker.

             6.1.1  BSC Tooling. Any tooling supplied by BSC to or purchased by
                    BSC from GB is and remains the property of BSC. Clearly
                    visible asset tags will be assigned and applied to all such
                    tooling specifying Boston Scientific as the owner of that
                    tooling. GB will (a) store and maintain all BSC tooling in
                    good working condition, (b) insure it at full replacement
                    value under an all-risk policy of property insurance
                    endorsed to name BSC as an additional insured with respect
                    to such tooling, and (c) not relocate said tooling without
                    the express written permission of BSC. All direct charges
                    for maintenance, repair or replacement after expiration of
                    useful life of any BSC tooling by GB or any third party,
                    other than that which may be caused by misuse of any tooling
                    or breach hereof by GB, will be the sole financial
                    responsibility of BSC. GB will use BSC tooling only in the
                    manufacture of Products pursuant to this Agreement and will
                    return said tooling without cost other than freight and
                    packaging charges to BSC at any time upon the written
                    request of BSC.

                                     - 9 -
<PAGE>

             6.1.2  Subcontracting. GB is not permitted to subcontract or
                    delegate any of its obligations under this Agreement without
                    the prior written consent of BSC.

7.0  DELIVERY

     7.1  BSC will give GB written instructions as to the method of shipment and
          carrier, which GB must follow. If BSC does not give specific
          instructions, GB may select the method of shipment and the carrier for
          the respective purchase order, and GB will prepay transportation and
          similar charges upon shipment (which payments will be added to the
          invoice).

     7.2  Title to all Products conforming to BSC'S purchase order will pass,
          free and clear of all encumbrances, at the FOB shipping point, which
          is * . BSC will bear all risk of damage or loss to those items after
          delivery by GB to the carrier at the FOB shipping point, and BSC
          releases GB from any and all claims and liability with respect to any
          such in-transit damages or losses to those items. The acceptance of
          title of the items does not constitute acceptance as conforming to
          applicable Specifications.

     7.3  GB will ship Product under Buyer Managed Purchase Orders to BSC * of
          GB's Sales Order Acknowledgement commit date. GB will ship Product
          under Kanban Purchase Orders to BSC within * of GB's confirmation of
          Kanban release receipt. GB will acknowledge receipt of Kanban release
          in *.

     7.4  In the event of any shortage, damage or discrepancy in or to a
          shipment of Products, BSC will promptly notify GB of the shortage,
          damage or discrepancy. GB will promptly ship the quantities of any
          missing Products to remedy any such shortage.

     7.5  Failure to Ship. If GB fails for any reason, other than Force Majeure
          or breach of this Agreement by BSC, to ship to BSC sufficient
          quantities of Products meeting BSC's Purchase Orders and Forecasts
          within *, GB agrees to provide BSC with * the committed purchase
          requirement for that Product for the *. The remedies provided to BSC
          in Article 4.2 and 4.3 (order cancellation), in this Article 7.5
          (reduction of volume commitments) and in Article 13.2 (termination)
          shall constitute BSC's sole remedies for any late shipments or
          failures to ship Product as provided for in this Agreement.

8.0  PRODUCT QUALITY AND INSPECTION

     8.1  Testing and Inspection.

                                     - 10 -
<PAGE>

             8.1.1  GB will perform testing to ensure that all Products
                    delivered to BSC meet all applicable Specifications. BSC
                    inspection of incoming Products will rely upon GB testing
                    and may consist of an examination of GB's testing
                    documentation as well as independent testing by BSC.

             8.1.2  BSC will conduct any incoming inspection tests not later
                    than * from the date of BSC'S receipt of the Products.
                    Products not rejected by BSC by written notice to GB within
                    such period will be deemed accepted.

                8.1.2.1  For Products shipped that fail to meet the
                         Specifications, BSC will deliver to GB, as appropriate,
                         a request for change to remedy the nonconformance of
                         the shipped Products and/or future Products. GB will,
                         upon receipt of BSC's documentation, ship promptly at
                         GB's expense, replacement items of the Product that are
                         in conformance with the Specifications.

                8.1.2.2  Prior to returning any Product to GB, BSC will first
                         contact its GB customer service representative and
                         obtain a Return Material Authorization (RMA) number.
                         BSC will only return the items and quantities approved
                         through the RMA.

     8.2  Manufacturing Location. Should GB wish to manufacture BSC Product at
          any other location other than the approved site, GB will provide
          written notice to BSC before the site change to allow for product
          qualification. GB agrees to provide BSC with transfer plans, site
          specifications, on-site inspection and audit opportunities and any
          reasonable documentation as requested by BSC to ensure GB's ability to
          continue production of acceptable Products that meet all
          Specifications. Should GB manufacturing move outside the U.S., BSC
          reserves the right to review and approve any additional charges that
          result from the move outside the U.S. The Parties acknowledge GB's
          Quality Performance Rating (as determined by BSC) and delivery
          performance as of the Effective Date as the desired performance to be
          achieved and maintained by GB. BSC is entering into this Agreement in
          reliance upon and conditioned on GB's quality and delivery ratings
          remaining consistent with the levels that exist as the Effective Date,
          regardless of the location at which Products are manufactured. BSC
          will qualify each Product before production components can be shipped
          to BSC and share in cost increases or decreases realized from such
          move.

     8.3  Quality Control. GB will follow strict quality control standards with
          respect to the production and transport of Products sold under this
          Agreement and consistent in all material respects with the standard of
          care and science applicable to the specified use of these Products and
          such requirements, policies, and procedures as provided for in Article
          8.4. BSC agrees to follow strict quality control standards with
          respect to the storage, preservation and use of Products purchased
          under this Agreement and consistent in all material respects with such
          guidelines as GB may from time to time deliver to BSC.

                                     - 11 -
<PAGE>

8.4  Quality Management

        8.4.1  Quality Management System. GB has established and maintains a
               certified quality management system in accordance with ISO
               9001-2000 or ISO 13485 and other relevant quality management
               standards and legal provisions applicable to its business (the
               "GBQMS"). GB represents and warrants that the actual production
               of the Products takes place under such GBQMS.

