Document:

exv10w4

 

Exhibit 10.4

Confidential Materials omitted and filed separately with the

Securities and Exchange Commission. Asterisks denote omissions.

EXTRACORPOREAL DISPOSABLES DISTRIBUTION AGREEMENT

          This Agreement, dated as of July 25, 2007 (the “Effective Date”), is between Medisystems
Corporation, a Washington corporation with offices at 701 Pike Street, 16th Floor, Seattle,
Washington 98101-3016 (“MDS”) and Henry Schein, Inc. a Delaware corporation with offices at 135
Duryea Road, Melville, NY 11747 (together with its subsidiaries, “Schein”).

          In consideration of the mutual promises made herein and other good and valuable consideration,
the receipt of which is hereby acknowledged, the parties hereto agree as follows:

   1.0 BACKGROUND

     1.1 The following are examples of certain disposable medical devices useful in dialysis and
pheresis therapies (collectively, the “Products”):

	 	a.	 	Blood, dialysate and/or fluid sets for dialysis such as blood
tubing sets, peritoneal sets, reversing connector sets, priming sets and the
like (“BTL”),
	 
	 	b.	 	extracorporeal access needle sets such as AVF needle sets,
pheresis needle sets, ButtonHole needle sets, Vasca access needle sets and the
like (“AVF”),
	 
	 	c.	 	antistick, plastic access needle/connectors and the like
(“Needleless”), and
	 
	 	d.	 	air filters, such as transducer protectors, diagnostic pressure
measurement devices and the like (“TP”).

     MDS designs and supplies certain Products under Specifications (as hereinafter defined)
including MDS labeling which MDS controls and currently has produced by subsidiaries or contract
manufacturers (“MDS Products”). Schein wishes to purchase certain MDS Products for resale to its
dialysis customers in certain countries of the world as listed in Exhibit A (the “Territory”).

   2.0 TERM OF AGREEMENT

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     2.1 The term (including any extensions, the “Term”) of this Agreement shall be for a two year
period beginning on the Effective Date of this Agreement. The Agreement shall terminate at the end
of the Term, unless the parties agree on provisions for an extension of the Term not less than six
(6) months prior to the date on which this Agreement would otherwise terminate.

   3.0 MDS PRODUCTS

     3.1 The MDS Products that Schein wishes to purchase pursuant to this Agreement are listed in
Exhibit B as “MDS BTL”, “MDS AVF”, “MDS Needleless”, “MDS TP”, etc., as such Exhibit B may be
amended from time to time by mutual agreement of the parties. The codes of the MDS Products that
are the subject of this Agreement are hereafter referred to as “Codes”. The Codes shall meet
specifications as set forth in Exhibit C, or as such specifications, including labeling may be
modified from time to time pursuant to Sections 9.1, 9.2 and 9.3 (the “Specifications”), provided
that such modifications are agreed upon in amendments to Exhibit C signed pursuant to Section 18.3
hereof.

     MDS reserves the right, at its sole discretion, to incorporate clinical use enhancements or
developments in existing Codes of the MDS Products or to supply existing Codes from alternate
manufacturing sites even if MDS designates them with a different Code prefix, provided that no
price increase is requested by MDS.

   4.0 PURCHASES AND ORDERS

     4.1 Subject to the terms and conditions of this Agreement, MDS shall sell the MDS Products
listed in Exhibit B to Schein and Schein shall purchase the MDS Products listed in Exhibit B for
use or resale by Schein only in the Territory.

     4.2 “Contract Year” shall mean the twelve-month period commencing on the Effective Date and
each subsequent twelve-month period during the Term.

     4.3 During the Term of this Agreement, Schein hereby agrees to sell in the Territory BTL and
AVF sourced only and exclusively from among MDS BTL and MDS AVF listed in Exhibit B (the “Exclusive
Products”). Except as provided in this Agreement, Schein shall not purchase or sell in the
Territory any Products identical, similar or competitive to Exclusive Products from any other
supplier (“Competing Products”).

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     Further, during each [**] month period during the Term of this Agreement, Schein shall
purchase from MDS, by way of valid Delivery Orders (as hereinafter defined) only, not less than
[**] pairs of MDS BTL and [**] each-equivalents of MDS AVF (the “Purchase Commitment”).

     Notwithstanding the above, if during any Contract Year during the Term of this Agreement MDS
or its affiliates sells more than $[**] worth of either the MDS BTL or the MDS AVF listed in
Exhibit B directly to any provider of chronic in-center dialysis services, then for such Contract
Year and for any remaining Contract Year during the Term of this Agreement, Schein shall be
relieved of its obligation not to purchase or sell either BTL and/or AVF, as the case may be, that
are Competing Products.

     The failure of Schein to order the minimum quantities of the Purchase Commitments shall be a
material breach of this Agreement, and shall entitle MDS to terminate this Agreement pursuant to
Section 14.1 hereof and to seek any and all other remedies provided for in this Agreement.

     4.4 Schein hereby warrants that as of the Effective Date, Schein neither purchases from any
source nor sells, any Competing Products in the Territory.

     4.5 After the Effective Date, except as set forth in Sections 8.1 and 8.9, MDS shall not sell
Exclusive Products to any Med/Surg Distributor (as hereinafter defined), other than Schein, in the
Territory. For the purposes of this Agreement a “Med/Surg Distributor” is defined as a distributor
who distributes general medical/surgical items such as syringes, gauze, drugs, etc. rather than one
who distributes primarily dialyzers, dialysis services and/or dialysis machines. Med/Surg
Distributors include [**] and other similar general medical surgical item
distributors.

     4.6 Notwithstanding 4.5 above, as of the Effective Date, MDS sells or may sell MDS Products,
including Exclusive Products, to dialysis specialty distributors currently including Fresenius
Medical Care, Inc., Baxter Healthcare Corporation, NxStage, Inc., Gambro Renal Products, Inc., B.
Braun Medical and Sorb Technology, each of which is a manufacturer or exclusive importer of a
hemodialyzer, hemodialysis machine, implanted dialysis access port or provider of specific dialysis
services. All MDS Products sold to [**] are

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intended for exclusive use by [**]
as a provider of specific dialysis services in its owned or
managed facilities and for the home-care patients thereof. MDS, to the extent allowable by law,
will not sell MDS Products to [**] with the intent that [**] will distribute, redistribute, resell,
or otherwise transfer to any other third party any MDS Products during the term of this Agreement.

     4.7 Except as set forth in Section 8.9, MDS shall not sell Exclusive Products to any
distributor at more favorable prices, including [**], discounts and the like, than those offered
to Schein for similar Delivery Order or Purchase Commitment quantities.

     4.8 Prior to the [**] day of each month during the Term of this Agreement (the “Order Date”),
Schein will provide MDS with one or more noncancellable delivery order(s) (a “Delivery Order” or
“Delivery Orders”) for the MDS Products. Any Delivery Order provided to MDS after the [**] day of
the month shall be deemed to have an Order Date on the [**] day of the subsequent month. The
requested delivery date (“Due Date”) provided by Schein on each Delivery Order shall be not earlier
than [**] days after the Order Date for all Products. Each Schein Delivery Order for delivery to
each FOB Location (as hereinafter defined) shall conform to the per Code or per MDS Product
quantity minimums and multiples stated in Exhibit B.

     Any Delivery Orders with a common Due Date, FOB Location and Manufacturing Location that
cumulatively comprise less than the number of pallets required to comprise full container loads or
truck loads as indicated in Exhibit B, shall be subject to freight cost premiums as quoted to
Schein by MDS at the time the Delivery Order is accepted.

     4.9 MDS shall not be required to accept any Schein Delivery Orders with a common Order Date to
the extent that the quantity of Codes in any Code Group so ordered exceeds [**] percent ([**]%) of
the average monthly quantity ordered during the immediately preceding [**] months. If accepted,
such excess quantities shall be deemed to have an Order Date on the [**] day of the next subsequent
calendar month and shall remain subject to the provisions of this Section. If MDS reallocates any
Schein Delivery Orders pursuant to this Section 4.9, it shall consult with Schein to determine
which orders shall be reallocated to a future Order Date.

     Notwithstanding the foregoing, MDS shall be obligated to deliver MDS Products in excess of
such [**]% if the Delivery

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Orders for such excesses are for Codes to be sold by Schein to customers already purchasing
such Codes from another MDS Contract Distributor, but only to the extent that the excesses in
Delivery Orders are for such sales.

     4.10 To the extent Schein commences sale to any new customer with more than [**] hemodialysis
patients and, as a result, Schein’s Delivery Orders to MDS increase significantly, MDS’s timely
delivery of such increased quantities of MDS Products shall not be subject to the provisions of
Section 8.5. In such a circumstance, however, MDS will use reasonable commercial efforts to
fulfill all of Schein’s requirements as soon as commercially possible.

     4.11 Notwithstanding the foregoing, during the final [**] months of this Agreement as
determined in accordance with Section 2.1 hereof, MDS shall not be obligated to accept Delivery
Orders to the extent that they cumulatively exceed [**]% of the cumulative quantity of MDS Products
ordered pursuant to Delivery Orders placed in the immediately preceding [**] month period.

     4.12
In the event that either Schein or MDS determines that [**], Schein and MDS shall [**]. In the
event that Schein and MDS agree on a [**], MDS and Schein shall [**] agree to a
[**] which will include such [**]; provided, however, that Schein [**] to the
extent of [**].  As of the Effective Date, all [**] under any previous agreement between MDS and Schein are
[**], and new [**] may be [**]. All [**]. The [**] will be
[**] as reasonably possible

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based on [**].

     MDS shall be [**] including but not limited to; [**].

     4.13 By the [**] day of each month during the Term of this Agreement, Schein shall provide MDS
with a non-binding forecast of the quantity of each Code Schein estimates it shall place orders for
during the following [**] months. These forecast figures will be e-mailed to the Marketing Services
Manager [**].

     By the [**] day of each month, Schein shall also provide Schein end-user sales information to
MDS from the previous month, including MDS Product sales across all Schein divisions. Such sales
information shall include; the Code, quantity, end-user name, end-user city and end-user state. By
the [**] day of each month, Schein shall also provide its ending inventory information from the
previous month to MDS, including inventory amounts across all Schein divisions, by Code and
warehouse.

   5.0 SHIPMENT OF MDS PRODUCTS

     5.1 MDS will ship the MDS Products, freight and insurance paid, to the F.O.B. location
specified on Schein’s Delivery Order (“F.O.B. Location”) at the prices listed in Exhibit D,
provided however, Schein shall only specify F.O.B. Locations listed in Exhibit D. MDS and Schein
may agree to add new F.O.B. Locations at any time provided the prices for delivery to such F.O.B.
Locations shall be added by amendment to Exhibit D, signed pursuant to Section 18.3 hereof.

     5.2 MDS shall prepare and send by facsimile transmission or via e-mail to Schein a packing
list for each shipment of MDS Products. This shipping information will include Schein’s specific
purchase order number, item shipping quantities, and item back order information. When MDS has the
necessary systems and procedures in place, the packing slip will also accompany

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the shipment to avoid loss of missing faxes and to reduce the chance of mismatching the paper
to the shipment.

     5.3 MDS shall notify Schein as soon as MDS becomes aware that any shipment may not be
delivered within a period commencing [**] days prior to the Due Date and ending [**] days after the
Due Date applicable to a Delivery Order, such period being hereinafter referred to as the “Delivery
Window”. Except as set forth in Section 8.1, if MDS is delinquent with Delivery Orders properly
placed by Schein and accepted by MDS in accordance with the terms of this Agreement, and as a
result, to the degree that Schein has insufficient MDS Products to ship to its customer in its
customary manner and at customary prices, MDS will be responsible for incremental freight costs
including all priority and cross shipping charges associated with MDS delayed order fulfillment
provided that the proper documentation of such incremental charges is produced, with prior written
authorization by MDS, of which such authorization shall not be unreasonably withheld.

     5.4 Schein will notify MDS in writing of any receiving discrepancy (over, short or patently
damaged), within [**] business days of receipt of such delivery. Schein hereby agrees to hold the
relevant part (over, short or patently damaged) intact pending resolution by MDS. At the time of
receipt of MDS Products by Schein, any damage, shortage or overage noted at that time must be noted
by Schein on the Bill of Lading. Credit will be issued only upon MDS’ verification of such damage,
shortage or overage, which verification shall not be unreasonably with-held. MDS hereby agrees to
arrange verification and to provide a disposition of such receiving discrepancy within [**]
business days from receipt of such notice. In the event of a receiving discrepancy, for the
purpose of Section 7.1, MDS’s invoice shall be deemed to be dated on the date MDS provides the
disposition.

     5.5 Schein accepts MDS’s standard packaging and palletizing methods. MDS will examine
proposals to modify the palletizing methods as requested by Schein, and provided these
modifications are approved by MDS, Schein agrees to pay any additional costs and to accept
responsibility for any damage related to the new packaging methods. MDS will use reasonable best
efforts to revisit its pallet size and work to conform to the Schein rack height configurations.

   6.0 PRICES

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     6.1 During [**] of this Agreement, MDS will sell the Codes meeting the
Specifications set forth in Exhibit C to Schein, and Schein agrees to buy the MDS Products from MDS
at the base prices and at F.O.B. Locations listed in Exhibit D (“Base Prices”). MDS makes no
commitment to provide any Code at these Base Prices beyond [**] of this
Agreement. Any price increase for [**] shall be limited to MDS’ increased
costs of goods sold. MDS shall notify Schein of the prices for the second Contract Year [**]
months after the Effective Date.

     6.2 [**] months prior to the end of the initial two year Term of this Agreement, and [**]
months prior to the end of the last year of any extension of the Term of this Agreement, MDS may
submit to Schein a written proposal for a revised Exhibit D which, if submitted, shall set forth
MDS’ proposed prices for MDS Products applicable during the next term of this Agreement, subject to
the other terms and conditions of this Agreement, if the parties agree to extend this Agreement.

     6.3 The quantity prices listed in Exhibit D are set forth on the basis of the total quantity
of Delivery Orders placed during each Contract Year for Codes. Prices include all United States
import duties, clearing charges, and freight up to the F.O.B. Location designated.

     6.4 It is expressly agreed that Base Prices for the MDS Products include delivery in full
trailer load or container load quantities to each F.O.B. Location, by ocean freight or least cost
overland method. Premiums for (i) air freight, (ii) LTL shipments, (iii) expedited delivery, (iv)
shipments of partial orders, or (v) other unusual or extra transportation expenses, if authorized
in advance by Schein in writing, (“Premiums”) will be invoiced to Schein.

