Wisconsin | 3845 | 39-1914727 | ||
(State or Other Jurisdiction
of
Incorporation or Organization) |
(Primary Standard Industrial
Classification Code Number) |
(I.R.S. Employer
Identification Number) |
Gregory J. Lynch, Esq.
Geoffrey R. Morgan, Esq. Michael Best & Friedrich LLP 100 East Wisconsin Avenue Suite 3300 Milwaukee, Wisconsin 53202 Telephone: (414) 225-2752 Facsimile: (414) 277-0656 |
Shawn Guse, Esq.
Vice President, General Counsel and Secretary TomoTherapy Incorporated 1240 Deming Way Madison, Wisconsin 53717 Telephone: (608) 824-2800 Facsimile: (608) 824-2996 |
Colin J. Diamond, Esq.
White & Case LLP 1155 Avenue of the Americas New York, NY 10036 Telephone: (212) 819-8200 Facsimile: (212) 354-8113 |
The information contained in this prospectus is not complete and
may be changed. We may not sell these securities until the
registration statement filed with the Securities and Exchange
Commission is effective. This prospectus is not an offer to sell
these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not
permitted.
|
Per Share | Total | |||||||
Public offering price
|
$ | $ | ||||||
Underwriting discount
|
$ | $ | ||||||
Proceeds, before expenses, to
TomoTherapy Incorporated
|
$ | $ | ||||||
Proceeds, before expenses, to the
selling shareholders
|
$ | $ |
Merrill Lynch & Co.
|
Piper Jaffray
|
Thomas Weisel Partners LLC
|
Robert W. Baird & Co.
|
William Blair & Company
|
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F-1
Form of Amended and Restated Articles of Incorporation
License Agreement
Development and OEM Supply Agreement
Manufacturing and Supply Agreement
Purchase Order
Variable Pay Plan
Consent
Consent
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1
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Intensity Modulated Radiation Therapy (IMRT)
, which
varies the radiation beam intensity to conform the dose more
accurately to the shape of the tumor;
Image Guided Radiation Therapy (IGRT)
, which involves
delivering IMRT guided by images taken shortly before treatment
to compare the patients position to, and make adjustments
from, the original treatment plan for more precision;
Dose escalation
, which involves delivering the cumulative
prescribed dose of radiation to the patient over less than the
typical number of treatment sessions by relying on extremely
precise targeting to deliver a higher dose of radiation during
each session; and
Adaptive radiation therapy
, which we believe requires
continual adjustments to the treatment plan throughout the
entire course of treatment, facilitated by both the regular
acquisition of updated images showing the location, geometry and
density of the tumor, as well as verification of the actual
radiation dose received by the patient.
Limited versatility and precision.
The limited
speed and range of C-arm gantries used by most other systems
often make it impractical to deliver radiation from more than
five to nine treatment angles during a typical treatment
session. These mechanical limitations reduce the systems
ability to deliver precisely targeted radiation that avoids
healthy tissue.
Limited ability to provide frequent, quantitative
images.
Many traditional radiation therapy
systems either do not incorporate CT imaging functionality or
use imaging technologies that do not have the ability to
generate daily, quantitative images. Since it is common for
internal organs to shift and for the size of the tumor to change
during the course of treatment, failure to obtain updated images
and adapt the treatment plan throughout the course of treatment
may result in a portion or potentially all of the radiation dose
missing the tumor and instead being absorbed by healthy tissue.
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Failure to integrate multiple functions.
Many
traditional radiation therapy systems were designed solely for
the purpose of delivering radiation and therefore do not possess
integrated imaging, treatment planning, dose verification or
quality assurance capabilities necessary for more advanced
treatment protocols.
More versatile treatment capabilities.
The
Hi Art systems high-speed ring gantry and beam-
shaping capability allow the intensity of the radiation beam to
be modified and treatment to be delivered continuously in a
helical pattern 360 degrees around the patients body from
thousands of angles without extending the time it takes to
complete the procedure.
Daily, quantitative imaging for better identification of
tumors, dose verification and treatment
planning.
The Hi Art system is the only
commercially available radiation therapy system offering
integrated quantitative CT imaging capabilities, which we market
as our CTrue technology, which depict the density of tumors and
healthy tissue more accurately than traditional radiation
therapy systems. We believe that daily, quantitative images are
necessary for the accurate delivery of IMRT and are essential to
optimizing a patients treatment by enabling clinicians to
adapt the treatment plan in response to anatomical changes and
the cumulative amount of radiation received by specific areas
within the patient over time.