        8.4.2  Except to the extent in conflict with this Agreement, GB agrees
               to comply with the following quality assurance requirements,
               policies and procedures of BSC:

               8.4.2.1 *.

               If BSC determines that it is necessary or desirable to make
               changes to BSC's quality standards, BSC will so notify GB in
               writing. GB will work to comply with all updates and revisions to
               BSC's quality standards that GB agrees to in writing. The
               requirements specified in, or subsequently approved pursuant to
               this Article 8.4.2 are referred to herein as the "BSC Supplier
               Quality Requirements".

        8.4.3  Audits and Inspections. BSC will have reasonable access to the
               portion of GB's premises in which Products are manufactured for
               BSC, and its relevant documentation, during regular business
               hours in order to verify that the production and inspection of
               the Products occur in accordance with all relevant provisions of
               the GBQMS, BSC's Supplier Quality System Assessment, and in
               compliance with the Specifications. GB will also fully support
               and permit any inspection or audit by any conformity assessment
               body, which is legally entitled to inspect or audit BSC, as the
               legal manufacturer of a medical device (which includes a
               Product), and GB, as the manufacturer of such Product.

        8.4.4  Compliance Inspection. GB will inspect and test Products prior
               to delivery to BSC to ensure compliance with the Specifications
               and quality management standards per this Article 8.4.

        8.4.5  Traceability. In accordance with the GBQMS standards and
               internal GB procedures, traceability of critical or major
               components, processes, manufacturing and release inspection
               results will be maintained by GB, per GB documentation retention
               standards, for a minimum of ten years, to the level of the
               individual item of each Product identified by serial or lot
               number.

                                     - 12 -
<PAGE>

        8.4.6  Compliance Notification. It is * responsibility to file required
               Medical Device Reports or Vigilance Reports to any legal
               authority for the medical devices which contain a Product in
               order to comply with the applicable laws and regulations.

        8.4.7  Survival. The provisions of this Article 8.4 will survive the
               termination of the Agreement.

8.5  Standard Forms Not Applicable. The terms and conditions of sale for
     Products sold by GB to BSC hereunder are exclusively set forth in this
     Agreement. The Parties expressly agree that none of the terms and
     conditions of any written or electronic standard or other preprinted forms
     used by either GB or BSC in executing the purchase and sale transactions
     contemplated by this Agreement (including, but not limited to, purchase
     orders, acknowledgements and acceptance forms, invoices, labels and
     shipping documents) which are inconsistent with, or in addition to, those
     contained in this Agreement will have any force or effect.

8.6  Continuous Improvement. The Parties recognize the need for continuous
     improvement driven changes focused on quality improvement and cost
     reduction. BSC and GB agree to work together to ensure such changes are
     reviewed and approved. Pricing in this Agreement is based on GB's ability
     to execute these changes in *.

9.0  INVOICES AND PAYMENT

     9.1  Payment Terms. Payment terms are net * from date of receipt of invoice
          and terms are * or the location of such other * the Product ("FCA" per
          INCOTERMS 2000). Remittances are to be made per the following:

                  Please direct all Wire Transfer Payments to:
                                 Account Name: *
                                Account Number: *
                                     ABA: *
                                  Bank Name: *
                            Swift Code (if needed): *

     9.2  U.S. Funds. All amounts referenced in or to be paid under this
          Agreement will be in U.S. funds.

10.0 WARRANTY AND LIMITATION OF LIABILITY

     10.1 Warranty. GB warrants to BSC that Products sold by GB to BSC under
          this Agreement are in conformance with applicable Specifications, are
          manufactured in accordance with the GBQMS as described in Article
          8.4.1 and are free from defects in material and workmanship at the
          time of delivery of said Products.

                                     - 13 -
<PAGE>

     10.2 Limited Warranty. THE WARRANTIES SET FORTH ABOVE ARE IN LIEU OF ALL
          OTHER WARRANTIES, EXPRESS OR IMPLIED, WHICH ARE HEREBY DISCLAIMED AND
          EXCLUDED BY GB, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF
          MERCHANTABILITY, OR OF FITNESS FOR A PARTICULAR PURPOSE OR USE.

     10.3 Remedies for Breach of Warranty. In the event that any Product
          manufactured or sold by GB to BSC under this Agreement fails to comply
          with the limited warranty provided for in this Article 10.0 and BSC
          delivers notice of such noncompliance to GB, within * of the delivery
          of that Product to BSC, GB will, upon substantiation that the Product
          has been stored, preserved and used in accordance with Article 8.3,
          correct such failure by *. GB agrees that it will promptly inform BSC
          in writing of any actual or potential problems of which GB becomes
          aware relating to the performance or safety of any Product design
          manufactured for BSC relative to the Specifications for such design.

     10.4 LIMITATION OF LIABILITY. *, IN THE MANNER PROVIDED ABOVE, CONSTITUTES
          THE FULL EXTENT OF GB'S LIABILITY TO BSC WITH RESPECT TO PRODUCTS SOLD
          HEREUNDER. IN NO EVENT WILL GB BE LIABLE UNDER THIS AGREEMENT FOR
          INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES, INCLUDING, BUT NOT
          LIMITED TO, LOSS OF SALES, PROFITS OR REVENUES OR COSTS OF ANY PARTIAL
          OR TOTAL RECALL OF DEVICES IN WHICH PRODUCTS MAY HAVE BEEN
          INCORPORATED, AND IN NO EVENT WILL GB BE LIABLE *, WHETHER A RESULT OF
          BREACH OF WARRANTY OR BREACH OF CONTRACT. THE PROVISIONS OF THIS
          ARTICLE 10.4 WILL SURVIVE THE EXPIRATION OR TERMINATION OF THIS
          AGREEMENT.

     10.5 Third Parties. BSC hereby agrees to indemnify, defend and hold GB, its
          Affiliates and each of their officers, directors and employees
          harmless from any damage, costs or liabilities, including, without
          limitation, any reasonable costs or legal fees thereby incurred by GB
          and payable to Third Parties (collectively, "damages") arising out of
          any claim to the extent that such claim arises from or results from
          the marketing, distribution or sale of medical devices by BSC *. Such
          indemnification will include, without limitation, damages resulting
          from:

          10.5.1 *

          10.5.2 *

          10.5.3 *

                                     - 14 -
<PAGE>

          unless the damage is *.