     6.5 Schein will qualify for an additional [**]% discount (“Additional Discount”) from MDS,
provided their Net Purchases (as hereinafter defined) from MDS are greater than $[**] over the most
recent [**]-month period. If Schein does qualify for such Additional Discount, the Additional
Discount will be calculated at the conclusion of each calendar quarter, and shall be credited to
Schein within 30 days of the end of the calendar quarter. Net Purchases are equal to the dollar
amount invoiced by MDS to Schein, less all credits and discounts, including but not limited to all
product returns, [**] and quick-pay discounts. MDS and Schein agree that should a change occur
within section 4.6 of this Agreement with respect to a dialysis specialty customer, and as a result
of such change the amount of

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MDS Products that Schein is purchasing would materially increase, the companies agree to
adjust the Net Purchases requirement of $[**] to a new figure mutually agreeable to both companies.

   7.0 PAYMENT

     7.1 The terms of payment
for the MDS Products purchased by Schein under this Agreement shall
be [**] days [**] from MDS’s invoice date, as determined
by the date of collected funds receipt of wire transfer or ACH transfer to MDS’ designated
financial institution. Any amounts not paid within [**] days from the invoice date shall be
subject to a service charge until paid, in an amount equal to [**]% per month. Such service charge
shall be computed on the last working day of the calendar month, on a pro rata basis if applicable,
for invoices [**] days old or more. In addition, if full payment including service charge is
not received by MDS within [**] days from MDS’s invoice date MDS may restrict weekly sales to
Schein to a dollar amount equal to the payments received from Schein in the previous week. If full
payment is not received by MDS within [**] days of MDS’s invoice date Schein shall be
considered to be in material breach of this Agreement and subject to Section 14.1.

     MDS may invoice Schein upon email notification to Schein that MDS Products are available for
carrier pickup at the FOB location listed in Exhibit D.

     7.2 All Schein payments are to be made by either wire transfer or ACH transfer and remitted to
the financial institution designated by MDS to receive such payments.

   8.0 DELAYED AND REPLACEMENT PRODUCTS

     8.1 MDS assumes no liability and shall not be liable to Schein for any failure to fill or
delay in filling Delivery Orders received from Schein to the extent such failure or delay results
from strikes, lockouts, or any other labor troubles, floods, fires, accidents, delays in the
delivery of raw materials, parts or completed merchandise by the supplier thereof or any cause
beyond the control of or occurring without the fault of MDS. In the event of any delay caused by
any of the above, MDS shall use commercially reasonable best efforts to fulfill Schein’s orders in
a timely fashion, provided, however, that in the event of a shortage of available MDS Products,
whether resulting from market conditions, manufacturing

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constraints, FDA action against any company or otherwise, MDS may allocate supply between
Schein and other MDS customers at its discretion, but will use commercially reasonable best efforts
to allocate in reasonable proportion to Schein’s market share, as compared to the total market
size. MDS shall notify Schein promptly if it anticipates any potential delay in the filling of any
of Schein’s Delivery Orders caused by any of the above.

     In the event an FDA action against any company results in a reduction of [**]% or more in the
overall market supply within the Territory of any product type (AVF, BTL, etc.) MDS may allocate
supply of MDS Products within such product type to any customer or distributor at its discretion
without regard to the provisions of Sections 4.5, 4.6 or 4.7.

     8.2 Schein assumes no liability and shall not be liable to MDS for any failure to place
Delivery Orders to the extent that such failure is because of strikes, lockouts, or any other labor
troubles, floods, fires, accidents, or any cause beyond the control of or occurring without the
fault of Schein.

     8.3 Notwithstanding Section 4.3, Schein may be relieved of its commitment to purchase
Exclusive Products only from MDS, in whole or in part, at Schein’s option, should MDS be in
material breach of this Agreement, if such breach remains uncured [**] days after MDS receives
notice from Schein of such breach.

     8.4 Notwithstanding Sections 4.3 and 4.8 Schein may, at its option, be relieved of its
obligations with respect to any specific Delivery Order, in whole or in part, at Schein’s option,
should a delay caused by an event described in Section 8.1 occur, if such delay is uncured within
[**] days after the Delivery Window of such Delivery Order. To the extent MDS is unable to deliver
within [**] days after the Delivery Window applicable to any Delivery Order MDS Products delayed by
an event described in Section 8.1, Schein may purchase replacement Products from others.

     8.5 Except as set forth in Sections 4.8 and 8.1, if MDS is unable to deliver MDS Products
during the Delivery Window applicable to a Schein Delivery Order, or MDS replaces MDS Products
pursuant to sections 11.3, 13.2 or 16.1, MDS will deliver or replace the MDS Products as soon as
possible, on an expedited basis (via air freight, exclusive use truck, overtime customs clearance
or similar means) at MDS’ expense if requested by Schein.

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     8.6 To the extent MDS is unable to deliver MDS Products within [**] days of the Delivery
Window applicable to a Schein Delivery Order, Schein may, at its option, purchase Products from
other suppliers to meet its immediate needs. Schein also reserves the right to cancel outstanding
orders if the [**] day Delivery Window is not met, up to the amount of orders not delivered to
Schein within the Delivery Window.

     8.7 To the extent that Schein, pursuant to Sections 8.6, 10.1, 12.1 or 16.1, but not Section
8.1, purchases replacement products from others, which are documented to be not of MDS origin and
more expensive than the relevant MDS Products, MDS shall credit Schein a portion of the cost of
such replacement products up to [**]% of the applicable price of the MDS Products which were
replaced or the cost of the replacement products, whichever is less, provided that Schein supplies
MDS with copies of such orders and the invoices related thereto. To the extent Schein purchases and
is credited for such replacement or fill-in products from others, it shall be relieved of its
obligation to take delivery of and pay for equivalent quantities of MDS Products pursuant to
Delivery Orders.

     8.8 Schein and MDS will make a cooperative effort to evaluate and implement supply chain
improvement opportunities, as mutually agreed upon.

     8.9 To the degree that Schein has Obsolete Inventory or Excess Inventory (as hereinafter
defined) and Schein advises MDS of such Product inventory, Schein and MDS will make reasonable
cooperative efforts to transfer to other MDS Contract Distributors; return to MDS; or promote to
Schein’s customers at a reduced price. Products that are no longer sold by MDS as a Code or
specification (“Obsolete Inventory”) or Products considered by Schein to be at inventory levels
greater than sales projections (“Excess Inventory”) may be requested for return to MDS, up to a
maximum MDS invoice value of $[**] per calendar quarter (“Quarterly Credit”) without carryover of
such Quarterly Credit, provided that any such Products returned to MDS are no older than [**]
months after Sterilization Date and provided further that if MDS notifies Schein (in a form
substantially similar to Exhibit I) that Schein is placing an order for Products that MDS
reasonably believes will become Obsolete Inventory or considered Excess Inventory by Schein before
such product can be sold, and notwithstanding such advice Schein refuses to revise such orders
within [**] business days, and orders such volume, MDS will not accept the return of such Products.
Schein must submit in writing any potential Quarterly Credit, within the calendar quarter, or it
cannot be submitted

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for that quarter. MDS shall have the right to resell such returned Products to any party that
it wishes to, including any Med/Surg Distributor. In addition, any approved returns pursuant to
section 11.3 of this Agreement will not be included in the Quarterly Credit.

     MDS must receive any such qualified returned Products at MDS’ specified location within [**]
days after providing written return authorization to Schein, or such return shall be disallowed.

     8.10 [**] each calendar quarter, Schein shall conduct a physical inventory review of all MDS
Products at all Schein warehouses for the purpose of determining any inventory greater than [**]
months and [**] months old based upon the lot number. Schein shall report to MDS each such Code,
lot, quantity and location. Schein shall prioritize all MDS Products over [**] months old for
early shipment. Schein shall manage all MDS Products [**] months old in a high priority fashion
for immediate shipment to the next order, or in accordance with Section 8.9 if applicable.

   9.0 MDS PRODUCT CHANGES AND NEW MDS PRODUCTS

     9.1 During the Term of this Agreement, MDS shall offer, on a non-exclusive basis, to
incorporate into the MDS Products any clinical use enhancements or developments or new MDS BTL or
MDS AVF that MDS designs, which enhancements, developments or products MDS controls, such
enhancements being subject to prior sale, exclusive license or exclusive contract.

     9.2 If Schein agrees in writing to accept any such enhancement or development or new MDS BTL
or MDS AVF, and the parties agree in writing on any price adjustment made necessary or possible by
such enhancement or development, Exhibits B, C and D shall be amended to incorporate such changes.
Notwithstanding the above, MDS reserves the right to incorporate clinical use enhancements or
developments in MDS Products as described herein, in accordance only with Section 9.3, provided
that no price increase is requested by MDS.

     9.3 MDS shall notify Schein in writing, using the “Vendor Notice of Change” form attached as
Exhibit F, at least [**] days prior to any substantial change in design of the MDS Products,
components of the MDS Products or packaging which may necessitate in-servicing or notification to
end-users.

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   10.0 REGULATORY RESPONSIBILITY; LABELING; ADVERTISING, PROMOTIONS AND TRADE NAMES

     10.1 MDS shall be responsible, at its expense, for complying with all applicable regulatory
requirements of the U.S. Food and Drug Administration (“FDA”) relating to the sale or use of the
MDS Products, including but not limited to obtaining authorization under Section 510(k) of the
United States Federal Food, Drug and Cosmetic Acts, as amended (the “Acts”). For MDS Products
bearing the CE mark of the European Community MDS shall also be responsible, at its expense, for
complying with all applicable requirements of the Council Directive 93/42/EEC of the European
Community (commonly known as the Medical Device Directive “MDD”) and all amendments thereto.
Failure of an MDS Product to meet the applicable FDA requirements, and where applicable the MDD
requirements, or to obtain FDA approval or approval to display the CE mark as applicable, shall be
considered a material breach of this Agreement by MDS as to which Schein’s exclusive remedies shall
be to terminate this Agreement under Section 14.1, to terminate any specified Delivery Order(s)
under Section 12.1 and/or to purchase Products from others to replace those MDS Products which fail
to meet the applicable FDA requirements and as applicable, the MDD requirements, or which fail to
obtain FDA approval or approval to display the CE mark. Except as specifically set forth in Section
12.1 of this Agreement, MDS shall have no obligation or liability to ensure that, and makes no
representation or warranty that, any MDS Product complies with any applicable product regulations
or laws of any regulatory agency in the Territory other than the FDA and where applicable the MDD
regulations, but agrees to give to Schein any reasonable assistance requested in order to
demonstrate that the MDS Products do so comply.

     10.2 Each use on the MDS Products of any MDS trade name owned or controlled by MDS (a “MDS
Trade Name”)shall inure to the benefit of MDS. Should any such use vest in Schein any rights in
any MDS Trade Name, Schein shall transfer such rights to MDS or its designee upon request of MDS.

     10.3 MDS represents and warrants to Schein that MDS has the right to authorize and so
authorizes Schein to use any MDS Trade Name that MDS requests be used on or with MDS Products sold
under this Agreement. MDS shall indemnify and hold Schein harmless from any and all claims,
liability, damages, loss, cost, or expense (including reasonable attorneys’ fees and expenses)
arising out of, based on, or caused by any claim that the use by Schein of an MDS Trade Name in a
manner approved by

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MDS infringes (or is alleged to infringe) upon any copyright, right to use, trade name,
trademark or other right of any person or entity.

     10.4 Except as provided in this Agreement, MDS will not use any Schein Trade Name, or any
trademark, trade name or logo confusingly similar therewith, during or after the Term of this
Agreement. Except as provided in this Agreement, Schein shall not use any MDS Trade Name,
trademark, logo, or any trade name, trademark or logo confusingly similar therewith in any MDS
Product advertisement or display.

     10.5 Packaging for each unit-of-sale comprises multiples of each Code, whether such Codes are
individually pouched or not, in cartons which are sealed, shippable and contain all such Codes’
labeling or references required by end-users (the “Unit-of-Sale”). Such Codes’ Unit-of-Sale are
detailed in Exhibit B herein. Schein acknowledges that it will store, ship, handle and sell the
MDS Products in their original, unopened Unit-of-Sale and in accordance with the labeling, and
Schein will not remove, modify, repack, amend or relabel such Unit-of-Sale without prior, written
approval of MDS.

     10.6 Schein hereby agrees that any written or oral statement, warning or representation made
by Schein or its representatives in any advertising, publicity, promotion or sale regarding any of
the MDS Products shall be consistent with the labeling of the MDS Products.

     10.7 Schein agrees to use its best reasonable efforts to promptly notify MDS whenever it
becomes aware of the use of the MDS Products in a manner inconsistent with the labeling or the
indications for use.

     10.8 Schein agrees to obtain MDS’s written authorization prior to the publication or
distribution of any advertising, displays or promotional material regarding or referencing the MDS
Products.

     10.9 During the Term of this Agreement, Schein shall allow MDS to buy back MDS Product from
Schein’s inventory. Such product shall be used at MDS’ discretion for post market testing, product
quality audits, market acceptance studies, stock rotation, market withdrawal, or other purposes in
compliance with 21 CFR € 806, “Medical Devices; Reports of Corrections and Removals.” The
definitions of stock rotation and market withdrawal shall be according to 21 CFR € 806.2(h).
MDS shall issue a returned goods authorization to Schein for

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such inventory of MDS Products to be purchased by MDS. MDS agrees to purchase such inventory
of MDS Product from Schein at a cost equal to Schein’s original purchase price from MDS, plus any
shipping or freight charges.

   11.0 QUALITY CONTROL

     11.1 All MDS Products shall be subjected to a quality control inspection in accordance with
MDS’s quality control standards and the applicable FDA regulations.

     11.2 The term “Lot” shall mean all MDS Products bearing the same lot number.

     11.3 If any customer of Schein returns to Schein MDS Products which fail to perform as
intended when used in accordance with the labeled indications for use, such MDS Products may be
returned to MDS, at MDS’ expense and option, provided that such MDS Products are returned within
[**] days of Schein’s receipt of the customer complaint regarding the MDS Products. Prior to any
MDS Product return, Schein shall submit a written request to MDS to accept the MDS Product return.
Schein’s request shall include, at a minimum, the reason for the return or the relevant complaint
reference, and the Code(s), quantities, and Lots of the MDS Products Schein wishes to return. MDS
shall approve or reject Schein’s request within 10 days of receipt. MDS shall not unreasonably
refuse to accept a return. Within [**] days of the receipt of such return, Schein shall receive, at
its option, a credit or refund for such MDS Products returned to MDS, or by mutual agreement of
Schein and MDS, Schein shall receive replacements for such MDS Products returned to MDS.