Fully integrated treatment system for more precise radiation
delivery.
We believe that the integration of our
CTrue imaging technology, treatment planning and helical
delivery of radiation beams shaped by the MLC enables highly
precise radiation delivery to ensure that the radiation conforms
to the patients tumor and avoids sensitive structures. We
also believe these features significantly benefit patients by
providing a precisely-targeted dose distribution which maximizes
the radiation delivered to cancerous tissues and minimizes
damage to healthy tissues.
Efficient clinical workflow for IGRT and adaptive radiation
therapy.
We believe that the Hi Art system
allows clinicians to easily and rapidly scan, plan and treat
cancer patients. This capability enables healthcare providers to
increase patient throughput for sophisticated IGRT and adaptive
radiation therapy procedures using the Hi Art system.
Low barriers to installation and
implementation.
The Hi Art systems
compact design, with built-in shielding, allows customers to
retrofit the Hi Art system into existing treatment rooms
and avoid or reduce the significant construction costs that can
be associated with the installation of other systems. We
preassemble, test and commission each Hi Art system at our
manufacturing facility and ship the unit almost fully assembled.
This assembly process allows radiation beam-on
within four days and treatments to begin within
45 days of delivery in most cases.
Platform for further technological advancements in adaptive
radiation therapy.
We believe that the
Hi Art system is the only commercially available linear
accelerator that enables adaptive radiation therapy because of
its unique ability to provide daily, quantitative images, high
speed delivery of radiation from 360 degrees around the body and
the data necessary for clinicians to verify the actual radiation
dose received by the patient. We also believe that the
combination of these design features and our integrated
treatment planning and optimization software will allow us to
continue to enhance the Hi Art systems adaptive
capabilities to a point where clinicians can routinely and
easily adjust a patients treatment as needed.
Increase market awareness of the Hi Art systems
clinical and economic benefits.
In order to
expand our installed base of Hi Art systems, we intend to
continue to position the Hi Art system as the most advanced
radiation therapy system for treating a wide range of cancers
effectively and efficiently.
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Expand our worldwide sales presence.
We intend
to add additional direct sales representatives to better
penetrate the United States market, while further investing in
direct and indirect sales and marketing efforts in international
markets.
Increase our profitability through cost reductions and
improved operating leverage.
In order to increase
our profitability, we will seek to decrease our reliance on
single-source suppliers of key components in order to enable us
to negotiate better prices with a wider range of suppliers and
to improve component reliability. In addition, a number of
opportunities exist to reduce costs through re-engineering
higher cost components. We will also seek to increase our
profitability as we leverage our investments in our global
service and support infrastructure through increased sales
volumes.
Continue to enhance our customer service and support
capabilities.
We intend to build upon our
infrastructure and technology advantages by hiring additional
support personnel, implementing regional training programs and
expanding the number of local spare parts depots to continually
augment and refine our customer service.
Enhance the Hi Art systems treatment capabilities
through on-going research and development
initiatives.
Our research and development
initiatives are focused on more fully automating the treatment
optimization process, thereby decreasing the time necessary for
clinicians to develop and adapt treatment plans. We believe
these enhancements will allow clinicians to increase patient
throughput without compromising treatment plan quality and
increase our customers return on their investment.
We depend on the Hi Art system for substantially all of our
revenue.
The long sales cycle and high unit price of the Hi Art
system, as well as other factors, may contribute to substantial
fluctuations in our quarterly operating results and stock price.
We face competition from numerous competitors, many of whom have
greater resources than we do.
Our reliance on single-source suppliers for critical components
of the Hi Art system could harm our ability to meet demand
for our products in a timely and cost-effective manner.
Sales of the Hi Art system may be adversely affected if
clinicians do not widely adopt IGRT and adaptive radiation
therapy.
We may be delayed or prevented from implementing our long-term
sales strategy if we fail to educate clinicians about the
benefits of the Hi Art system.
If we are unable to satisfy the requirements of our licenses
with the Wisconsin Alumni Research Foundation, or WARF, we could
lose access to those licensed technologies and be unable to
produce or sell the Hi Art system.