          GB is responsible to complete incoming inspection requirements.

          BSC's obligation under this Article 10.5 is subject to the following
          conditions: GB must give BSC prompt written notification of any such
          claim so as not to prejudice BSC's performance, and GB must cooperate
          in the defense of such claim at BSC's expense. Further, GB agrees that
          BSC has sole control over the defense or settlement of any such claim,
          action or proceedings, including, but not limited to, the right to
          select defense counsel. GB and its officers, directors, employees,
          agents, or contractors will not enter into any agreement with respect
          to such claim, action or proceeding for which indemnification is or
          may be sought without receipt of BSC's prior written approval. GB will
          have the right to retain separate counsel at its sole expense. Such
          separate counsel will function solely to advise GB and will have no
          right to control the defense of any lawsuit or to effect any
          settlement, other than at GB's sole expense.

10.6 Product Liability Insurance.

       10.6.1  GB has and will maintain product liability insurance in such
               amounts as ordinary good business practice for its type of
               business would make advisable and will provide BSC with evidence
               of this coverage; provided, however, that in no case will the
               limits of such coverage be less than the following (but subject
               to any deductible or self-insured retention (SIR) which will not
               exceed *):

                       Bodily Injury:     *  Each Occurrence
                                          *  General Aggregate

                       Property Damage:   *  Each Occurrence
                                          *  General Aggregate

               10.6.1.1  GB will provide BSC with an insurance certificate *
                         specifying the amounts stated in this Article 10.6.1
                         including the SIR.

       10.6.2  BSC has and will maintain product liability insurance in such
               amounts as ordinary good business practice for its type of
               business would make advisable and will provide GB with evidence
               of this coverage; provided, however, that in no case will the
               limits of such coverage be less than the following (but subject
               to any deductible or self-insured retention (SIR) which will not
               exceed *):

                       Bodily Injury:     *  Each Occurrence
                                          *  General Aggregate

                                     - 15 -
<PAGE>

                       Property Damage:   *  Each Occurrence
                                          *  General Aggregate

               10.6.2.1  BSC will provide GB with an insurance certificate *
                         specifying the amounts stated in this Article 10.6.2
                         including the SIR.

10.7 Indemnification

       10.7.1  Indemnification by BSC. BSC hereby agrees to indemnify, defend
               and hold GB, its Affiliates and each of their officers, directors
               and employees harmless from any damage, costs or liabilities,
               including, without limitation, any reasonable costs or legal fees
               thereby incurred by GB and payable to third parties
               (collectively, "damages") arising out of any claim to the extent
               that such claim arises from or results out of the marketing,
               distribution or sale of medical devices by BSC which contain a
               Product, including, without limitation:

               10.7.1.1 *

               10.7.1.2 *

               unless the damage is *

       10.7.2  BSC's Indemnification Procedure. BSC's obligation under Article
               10.7.1 is subject to the following conditions: GB must give BSC
               prompt written notification of any such claim so as not to
               prejudice BSC's performance, and GB must cooperate in the defense
               of such claim at BSC's expense. Further, GB agrees that BSC has
               sole control over the defense or settlement of any such claim,
               action or proceedings, including, but not limited to, the right
               to select defense counsel. GB and its officers, directors,
               employees, agents, or contractors will not enter into any
               agreement with respect to such claim, action or proceeding for
               which indemnification is or may be sought without receipt of
               BSC's prior written approval. GB will have the right to retain
               separate counsel at its sole expense. Such separate counsel will
               function solely to advise GB and will have no right to control
               the defense of any lawsuit or to effect any settlement, other
               than at GB's sole expense.

       10.7.3  Indemnification by GB. GB hereby agrees to indemnify, defend and
               hold BSC, its Affiliates and each of their officers, directors
               and employees harmless from any damage, costs or liabilities,
               including, without limitation, any reasonable costs or legal fees
               thereby incurred by BSC and payable to third parties
               (collectively, "damages") arising out of any claim to the extent
               that such claim arises from or results out of: (a) personal
               injury or death resulting from the use of the Product and caused
               by GB's negligence or willful misconduct; and (b) personal injury
               or death resulting from alleged defects of the Product caused by
               GB's negligence or willful misconduct.

                                     - 16 -
<PAGE>

       10.7.4  GB's Indemnification Procedure. GB's obligation under Article
               10.7.3 is subject to the following conditions: BSC must give GB
               prompt written notification of any such claim so as not to
               prejudice GB's performance, and BSC must cooperate in the defense
               of such claim at GB's expense. Further, BSC agrees that GB has
               sole control over the defense or settlement of any such claim,
               action or proceedings, including, but not limited to, the right
               to select defense counsel. BSC and its officers, directors,
               employees, agents, or contractors will not enter into any
               agreement with respect to such claim, action or proceeding for
               which indemnification is or may be sought without receipt of GB's
               prior written approval. BSC will have the right to retain
               separate counsel at its sole expense. Such separate counsel will
               function solely to advise BSC and will have no right to control
               the defense of any lawsuit or to effect any settlement, other
               than at BSC's sole expense.

11.0 PROCESS AND/OR DESIGN CHANGE

     11.1 Specifications. All Products supplied by GB to BSC will be in
          accordance with the Specifications and supplied after GB Qualification
          thereof. Any changes to Specifications for Products to be sold under
          this Agreement will be agreed upon by both Parties in writing.

            11.1.1  If GB determines that it is necessary or desirable to make
                    any change in process, material or design affecting the
                    form, fit, function, or performance of any Product, GB will
                    immediately notify BSC in writing. GB will not implement any
                    such change without BSC'S prior consent.

            11.1.2  If BSC determines that it is necessary or desirable to make
                    any change to the Specification(s) for a Product, then BSC
                    will so notify GB in writing. GB will respond identifying
                    (a) GB's suggestions, if any, for modifying BSC's proposed
                    Specification change; (b) the lead time necessary to
                    implement such change; and (c) the amount and nature of any
                    price change, if any, estimated to result from implementing
                    such change. The Parties agree to negotiate in good faith
                    with respect to an adjustment to the Specifications and
                    pricing set forth in the pricing tables of the Agreement.