     11.4 In the event that Schein receives any complaint regarding the MDS Products, Schein shall
notify MDS promptly using a complaint communication form which form shall be substantially in the
form of Exhibit G. MDS will be responsible for evaluating these complaints and promptly submitting
to Schein a statement of its findings and corrective actions as appropriate. Nothing in this
section shall be deemed to relieve either party of its own reporting responsibilities under
applicable FDA and MDD regulations.

     11.5 MDS shall be responsible for issuing all written and oral communications with third
parties regarding any complaint about, alleged defect in, or recall of the MDS Products. Except as
required by law, Schein will make no written or oral statements regarding any complaint about,
alleged defect in, or

15

 

recall of the MDS Products without the prior written approval of MDS.

     11.6 During normal Schein working hours, with prior written notice to Schein, and until Schein
shall institute systems to control its MDS Product inventory on a strict MDS-lot by MDS-lot FIFO
basis, Schein shall allow MDS to enter Schein’s facilities in which MDS’ Products are stored in
order for MDS to determine inventories by MDS lot number. In addition, MDS shall have regulatory
access to MDS Products in Schein’s inventory in order for MDS to obtain MDS Product samples or
otherwise analyze MDS Products in Schein inventory for MDS trending purposes. Schein agrees to
assist MDS in such action. MDS agrees to reimburse Schein for reasonable cost for Schein’s labor
and handling resulting from Schein’s assistance for such action.

   12.0 GUARANTEE

     12.1 All MDS Products sold to Schein under this Agreement are hereby guaranteed by MDS, as of
the time the title to the MDS Products is transferred to Schein, to be not adulterated or
misbranded within the meaning of the Acts or any similar federal, state or local laws or
regulations, and not articles which may not, under the provisions of Section 510, 514, 515 or 516
of the Acts, be introduced into interstate commerce. All MDS Products bearing the CE sold to
Schein under this Agreement are hereby guaranteed by MDS, as of the time the title to the MDS
Products is transferred to Schein to be not in violation of any applicable law or regulation of the
MDD. If MDS breaches this guarantee with respect to any Lot, Schein may immediately return to MDS,
at MDS’s expense, any MDS Products of such Lot received by Schein. At Schein’s option, MDS either
will immediately credit Schein for such MDS Products, or repay to Schein any moneys paid by Schein
for such MDS Products. Schein may purchase Products to replace any MDS Products which are in breach
of this guarantee from another supplier.

   13.0 WARRANTIES AND INDEMNIFICATIONS

     13.1 MDS warrants that MDS Products sold to Schein under this Agreement are free from defects
in design, workmanship and materials and are merchantable and fit for their intended purposes.
EXCEPT AS SET FORTH IN THE PRECEDING SENTENCE, SECTION 12.1 AND IN THE LABELING FOR THE MDS
PRODUCT, MDS MAKES NO REPRESENTATION OR WARRANTY WHATSOEVER, WRITTEN OR ORAL, EXPRESS OR IMPLIED,
AS TO ANY OF THE MDS PRODUCTS, OR THEIR MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE, AND
MDS HEREBY EXPRESSLY DISCLAIMS ANY SUCH REPRESENTATION AND WARRANTY.

16

 

ALL OF THE WARRANTIES SET FORTH IN THIS SECTION 13.1 ARE VOID AND OF NO EFFECT IF THE MDS
PRODUCTS ARE NOT STORED AND USED IN ACCORDANCE WITH THE DIRECTIONS ON THE LABELING OR PRODUCT
INSERTS ACCOMPANYING THE MDS PRODUCTS.

     13.2 SCHEIN ACKNOWLEDGES AND AGREES THAT, EXCEPT FOR THE PROVISIONS OF SECTION 13.3, MDS’ SOLE
RESPONSIBILITY TO SCHEIN IN THE CASE OF BREACH OF THE FOREGOING WARRANTY SHALL BE FOR MDS, BY
MUTUAL AGREEMENT OF SCHEIN AND MDS, TO REPAIR OR REPLACE THE MDS PRODUCTS WITH RESPECT TO WHICH
SUCH WARRANTY IS BREACHED, OR, AT SCHEIN’S ELECTION TO RETURN ALL PAYMENTS MADE BY SCHEIN TO MDS
WITH RESPECT TO SUCH MDS PRODUCTS OR TO CREDIT SCHEIN IN THE AMOUNT OF ALL PAYMENTS MADE BY SCHEIN
TO MDS WITH RESPECT TO SUCH MDS PRODUCTS. IN NO EVENT SHALL MDS BE LIABLE FOR SCHEIN’S LOSS OF
PROFITS, LOSS OF USE, OR INCIDENTAL, CONSEQUENTIAL OR SPECIAL DAMAGES OF ANY KIND.

     13.3 MDS hereby indemnifies and agrees to hold Schein, its affiliates, successors and assigns
harmless from and against all claims, liability, damage, cost or expense of Schein, including its
attorneys’ fees, with respect to any Schein customer arising out of, or in connection with, or as a
result of (i) the failure of any of the MDS Products to meet the warranty set forth in Section 13.1
at the time of delivery to Schein or (ii) usage of the MDS Products in accordance with instructions
for use (if any) supplied from time to time by MDS. In order to discharge its obligations under
this Section 13.3, MDS shall obtain and keep in force during the Term of this Agreement, product
liability insurance with a limit of liability of not less than $3,000,000.

     13.4 MDS shall defend, indemnify and hold Schein harmless with respect to any liability of
Schein for infringement of any patent or copyright arising out of the use or sale in the Territory
of the MDS Products supplied to Schein under this Agreement. Schein shall communicate to MDS all
charges of alleged infringement within a reasonable time after their receipt. Schein will cooperate
fully with MDS in defending or otherwise resolving any charges of infringement. MDS will have full
control of the defense of any litigation brought against Schein for alleged infringement by MDS
Products supplied under this Agreement; however, Schein, at its expense, may be represented by its
own counsel in any such litigation. MDS agrees to bear all other costs and expenses of litigation,
including any bonds required by a court and its own attorneys’ fees in connection with such alleged
infringement, and MDS will reimburse Schein for any disbursement made by Schein in satisfaction of
any final judgment issued in such litigation.

17

 

     13.5 Schein shall indemnify and hold MDS harmless from any and all claims, liability, damages,
loss, cost, or expense (including reasonable attorneys’ fees) arising out of, based on, or caused
by (i) any product claims, representations, descriptions or other statements, whether oral or
written, made or alleged to be made by Schein or its representatives in any advertising, publicity,
promotion or sale of any of the MDS Products where such product claims were inconsistent with the
labeling, and (ii) any product claim arising out of, based on, or caused by negligent handling of
the MDS Products by Schein or its agents (including, without limitation, failure to sell MDS
Products in the original, unopened Units of Sale, as described in Exhibit B).

   14.0 TERMINATION

     14.1 Either party may terminate this Agreement for any material breach of it by the other
party, by giving ninety (90) days written notice to the other party, if such breach shall, as of
the expiration of [**] day period, remain uncured.

     14.2 Either party may terminate this Agreement effective immediately upon the giving of
notice, if the other party shall file a petition in bankruptcy, or shall be adjudicated as
bankrupt, or shall take advantage of the insolvency laws of any state, or shall make an assignment
for the benefit of creditors, shall be voluntarily or involuntarily dissolved, or shall have a
receiver, trustee or other court officer appointed for its property.

   15.0 EFFECT OF TERMINATION

     15.1 No termination of this Agreement, other than by reason of breach of this Agreement by
Schein or if Schein has received notice of termination pursuant to Section 14.2 of this Agreement,
will relieve MDS from its obligation to deliver all MDS Products ordered pursuant to any Delivery
Order of Schein properly placed by Schein in accordance with the provisions of this Agreement, nor
will any termination, other than by reason of breach of this Agreement by MDS or if MDS has
received notice of termination pursuant to Section 14.2 of this Agreement, relieve Schein from
accepting and paying for all MDS Products ordered by Schein under any Delivery Order properly
issued by Schein in accordance with the provisions of this Agreement or relieve Schein of its
obligation pursuant to Section 4.3.

   16.0 MDS PRODUCT RECALL

18

 

     16.1 In the event that it shall be deemed necessary by MDS or Schein to recall from the U.S.
and/or European market any of the MDS Products sold or distributed by Schein because the MDS
Products are believed to violate any provision of any U.S. law or regulation or the MDD, subject to
Section 16.4 below, MDS shall bear all out-of-pocket costs and expense of such recall, including,
without limitation, refunds to customers for recalled MDS Products but only in an amount not to
exceed the sum of the purchase price paid by Schein to MDS for the recalled MDS Products, the cost
of notifying customers, and costs associated with the shipment of recalled MDS Products from
customers to Schein, Schein to MDS or customers to MDS. Schein shall maintain complete and
accurate records, for such periods as may be required by applicable law, of all the MDS Products
sold by Schein. Schein may purchase from another supplier replacement Products for recalled MDS
Products.

     16.2 In the event of a recall of any of the MDS Products sold by Schein, the parties will
cooperate fully with each other in effecting such a recall, including without limitation promptly
contacting any customer of Schein and communicating to such customer of Schein any information or
instructions that either party may desire be communicated to such customer of Schein in conformance
with the obligations of Section 11.5.

     16.3 Unless required by law, Schein shall not initiate any recall of MDS Products until Schein
has consulted with MDS.

     16.4 In the event that Schein determines that it will recall any MDS Products sold or
distributed by Schein because the MDS Products are believed to violate any provision of U.S. law,
and MDS has not agreed with Schein’s determination, MDS may, once the recall has been substantially
completed, have an arbitrator appointed by the American Arbitration Association who shall determine
whether Schein’s determination to recall was necessary and reasonable; the arbitrator may require
that Schein bear all costs, damages and expenses of such recall or may apportion such costs and
expenses between the parties as the arbitrator deems just.

     16.5 Schein shall bear all costs and expenses of a recall of the MDS Products caused by the
negligence of Schein or its agents.

   17.0 DISCLOSURE OF INFORMATION

     17.1 Unless specifically covered by a non-disclosure agreement between the parties hereto, any
information disclosed

19

 

by MDS or Schein to the other prior to or during the Term of this Agreement concerning the MDS
Products has been or shall be disclosed on a non-confidential basis and neither party shall be
liable for the disclosure or use of such information, except for any liability that may arise under
any patent or copyright laws.

   18.0 OTHER PROVISIONS

     18.1 For purposes of enumerating the Purchase Commitment, BTL are pouched in arterial and
venous line pairs and each pair is counted as one MDS Product. AVF may be supplied in pairs or
individually. Each AVF Code pouched as a pair shall be counted as two (2) each-equivalents for the
purpose of this Agreement. All other MDS Products are counted as eaches.

     18.2 All sales of MDS Products to Schein under this Agreement shall be subject to the
provisions of this Agreement and shall not be subject to the terms and conditions contained in any
Delivery Order of Schein, or confirmation or invoice of MDS except insofar as any such Delivery
Order, confirmation or invoice establishes (i) the quantity of Codes ordered for delivery, (ii) the
Due Date of such Codes, and (iii) the quantity of Codes to be delivered at each F.O.B. Location.

     18.3 This Agreement contains the entire agreement between the parties relating to the MDS
Products and all prior proposals, discussions, and writings by and between the parties and relating
to the subject matter herein are superseded by this Agreement. None of the terms of this Agreement
shall be deemed to be waived by either party or amended unless such waiver or amendment is in
writing and is signed by the party to be charged with such waiver or amendment, and such writing
recites specifically that it is a waiver of, or amendment to, the terms of this Agreement.

     18.4 All notices and other communications provided for or permitted hereunder shall be made in
writing by hand delivery, first-class mail, facsimile transmission, or air courier which guarantees
overnight delivery:

If to Schein:

General Counsel

Henry Schein, Inc.

135 Duryea Road,

Melville, NY 11747

If to MDS:

20

 

President

Medisystems Corporation

701 Pike Street, 16th Floor

Seattle, WA 98101

or to such other address as to which either party may properly notify the other. All such notices
and communications shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; three business days after being deposited in the mail, postage prepaid, if
mailed; when receipt is acknowledged, if sent by facsimile transmission; and on the day delivered,
if sent by overnight air courier guaranteeing next day delivery.

     18.5 This Agreement shall be binding upon and inure to the benefit of the parties, their
successors and permitted assigns. This Agreement shall be assignable by either party with the
written consent of the other; provided, however, that either party may assign this Agreement to any
entity controlled by or under common control with such party and in such event the assigning party
shall provide the other party with written notice of such assignment.

     18.6 This Agreement is deemed to have been entered into in the State of New York and its
interpretation, construction, and the remedies for its enforcement or breach are to be applied
pursuant to and in accordance with the laws of the State of New York.

     18.7 In the event that a court of competent jurisdiction holds that particular provisions or
requirements of this Agreement are in violation of any law, such provisions or requirements shall
be enforced and shall remain in full force and effect to the extent they are not in violation of
any such law or are not otherwise unenforceable, and all other provisions and requirements of this
Agreement shall remain in full force and effect.

   19.0 DEFINITIONS

     The following list of defined terms used in this Agreement is provided for convenience only.
Reference must be made to the relevant sections of this Agreement for the complete definitions.

     19.1 The “Acts” means the United States Federal Food, Drug and Cosmetic Acts (Section 10.1).

21

 

     19.2 “AVF” means extracorporeal access needle sets such as AVF needle sets, pheresis needle
sets, ButtonHole needle sets, Vasca access needle sets and the like (Section 1.1).

     19.3 “Base Prices” means the prices indicated on Exhibit D as Base Prices which shall be the
unrebated prices invoiced to Schein (Section 6.1).

     19.4 “BTL” means blood, dialysate and/or fluid sets for dialysis such as blood tubing sets,
peritoneal sets, reversing connector sets, priming sets and the like (Section 1.1).

     19.5 “Codes” means the codes of each MDS Product that meet the Specifications (Section 3.1).

     19.6 “Competing Products” means any Products identical, similar or competitive to Exclusive
Products (Section 4.3).

     19.7 “Contract Year” means the twelve-month period following the Effective Date and each
subsequent twelve-month period of this Agreement (Section 4.2).

     19.8 “Delivery Order” means noncancellable monthly order(s) for MDS Products that Schein
commits to purchase from MDS (Section 4.8.).