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Common stock offered:
By TomoTherapy
10,200,000 shares
By the selling shareholders
737,500 shares
Shares to be outstanding after this offering
48,345,337 shares
Use of proceeds
We estimate that the net proceeds from this offering will be
approximately $150.0 million after deducting underwriting
discounts and estimated offering expenses. We intend to use the
net proceeds from this offering to finance expanding our sales
and marketing efforts, increasing our research and development
programs, expanding our international service and support group,
and for working capital and other general corporate purposes. We
may also use a portion of the net proceeds to acquire or invest
in complementary businesses, products or technologies, although
we currently do not have any acquisitions or investments
planned. See Use of Proceeds. We will not receive
any proceeds from the sale of shares by the selling shareholders.
Risk factors
See Risk Factors and other information included in
this prospectus for a discussion of factors you should carefully
consider before deciding to invest in our common stock.
Nasdaq Global Market Symbol
TTPY
9,533,677 shares reserved for issuance under our stock
option plans, of which options to purchase 7,231,189 shares
of common stock at a weighted average exercise price of $3.97
per share had been granted; and
10,039 shares reserved for issuance upon the exercise of
outstanding warrants with an exercise price of $1.84 per
share.
1,288,669 shares issued for no consideration to certain
holders of our Series A preferred stock, including certain
members of our management and entities affiliated with our
directors, pursuant to the Series A Investment Agreement;
1,915,522 shares issued upon the exercise of stock
options; and
455,615 shares issued upon the exercise of warrants;
reflects the conversion upon the closing of this offering of all
of our shares of preferred stock on a
one-for-one
basis into shares of common stock;
assumes an initial public offering price of $16.00 per
share, the midpoint of the estimated initial public offering
price range;
assumes no exercise of the underwriters option to purchase
from the selling shareholders up to 1,640,625 additional
shares to cover overallotments; and
reflects a
50-for-1
stock split effected on August 26, 2002, a 4-for-1 stock
split effected on June 30, 2005, and a 1.36-for-1 stock
split to become effective prior to the effectiveness of the
registration statement of which this prospectus forms a part.
6
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Year Ended December 31,
2004
2005
2006
(in thousands, other than share and per share data)
$
45,460
$
75,754
$
156,102
28,078
50,047
102,653
17,382
25,707
53,449
6,492
11,372
21,397
7,827
14,197
23,119
14,319
25,569
44,516
3,063
138
8,933
(31
)
179
(1,202
)
3,032
317
7,731
151
78
(7,184
)
2,881
239
14,915
(2,140
)
2,881
239
12,775
(41,960
)
(68,075
)
(46,253
)
$
(39,079
)
$
(67,836
)
$
(33,478
)
$
(5.40
)
$
(8.48
)
$
(3.78
)
7,234,229
7,995,629
8,855,870
$
0.36
$
0.32
35,365,778
40,130,383
(1)
Represents impact of the adoption of Staff Position
150-5,
Issuers Accounting under Financial Accounting Standards
Board (FASB) Statement No. 150 for Freestanding Warrants
and Other Similar Instruments on Shares That Are Redeemable
(FSP
150-5).
Pursuant to FSP
150-5,
we
are required to classify our outstanding warrants to purchase
preferred stock as a liability on our balance sheet and record
adjustments to their fair value in our statements of operations
at the end of each reporting period. For the year ended
December 31, 2006, the impact of the change in accounting
principle was to decrease net income by $3.1 million,
consisting of a $2.2 million cumulative effect adjustment
for the change in accounting principle as of January 1,
2006, when the Company adopted FSP
150-5,
and
$0.9 million of expense that was recorded in other income
(expense), net to reflect the increase in fair value between
January 1, 2006 and December 31, 2006. The warrants
will be subject to revaluation at each balance sheet date and
any change in fair value will be recognized as a component of
other income (expense), net, until the earlier of exercise of
the warrants or the closing of this offering.
(2)
Accretion of redeemable convertible preferred stock represents
the impact attributable to the increase in the fair market value
of such shares. The holders of Series A, B, C and D
preferred stock have the option to put their shares back to us
at the greater of (i) the original purchase price plus
accrued dividends, or
7
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(ii) the fair market value of the shares. The holders of
Series E preferred stock have the option to put their
shares back to us at the original purchase price plus accrued
dividends. The put option and the related accretion of the
preferred shares will terminate upon the closing of this
offering.