12.0 BUSINESS REVIEWS AND CERTIFICATIONS

       12.1 *  Business Review. The Parties agree to meet on a * basis for
               purposes of a * Business Review focused on *. Meetings will be
               coordinated by BSC's Commodity Manager and GB's Global Account
               Manager. Agenda items should include:

                                     - 17 -
<PAGE>

               o    A review of GB's performance in meeting BSC's quality and
                    delivery requirements

               o    Ongoing * projects

               o    *.

               o    Review of options to improve * as well as and opportunities
                    to * through *.

               *    both Parties should be in attendance.

       12.2 *:

               12.2.1 *.

               12.2.2 *.

               12.2.3 *.

               12.2.4 *

       12.3    BSC will send a letter to GB on *, certifying BSC's compliance
               with the terms and conditions of this Agreement during the prior
               Contract Year, including the Purchase Requirements specified in
               Exhibits A, B, C, D, and E.

13.0 BUSINESS EXIT AND TERMINATION

     13.1 GB must give BSC * written notice of any intent to discontinue supply
          of any Product to BSC ("Article 13.0 Notice"), but GB will not be
          bound after the expiration of this Agreement to the pricing set forth
          in Article 5.0. If GB so informs BSC of its intent to discontinue, BSC
          has the right to make a last order, * prior to the date of
          discontinuation as set forth by GB in the Article 13.0 Notice, which
          will be fulfilled by GB provided that (a) units of Product covered by
          the last order for any Product, not exceed * the number of units of
          such Product delivered to BSC in the * immediately preceding the date
          of such Article 13.0 Notice; and (b) GB will deliver Product in
          accordance with a reasonable production and delivery schedule, but in
          any event the full order will be completed prior to the date of
          discontinuance. Further, GB will assist BSC in identification of a
          replacement supplier.

     13.2 Termination. Notwithstanding the provisions of Articles 3.1. and 3.2
          above, this Agreement may be terminated in accordance with the
          following provisions:

            13.2.1  A Party may terminate this Agreement by giving notice in
                    writing to the other Party in the event the other Party is
                    in breach of any material representation, warranty or
                    covenant of this Agreement and shall have failed to cure
                    such breach within * of receipt of written notice thereof
                    from the first Party.

                                     - 18 -
<PAGE>

            13.2.2  A Party may terminate this Agreement at any time by giving
                    notice in writing to the other Party, which notice will be
                    effective upon delivery, should the other Party file a
                    petition of any type as to its bankruptcy, be declared
                    bankrupt, become insolvent, make an assignment for the
                    benefit of creditors, go into liquidation or receivership;
                    or

            13.2.3  A Party may terminate this Agreement by giving notice in
                    writing to the other Party should an event of Force Majeure
                    continue for more than * as provided in Article 16.0 below.

     13.3 Rights and Obligations on Termination. Termination of this Agreement
          will not release either Party from the obligation to make payment of
          all amounts previously due and payable, or which become due and
          payable due to termination of this Agreement. In addition:

            13.3.1  Upon expiration or termination of this Agreement or if BSC
                    changes the model mix of, or discontinues, any Products,
                    resulting in the cancellation of Purchase Orders inside the
                    standard lead times, BSC will be responsible for all
                    finished goods inventory, WIP, Product-specific,
                    non-returnable purchased material and any non-cancelable
                    purchase orders outstanding with GB's suppliers. In the
                    event that BSC cancels a Buyer-Managed Purchase Order
                    outside of agreed upon lead-time, BSC and GB will negotiate
                    resulting costs.

14.0 CONFIDENTIAL INFORMATION

     14.1 Treatment of Proprietary Information. Each of GB and BSC (each a
          "receiving party" agrees to maintain all proprietary information
          disclosed by the other Party (each a "disclosing party") pursuant to
          or in the performance of this Agreement ("Proprietary Information") in
          strict secrecy and confidence, and not to disclose said Proprietary
          Information to any third party, nor make use of said Proprietary
          Information for any purpose other than in carrying out its efforts
          under this Agreement. The receiving party agrees to have its employees
          sign agreements, or to have an appropriate corporate policy in effect,
          which requires them to keep confidential any Proprietary Information
          they learn in their positions at the receiving party; including the
          Proprietary Information of the disclosing party. The receiving party
          further agrees that no proprietary information or materials will be
          supplied to any other corporation, partnership, laboratory, or
          individuals other than those approved in writing by the disclosing
          party, with the exception of disclosure to the FDA and similar
          regulatory agencies of information relative to obtaining regulatory
          approval.

                                     - 19 -
<PAGE>

     14.2 Limited Release. The receiving party is released from the obligations
          of Article 14.1 to the extent that any of the disclosed Proprietary
          Information: (a) was already part of the public domain at the time of
          the disclosure by the disclosing party; (b) becomes part of the public
          domain through no fault of the receiving party (but only after and
          only to the extent that it is published or otherwise becomes part of
          the public domain); (c) was in the receiving party's possession prior
          to the disclosure by the disclosing party and was not acquired,
          directly, or indirectly, from the disclosing party or from a third
          party who was under continuing obligation of confidence to the
          disclosing party; (d) is received (after the disclosure by the
          disclosing party) by the receiving party from a third party who did
          not require the receiving party to hold it in confidence and did not
          acquire it directly or indirectly, from the disclosing party under a
          continuing obligation of confidence; or (e) is disclosed by the
          receiving party pursuant to judicial compulsion, provided that the
          disclosing party is notified at the time such judicial action is
          initiated. In addition, notwithstanding Article 14.1, only to the
          extent necessary to carry out the terms of this Agreement, GB may
          provide proprietary information of BSC to its subcontractors and
          vendors without BSC's prior approval provided that GB first requires
          each subcontractor or vendor to sign a confidentiality agreement which
          requires them to keep confidential such BSC Proprietary Information
          and not to use it except for the purpose of performing their
          obligations to GB.