     19.9 “Delivery Window” means the period commencing [**] days prior to the Due Date and ending
[**] days after the Due Date applicable to a Delivery Order (Section 5.3).

     19.10 “Due Date” means the requested delivery date provided by Schein on each Delivery Order
that shall be not earlier than [**] days after the Order Date (Section 4.8).

     19.11 “Effective Date” means the date set forth in the preamble of this Agreement (Preamble).

     19.12 “Exclusive Products” means BTL and AVF that Schein agrees to sell in the Territory
sourced only and exclusively from among MDS BTL and MDS AVF listed in Exhibit B (Section 4.3).

     19.13 “FDA” means the United States Food and Drug Administration (Section 10.1).

     19.14 “F.O.B. Location” means the F.O.B. location specified on Schein’s Delivery Order for
shipment of MDS Products, freight and insurance paid (Section 5.1).

22

 

     19.15 “Lot” means all Products bearing the same lot number (Section 11.2).

     19.16 “MDD” means the Medical Device Directive of the Council of the European Community
(Section 10.1).

     19.17 “MDS” means Medisystems Corporation, a Washington corporation (Preamble).

     19.18 “MDS Products” means Products under Specifications including MDS labeling which MDS
controls and currently has produced by subsidiaries or contract manufacturers, i.e. MDS BTL, MDS
AVF, MDS Needleless and MDS TP (Section 1.1).

     19.19 “Med/Surg Distributor” means a distributor who distributes general medical/surgical
items such as syringes, gauze, drugs, etc. rather than one who distributes primarily dialyzers,
dialysis services and/or dialysis machines. Med/Surg Distributors include [**] and
other similar general medical surgical item distributors (Section 4.5).

     19.20 “Needleless” means antistick, plastic access needle/connectors and the like (Section
1.1).

     19.21 Intentionally left blank

     19.22 “Order Date” means that date prior to the [**] day of each month, or such later date as
may be determined in accordance with Section 4.8 hereof, on which a noncancellable Delivery Order
is deemed provided to MDS (Section 4.8).

     19.23 “Premiums” means premium freight and handling charges invoiced by MDS to Schein for (i)
air freight, (ii) LTL shipments, (iii) expedited delivery, (iv) shipments of partial orders, or
(v) other unusual or extra transportation expenses, if authorized in advance by Schein in writing
(Section 6.4).

     19.24 “Products” means certain disposable medical devices useful in dialysis and pheresis
therapies including the following examples: BTL, AVF, Needleless, TP (Section 1.1).

     19.25 “Purchase Commitment” means Schein’s commitment to purchase from MDS, by way of valid
Delivery Orders only, not less than [**] pairs of MDS BTL and [**] each equivalents of MDS AVF
during each [**] month period during the Term of this Agreement (Section 4.3).

23

 

     19.26 “[**]” means an agreement relating to [**] in the event that Schein and MDS [**], after Schein and MDS [**].

     19.27 “Schein” means Henry Schein, Inc., a Delaware corporation with offices at 135 Duryea
Road, Melville, NY 11747 and its affiliates (Preamble).

     19.28 “Specifications” means the specifications of the Codes as set forth in Exhibit C, or as
such Exhibit may be amended from time to time pursuant to Sections 9.1 or 9.2 hereof, or as
modified by Section 9.3 (Section 3.1).

     19.29 “Term” means the two (2) year period beginning on the Effective Date of this Agreement
and any extensions thereof (Section 2.1).

     19.30 “Territory” means the countries set forth in Exhibit A (Section 1.1).

     19.31 “TP” means air filters, such as transducer protectors, diagnostic pressure measurement
devices and the like (Section 1.1).

     19.32 “Unit of Sale” means the packaging which comprises multiples of each Code, whether such
Codes are individually pouched or not, in cartons which are sealed, shippable and contain all such
Codes’ labeling or references required by end-users and are described in Exhibit B (section 10.5).

     19.33 “Vendor Notice of Change” means the form set forth in Exhibit F (Section 9.3).

24

 

     IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their authorized
representatives as of the date first set forth above.

	 	 	 	 	 	 	 
	 

	 	 	 	MEDISYSTEMS CORPORATION	 	 
	 
	 

	 	By:
	 	/s/ David S. Utterberg
 

	 	 
	 	 	David S. Utterberg	 	 
	 	 	President	 	 
	 	 	Henry Schein, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Richard G. Alexander	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Richard G. Alexander	 	 
	 

	 	Title:
	 	Vice President	 	 

25

 

Exhibit A

Territory

The Territory is the United States of America.

 

 

Exhibit B

List of Codes

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Minimum Quantity	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Unit of	 	per Code per	 	U/M per	 	Units of Sale	 	Cases	 	 	 	 
	 	 	 	 	Measure	 	Delivery Order per	 	Inner Box	 	(Units per	 	per	 	Case Dimensions	 	Pallet Dimensions
	Product Line	 	Code	 	(See note)	 	FOB Location	 	or Bag	 	Case)	 	Pallet	 	(L X W X H) in Inches	 	(L x W x H) in Inches
	MDS BTL — Manufactured in Mexico
	 

	 	D3-8630M9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	D3-9630M9793 D3-9630M9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	D3-9633M9793 D3-9633M9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	D3-9642M9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	D3-9680M9793 D3-9680M9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	D3-9681M9793 D3-9681M9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	D3-9682M9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	D3-9692M9793 D3-9692M9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	D3-9696M9793 D3-9696M9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	D3-9892M9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9992M9792
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	SL-2000M2095
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	MDS BTL — Manufactured In Thailand
	 

	 	K3-8630/9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9601/9700
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9603/9750
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9603/9792
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9605/9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9630/9750
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9642/9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9689/9793
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9690/9792
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9691/9792
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9692/9793
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9694/9793
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9696/9793
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9892/9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9990/9792
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	K3-9992/9792
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	MDS BTL Special Codes — Manufactured in Thailand
	 

	 	B3-3632/3705
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	B3-4630/4705
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	B3-6604/6792
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	B3-6605/6792
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	M3-9676/9795
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	M3-9792
	 	Ea
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Minimum Quantity	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Unit of	 	per Code per	 	U/M per	 	Units of Sale	 	Cases	 	 	 	 
	 	 	 	 	Measure	 	Delivery Order per	 	Inner Box	 	(Units per	 	per	 	Case Dimensions	 	Pallet Dimensions
	Product Line	 	Code	 	(See note)	 	FOB Location	 	or Bag	 	Case)	 	Pallet	 	(L X W X H) in Inches	 	(L x W x H) in Inches
	MDS AVF — Manufactured in Thailand
	 

	 	See Note for Explanation
of Coding	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	BH-30XY
	 	Ea
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	BH-40XY
	 	Ea	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	BH-70XY
	 	Ea
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	BH-76XY
	 	Ea	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	D9-20XYBB
	 	Ea
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	D9-20XYMGLB
	 	Ea
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	M9-30XYBB
	 	Ea
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	S9-40XYBB
	 	Ea
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	S9-50XYBB
	 	Ea
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	D9-60XYBB
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	S9-70XYBB
	 	Ea
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	S9-70XYMGLB
	 	Ea
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 

	 	S9-74XYBB
	 	Ea	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	S9-76XYBB
	 	Ea	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	V9-92XYD/G
	 	Ea
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	MDS TP — Manufactured in Mexico
	 

	 	M8-2006
	 	Ea
	 	[**]
	 	[**]
	 	[**]
	 	 	 	[**]
	 	[**]
	 

	 	M8-8000 Access Alert
	 	Pr
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	MDS DPS — Manufactured in Mexico
	 

	 	M4-9440
	 	Ea
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	MDS Medic — Manufactured in Mexico
	 

	 	M8-5007
	 	Ea
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 	[**]
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	NOTES:	 	Unit of Measure “Pr” means Pair, “Ea” means Each.
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	[**]	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Minimum Delivery Order Quantities to each FOB Location:

Products Manufactured In Thailand, Combined: [**] pallets or exact multiples thereof.

Products Manufactured in Mexico, Combined: [**] pallets or exact multiples thereof.

 

 

Ex. C — Specifications

(sample page)

[**]

 

 

Exhibit D

Base Prices

	 	 	 	 	 
	Blood Tubing Sets (BTL)
	 	 	 	 
	All ReadySet® Codes except “Specials”
	 	$[**]/pr
	 
	 	 	 	 
	Specials
	 	 	 	 
	 
	B3-3632/3705
	 	$[**]/pr
	B3-4630/4705
	 	$[**]/pr
	B3-6604/6792
	 	$[**]/pr
	B3-6605/6792 and B3-6606/6792
	 	$[**]/pr
	M3-9676/9795
	 	$[**]/pr
	M3-9792
	 	$[**]/pr
	 
	 	 	 	 
	StreamLine Airless Sets
	 	 	 	 
	 
	SL-2000M2095
	 	$[**]/pr
	 
	 	 	 	 
	AV Fistula Needles (AVF):
	 	 	 	 
	 
	Single Pack, Fixed Wing, Clamp/BE
	 	$[**]/ea
	TwinPack+TM, Fixed Wing, Clamp/art.BE
	 	$[**]/ea equiv.
	Single Pack, Fixed Wing, Clamp/BE/MasterGuard
	 	$[**]/ea
	TwinPack+, Fixed Wing, Clamp/art.BE/MasterGuard
	 	$[**]/ea equiv.
	Single Needle, Fixed Wing, 16” tubing, Clamp/BE
	 	$[**]/ea
	 
	Add for Rotatable Hub
	 	$[**]/ea
	Add for ButtonHoleTM AVF
	 	$[**]/ea
	Add for 16” Tubing
	 	$[**]/ea
	Add for 3/5” Cannula
	 	$[**]/ea
	Add for CE Mark, Multi-language labeling
	 	$[**]/ea

See Section 18.1 for information on how TwinPack+ AVF are counted.

 

 

	 	 	 	 	 
	Dialysis Priming Sets (DPS):
	 	 	 	 
	 
	All Quantities
	 	 	 	 
	M4-9440 With Needleless Access Port
	 	$[**]/ea
	 
	 	 	 	 
	Transducer Protectors (TP):
	 	 	 	 
	 
	M8-2006 ViraGuard®, Viral Retentive
	 	$[**]/ea
	M8-8000 Access Alert® Filters
	 	$[**]/pr
	 
	 	 	 	 
	Medic®Anti-Stick Plastic Needles (Medic):
	 	 	 	 
	 
	M8-5007 Sterile bevel tip Medic (bucket pkg)
	 	$[**]/ea
	 
	 	 	 	 
	Miscellaneous
	 	 	 	 
	 
	M8-8100 Access Alert Pressure Gauge
	 	$[**]/ea

 

Note 1: Prices are for delivery to the following FOB Locations

          Schein Warehouse, Reno, NV

          Schein Warehouse, Denver, PA

          Schein Warehouse, Grapevine, TX

          Schein Warehouse, Indianapolis, Indiana

          Schein Warehouse, Jacksonville, Florida

Note 2: See Exhibit A for the list of “Special BTL Codes”.

 

 

Exhibit E

Net Margins* to Schein by [**]

	 	 	 
	MDS BTL (Standard ReadySets)	 	Net Margin per BTL pair
	[**]

	 	$[**]
	[**]

	 	$[**]

	 	 	 
	MDS BTL (StreamLine Code SL-2000M2095)	 	Net Margin per BTL pair
	[**]

	 	$[**]
	[**]

	 	$[**]

	 	 	 
	MDS AVF (TwinPack+ w/MasterGuard)	 	Net Margin per AVF pair
	[**]

	 	$[**]
	[**]

	 	$[**]

 

			
	*	 	Net Margin = [**]

 

 

Exhibit F

VENDOR NOTICE OF CHANGE

Reference is made to the Extracorporeal Disposables Distribution Agreement dated                     
between Medisystems Corporation (MDS) and Henry Schein Incorporated (Schein), pursuant to which MDS
has agreed to notify Schein in writing of any substantial change in design, components, or
packaging of the MDS Products which may necessitate in-servicing or notification to end-users:

MDS hereby notifies Schein of the following change:

 

 

 

Plans for initiation of this change are as follows:

 

 

 

	 	 	 	 	 	 	 
	 	 	MEDISYSTEMS CORPORATION
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	Signature	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	Date:	 	 
	 

	 	 	 	 	 	 

 

 

Exhibit G

Medisystems Field Experience Worksheet

Date Received:                     

Received Via (Circle): Fax, Telephone, Letter     From:                     

Received By:                                         

Incident Date:                                         

No. of Patients/Donors:                          No. of Incidents:                     

Product Code:                     

Lot Numbers(s):                                                               

No. of Products Involved:                     

Complainant: Name:                     

Title:                                                             

Health Care Professional (Circle): Yes/No

Occupation:                     

Facility:                     

Address:                                                             

City:                      State & Zip:                                         

Telephone: (___)                     

Complainant’s Ref. No:                     

Distributor(s):                         

Contact:                                                             

Complaint Description:                                                                 
                                                                              
                  

 

 

Patient/Donor Injury? (Circle): Yes / No

 

 

If yes, describe injury and any medical intervention (i.e., transfusion) required:                                                                                           

 

 

	 	 	 	 	 
	Blood Loss? (Circle): Yes/No.

	 	Amount of Blood Loss:
	 	<20cc. 20-100cc. >100cc.
	 

	 	 	 	Exact Amount if Available; if not circle closest estimate

As appropriate list device and/or machine codes and lots which interfaced with the complaint
device: Item:                      

Code:                      Lot:                     

Item:                      Code:                      Lot:                     

 Will the complainant return samples? Yes / No.