(3)
Pro forma net income per share gives effect to the conversion
upon the closing of this offering of all of our issued and
outstanding shares of preferred stock on a
1-for-1
basis into shares of common stock. See Note A to our
consolidated financial statements for an explanation of the
number of shares used in computing per share data.
As of December 31, 2006
Pro forma as
Actual
Pro forma
Adjusted
(unaudited)
(unaudited)
(in thousands)
$
20,137
$
20,137
$
170,113
40,026
40,026
40,026
7,446
7,446
157,422
109,314
109,314
259,290
43,307
43,307
43,307
212,663
(184,117
)
28,546
178,522
8
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difficulties in enforcing agreements and collecting receivables
in a timely manner through the legal systems of many countries
outside North America;
the failure to fulfill foreign regulatory requirements to market
the Hi Art system on a timely basis or at all;
availability of, and changes in, reimbursement within prevailing
foreign health care payment systems;
difficulties in managing foreign relationships and operations,
including any relationships that we establish with foreign
distributors or sales or marketing agents;
limited protection for intellectual property rights in some
countries;
fluctuations in currency exchange rates;
the possibility that foreign countries may impose additional
withholding taxes or otherwise tax our foreign income, impose
tariffs or adopt other restrictions on foreign trade;
the possibility of any material shipping delays; and
significant changes in the political, regulatory, safety or
economic conditions in a country or region.
15
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current or future U.S. or foreign patent applications will
be approved in a timely manner or at all;
our issued patents will protect our intellectual property and
not be challenged by third parties;
we will develop patentable intellectual property;
the validity of our patents will be upheld;
the patents of others will not have an adverse effect on our
ability to do business; or
others will not independently develop similar or competing
products or methods or design around any patents that may be
issued to us.
18
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fluctuations in quarterly revenue and net income;
regulatory developments related to the manufacturing, marketing
or sale of the Hi Art system;
announcements of technological innovations, new services or
service enhancements, strategic alliances or significant
agreements by us or by our competitors;
recruitment or departure of key personnel;
changes in the estimates of our operating results or changes in
recommendations by any securities analyst that elects to follow
our common stock;
sales of large blocks of our common stock; and
changes in accounting principles or changes in interpretations
of existing principles, which could affect our financial results.
22
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Number of Shares/
Percentage of Total
Date of Availability for Resale into the Public Market
Upon the effectiveness of this
prospectus.
90 days after the date of this
prospectus.
between 90 and 180 days after
the date of this prospectus of which 18,245,256, or 48.8%, are
subject to volume limitations under Rule 144.
More than 180 days after the
date of this prospectus.
delaying, deferring or preventing a change in control of our
company;
entrenching our management
and/or
board;
impeding a merger, consolidation, takeover or other business
combination involving our company; or
23
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discouraging a potential acquiror from making a tender offer or
otherwise attempting to obtain control of our company.
our board of directors is authorized to issue preferred stock in
series, with the designation, powers, preferences and rights of
each series to be fixed by our board of directors;
a board of directors divided into three classes serving
staggered three-year terms, such that not all members of the
board will be elected at one time;
a requirement that special meetings of shareholders be called
only by a majority of our board of directors or our Chief
Executive Officer upon demand of the holders of record of shares
representing ten percent or as otherwise required by law;
advance notice requirements for shareholder proposals and
nominations; and
24
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our bylaws may be amended by approval of either our shareholders
or our board of directors, except where: (i) our articles
of incorporation or the Wisconsin Business Corporation Law
reserve the power exclusively to the shareholders, or
(ii) the shareholders, in adopting, amending or repealing a
particular bylaw, provide within the bylaws that the board of
directors may not amend, repeal or readopt such bylaw.
25
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statements regarding the adoption of IGRT and adaptive radiation
therapy as the standard treatment technique for treatment of
most cancer patients;
statements regarding the anticipated change in clinician
perception as to the appropriateness of using the Hi Art
system to treat certain tumors;
statements regarding planned technological advancements and
expanded capabilities of the Hi Art system;
statements regarding the increase in the number of sales,
marketing and support personnel we expect to employ;
statements as to our ability to meet our anticipated cash needs
for working capital and capital expenditure based on our current
business plan;
statements regarding the lack of need for additional FDA
approvals or clearances for modifications to the Hi Art
system;
statements as to the increasing global demand for advanced
medical treatments; and
our intended uses of the proceeds from this offering.