     14.3 Term of Obligation. The obligation of the receiving party to receive
          and hold information disclosed by the disclosing party in confidence,
          as required by this Article 14.0, will terminate five (5) years from
          the date of the disclosure of the information hereunder and will
          survive the termination or expiration of this Agreement.

     14.4 Disposal upon Termination. Upon the termination or expiration of this
          Agreement, any samples, sketches, or other proprietary material
          provided by the disclosing party to the receiving party will be
          destroyed or returned to the disclosing party, unless and to the
          extent such materials are necessary to the receiving party to provide
          continuing support.

     14.5 Public Statements. (a) Neither Party will initiate or make any public
          announcement or other disclosure concerning any previously
          non-disclosed terms and conditions or the subject matter of this
          Agreement, assuming all previously disclosed terms and conditions were
          disclosed lawfully ("Confidential Information") to any third party
          without the prior written approval of the other Party. Nothing herein
          however, precludes a Party from disclosing Confidential Information
          that the Party is compelled, based on advice of legal counsel, to
          disclose under an applicable legal requirement, stock exchange rule or
          similar rule, provided that the Party uses commercially reasonable
          efforts to provide the other Party with at least five (5) business
          days but in any event prompt advance written notice thereof and
          cooperates with the other Party, to the extent the other Party
          requests, so that such other Party may seek a protective order or
          other appropriate remedy. If such protective order or other remedy is
          not available or is not obtained, then the Party required to disclose
          such Confidential Information will use commercially reasonable efforts
          to limit the disclosure, furnish only that portion of such
          Confidential Information that is legally required to be furnished and
          will cooperate with the other Party to obtain a protective order,
          agency ruling, or other assurance that Confidential Information will
          be accorded such confidential treatment to the extent permissible
          under the applicable legal requirement or rule.

                                     - 20 -
<PAGE>

          (b) With regard to any required filing of this Agreement with the
          Securities and Exchange Commission (the "SEC"), the disclosing Party
          will seek Confidential Treatment pursuant to Rule 24b-2 of Securities
          Exchange Act of 1934, as amended , with respect to the Confidential
          Information. The Party required to disclose such Confidential
          Information shall give the other Party a reasonable opportunity to
          review and provide suggestions to limit disclosure of all Confidential
          Information to be made public.

     14.6 Mutual Non-Disclosure Agreements. The provisions of this Article 14.0
          are not intended to replace, supersede, amend or modify all
          non-disclosure agreements between the Parties, including the Mutual
          Confidential Disclosure Agreement effective June 20, 2005, and the
          Mutual Non-Disclosure Agreement effective August 1, 2005, except that
          the requirements to maintain the confidentiality of Confidential
          Information under those agreements will continue in full force and
          effect for 5 years following the expiration or termination of this
          Agreement.

15.0 INTELLECTUAL PROPERTY

     15.1 Ownership of Product Technology

            15.1.1  All Intellectual Property of GB in existence on the date of
                    this Agreement shall remain the exclusive property of GB
                    (hereinafter "GB Product Technology"). All Intellectual
                    Property of BSC in existence on the date of this Agreement
                    shall remain the exclusive property of BSC (hereinafter "BSC
                    Product Technology"). Nothing in this Agreement will give
                    BSC any license, claim, right, title or interest in any GB
                    Product Technology, nor will it give GB any license, claim,
                    right, title or interest in any BSC Product Technology.

            15.1.2  All inventions, additions and/or improvements relating to
                    the Products or their use in implantable medical devices
                    developed, conceived, or invented solely by GB during the
                    Term is the sole property of GB.

            15.1.3  All inventions, additions and/or improvements relating to
                    the Products or their use in implantable medical devices
                    developed, conceived, or invented solely by BSC during the
                    Term is the sole property of BSC.

                                     - 21 -
<PAGE>

            15.1.4  All inventions, additions and/or improvements relating to
                    the Products, their use in implantable medical devices or in
                    respect of either the GB Product Technology or BSC Product
                    Technology developed, conceived, or invented jointly by GB
                    and BSC during the Term will be Joint Intellectual Property
                    ("Joint IP").

            15.1.5  All Joint IP will be jointly owned by the Parties and each
                    Party's joint ownership in the Joint IP will be an equal and
                    undivided interest therein.

            15.1.6  Joint IP is otherwise subject to all of the terms and
                    conditions of this Agreement.

     15.2 This Article 15.0 will survive expiration or termination of this
          Agreement.

16.0 FORCE MAJEURE

     16.1 "Force Majeure" shall mean storm, earthquake, embargoes, and acts of
          God, war and/or public enemy that prevents in whole or in material
          part the performance by a Party of its obligations under this
          Agreement.

     16.2 Upon giving notice to the other Party, a Party affected by an event of
          Force Majeure will be released without any liability on its part from
          the performance of its obligations under this Agreement, except with
          respect to Product delivered and accepted prior to the date of the
          event of Force Majeure, the obligations under Article 9.0, Article
          10.0, Article 13.1, Article 14.0, and Article 15.0, but only to the
          extent and only for the period that its performance of such
          obligations is prevented by the event of Force Majeure.

     16.3 During the period that the performance of a Party of its obligations
          under this Agreement has been suspended by reason of an event of Force
          Majeure, the other Party may likewise suspend the performance of all
          or part of its obligations hereunder to the extent that such
          suspension is commercially reasonable.

17.0 MISCELLANEOUS

     17.1 Governing Law. This Agreement will be interpreted, construed and
          governed by and in accordance with the laws of the State of New York.
          The Parties expressly agree that the United Nations Convention on the
          International Sale of Goods does not apply to this Agreement on any
          transaction pursuant hereto.

     17.2 Assignment. Either Party may assign this Agreement to an entity that
          acquires, directly or indirectly, substantially all of the assets or
          shares of such Party or merges with it. Except as set forth herein,
          neither this Agreement nor any rights here under, in whole or in part,
          will be assignable or otherwise transferable by either Party without
          the express written consent of the other Party. Subject to the above,
          this Agreement will be binding upon and inure to the benefit of the
          successors and assigns to the Parties here to.