Samples may be returned via Fedex with billing to Medisystems Account # 1058-39626

Did the user clinic or distributor file a MedWatch form with the FDA? (Circle) Yes / No

	 	 	 
	 
	(Signature)

	 	(Date)

Immediately fax form with all available information to Medisystems Seattle

(206) 621-6501.FRM-14-002a Rev 00

 

 

     

Exhibit H

[**] Format

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Customer/	 	 	 	 	 	 	 	 	 	 	 	 	 	[**]	 	Extended	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Ship To	 	 	 	 	 	Ship	 	Ship To	 	Ship	 	 
	External	 	Supplier Item	 	Quantity	 	File	 	Net	 	Per Unit	 	[**]	 	 	 	 	 	Shipped	 	Invoice	 	Order	 	Ship To	 	Ship To	 	Address	 	Ship To	 	To	 	Postal	 	To	 	Adj.
	Contract	 	Number	 	Shipped	 	Cost	 	Cost	 	Amount	 	Amount	 	Order Date	 	Date	 	Number	 	Number	 	Number	 	Name	 	Lines	 	City	 	ST	 	Code	 	Ctry	 	Schedule
	[**]
	 	 	K3-9690/9792	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	7028506	 	 	 	5015015	 	 	 	773650	 	 	[**]	 	[**]	 	[**]	 	OH	 	 	434208550	 	 	US	 	 	[**]	 
	[**]
	 	 	K3-9690/9792	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	7028506	 	 	 	5015015	 	 	 	773650	 	 	[**]	 	[**]	 	[**]	 	OH	 	 	434208550	 	 	US	 	 	[**]	 
	[**]
	 	 	K3-9690/9792	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	7028506	 	 	 	5015015	 	 	 	773650	 	 	[**]	 	[**]	 	[**]	 	OH	 	 	43420550	 	 	US	 	 	[**]	 
	[**]
	 	 	K3-9690/9792	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	[**]	 	 	 	7028506	 	 	 	5015015	 	 	 	773650	 	 	[**]	 	[**]	 	[**]	 	OH	 	 	43428550	 	 	US	 	 	[**]	 

 

 

Exhibit I

[Date)

Mr. Richard Alexander

Vice President, Dialysis Division

Henry Schein, Inc.

135 Duryea Road

Melville, NY 11747

Dear Dick,

Per the Extracorporeal Disposables Distribution Agreement between Medisystems Corporation (“MDS”),
and Henry Schein, Inc. (“Schein”), (the “Agreement”), following are a listing of items to be
addressed by Henry Schein pursuant to the Delivery Order(s) placed by Schein to MDS on                     .

Order Quantity: Pursuant to section 4.9 of the Agreement, “MDS shall not be required to accept any
Schein Delivery Orders with a common Order Date to the extent that the quantity of Codes in any
Code Group so ordered exceeds [**] percent ([**]%) of the average monthly quantity ordered during
the immediately preceding [**] months.”

The table below depicts the averages of Delivery Orders accepted over the most recent [**]-month
period, the calculated maximum on-time delivery quantities per the Agreement, and the                     
Delivery Order quantities placed by Schein in                                                                        :

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	[**]-mo.	 	 	 	 	 	 	 	 	 	 
	 	 	Avg. of	 	 	 	Original	 	 	 	 	 	 
	 	 	orders	 	 	 	Orders	 	Orders	 	Contractual	 	Contractual
	 	 	accepted	 	[**]%	 	Placed	 	accepted	 	Overage	 	Overage not
	 	 	(____-____)	 	Maximum	 	                    	 	                    	 	Accepted	 	Accepted
	AVF Manufactured in Thailand (ea)
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	BTL Manufactured in Thailant (pr)
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	BTL Manufactured in Mexico (pr)
	 	 	 	 	 	 	 	 	 	 	 	 

The quantities listed in the Contractual Overage section are accepted for delivery to Schein at
dates exceeding the standard [**] day lead time window, with estimated delivery dates to be
confirmed to Schein via monthly Order Fulfillment Reports.

Order Date: Pursuant to section 4.8 of the Agreement, “Any Delivery Order provided to MDS after
the [**] day of the month shall be deemed to have an Order Date on the [**] day of the subsequent
month.”

 

 

Exhibit I

The orders placed on                      are accepted as Delivery Orders placed on the [**] and for
delivery to Schein (for the quantities accepted for on-time delivery) within the [**] day lead time
delivery window from the accepted order date of                     .

Obsolete Inventory / Excess Inventory: Pursuant to section 8.9 of the Agreement, “if MDS notifies
Schein that Schein is placing an order for Products that MDS reasonably believes will become
Obsolete Inventory or considered Excess Inventory by Schein before such product can be sold, and
notwithstanding such advice Schein refuses to revise such orders within [**] business days, and
orders such volume, MDS will not accept the return of such Products.”

MDS Client Services and Schein’s purchasing group have agreed on revised quantities on the delivery
orders placed in                      per MDS’ notification. No further action is required at this time.

Purchase Commitment: Pursuant to section 4.3 of the Agreement, “during each [**] month period
during the Term of this Agreement, Schein shall purchase from MDS, by way of valid Delivery Orders
(as hereinafter defined) only, not less than [**] pairs of MDS BTL and [**] each-equivalents of MDS
AVF (the “Purchase Commitment. The failure of Schein to order the minimum quantities of the
Purchase Commitments shall be a material breach of this Agreement, and shall entitle MDS to
terminate this Agreement pursuant to Section 14.1 hereof and to seek any and all other remedies
provided for in this Agreement.”

	 	 	 	 	 
	Month	 	AVF (Ea)	 	BTL (Pr)
	                                         *
	 	 	 	 
	                                         *
	 	 	 	 
	                                         *
	 	 	 	 
	 Totals
	 	 	 	 
	Purchase Commitment
	 	 	 	 

 

	
	*Final order quantity after mutually agreed upon revisions/

Additional Discount: Pursuant to section 6.5 of the Agreement, “Schein will qualify for an
additional [**]% discount (“Additional Discount”) from MDS, provided their Net Purchases (as
hereinafter defined) from MDS are greater than $[**] over the most recent [**]-month period. If
Schein does qualify for such Additional Discount, the Additional Discount will be calculated at the
conclusion of the calendar quarter, and shall be credited to Schein within [**] days of the end of
the calendar quarter. Net Purchases are equal to the dollar amount invoiced by MDS to Schein, less
all credits and discounts, including but not limited to all product returns, [**] and quick-pay
discounts.”

The following are Schein’s Net Purchases over the [**]-month period ending ___/___/___:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	MDS	 	 	 	 	 	Less:	 	 	 	 	 	 
	Month	 	Invoices	 	Less: Credits	 	Discounts	 	Less: [**]	 	Less: Returns	 	Net Purchases
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Totals
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Requirement
	 	 	N/A	 	 	 	N/A	 	 	 	N/A	 	 	 	N/A	 	 	 	N/A	 	 	$	[**]	 

 

 

Exhibit I

Obsolete or Excess Inventory: Pursuant to section 8.9 of the Agreement, “To the degree that Schein
has Obsolete Inventory or Excess Inventory (as hereinafter defined) and Schein advises MDS of such
Product inventory, Schein and MDS will make reasonable cooperative efforts to transfer to other MDS
Contract Distributors; return to MDS; or promote to Schein’s customers at a reduced price. Products
that are no longer sold by MDS as a Code or specification (“Obsolete Inventory”) or Products
considered by Schein to be at inventory levels greater than sales projections (“Excess Inventory”)
may be requested for return to MDS, up to a maximum of [**]% of the rolling [**] months Sales from
MDS to Schein, as measured on a pro rata basis at the end of each calendar quarter during the Term
of this Agreement, or $[**] per calendar quarter, whichever is greater, (“Quarterly Credit”)
without carryover of such Quarterly Credit, provided that any such Products returned to MDS are no
older than [**] months after Sterilization Date.”

The following are MDS’ Sales to Schein over the past 12 months, by quarter:

	 	 	 	 	 
	Quarter	 	Sales
	Q_ ____
	 	 	 	 
	Q_ ____
	 	 	 	 
	Q_ ____
	 	 	 	 
	Q_ ____
	 	 	 	 
	Totals
	 	 	 	 
	[**]% of Sales
	 	 	 	 
	[**]% of Sales, pro-rata
	 	 	 	 
	Fixed amount per quarter
	 	$	[**]	 
	Amount submitted by Schein for return (Q_ ____)
	 	 	 	 
	Amount agreed to for return (Q_ ____)
	 	 	 	 
	Excess not allowed for return, if any (Q_ ____)
	 	 	 	 

Thank you for your attention,

Sincerely,

Melanie Imperial

Senior Vice President

Medisystems Corporation

	 	 	 
	cc:

	 	Henry Schein Inc.
	 

	 	[**]
	 

	 	[**]
	 

	 	[**]
	 
	 	 
	 

	 	Medisystems Corporation
	 

	 	[**]

 

 

Exhibit I

	 	 	 
	 

	 	[**]
	 

	 	[**]exv10w5

 

Exhibit 10.5

Confidential Materials omitted and filed separately with the

Securities and Exchange Commission. Asterisks denote omissions.

     This Agreement (this “Agreement”) is made as of December 22, 2003 (the “Effective Date”), by
and between Medisystems Corporation, a Washington corporation (“MDS”), and DaVita Inc., a Delaware
corporation (“DVA”).

W I T N E S S E T H :

     WHEREAS, MDS produces BLOOD TUBING PRODUCTS, including CUSTOM DVA CODES, and ACCESS DEVICES
(all as defined in Schedule A attached hereto and incorporated herein by this reference) and
delivers such BLOOD TUBING PRODUCTS and ACCESS DEVICES (collectively, the “MDS PRODUCTS”) to
certain qualified distributors of MDS (each, a “MDS CONTRACT DISTRIBUTOR”); and

     WHEREAS, DVA wishes to purchase MDS PRODUCTS from such MDS CONTRACT DISTRIBUTORS;

     NOW, THEREFORE, the parties agree as follows:

	 	 	 
	1.

	 	Purchase Commitment.
	 
	 	 
	1.1

	 	(a) During the Term of this Agreement, DVA shall purchase BLOOD TUBING PRODUCTS (as
identified and defined on Schedule A) from DVA’s chosen MDS CONTRACT DISTRIBUTOR (as
identified on Schedule C) sufficient to fulfill at least [**] percent ([**]%)
of DVA’s total
blood tubing set usage (in pairs) in DVA-owned facilities, including inventory needs, but not
including [**] unless and until DVA elects by
[**] days written notification to MDS, which notification shall be given by DVA upon the
earlier of (X) [**] or (Y)
the date on which such acquired facility has used up its inventory of blood tubing products
(the “BLOODLINE COMMITMENT”). The foregoing BLOODLINE COMMITMENT shall go into effect
commencing three (3) months after the Effective Date of this Agreement (with the first three
months constituting a “grace period”).
	 
	 	 
	 

	 	(b) MDS may audit such annual compliance, at its sole cost and expense, by a third party
accounting firm reasonably acceptable to DVA and with confidentiality requirements
acceptable to DVA, during normal business hours and upon at least [**] business days notice
to DVA. If during each [**] month period during the Term of this Agreement DVA
[**], DVA shall
[**] not so purchased
during [**] period (but this provision shall not apply with respect to the
“grace period”), and, except for this provision and the terms of section 1.4 below, MDS
shall not be entitled to any other damages or remedy whatsoever. Any such payment by DVA to
MDS shall be made within [**] days of the anniversary of this Agreement.

1

 

	 	 	 
	 

	 	(c) MDS acknowledges that DVA’s total usage for BLOOD TUBING PRODUCTS is currently forecast
to be no less than [**] pair/month, from and after the grace period referenced above. MDS
and DVA acknowledge that the foregoing forecast is non-binding and is being provided only to
assist MDS in determining whether it can meet DVA’s needs. DVA shall provide MDS [**]
forecasts on a code by code basis, which DVA will use its best commercially reasonable
efforts to make as accurate as possible no later than [**] days prior to the beginning of
each [**].
	 
	 	 
	1.2

	 	(a) During the Term of this Agreement, DVA shall purchase AVF NEEDLE SETS (as identified and
defined on Schedule A) from DVA’s chosen MDS CONTRACT DISTRIBUTOR sufficient to fulfill at
least [**] percent ([**]%) of DVA’s total AVF set usage (in each equivalents) in DVA-owned
facilities, including inventory needs, but not including [**] unless and until DVA elects by
[**] days written notification to MDS, which notification shall be given by DVA upon the
earlier of (X) [**] or (Y) the date on
which such acquired facility has used up its inventory of AVF products (the “AVF COMMITMENT”).
The foregoing AVF COMMITMENT shall go into effect commencing three (3) months after the
Effective Date of this Agreement (with the first three months constituting a “grace period”),
(b) MDS may audit such annual compliance, at its sole cost and expense, by a third party
accounting firm reasonably acceptable to DVA and with confidentiality requirements acceptable
to DVA, during normal business hours and upon at least [**] business days notice to DVA. If
during each [**] period during the Term of this Agreement
DVA [**], DVA shall [**] not so purchased during [**] period (but
this provision shall not apply with respect to the “grace period”), and,
except for this provision and the terms of section 1.4 below, MDS shall not be entitled to any
other damages or remedy whatsoever. Any such payment by DVA to MDS shall be made within [**]
days of each anniversary of this Agreement.
	 
	 	 
	 

	 	(b) MDS acknowledges that DVA’s total usage for AVF NEEDLE SETS is
currently forecast to be
no less than [**] eachcs/month, from and after the grace period referenced above. MDS and
DVA acknowledge that the foregoing forecast is non-binding and is being provided only to
assist MDS in determining whether it can meet DVA’s needs. DVA shall provide MDS with
[**] forecasts on a code by code basis, which DVA will use its best commercially
reasonable efforts to make as accurate as possible no later than [**] days prior to the
beginning of each [**].
	 
	 	 
	1.3

	 	(a) DVA makes no commitment to purchase any particular unit volume of antistick
needle/connectors from MDS (defined as the “MEDIC” on Schedule A) during the Term of this
Agreement, or any particular percentage of its requirements for antistick needle/connectors,
but DVA shall submit a rolling non-binding forecast to MDS regarding its estimated [**]
months’ future orders to its MDS CONTRACT

2

 

	 	 	 
	 

	 	DISTRIBUTOR for MEDIC, for MDS’ production planning purposes. At any time during the Term
of this Agreement DVA may commit to MDS upon [**] days written notice to a minimum annual
volume of MEDIC purchases for the remainder of the Term of this Agreement (a “MEDIC
COMMITMENT”) which shall qualify for special pricing as hereinafter described.
	 
	 	 
	 

	 	(a) Only if DVA makes the foregoing MEDIC COMMITMENT, MDS may audit such annual compliance
by a third party accounting firm reasonably acceptable to DVA and with confidentiality
requirements acceptable to DVA. If during each such commitment period during the Term of
this Agreement DVA, [**] DVA
shall [**] not so purchased during each
such commitment period, and MDS shall not be entitled to any other damages or remedy
whatsoever. Any such payment by DVA to MDS shall be made within [**] days of each
anniversary of this Agreement.
	 
	 	 
	1.4

	 	In addition to the liquidated damages provided for above, in the event that DVA fails to meet
its annual commitment for either BLOOD TUBING PRODUCTS or AVF NEEDLE SETS, the [**], as the case may
be) set forth in Schedule B shall be [**] for the remaining Term
of the Agreement.
	 