26
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27
on an actual basis; and
on a pro forma basis to give effect to: (1) the automatic
conversion upon the closing of this offering of all of our
shares of preferred stock outstanding as of December 31,
2006 on a
one-for-one
basis into shares of common stock, and (2) the issuance of
1,288,669 shares of common stock issuable for no consideration
pursuant to the Series A Investment Agreement; and
on a pro forma as adjusted basis to give effect to: (1) the
automatic conversion upon the closing of this offering of all of
our shares of preferred stock outstanding as of
December 31, 2006 on a
one-for-one
basis into shares of common stock, (2) the issuance of
1,288,669 shares of common stock issuable for no consideration
pursuant to the Series A Investment Agreement, and
(3) the receipt of estimated net proceeds of
$150.0 million from our sale of 10,200,000 shares of
common stock in this offering at an assumed public offering
price of $16.00 per share, the mid-point of the price range
set forth on the cover of this prospectus, less the underwriting
discount and estimated offering expenses payable by us.
As of December 31, 2006
Pro forma as
Actual
Pro forma
adjusted
(unaudited)
(unaudited)
(in thousands)
$
212,663
$
$
93
358
460
1,771
214,169
364,043
(185,981
)
(185,981
)
(185,981
)
(184,117
)
28,546
178,522
$
28,546
$
28,546
$
178,522
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11,449,199 shares of common stock reserved for issuance
under our stock option plans, of which options to purchase
9,155,925 shares of common stock at a weighted average
exercise price of $3.30 per share have been granted; and
465,654 shares issuable upon the exercise of outstanding
warrants at a weighted average exercise price of $1.16 per
share.
29
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the conversion of all of our shares of preferred stock on a
one-for-one
basis into shares of common stock; and
the issuance of 1,288,669 shares of common stock issuable
for no consideration to certain holders of our Series A
preferred stock, including certain members of our management and
entities affiliated with our directors, pursuant to the
Series A Investment Agreement.
$
16.00
$
0.78
3.09
3.87
$
12.13
Shares of Common Stock Purchased
Total Consideration
Average Price
Number
Percent
Amount
Percent
per Share
(in thousands)
35,774
77.8
%
$
42,735
20.8
%
$
1.19
10,200
22.2
163,200
79.2
16.00
45,974
100.0
%
$
205,935
100.0
%
$
4.48
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11,449,199 shares of common stock reserved for issuance
under our stock option plans, of which options to purchase
9,155,925 shares of common stock at a weighted average
exercise price of $3.30 per share have been granted; and
465,654 shares issuable upon the exercise of outstanding
warrants with a weighted average exercise price of
$1.16 per share.
Shares of Common Stock Purchased
Total Consideration
Average Price
Number
Percent
Amount
Percent
per Share
(in thousands)
37,063
78.4
%
$
42,735
20.8
%
$
1.15
10,200
21.6
163,200
79.2
16.00
47,263
100.0
%
$
205,935
100.0
%
$
4.36
11,449,199 shares of common stock reserved for issuance
under our stock option plans, of which options to purchase
9,155,925 shares of common stock at a weighted average
exercise price of $3.30 per share have been granted; and
465,654 shares issuable upon the exercise of outstanding
warrants with a weighted average exercise price of
$1.16 per share.
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Year Ended December 31,
2002
2003
2004
2005
2006
(in thousands, other than share and per share data)
$
$
11,778
$
45,460
$
75,754
$
156,102
9,158
28,078
50,047
102,653
2,620
17,382
25,707
53,449
8,723
5,530
6,492
11,372
21,397
4,125
4,856
7,827
14,197
23,119
12,848
10,386
14,319
25,569
44,516
(12,848
)
(7,766
)
3,063
138
8,933
9
(399
)
(31
)
179
(1,202
)
(12,839
)
(8,165
)
3,032
317
7,731
151
78
(7,184
)
(12,839
)
(8,165
)
2,881
239
14,915
(2,140
)
(12,839
)
(8,165
)
2,881
239
12,775
(155
)
(11,421
)
(41,960
)
(68,075
)
(46,253
)
$
(12,994
)
$
(19,586
)
$
(39,079
)
$
(67,836
)
$
(33,478
)
$
(1.99
)
$
(2.89
)
$
(5.40
)
$
(8.48
)
$
(3.78
)
6,527,995
6,766,299
7,234,229
7,995,629
8,855,870
$
0.36
$
0.32
35,365,778
40,130,383
(1)
Represents impact of the adoption of Staff Position
150-5,
Issuers Accounting under FASB Statement No. 150
for Freestanding Warrants and Other Similar Instruments on
Shares That Are Redeemable
(FSP 150-5).