                                     - 22 -
<PAGE>

     17.3 Integration. This Agreement constitutes the entire agreement of the
          Parties with respect to the subject matter hereof and supersedes all
          previous agreements or proposals, oral or written, and all
          negotiations, conversations or discussions between the Parties related
          to the subject matter of this Agreement, but excluding any
          confidentiality agreements between the Parties or their Affiliates
          which will remain in full force and effect.

     17.4 Survival. All of the representations, warranties, covenants and
          indemnifications made in this Agreement, and all terms and provisions
          hereof intended to be observed and performed by the Parties after the
          termination or expiration of this Agreement, will survive the
          termination or expiration and continue thereafter in full force and
          effect, subject to applicable statute of limitations.

     17.5 Amendment; Waiver. This Agreement is not to be released, discharged,
          abandoned, changed or modified in any manner, except by an instrument
          in writing signed on behalf of each of the Parties to this Agreement
          by their duly authorized representatives. The failure of either Party
          to enforce at any time any of the provisions of this Agreement will
          not be construed to be a waiver of that provision, nor in any way to
          affect the validity of this Agreement or any part of it or the right
          of either Party after any such failure to enforce each and every such
          provision. No waiver of any breach of this Agreement will be held to
          be a waiver of any other or subsequent breach.

     17.6 Counterparts. This Agreement may be executed in one or more
          counterparts, all of which will be considered one and the same
          agreement, and become a binding agreement when one or more
          counterparts have been signed by each Party and delivered to the other
          Party.

     17.7 Headings. The titles and headings to the Articles herein are inserted
          for the convenience of reference only and are not intended to be a
          part of or to affect the meaning or interpretation of this Agreement.
          This Agreement is to be construed without regard to any presumption or
          other rule requiring construction hereof against the Party causing
          this Agreement to be drafted. All references to Articles, Section and
          Exhibits means Articles and Sections of, and Exhibits to, this
          Agreement.

     17.8 No Third Party Beneficiaries. Nothing in this Agreement, expressed or
          implied, is intended to confer on any person other than the Parties
          and their Affiliates, or their respective successors or assigns, any
          rights, remedies, obligations or liabilities under or by reason of
          this Agreement.

     17.9 Notices. Any notice or other communication hereunder must be given in
          writing and either (a) delivered in person, (b) transmitted by telex,
          facsimile or telecopy mechanism, provided that any notice so given is
          also mailed as provided in clause (c), or (c) mailed, postage prepaid,
          receipt requested as follows:

                If to GB:                         If to BSC:
                9645 Wehrle Drive                 4100 Hamline Avenue North
                Clarence, New York 14031          St. Paul , MN 55112-5798
                Facsimile: 716.759.5664           Facsimile: (sent to the Buyer)
                Attention: President              Attention: President
                CC: General Counsel               CC: General Counsel

                                     - 23 -
<PAGE>

          or to such other address or to such other person as either Party
          designates by such notice to the other Party. Each such notice or
          other communication will be effective (i) if given by
          telecommunication, when transmitted to the applicable number so
          specified in (or pursuant to) this Article 17.9 and an appropriate
          receipt is received, (ii) if given by mail, three (3) days after such
          communication is deposited in the mails with first class postage
          prepaid, addressed as aforesaid or (iii) if given by any other means,
          when actually received at such address.

    17.10 Severability. If any provision of this Agreement is held invalid by a
          court of competent jurisdiction, the remaining provisions will
          nonetheless be enforceable according to their terms. Further, if any
          provision is held to be overbroad as written, that provision will be
          deemed amended to narrow its application to the extent necessary to
          make the provision enforceable according to applicable law and will be
          enforced as amended.

    17.11 Disputes; Enforceability

           17.11.1  Confidentiality. The Parties agree that a violation of the
                    covenants set forth in Article 14.0 and Article 15.0 of the
                    Agreement will cause damages to the other Party that are
                    significant, material and difficult or impossible to
                    adequately measure and the injured Party will be entitled to
                    seek and obtain injunctive relief compelling compliance in
                    terms of this Agreement.

           17.11.2  Arbitration. Except as set forth in Article 17.11.1 above,
                    all disputes and controversies arising out of or relating to
                    this Agreement or any of the other documents to be delivered
                    hereunder, or the performance, breach, validity,
                    interpretation or enforcement thereof that are not resolved
                    through negotiation, mediation other forms of alternative
                    dispute resolution, will be resolved by binding arbitration
                    in accordance with the commercial arbitration rules of the
                    American Arbitration Association (the "Rules"), and judgment
                    upon the award rendered by the arbitrator may be entered in
                    any court having jurisdiction thereof. A Party may initiate
                    arbitration by sending written notice of its intention to
                    arbitrate to the other Party and to the AAA office located
                    in New York, New York (the "Arbitration Notice"). The
                    Arbitration Notice will contain a description of the dispute
                    and the remedy sought. The arbitration will be conducted at
                    the offices of the AAA in New York, New York before an
                    independent and impartial arbitrator experienced in legal
                    matters related to the medical device industry. In no event
                    may the demand for arbitration be made after the date when
                    the initiation of a legal or equitable proceeding based on
                    such claim, dispute or other matter in question would be
                    barred by New York law. The arbitrator will deliver his or
                    her decision in writing, together with the summary of the
                    reasons for the decision, including citations to legal
                    authority to the extent appropriate. The decision of the
                    arbitrator will be final and binding on both Parties and
                    their successors and permitted assignees. The parties agree
                    that, notwithstanding anything to the contrary in this
                    Article 17.11.2, any award made by the arbitrator will be
                    consistent with the terms of this Agreement and that any
                    award will be restricted to a remedy that would be available
                    to a party under this Agreement.

                                     - 24 -
<PAGE>

IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed
by their authorized representatives.

CARDIAC PACEMAKERS, INC.                    GREATBATCH LTD.

By:    /s/ Helge Batz                   By:    /s/ Susan Campbell
       ------------------------------          ---------------------------------
       HELGE BATZ                              SUSAN CAMPBELL
Title: Director, Materials Management   Title: Sr. Vice President, Medical Power

Date:                                   Date:
       ------------------------------          ---------------------------------

                                     - 25 -
<PAGE>

                    EXHIBIT A - LOW AND MEDIUM RATE BATTERIES

1.0  Purchase Requirements: a minimum of * % of BSC's Low and Medium rate
     battery demand for * devices to be purchased from Seller.