	 	 
	2.

	 	Price Guarantee.
	 
	 	 
	2.1

	 	(a) From and after the Effective Date and throughout the Term of this Agreement for BLOOD
TUBING PRODUCTS (as set forth in Section 5 below), MDS shall make the BLOOD TUBING PRODUCTS
purchased by DVA’s chosen MDS CONTRACT DISTRIBUTOR and further sold to DVA, available at the
EFFECTIVE PRICES as set forth in Schedule B hereto for DVA’s purchases (which is incorporated
herein by this reference) provided that DVA complies with its BLOODLINE COMMITMENT. Such
EFFECTIVE PRICES do not reflect any MDS CONTRACT DISTRIBUTOR markup to DVA.
	 
	 	 
	 

	 	(b) [intentionally omitted]
	 
	 	 
	 

	 	(c) From and after the Effective Date and throughout the Term of this Agreement for ACCESS
DEVICES (as set forth in Section 5 below), MDS shall make the AVF NEEDLE SETS purchased by
DVA’s chosen MDS CONTRACT DISTRIBUTOR, and further sold to DVA, available at the EFFECTIVE
PRICES as set forth in Schedule B hereto for DVA’s purchases provided that DVA complies with
its AVF COMMITMENT. Such EFFECTIVE PRICES do not reflect any MDS CONTRACT DISTRIBUTOR
markup to DVA.
	 
	 	 
	 

	 	(d) From and after the Effective Date and throughout the Term of this Agreement for ACCESS
DEVICES (as set forth in Section 5 below), MDS shall make the MEDIC products purchased by
DVA’s chosen MDS CONTRACT DISTRIBUTOR, and further sold to DVA, available at the EFFECTIVE
PRICES as set forth in Schedule B hereto for

3

 

	 	 	 
	 

	 	DVA’s purchases. Such EFFECTIVE PRICES do not reflect any MDS CONTRACT DISTRIBUTOR markup
to DVA.
	 
	 	 
	 

	 	           
If DVA makes a MEDIC COMMITMENT, [**]
shall be adjusted such that such [**] shall treat each [**] as if it were [**]
during the remaining Term of the Agreement. By way of example only, if DVA
makes a MEDIC COMMITMENT on the first anniversary of the Agreement for [**] MEDIC products,
such EFFECTIVE PRICE shall be $[**]ea for all MEDIC products from unit one, after the first
anniversary, throughout the remainder of the Term.
	 
	 	 
	 

	 	(e) Except for the liquidated damages provision as set forth in Section 1.1(b), any failure
by DVA to comply with its BLOODLINE COMMITMENT shall not affect the EFFECTIVE PRICES for
ACCESS DEVICES as set forth in Schedule B hereto; nor except for the liquidated damages
provisions as set forth in Section 1.2(b) shall any failure by DVA to comply with its AVF
COMMITMENT affect the EFFECTIVE PRICES for BLOOD TUBING PRODUCTS as set forth in Schedule B
hereto. Any failure by DVA to comply with either its BLOODLINE COMMITMENT or its AVF
COMMITMENT shall not affect the EFFECTIVE PRICES for MEDIC products (or MEDIC COMMITMENT, as
the case may be) as set forth in Schedule B hereto.
	 
	 	 
	2.2

	 	From and after the Effective Date and throughout the Term, the EFFECTIVE PRICES for each
CUSTOM DVA CODE together with AVF NEEDLE SETS to DVA’s chosen MDS CONTRACT DISTRIBUTOR for
DVA’s relevant commitment shall be [**] taking into consideration [**] at which MDS [**].
	 
	 	 
	3.

	 	MDS Products Not for Resale.
	 
	 	 
	 

	 	All MDS PRODUCTS sold by any MDS CONTRACT DISTRIBUTOR to DVA pursuant to this Agreement are
exclusively for use in DVA-owned or managed facilities and for the home patients thereof.
DVA may not distribute, redistribute, resell, or otherwise transfer to any other third party
any MDS PRODUCTS purchased under this Agreement.
	 
	 	 
	4.

	 	Custom DVA Codes Acceptance; Delivery Requirements.
	 
	 	 
	4.1

	 	Subject to DVA’s written acceptance of MDS’ documented specifications of each CUSTOM DVA CODE
(such specifications being attached hereto as part of Schedule A and incorporated herein by
this reference), MDS shall accept DVA’s MDS CONTRACT DISTRIBUTOR’S initial order for each such
CUSTOM DVA CODE for delivery to such MDS CONTRACT DISTRIBUTOR within [**] days. Repeat orders
for each such CUSTOM DVA CODE and for ACCESS DEVICES shall be accepted for delivery to

4

 

	 	 	 
	 

	 	DVA’s chosen MDS CONTRACT DISTRIBUTOR pursuant to the contractual provisions of the
governing agreement between MDS and DVA’s chosen MDS CONTRACT DISTRIBUTOR. Any subsequent
DVA-requested change in any specification of any CUSTOM DVA CODE shall require the above
acceptance process and initial order delivery lead-time of [**] days to be repeated.
	 
	 	 
	4.2

	 	MDS agrees that it will fulfill all MDS CONTRACT DISTRIBUTOR orders on a timely basis
pursuant to its contractual arrangements with such MDS CONTRACT DISTRIBUTOR.
	 
	 	 
	4.3

	 	On or prior to the EFFECTIVE DATE, DVA shall elect by written notice to MDS a MDS CONTRACT
DISTRIBUTOR from among those set forth on Schedule C. Any DVA change in its chosen MDS
CONTRACT DISTRIBUTOR, as listed in Schedule C, for the MDS PRODUCTS shall require written
notice to MDS at least [**] days prior to DVA placing purchase orders for MDS PRODUCTS to such
newly chosen MDS CONTRACT DISTRIBUTOR provided, however, that such newly chosen MDS CONTRACT
DISTRIBUTOR has a continuing contractual relationship throughout the Term of this Agreement,
and provided, further that MDS shall exercise its best commercially reasonable efforts to
effectuate such change on fewer than [**] days notice, MDS shall promptly notify DVA if the
relationship between MDS and any of the MDS CONTRACT DISTRIBUTORS listed on Schedule C has
terminated.
	 
	 	 
	5.

	 	Terms and Termination.
	 
	 	 
	5.1

	 	Unless earlier terminated pursuant to this Section 5, this Agreement shall be for a Term
beginning on the Effective Date and ending eighteen (18) months thereafter for BLOOD TUBING
PRODUCTS and on the second anniversary thereof for all other MDS PRODUCTS.
	 
	 	 
	5.2

	 	The following shall constitute a termination default (‘Termination Default”) hereunder:
	 
	 	 
	 

	 	(a) Substantial breach of the terms of this Agreement, which breach is not cured, corrected
or otherwise resolved within [**] days after written notice by the non-breaching party
(setting forth the particulars of the alleged breach) to the breaching party; or
	 
	 	 
	 

	 	(b) the delivery of one or more types (product codes)_of MDS PRODUCTS (i) which are
defective and (ii) (A) which materially interfere with the conduct of normal operations at
one or more of DVA’s facilities or (B) which adversely affect the ability to treat patients
at one or more of DVA’s facilities, in either case, for more than [**] consecutive
days without replacement of such defective products; or
	 
	 	 
	 

	 	(c) (i) the institution by or against a party or its assets of insolvency, receivership or
bankruptcy proceedings or any other material proceedings for the settlement of such party’s
debts, (ii) a party’s making a general assignment for the benefit of its creditors, or (iii)
a party’s dissolution.

5

 

	 	 	 
	5.3

	 	Upon the occurrence of a Termination Default hereunder, and only upon such occurrence, the
non-defaulting party may terminate this Agreement immediately upon written notice to the
defaulting party. Termination of this Agreement shall not relieve either party of obligations
incurred prior to the effective date of termination, including without limitation obligations
of payment of monies or credits owed at the time of such termination. The provisions of this
Section 5 and of Sections 8 (Warranties), l0 (Confidentiality), 11 (Indemnification and
Insurance), 17.5 (Choice of law), and any other provision the context of which shows the
parties intended it to survive, shall survive any expiration or termination of this Agreement.
	 
	 	 
	5.4

	 	Upon any termination or expiration of this Agreement, MDS shall fulfill all orders previously
placed to MDS by DVA’s chosen MDS CONTRACT DISTRIBUTOR, pursuant to orders placed by DVA, that
are in accordance with the provisions of the MDS agreement with such MDS CONTRACT DISTRIBUTOR.
MDS shall not produce any MDS PRODUCT, including CUSTOM DVA CODES, not ordered by DVA’s
chosen MDS CONTRACT DISTRIBUTOR and MDS shall not, under any circumstances, sell, assign,
pledge, deliver or transfer any MDS PRODUCTS consisting of CUSTOM DVA CODES to any other
person or entity other than DVA’s chosen MDS CONTRACT DISTRIBUTOR.
	 
	 	 
	6.

	 	Force Majeure.
	 
	 	 
	 

	 	Unless otherwise stated herein, all obligations of either party hereto shall be excused to
the extent and for the period of time necessitated by the occurrence of any act of God,
fire, casualty, flood, war, failure of public utilities, injunction, accident, epidemic,
riot, insurrection, strikes, lockouts or other labor problems, delays in the delivery of raw
materials, parts or completed merchandise by the supplier thereof, or any other
circumstances beyond the reasonable control of the party asserting it (and not caused by the
negligence of the non-performing party), which prevents or delays the performance by such
party of any of its obligations under this Agreement. However, if any such circumstances
persist for longer than sixty (60) days, the unaffected party may terminate this Agreement
effective at the end of such sixty (60)-day period.
	 
	 	 
	7.

	 	Failure to Supply.
	 
	 	 
	 

	 	In the event MDS cannot supply or does not deliver any MDS PRODUCT(S) (whether as a result
of force majeure or otherwise) within and for the time period pursuant to the agreement
between MDS and DVA’s chosen MDS CONTRACT DISTRIBUTOR, MDS agrees that it shall give notice
as promptly as is practicable under the circumstances to DVA, unless an order of a
regulatory agency or other action arising out of patient safety concerns requires the giving
of shorter notice. In the event MDS is unable to fulfill MDS CONTRACT DISTRIBUTOR’S
contractually placed orders within the provisions of such agreement at any time during the
Term of this Agreement, other than by action of the FDA, DVA’s chosen MDS CONTRACT
DISTRIBUTOR shall be entitled, at a minimum, to have the same proportion of its purchase
orders fulfilled at all times as other purchasers of the MDS PRODUCTS and, upon written
request, MDS shall provide written assurances of same to DVA and its chosen MDS CONTRACT
DISTRIBUTOR.

6

 

	 	 	 
	 

	 	In addition, in such circumstances, (a) any purchases of other codes of MDS bloodlines or
access devices, as the case may be, or other manufacturers’ products by DVA shall count as
MDS PRODUCT unit purchases for purposes of the BLOODLINE commitment, the AVF COMMITMENT and
any MEDIC COMMITMENT and for purposes of the tier pricing and rebates for MEDIC products not
subject to any MEDIC COMMITMENT set forth in Schedule B; and (b) MDS has the right to offer
to DVA substitute MDS PRODUCTS at effective pricing no greater than as listed on Schedule B;
and (c) if the failure to supply was not the result of force majeure [**] then MDS shall [**] and
what DVA [**], but in no case shall MDS be liable for payment to DVA of such difference in excess
of $[**] per pair for BLOOD TUBING PRODUCTS, $[**] per each equivalent for AVF NEEDLE SETS
or $[**] per each equivalent for MEDIC. Notwithstanding the foregoing, if MDS’ failure to
supply MDS PRODUCTS persists for longer than sixty (60) days and MDS is unable to provide
reasonably acceptable alternative MDS PRODUCTS, DVA may terminate this Agreement effective
at the end of such sixty (60) day period.
	 
	 	 
	8.

	 	Warranties.
	 
	 	 
	 

	 	Each party represents and warrants to the other that this Agreement (a) has been duly
authorized, executed and delivered by it, and (b) constitutes a valid, legal, and binding
agreement enforceable against it in accordance with its terms. MDS represents and warrants
that it has all rights, licenses, permits and consents necessary to sell the MDS PRODUCTS to
DVA’s chosen MDS CONTRACT DISTRIBUTOR and to perform its obligations hereunder, and that it
shall at all times comply in all material respects with all federal, state and local laws
and regulations applicable to its business and its performance of its obligations under this
Agreement. MDS warrants that the use by DVA of the MDS PRODUCTS for their intended use
shall not infringe upon any ownership rights of any other person or upon any patent,
copyright, trademark, or other intellectual property or proprietary right or trade secret of
any third party. MDS warrants that it will convey to DVA’s chosen MDS CONTRACT DISTRIBUTORS
good and marketable title to the MDS PRODUCTS. MDS further covenants and agrees that no MDS
PRODUCT delivered hereunder to DVA’s chosen MDS CONTRACT DISTRIBUTOR is or will be
adulterated or misbranded within the meaning of the Federal Food, Drug and Cosmetic Act, as
amended, or within the meaning of any applicable state or municipal taw, or is or will be a
product which may not be introduced into interstate commerce. MDS further warrants that the
MDS PRODUCTS purchased pursuant to this Agreement (a) shall be manufactured in accordance
with their packaging; (b) are and shall be manufactured, handled, stored and transported by
MDS in accordance with all applicable United States, state and local laws and regulations
pertaining thereto, including without limitation, the Federal Food, Drug, and Cosmetic Act
and implementing regulations and United States Food and Drug Administration (“FDA”)-approved
Good Manufacturing Practices, and meet all specifications for effectiveness, safety and
reliability as required by the FDA, and (c) when used in accordance with the directions on
the labeling, are and shall be fit for the purposes and indications described in the
labeling. MDS further warrants that the

7

 

	 	 	 
	 

	 	MDS PRODUCTS are in compliance with all applicable federal laws and regulations and is not
aware of any state or local law or regulation that would prohibit the use of the MDS
PRODUCTS. MDS warrants that all Products sold to a MDS CONTRACT DISTRIBUTOR in accordance
with this agreement will be of the kind and quantity specified from time to time herein,
will conform to the relevant samples or models previously delivered to DVA and will conform
to their specifications (including for the CUSTOM DVA CODES, the specifications attached as
Schedule A as may be modified by written agreement of the parties during the Term of this
Agreement), and will be free of defects in materials or workmanship. If any of the MDS
PRODUCTS are used, stored or shipped by DVA other than in accordance with MDS labeling, the
product warranties shall be void and of no effect. There are no other expressed or implied
warranties.
	 