Pursuant to FSP
150-5,
we
are required to classify our outstanding warrants to purchase
32
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preferred stock as a liability on our balance sheet and record
adjustments to their fair value in our statements of operations
at the end of each reporting period. For the year ended
December 31, 2006, the impact of the change in accounting
principle was to decrease net income by $3.1 million,
consisting of a $2.2 million cumulative effect adjustment
for the change in accounting principle as of January 1,
2006, when the Company adopted FSP
150-5,
and
$0.9 million of expense that was recorded in other income
(expense), net to reflect the increase in fair value between
January 1, 2006 and December 31, 2006. The warrants
will be subject to revaluation at each balance sheet date and
any change in fair value will be recognized as a component of
other income (expense), net, until the earlier of the exercise
of the warrants or the closing of this offering.
(2)
Accretion of redeemable convertible preferred stock represents
the impact attributable to the increase in the fair market value
of such shares. The holders of Series A, B, C and D preferred
stock have the option to put their shares back to us at the
greater of (i) the original purchase price plus accrued
dividends, or (ii) the current fair market value of the
shares. The holders of Series E preferred stock have the
option to put their shares back to us at the original purchase
price plus accrued dividends. The put option and the related
accretion of the preferred shares will terminate upon the
closing of this offering.
(3)
Pro forma net income per share gives effect to the conversion
upon the closing of this offering of all of our issued and
outstanding shares of preferred stock on a
one-for-one
basis into shares of common stock. See Note A to our
consolidated financial statements for an explanation of the
number of shares used in computing per share data.
As of December 31,
2002
2003
2004
2005
2006
(in thousands)
$
2,474
$
7,524
$
1,950
$
30,396
$
20,137
3,791
8,179
15,740
28,283
40,026
(3,065
)
(10,973
)
(4,187
)
7,792
7,446
9,428
20,796
29,069
82,303
109,314
9,010
21,566
16,133
49,281
43,307
24,176
35,597
84,234
166,402
212,663
(25,488
)
(44,704
)
(83,720
)
(151,406
)
(184,117
)
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FINANCIAL CONDITION AND RESULTS OF OPERATIONS
there is persuasive evidence that an arrangement exists;
34
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the title and risk of loss have been transferred to the
customer, as evidenced by the customers signature on our
acceptance test procedure document;
the sales price is fixed or determinable; and
collection is reasonably assured.
Year Ended December 31,
2004
2005
2006
94
%
78
%
57
%
6
7
22
7
11
8
10
100
%
100
%
100
%
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Sales outside of the United States accounted for 22% of our
revenue in 2005 and 43% of our revenue in 2006. Increased sales
of the Hi Art system outside of the United States have
tended to impact our gross margins favorably due to higher
average selling prices in these markets. We intend to continue
to expand our international selling efforts although we cannot
be certain that favorable pricing trends will continue.
The majority of our sales to date have been to university
research centers, hospitals and cancer treatment centers that
are early adopters of new technologies and that tend to replace
equipment regularly in order to upgrade their treatment
capabilities. Our sales strategy includes increasing sales to
community hospitals and smaller treatment centers, which have
traditionally been slower in their adoption of new technologies
primarily due to cost-based purchasing decisions. Our efforts to
penetrate this market may require us to lower the price of the
Hi Art system. Similarly, we may be required to lower the
price of the Hi Art system in order to sell to national
chains or large volume purchasers.
Our ability to demonstrate the clinical benefits of the
Hi Art system compared to competing systems is likely to be
a factor in our ability to maintain the selling price of the
Hi Art system. We may need to demonstrate increased
clinical benefits and offer additional features in order to
compete favorably with our competitors in the medium to long
term.