2.0  Lithium Iodine Low Rate Battery Pricing

2.1  Volumes below are based on BSC * Lithium Iodine volume.

                                        *

3.0  *Medium Rate Battery Pricing

                                        *

4.0  Lead Time for GB Low and Medium Rate Batteries is * as of the Effective
     Date of this Agreement.

5.0  Pricing Adjustments

     5.1  Pricing shown in tables above valid for GB Low and Medium Rate battery
          models shown in the table below in production as of the Effective Date
          of this Agreement.

                                        *

     5.2  *

          5.2.1 *.

          5.2.2 *.

     5.3  A price premium will apply for * enclosures, non-standard shapes, and
          for terminal modification complexity.

     5.4  A price premium will apply for other value added options (e.g., *)
          requested by BSC.

     5.5  Significant material cost change. The price for any Low or Medium Rate
          Battery may be adjusted up or down as of the * of each Contract Year
          during the Term of this Agreement, by mutual consent, if there is a
          material cost change which has a significant impact to a Product's
          final cost. Any price modification will be determined * of each year
          and will be effective for shipments delivered beginning * the
          following Contract Year.

                                     - 26 -
<PAGE>

             5.5.1  In the case of Low and Medium Rate Batteries containing *,
                    if the Reference Price for * below has changed by more than
                    * compared to the Reference Price used for the current
                    Contract Year, a price adjustment (either up or down) will
                    be allowed for those products.

                5.5.1.1  The "Reference Price for *" is based upon the * of each
                         Contract Year.

                5.5.1.2  The Reference Price for * used as the basis to
                         establish 2007 pricing in this Exhibit A of the
                         Agreement is * per Troy Ounce.

             5.5.2  Price adjustment per unit resulting from changes in
                    materials cost

                                        *

6.0  NRE charges for new, custom designed cells will be no more than * per
     development program.

                                     - 27 -
<PAGE>

                         EXHIBIT B - HIGH RATE BATTERIES

1.0  Purchase Requirements, Volumes and Prices.

     1.1  *.

     1.2  *

     1.3  *.

2.0  * Battery Pricing

                                        *

3.0  * High Rate Battery Pricing

                                        *

4.0  Lead Time for GB High Rate Batteries * as of the Effective Date of this
     Agreement.

5.0  Pricing Adjustments

     5.1  Pricing shown in tables above valid for GB High Rate Battery models
          shown in the table below in production as of the Effective Date of
          this Agreement.

                                        *

     5.2  Price adjustment for increased commitment

             5.2.1  Upon receipt of written commitment from BSC to procure no
                    less than * of GB's * batteries * for the remainder of the
                    Term of this Agreement, BSC will receive the following price
                    adjustments for High Rate Batteries:

                    5.2.1.1 *

                    5.2.1.2 *

             5.2.2  Upon receipt of written commitment from BSC to procure no
                    less than * of GB's * batteries * for the remainder of the
                    Term of this Agreement, BSC will receive the following price
                    adjustments for High Rate Batteries:

                                     - 28 -
<PAGE>

                    5.2.2.1 *

                    5.2.2.2 *

                    These price adjustments for increased commitment are further
                    described in the flow chart included in Exhibit F of this
                    Agreement.

             5.2.3  All price adjustments will be made for future purchases
                    only. No retroactive price reductions will be allowed.

     5.3  A price premium will apply for * enclosures, non-standard shapes, and
          for terminal modification complexity.

     5.4  A price premium will apply for other value added options (e.g., *)
          requested by Buyer.

     5.5  A price premium will apply for each additional * configurations.

6.0  NRE charges for new custom designed cells will be no more than * per
     development program

     6.1  NRE charges for development of * for application in any of the *
          models identified in this Exhibit B Article 5.1 will be * per program.

                                     - 29 -
<PAGE>

                       EXHIBIT C - WET TANTALUM CAPACITORS

1.0  Purchase Requirements: BSC will purchase GB Wet Tantalum Capacitors for use
     in BSC's * devices for the minimum annual percentage of BSC hybrids per the
     pricing table below.

2.0  Wet Tantalum Capacitor Pricing

                                        *

3.0  Lead Time for GB Wet Tantalum Capacitors is * as of the Effective Date of
     this Agreement.

4.0  Pricing Adjustments

     4.1  Pricing shown in the table above valid for GB Wet Tantalum Capacitor
          models shown in the table below in production as of the Effective Date
          of this Agreement.

                                        *

     4.2  Price adjustment for increased commitment

             4.2.1  Upon receipt of written commitment from BSC to * BSC will
                    receive the following price adjustments:

                4.2.1.1  In the case of Wet Tantalum Capacitors, BSC will
                         receive a * to the then current price and * for Wet
                         Tantalum Capacitors purchased in subsequent Contract
                         Years.

             4.2.2  Upon completion of activities defined in this Exhibit C,
                    Article 4.2.1 and * of the GB Wet Tantalum Capacitor
                    specified for the * device, BSC will receive the following
                    price adjustments:

                4.2.2.1  In the case of Wet Tantalum Capacitors, BSC will
                         receive a * to the then-current price and * for Wet
                         Tantalum Capacitors purchased in subsequent Contract
                         Years. These price reductions are in addition to the
                         price reductions defined in Article 4.2.1.1 above.

             4.2.3  Upon completion of activities defined in this Exhibit C,
                    Articles 4.2.1 and 4.2.2 and * of the GB Wet Tantalum
                    Capacitor specified for the * device, BSC will receive the
                    following price adjustments:

                                     - 30 -
<PAGE>

                4.2.3.1  In the case of Wet Tantalum Capacitors, BSC will
                         receive a * to the then-current price and * for Wet
                         Tantalum Capacitors purchased in subsequent Contract
                         Years. These price reductions are in addition to the
                         price reductions defined in Articles 4.2.1.1 and
                         4.2.2.1. above.