	 	 
	9.

	 	Product Addition.
	 
	 	 
	 

	 	Any products other than those set forth on Schedule A may be included under the terms
hereof, but only upon the mutual, written agreement of the parties. Prices for such
products shall be negotiated by the parties in good faith and the agreed prices shall be
confirmed in writing and made a part of this Agreement.
	 
	 	 
	10.

	 	Confidentiality.
	 
	 	 
	 

	 	Both MDS and DVA agree that this Agreement (including all Schedules) represents and contains
confidential information which shall not be disclosed to any third party, or otherwise made
public, without prior written authorization of the other party, except where it is required
by law or pursuant to subpoena or court or administrative order, and then only upon prior
written notification to the other party giving such party an adequate opportunity to take
whatever steps it deems necessary to prevent, limit the scope of or contest the disclosure.
Neither party shall make any public announcement (including, without limitation, any press
release or other similar announcement) of the matters described in this Agreement without
the express prior written consent of the other party. Each party agrees not to use,
release, publish or distribute any materials or information (including but not limited to
advertising and promotional materials) containing the names, tradenames, or trademarks of
the other party without the express prior written consent of such other party. Each party
and its agents shall keep confidential and shall hold in trust for the sole benefit of the
other, and not disclose or use except in connection with the performance of its obligations
hereunder, any and all trade secrets and other proprietary and confidential information
regarding the other’s business, customers, financial condition, practices or procedures
(including business and clinical practices and protocols and patient information), whether
disclosed by the other or discovered by it. Any breach of these provisions would cause
irreparable harm to the other party, and each party agrees that it will not interpose the
lack of such irreparable harm in any action to enforce these obligations. Each party agrees
to require each of its subcontractors or agents hereunder to provide reasonable assurance
that such subcontractor or agent will comply with the terms hereof, and any breach of this
provision by any such subcontractor or agent shall be deemed a breach of this Agreement by
the respective party hereto.

8

 

	 	 	 
	11.

	 	Indemnification and Insurance.
	 
	 	 
	11.1

	 	MDS agrees to defend, indemnify and hold harmless DVA, its affiliates, successors, assigns,
directors, officers, agents and employees (“DVA Indemnitees”) from and against any and all
liabilities, demands, losses, damages, and/or expenses (including costs, expenses, fines,
amounts paid in settlements or judgments, reasonable attorneys’ fees, witnesses’ fees,
investigation expenses, and, expenses incident thereto) (collectively referred to as
“Damages”) that DVA Indemnitees may suffer resulting from: (i) any claim, lawsuit,
investigation, proceeding, regulatory action, or other cause of action (or threats thereof),
to the extent arising out of any defect in the design or manufacture of any MDS PRODUCT,
including but not limited to claims for property damage, loss of life, and bodily injury (a
“PROCEEDING”), or (ii) the breach by MDS of any warranty, representation or covenant contained
in this Agreement or in materials furnished by MDS for DVA’s use. Notwithstanding the
foregoing, in no event shall MDS have an obligation to defend, indemnify or hold DVA harmless
hereunder to the extent any such Damages were caused by the negligence or willful misconduct
of DVA, its employees, agents or contractors.
	 
	 	 
	11.2

	 	If any PROCEEDING referred to in Section 11.1 is brought against DVA, DVA shall give prompt
notice to MDS of the commencement of such PROCEEDING. Following receipt of such notice MDS
shall have the option to assume the defense of such PROCEEDING with counsel reasonably
satisfactory to DVA. After notice to DVA from MDS of its election to assume the defense of
such PROCEEDING, MDS will not, as long as it diligently conducts such defense, be liable to
DVA under this Section 11 for any fees of other counsel or any other expenses with respect to
the defense of such PROCEEDING. If MDS does not assume defense of such PROCEEDING, DVA shall
have the right, following notice to MDS, to assume the defense of such PROCEEDING and MDS
shall reimburse DVA for any expenses reasonably incurred by DVA in connection with the
investigation and defense thereof. In no event shall either of MDS or DVA be bound by a
compromise or settlement of a PROCEEDING without such party’s prior written consent.
	 
	 	 
	11.3

	 	MDS agrees that it shall secure and maintain in full force and effect throughout the term of
this Agreement (and following termination, to cover any claims arising from this Agreement)
commercial general liability insurance, which includes contractual liability coverage, product
liability and workers’ compensation insurance, with a limit of liability of $3,000,000. Any
limits on MDS’S insurance coverage shall not be construed to create a limit on its liability
with respect to its obligations hereunder. DVA shall be named as an additional insured on
vendor’s endorsement for product liability insurance. Such policies shall provide at least
thirty (30) days prior written notice to DVA of the cancellation, non-renewal or substantial
modification thereof. MDS shall supply certificates of insurance to DVA upon request.
	 
	 	 
	12.

	 	Compliance with DVA’s Policies.
	 
	 	 
	 

	 	The parties agree to negotiate in good faith to amend this Agreement and/or enter into such
additional agreements to the extent deemed necessary or appropriate by DVA in

9

 

	 	 	 
	 

	 	connection with any disclosure by DVA to MDS of any patient information (including any
individually identifiable health information) and/or to comply with DVA’s Vendor Relations
and Health Information Privacy Policies and Procedures as provided by DVA to MDS, or any
federal or state regulations or statutes related to privacy of health information.
Simultaneously upon execution of this Agreement, DVA has delivered to MDS a copy of all
applicable Vendor Relations and Health Information Privacy Policies and Procedures in effect
on the date hereof, and MDS acknowledges receipt of same and agrees to make commercially
reasonable efforts to comply with the requirements thereof. During the term of this
Agreement, DVA shall provide MDS, from time to time, with additional Vendor Relations and/or
Health Information Privacy Policies and Procedures as they become effective, and with
updates and/or additional information related to same, at least thirty (30) days prior to
the effective date of each policy and procedure.
	 
	 	 
	13.

	 	Access.
	 
	 	 
	 

	 	MDS acknowledges, agrees and understands that [**] shall be permitted access [**]. Without limitation of the
foregoing, MDS agrees that it and its agents, representatives and employees shall at all
times comply with all applicable laws and regulations, and with DVA’S general policies and
procedures, regulations and guidelines regarding product promotion, health information
privacy and otherwise (which applicable policies, procedures, regulations and guidelines
shall be identified to MDS from time to time by DVA as more fully described in Section 12),
and that MDS’S discussion of the MDS PRODUCTS shall be in compliance with all such policies,
procedures, regulations and guidelines and all applicable laws and regulations.
Furthermore, MDS acknowledges, agrees and understands that [**].
	 
	 	 
	14.

	 	Training.
	 
	 	 
	 

	 	Subject to the terms of Section 13 above, MDS shall provide qualified clinical personnel to
deliver appropriate educational and in-service programs and materials, at [**] cost or
expense, to DVA’s corporate personnel at DVA’s facilities located throughout the United
States. The educational and in-service materials and programs shall include hands-on
training sessions, written literature, videos and/or CD-ROMS, as well as unlimited telephone
support services which shall be staffed by qualified personnel available during regular
business hours 5 days per week.

10

 

	 	 	 
	15.

	 	Monitoring Product Quality.
	 
	 	 
	 

	 	MDS shall inform DVA in writing within [**] of MDS’ receipt of a product complaint from DVA
acknowledging an initiation of an investigation into the complaint. MDS shall provide to
DVA a written update when the complaint sample has been received and sent to the factory.
Within [**] days, MDS shall notify DVA of the status of such complaint, if not already
previously notified by MDS. MDS will make best reasonable efforts to conclude all
complaints within [**] days. At the conclusion of the complaint, MDS shall provide a
thorough and formal written assessment to DVA’s Vice President, Clinical Operations.
	 
	 	 
	16.

	 	Meetings.
	 
	 	 
	16.1

	 	MDS may elect to participate in regional rallies, regional meetings, and other meetings and
presentations (“Other Meetings”) that may be organized from time to time by DVA during the
Term, other than DVA’s annual national meeting, annual medical directors meeting, and annual
divisional meetings, on such terms and conditions as shall generally apply to participation by
vendors at such Other Meetings.
	 
	 	 
	16.2

	 	MDS hereby acknowledges receipt of a copy of DVA’S current Policies and Procedures entitled
“Sponsorship Discounts and Event Participation” and “Vendor Relations Policy” (“Policies”),
and agrees to be bound by the terms thereof to the extent applicable. DVA agrees that, except
as provided in the Policies, none of its agents, representatives or employees (“Agents”) shall
otherwise solicit MDS for any other contributions, sponsorships, awards, prizes, raffles or
the like (“Contributions”), for DVA or any of its agents or facilities, whether in cash or in
kind, at any local, regional or national event, seminar, meeting, conference, rally or
pursuant to any other program. MDS acknowledges and agrees that, except as provided in the
Policies, it shall not make or offer to make any such other Contributions to DVA, its Agents,
or its facilities.
	 
	 	 
	17.

	 	Miscellaneous.
	 
	 	 
	17.1

	 	DVA acknowledges that the MDS PRODUCTS are intended for use only by qualified medical
personnel fully trained in their use and who are under the direction of a licensed physician
and have the Instructions for Use (provided within each unit of sale) readily available.
	 
	 	 
	17.2

	 	This Agreement contains the entire agreement between MDS and DVA and supercedes all prior
understandings or agreements of the parties, whether written or oral, with respect to the
subject matter hereof. No modification of, nor amendment to, this Agreement shall be
effective unless in writing and signed by MDS and DVA. The Schedules attached are
incorporated herein. To the extent that any provision of any purchase order, invoice, or any
other document, or the terms of any of MDS’S general policies, procedures or catalogs,
conflict with or materially alter any term of this Agreement, this Agreement shall govern and
control.
	 
	 	 
	17.3

	 	This Agreement is not, and shall not be construed to be, a grant of any right or license,
express or implied, to MDS by DVA to manufacture or sell the DVA CUSTOM CODES,

11

 

	 	 	 
	 

	 	or products that have identical specifications as the DVA CUSTOM CODES, to anyone other than
DVA’s chosen MDS CONTRACT DISTRIBUTOR. MDS shall not refer to the DVA CUSTOM CODES or the
specifications for any DVA CUSTOM CODES in any advertising or promotional literature or in
connection with any advertising or promotional literature, and MDS shall not disclose the
specifications of the DVA CUSTOM CODES to MDS CONTRACT DISTRIBUTOR.
	 
	 	 
	17.4

	 	The rights and obligations of the parties shall inure to the benefit of, and shall be binding
upon the parties hereto and their respective successors and assigns; provided that neither
party shall assign its rights and obligations hereunder without the prior written consent of
the other, such consent not to be unreasonably withheld, conditioned or delayed.
Notwithstanding the foregoing, (a) if MDS assigns its rights and obligations hereunder to any
party that is a competitor of DVA; or (b) if MDS engages in any transaction or series of
transactions not in the ordinary course of business with any party that is a competitor of DVA
(i) in which the persons, who are the stockholders of MDS immediately prior to the
consummation of such transaction, possess immediately after the consummation of such
transaction less than 50% of the voting power of MDS or, if MDS does not survive such
transaction, the surviving entity, or (ii) involving any sale or transfer of all or
substantially all of the assets of MDS, then MDS shall notify DVA of same within seven (7)
days following consummation of such transaction, and DVA shall have the right to terminate
this Agreement at any time immediately upon delivery of written notice to MDS.
	 
	 	 
	17.5

	 	This Agreement shall be governed by and construed according to the laws of the State of
Washington without reference to conflicts of law principles. Each party agrees to submit to
the jurisdiction of the courts of the State of Washington for the purpose of resolving any
dispute hereunder. If particular portions of this Agreement are ruled unenforceable, such
portions shall be deemed modified to the extent necessary to render such portions enforceable
and to preserve to the fullest extent permissible the intent and agreement of the parties
herein set forth.
	 
	 	 
	17.6

	 	Any notice required to be given under this Agreement shall be in writing and deemed to have
been given (a) one day following the sending of a facsimile if the sender on the same day
sends a confirming copy of such notice by a nationally recognized overnight delivery service
(charges prepaid) with instructions for overnight delivery, or (b) five days after the date of
mailing if mailed by first class mail, registered or certified mail with return receipt
requested (postage prepaid), or (c) one day following traceable delivery to a nationally
recognized overnight delivery service (with charges prepaid) with instructions for overnight
delivery, in each case addressed to the appropriate party at the following addresses:

	 	 	 	 	 
	 

	 	(i) to MDS:
	 	Medisystems Corporation
	 

	 	 	 	701 Pike Street, 16th Floor
	 

	 	 	 	Seattle, WA 98101-2016
	 

	 	 	 	Phone:(206)834-1200
	 

	 	 	 	Fax:(206)834-1201
	 
	 	 	 	 

12

 

	 	 	 	 	 
	 

	 	(ii) to DVA:
	 	DaVita Inc.
	 

	 	 	 	601 Hawaii Street
	 

	 	 	 	El Segundo, CA 90245
	 

	 	 	 	Attn: Vice President, Finance & Purchasing
	 

	 	 	 	Phone:(800)310-4872
	 

	 	 	 	Fax:(310)536-2675
	 
	 	 	 	 
	 

	 	With a copy to:
	 	601 Hawaii Street
	 

	 	 	 	El Segundo, CA 90245
	 

	 	 	 	Attn: General Counsel
	 

	 	 	 	Phone: (800)310-4872
	 

	 	 	 	Fax: (310)536-2679

	 	 	 
	17.7

	 	This Agreement may be executed in counterparts both of which shall be deemed to be originals.
Captions are intended for convenience of reference only.
	 
	17.8

	 	Neither party is in any way the legal representative or agent of the other nor authorized or
empowered to assume any obligation of any kind, implied or expressed, on behalf of the other
party, without the express written consent of the other. This Agreement shall not constitute,
create or in any way be interpreted as a joint venture or partnership of any kind.
	 
	17.9

	 	Each party to this Agreement (a) has participated in the preparation of this Agreement; (b)
has read and understands this Agreement; and (c) has been represented by counsel of its own
choice in the negotiation and preparation of this Agreement. Each party represents that this
Agreement is executed voluntarily and should not be construed against any party hereto solely
because it drafted all or a portion hereof.
	 
	17.10

	 	The failure to insist upon strict adherence to one or more or all of the provisions of this
Agreement on any one or more occasions, shall not be construed as a waiver, nor shall such
course of action deprive a party of the right thereafter to require strict compliance with
same.
	 