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Year Ended December 31,
2004
2005
2006
100.0
%
100.0
%
100.0
%
61.8
66.1
65.8
38.2
33.9
34.2
14.3
15.0
13.7
17.2
18.7
14.8
31.5
33.7
28.5
6.7
0.2
5.7
0.2
(0.7
)
6.7
0.4
5.0
0.4
0.1
(4.6
)
6.3
%
0.3
%
9.6
%
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39
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40
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Three Months Ended,
Mar. 31,
June 30,
Sept. 30,
Dec. 31,
Mar. 31,
June 30,
Sept. 30,
Dec. 31,
2005
2005
2005
2005
2006
2006
2006
2006
(unaudited)
(in thousands)
$
10,174
$
29,581
$
14,111
$
21,888
$
27,462
$
31,869
$
37,173
$
59,598
6,921
17,721
10,857
14,548
19,320
22,880
23,651
36,802
3,253
11,860
3,254
7,340
8,142
8,989
13,522
22,796
32.0
%
40.1
%
23.1
%
33.5
%
29.6
%
28.2
%
36.4
%
38.2
%
4,839
6,555
6,727
7,448
7,441
9,396
12,069
15,610
$
(1,586
)
$
5,305
$
(3,473
)
$
(108
)
$
701
$
(407
)
$
1,453
$
7,186
$
69
$
69
$
69
$
99
$
104
$
139
$
146
$
164
13.5
%
39.0
%
18.6
%
28.9
%
17.6
%
20.4
%
23.8
%
38.2
%
12.6
%
46.1
%
12.7
%
28.6
%
15.2
%
16.8
%
25.3
%
42.7
%
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43
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44
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Payment Due by Period
Less Than
1-3
3-5
More Than
Total
1 Year
Years
Years
5 Years
(in thousands)
$
19,188
$
1,962
$
4,101
$
4,180
$
8,945
875
34
247
467
127
$
20,063
$
1,996
$
4,348
$
4,647
$
9,072
revenue generated by sales of the Hi Art system and service
plans;
costs associated with our sales and marketing initiatives and
manufacturing activities;
the level of investment needed in our service and support
infrastructure;
costs of our research and development activities; and
effects of competing technological and market developments.
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Persuasive evidence of an arrangement
exists.
We require evidence of a purchase order
with a customer specifying the terms and conditions of the
product or services to be delivered, typically in the form of a
signed quotation or purchase order from the customer.
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Title and risk of loss have been transferred to the
customer.
During the installation phase, each
Hi Art system is fully tested to confirm that it functions
within operating specifications. Upon completion of the test
procedures, the customer signs the acceptance test procedures
document, or ATP, acknowledging acceptance of the system.
Revenue for the sale of systems is recognized upon receipt of
the signed ATP.
The sales price is fixed or determinable.
All
contract terms are fixed in the signed quotation or purchase
order received from the customer. The contracts do not contain
rights of cancellation, return, exchanges or refunds.
Collection is reasonably assured.
Due to the
fact that our sales are to hospitals and cancer treatment
centers with significant resources, we consider accounts
receivable to be fully collectible. In addition, contracts
generally require staged payments as follows: 20% to 30% down
payment, 60% to 70% due upon shipment and 10% due upon final
acceptance by the customer.
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the issuance price of our series of preferred shares to third
parties;
recent third-party transactions in our common stock;
valuations performed by independent valuation firms;
the liquidation preference and other rights of the preferred
shares;
our revenue backlog and financial performance;
trends in the market for public companies involved in similar
lines of business; and
the fact that the option grants involved illiquid securities of
a private company.
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Number of
Fair Value
Intrinsic
Options
Exercise
Estimate
Value per
Granted
Price
per Share
Share
34,000
$
4.99
$
4.99
$
46,920
5.35
5.35
108,800
5.35
5.35
190,313
6.75
6.75
3,400
6.75
6.75
1,958,400
6.75
6.75
On December 29, 2005, we sold 2,356,435 shares of
Series E convertible preferred stock at $5.94 per
share, representing net proceeds of $13.9 million. We
engaged Virchow Krause to perform an independent valuation of
our common stock based on this preferred stock transaction.
Virchow Krause determined that our common stock was valued at
$4.99 per share as of December 29, 2005. This
valuation was then used for the option grants made in January
2006.
In the second quarter of 2006, our board of directors determined
that an updated independent valuation should be obtained.
Therefore, we engaged Virchow Krause to perform a valuation of
all classes of our capital stock. Virchow Krause issued a report
dated May 16, 2006, which concluded that our common stock
was valued at $5.35 per share as of March 31, 2006.