             4.2.4  Should BSC increase commitments as defined in this Exhibit C
                    Articles 4.2.1, 4.2.2, and 4.2.3 and Exhibit B, Article
                    5.2.1 and 5.2.2, BSC will receive the following additional
                    price reductions:

                4.2.4.1  In the case of Wet Tantalum Capacitors, BSC will
                         receive a * to the then-current price.

                4.2.4.2  In the case of * High Rate Batteries, BSC will receive
                         * for SVO batteries purchased in subsequent Contract
                         Years.

                4.2.4.3  In the case of * High Rate Batteries, BSC will receive
                         a *.

                These price adjustments for increased commitment are further
                described in the flow chart included in Exhibit F of this
                Agreement.

             4.2.5  All Price Adjustments will be made on future purchases only.
                    No retroactive price reductions will be provided.

4.3  A price premium will apply for * enclosed designs

4.4  A price premium will apply for * modification complexity

4.5  A price premium will apply for other value added options (e.g., *)
     requested by Buyer.

4.6  Significant material cost change. The price for any Wet Tantalum Capacitor
     may be adjusted up or down as of the * of each Contract Year during the
     Term of this Agreement, by mutual consent, if there is a material cost
     change which has a significant impact to a Product's final cost. Any price
     modification will be determined by * of each year and will be effective for
     shipments delivered beginning * of the following Contract Year.

          4.6.1 In the case of Capacitors containing *, if the Reference Price
                for * below has changed by more than * compared to Reference
                Price for * used for the current Contract Year, a price
                adjustment (either up or down) will be allowed for those
                products.

                                     - 31 -
<PAGE>

                4.6.1.1  The "Reference Price of *" is based upon the * of each
                         Contract Year.

                4.6.1.2  The Reference Price for * used as the basis to
                         establish 2007 prices in this Exhibit C of the
                         Agreement *.

             4.6.2  In the case of Capacitors containing *, if the Reference
                    Price for * below has changed by more than * compared to
                    Reference Price for * used for the current Contract Year, a
                    price adjustment (either up or down) will be allowed for
                    those products.

                4.6.2.1  The "Reference Price for *" is based upon the * of each
                         Contract Year.

                4.6.2.2  The Reference Price for * used as the basis to
                         establish 2007 prices in this Exhibit C of the
                         Agreement is *.

          4.6.3 In the case of Capacitors containing *, if the Reference Price
                for * below has changed by more than * compared to Reference
                Price for * used for the current Contract Year, a price
                adjustment (either up or down) will be allowed for those
                products.

                4.6.3.1  The "Reference Price for *" is based upon the * of each
                         Contract Year.

                4.6.3.2  The Reference Price for * used as the basis to
                         establish 2007 prices in this Exhibit C of the
                         Agreement is *.

             4.6.4  Price adjustment per unit resulting from change in materials
                    cost

                                        *

5.0  NRE charges for new custom designed capacitors will be no greater than *
     per development program.

     5.1  NRE charges for Future Program Commitments defined in Article 5.0
          above will be rebated * at a rate of * for the *, which ever comes
          first.

                                     - 32 -
<PAGE>

     5.2  NRE charges for a * capacitor development program will be rebated *,
          which ever comes first.

                                     - 33 -
<PAGE>

                             EXHIBIT D - CASE HALVES

1.0  Purchase Requirements: * of BSC's demand for Case Halves will be purchased
     from GB

2.0  Case Half Pricing

                                        *

                                     - 34 -
<PAGE>

3.0  Lead Time for GB Case Halves is * as of the Effective Date of this
     Agreement.

4.0  Pricing Adjustments

     4.1  Annual PPV

             4.1.1  In the case of Case Halves listed in this Exhibit D, Article
                    2.0, BSC will receive * in the subsequent Contract Years
                    compared to the then-current year's pricing.

     4.2  Significant material cost change. The price for any Case Half may be
          adjusted up or down as of the * of each Contract Year during the Term
          of this Agreement, by mutual consent, if there is a material cost
          change which has a significant impact to a Product's final cost. Any
          price modification will be determined by * of each year and will be
          effective for shipments delivered beginning * of the following
          Contract Year.

             4.2.1  In the case of Case Halves containing *, if the Reference
                    Price for * below has changed by more than * compared to the
                    Reference Price for * used for the current Contract Year, a
                    price adjustment (either up or down) will be allowed for
                    those products.

                4.2.1.1  The "Reference Price for *" is based upon the * of each
                         Contract Year.

                4.2.1.2  The Reference Price for * used as the basis to
                         establish 2007 prices in this Exhibit D of the
                         Agreement is *.

             4.2.2  In the case of Case Halves containing *, if the Reference
                    Price for * below has changed by more than * compared to the
                    Reference Price for * used for the current Contract Year, a
                    price adjustment (either up or down) will be allowed for
                    those products.

                4.2.2.1  The "Reference Price for *" is based upon the * of each
                         Contract Year.

                4.2.2.2  The Reference Price for * used as the basis to
                         establish 2007 pricing in this Exhibit D of the
                         Agreement is *.

                                     - 35 -
<PAGE>

                        EXHIBIT E - FILTERED FEEDTHROUGHS

                          Exhibit E intentionally blank

                                     - 36 -
<PAGE>

            EXHIBIT F - BATTERY AND CAPACITOR PRICING ADJUSTMENTS FOR
                              INCREASED COMMITMENT

1.0  The flow chart included below provides a visual depiction of paths
     available for BSC to realize improved pricing as a result if increased
     business commitment to GB as described in Exhibit B Article 5.2 and Exhibit
     C Article 4.2.

                                        *

1.1  Pricing adjustments described in the flow chart above will apply only to
     future purchases after completion of all elements described in the relative
     Exhibit and Article. No retroactive price adjustments will be allowed.

                                     - 37 -
<PAGE>

EXHIBIT G - *

*.

1.0  *

*.

2.0  *

*

     2.1  *

                                        *

                                     - 38 -
<PAGE>

     2.2  *

                                        *

3.0  *

*.

                                     - 39 -
<PAGE>

                EXHIBIT H - BSC-DESIGNATED THIRD PARTY SUPPLIERS

                          Exhibit H intentionally blank

                                     - 40 -

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