	17.11

	 	Any discounts, rebates, incentives, or other reductions in price issued by MDS to its MDS
CONTRACT DISTRIBUTOR under this Agreement may constitute a discount within the meaning of 42
U.S.C. Section 1320a-7b (b)(3)(A). DVA may have an obligation to properly disclose and
appropriately reflect such discount to any state or federal program that provides cost or
charge based reimbursement to DVA for the items to which the discount applies. MDS shall also
provide to DVA or MDS CONTRACT DISTRIBUTOR any other information that they may require in
order to comply with any such obligations.
	 
	17.12

	 	To the extent required by §1861(v)(l)(I) of the Social Security Act, as amended, the parties
will allow the U.S. Department of Health and Human Services, the U.S. Comptroller General and
their duly authorized representatives, access to this Agreement and records necessary to
verify the nature and extent of costs incurred pursuant to it during the Term and for four
years following the last date Products are furnished under it.

13

 

	 	 	 
	 

	 	If MDS carries out the duties of this Agreement through a subcontract worth $10,000 or more
over a 12-month period with a related organization, the subcontract shall also contain an
access clause to permit access by the U.S. Department of Health and Human Services, the U.S.
Comptroller General, and their duly authorized representatives to the related organization’s
books and records. Nothing in this paragraph is intended to waive any right either party
may have under applicable law or regulations to retain in confidence information included in
records so requested.

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

	 	 	 
	MEDISYSTEMS CORPORATION

	 	DAVITA INC.
	 
	 	 
	By:  /s/ David S. Utterberg                                                    

	 	By:  /s/ HWG Seay                                                              
	 
	 	 
	Name:  David S. Utterberg                                                     

	 	Name:  HWG Seay                                                              
	 
	 	 
	Title:    President                                                                     

	 	Title:    VP Finance                                                              
	 
	 	 
	Date:    01/04/04       
                                                               

	 	Date:    12/22/03      
                                                            

14

 

Schedule A

MDS PRODUCTS

     BLOOD TUBING PRODUCTS

     (1) Custom DaVita Codes consisting of:

	 	a)	 	pre-pump chamber blood tubing set Code K3-9992/9792 Rev. 04, and
	 
	         b)      post-pump chamber blood tubing set code K3-9990/9792 Rev. 04; in each case as per samples
heretofore provided to DVA and referenced by the final accepted specification drawings attached as
pages 17-A through 17 — C hereto (collectively, the “CUSTOM DVA CODES”); and

     (2) all other ReadySet blood tubing set codes currently in use by DVA clinics, as of the
Effective Date of this Agreement:

K3-9692/9793

K3-9690/9792

K3-9691/9792

K3-9642/9795

K3-9696/9793

K3-8630/9795,

(the “OTHER BLOODLINE CODES”).

     The OTHER BLOODLINE CODES together with the CUSTOM DVA CODES are referred to herein as the
“BLOOD TUBING PRODUCTS”.

     ACCESS DEVICES

     (1) AVF Needle Set codes currently in use by DVA clinics, as of the Effective Date of this
Agreement:

	 	a)	 	MDS Codes D9-20XXMG (w/ MasterGuard®), TWINPACK+TM,
	 
	 	b)	 	MDS Codes S9-70XXMG (w/ MasterGuard), single,
	 
	 	c)	 	MDS Codes D9-20XX (w/o MasterGuard), TWINPACK+,
	 
	 	d)	 	MDS Codes S9-70XX (w/o MasterGuard, single), (the “AVF NEEDLE SETS”), and

     (2) Medic plastic antistick needle/connector codes currently in use by DVA clinics, as of the
Effective Date of this Agreement:

	 	a)	 	MDS Code M8-5005 and
	 
	 	b)	 	MDS Code M8-5007 (the “MEDIC”).

15

 

Schedule A

MDS PRODUCTS

The MEDIC together with the AVF NEEDLE SETS are referred to herein as the “ACCESS DEVICES”.

Specifications for CUSTOM DVA CODES

[**]

16

 

Schedule B

EFFECTIVE PRICES

[**]

	 	 	 
	BLOOD TUBING PRODUCTS
	 	 
	 
	 	 
	CUSTOM DVA CODES
	 	 
	Code: K3-9992/9792 Rev. 04

	 	[**]
	Code: K3-9990/9792 Rev. 04

	 	[**]
	 
	 	 
	OTHER BLOODLINE CODES

	 	[**]
	 
	 	 
	ACCESS DEVICES
	 	 
	 
	 	 
	AVF NEEDLE SETS
	 	 
	Codes D9-20XXMG (w/ MasterGuard), TWINPACK+

	 	[**]
	Codes S9-70XXMG(w/MasterGuard), single

	 	[**]
	Codes D9-20XX (w/o MasterGuard), TWINPACK+

	 	[**]
	Codes S9-70XX (w/o MasterGuard), single

	 	[**]
	 
	 	 
	MEDIC plastic antistick needle/connector
	 	 
	Code M8-5005 (“bevel tip”, bulk, sterile)

	 	see * below
	Code M8-5007 (“bevel tip”, sterile, tamperproof)

	 	see * below

	 	 	 	 	 
	 
	 	1st Contract Year*	 	 
	 
	 	Total Unit Purchases of:	 	 
	[**]	 	[**]
	 	[**]
	[**]
	 	[**]
	 	[**]
	 	 	 	 	 
	 
	 	2nd Contract Year*	 	 
	 
	 	Total Unit Purchases of:	 	 
	[**]	 	[**]	 	[**]
	[**]
	 	[**]
	 	[**]

 

* [**]. The 1st Contract Year
commences on the Effective Date and the 2nd Contract Year commences on the first
anniversary of the Effective Date.

20

 

Schedule C

AUTHORIZED MDS CONTRACT DISTRIBUTORS

[**]

[**]

21

 

FIRST AMENDMENT

     THIS FIRST AMENDMENT (this “Amendment”) is effective as of the 24th day of June 2005
(“Amendment Date”) by and between Medisystems Corporation, a Washington corporation (“MDS”) and
DaVita Inc., a Delaware corporation (“DVA”).

WITNESSETH:

     WHEREAS, MDS and DVA entered into an agreement effective December 22, 2003 (the “Effective
Date”) relating to the purchase by DVA from MDS CONTRACT DISTRIBUTORS of certain blood tubing
products and access devices (the “Agreement”); and

     WHEREAS, the parties wish to amend the Agreement to extend the Term thereof and to modify
certain other provisions of the Agreement.

     NOW, THEREFORE, in consideration of the promises herein contained and for other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto hereby agree as follows:

	 	 	 
	1.

	 	Section 1.1 of the Agreement is hereby deleted in its entirety and amended to read as
follows:
	 
	 	 
	1.1

	 	(a) Except as set forth in Section 1.1 (b) and (c), during the Term of this Agreement, DVA
shall purchase BLOOD TUBING PRODUCTS (as identified and defined on Schedule A) from DVA’s
chosen MDS CONTRACT DISTRIBUTOR (as identified on Schedule C) sufficient to fulfill at least
[**] percent ([**]%) of DVA’s total blood tubing set usage (in pairs) in DVA-owned facilities,
including inventory needs, but not including [**] unless and
until DVA elects by [**] days written notification to MDS, which notification shall be given
by DVA upon the earlier of (X) [**] or (Y) the date on which such acquired facility has used up its inventory of
blood tubing products (the “BLOODLINE COMMITMENT”).
	 
	 	 
	 

	 	(b) If during the first twelve (12) months following the Amendment Date, DVA determines
that it can [**], then DVA shall
provide written notice to MDS of these findings and: (y) beginning on July 21, 2006, DVA’s
BLOODLINE COMMITMENT shall be decreased from ([**]%) of DVA’s total blood tubing set usage
(in pairs) in DVA-owned facilities, including inventory needs, to [**] percent ([**]%) of
DVA’s total blood tubing set usage (in pairs) in DVA-owned facilities, including inventory
need (but not including any [**]

 

 

	 	 	 
	 

	 	and (z)
beginning on August 21, 2006, DVA’s BLOODLINE COMMITMENT shall be decreased from [**]
percent ([**]%) of DVA’s total blood tubing set usage (in pairs) in DVA-owned facilities,
including inventory needs, to [**] percent ([**]%) of DVA’s total blood tubing set usage (in
pairs) in DVA-owned facilities, including inventory needs (but not including any [**].
	 
	 	 
	 

	 	(c) If during the first eighteen (18) months following the inception, if any, of the Second
BTP Renewal Term as such term is defined in Section 5.1 below, it is determined by DVA that
it can [**], then DVA shall provide
written notice to MDS of these findings and: (y) beginning on July 21, 2008, DVA’s
BLOODLINE COMMITMENT shall be decreased from ([**]%) of DVA’s total blood tubing set usage
(in pairs) in DVA-owned facilities, including inventory needs, to [**] percent ([**]%) of
DVA’s total blood tubing set usage (in pairs) in DVA-owned facilities, including inventory
need (but not including any [**] and (z) beginning on August 21, 2008, DVA’s BLOODLINE
COMMITMENT shall be decreased from [**] percent ([**]%) of DVA’s total blood tubing set
usage (in pairs) in DVA-owned facilities, including inventory needs, to [**] percent ([**]%)
of DVA’s total blood tubing set usage (in pairs) in DVA-owned facilities, including
inventory needs (but not including any [**].
	 
	 	 
	 

	 	(d) For purposes of this Amendment, the term [**] shall be determined solely by DVA through an evaluation of the BLOOD TUBING
PRODUCTS [**] (the “Evaluation”), Although MDS shall be
entitled to receive a copy of an explanation of the Evaluation results, MDS hereby
acknowledges that it shall have no rights, whatsoever, to challenge DVA’s determination.

2

 

	 	 	 
	 

	 	(e) MDS may audit DVA’s compliance with the BLOODLINE COMMITMENT, at its sole cost and
expense, by a third party accounting firm reasonably acceptable to DVA and with
confidentiality requirements acceptable to DVA, during normal business hours and upon at
least [**] business days notice to DVA. If during each [**] period during the
Term of this Agreement DVA [**], DVA shall [**] not so purchased during [**] period, and, except for this
provision and the terms of section 1.4 below, MDS shall not be entitled to any other damages
or remedy whatsoever. Any such payment by DVA to MDS shall be made within [**] days of the
anniversary of this Agreement.
	 
	 	 
	2.

	 	Section 1.2 of the Agreement is hereby deleted in its entirety and amended to read as
follows:
	 
	 	 
	1.2

	 	(a) From the Effective Date until the Amendment Date of this Agreement (the “Initial AVF
Period”), DVA shall purchase AVF NEEDLE SETS (as identified and defined on Schedule A) from
DVA’s chosen MDS CONTRACT DISTRIBUTOR sufficient to fulfill at least [**] percent ([**]%) of
DVA’s total AVF set usage (in each equivalents) in DVA-owned facilities, including inventory
needs, but not including [**] unless and until DVA elects by [**] days written notification to MDS,
which notification shall be given by DVA upon the earlier of (X) [**] or (Y) the date on which such acquired facility has used
up its inventory of AVF products (the “AVF COMMITMENT” for the Initial AVF Period). The
foregoing AVF COMMITMENT shall go into effect commencing three (3) months after the Effective
Date of this Agreement (with the first three months constituting a “grace period”).
	 
	 	 
	 

	 	(b) Effective as of the Amendment
Date, DVA [**] AVF needles, in each needle equivalents, of the AVF NEEDLE SETS (as identified and
defined on Schedule A) per month from DVA’s chosen MDS CONTRACT DISTRIBUTOR (the “AVF
COMMITMENT” commencing after the Amendment Date of this Agreement.)
	 
	 	 
	 

	 	(c) MDS may audit annual compliance for the Initial AVF Period, at its sole cost and
expense, by a third party accounting firm reasonably acceptable to DVA and with
confidentiality requirements acceptable to DVA, during normal business hours and upon at
least [**] business days notice to DVA.
	 
	 	 
	 

	 	(d) If during each [**] period during the Term of this Agreement DVA [**], DVA shall
[**] not so purchased during [**] period (but this provision shall not apply with respect to the “grace
period”), and, except for this provision and the

3

 

	 	 	 
	 

	 	terms of section 1.4 below, MDS shall not be entitled to any other damages or remedy
whatsoever. Any such payment by DVA to MDS shall be made within [**] days of each
anniversary of this Agreement.
	 
	 	 
	3.

	 	Section 5.1 of the Agreement is hereby amended in its entirety to read as follows:
	 
	 	 
	5.1

	 	Unless earlier terminated pursuant to this Sections, this Agreement shall continue in effect
as follows:
	 
	 	 
	 

	 	(a) for BLOOD TUBING PRODUCTS, through September 21, 2006 (“First BTP Renewal Term”);
provided, however, that if DVA determines that it can not [**] pursuant to the terms set forth in Section 1.1 of this
Agreement, this Agreement shall be renewed for an additional term of twenty-four (24) months
through September 21, 2008 (“Second BTP Renewal Term”).
	 
	 	 
	 

	 	(b) for all other MDS PRODUCTS, through December 21, 2007.
	 
	 	 
	4.

	 	The following sentence shall be added to Schedule B, following the tier pricing structure
applicable to the MEDIC plastic antistick needle/connector for the 2nd Contract
Year, as follows: “The tier pricing structure for the 3rd and 4th
Contract Years shall [**].”
	 
	 	 
	5.

	 	Defined terms used herein without definitions have the meanings assigned to such terms in the
Agreement.
	 
	 	 
	6.

	 	Except as specifically and expressly modified herein, all of the terms and conditions of the
Agreement shall remain in full force and effect as originally written.
	 
	 	 
	7.

	 	This Amendment may be executed in multiple counterparts, and all such counterparts shall
constitute a single amendment.

     IN WITNESS WHEREOF, authorized representatives of the parties have executed this Amendment to
the Agreement.

	 	 	 	 	 	 	 	 	 	 	 
	MEDISYSTEMS CORPORATION

	 	 
	 
    	DAVITA INC. 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	By:

	 	/s/ David Utterberg
	 	 
	 	By:
	 	/s/ HWG Seay
	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Name:

	 	David Utterberg
	 	 	 	Name:
	 	HWG Seay	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Title:

	 	President
	 	 	 	Title:
	 	Vice President	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Date:

	 	6/24/05
	 	 	 	Date:
	 	6/28/05	 	 
	 

	 	 
	 	 	 	 	 	 	 	 

4

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