This valuation was then used for the option grants made in May
and July 2006. We believe that there were no material events and
no material changes in our financial condition or prospects
during this period that would have resulted in a change in the
valuation of a share of our common stock. The principal reasons
for the difference in the fair value of our common stock at
these dates compared to the price of $16.00 per share, the
mid-point of the estimated initial public offering price range,
was our improved financial results that materialized in December
2006, the lack of marketability of our common stock and the
improved prospects since the grant date for our initial public
offering due to a successful public offering of another company
in our segment.
On October 23, 2006, the Chairman of our board of
directors, T. Rockwell Mackie, sold an aggregate of
190,400 shares of common stock to two independent
investors, and our President, Paul Reckwerdt, sold 190,400
common shares to a single independent investor. The purchase
price of all these shares was $6.75 per share resulting in
aggregate proceeds of $1.3 million to each seller. Given
the significant size of the transactions and the fact that these
shares were sold to independent third parties, we concluded that
our common stock should be valued at $6.75 per share as of
October 23, 2006. Both the buyers and sellers had knowledge
of the possibility that we would undertake an initial public
offering. Stock option grants were made based on this price in
October, November and early December 2006. The principal reasons
for the difference in the fair value of our common stock at
these dates compared to the price of $16.00 per share, the
mid-point of the estimated initial public offering price range,
was our improved financial results that materialized in
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December 2006, the lack of marketability of our common stock and
the improved prospects since the grant date for our initial
public offering due to a successful public offering of another
company in our segment.
We believe that there were no material events and no material
charges in our financial condition or prospects between
October 23, 2006 (the date of the most recent third-party
sale of our common stock) and December 7, 2006 (the date on
which we granted options) that would have resulted in a change
in the valuation of a share of our common stock. Therefore, we
believe that the appropriate valuation to use for the grants
dated December 7, 2006 was $6.75, the price paid in the
third-party sales of our common stock that occurred on
October 23, 2006. The principal reasons for the difference
in the fair value of our common stock at these dates compared to
the price of $16.00 per share, the mid-point of the estimated
initial public offering price range, was our improved financial
results as evidenced by the higher than expected orders received
by us between December 7 and December 31, 2006 resulting in
improved backlog, the lack of marketability of our common stock
and the improved prospects since the grant date for our initial
public offering due to a successful public offering of another
company in our segment.
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Intensity modulated radiation
therapy.
Intensity modulated radiation therapy,
or IMRT, involves varying, or modulating, the radiation beam
intensity across the treatment area. This technique attempts to
conform the high dose region of the radiation beam more closely
with the
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shape of the tumor, enabling the delivery of higher doses of
radiation to tumors with a reduced impact on surrounding healthy
tissue. Using IMRT, medical professionals can design a more
individualized treatment plan for each patient.
Image guided radiation therapy.
Image guided
radiation therapy, or IGRT, involves delivering IMRT guided by
images of the treatment area taken shortly before treatment
using CT, x-ray, ultrasound or other imaging technologies. By
combining imaging with radiation treatment, clinicians can
adjust the patients position relative to the radiation
source prior to each treatment to target the tumor more
precisely. However, the precision and effectiveness of IGRT
depends largely on the quality of the images and the degree to
which the radiation delivery system is integrated with the
images. Compared to traditional IMRT without image guidance,
accurate image guidance enables clinicians to improve patient
outcomes by concentrating higher doses of radiation at tumors
and further reducing the exposure of healthy tissues to
radiation. According to a 2006 report by the Advisory Board
Company, a provider of research and analysis on the healthcare
industry, 33% of radiation therapy facilities offered IGRT and
43% planned to do so within the subsequent three years. The
survey was based on 267 radiation therapy facilities in the
United States.
Dose escalation.
Dose escalation, or
hypofractionation, is an evolving radiation therapy technique
that involves reducing the number of fractions and delivering
larger doses of radiation per fraction. The benefits of
hypofractionation include fewer patient visits and more
efficient use of radiation therapy systems. Stereotactic
radiation therapy and stereotactic radiosurgery procedures, in
which treatment is provided in one to five sessions, are extreme
examples of hypofractionation. Hypofractionation has been used
to date to treat only a limited number of tumor types. These
tumors are generally small and are located in a few specific,
sensitive regions of the body, such as the head and neck, spinal
cord, lung and prostate, where the very high intensity radiation
involved in dose escalation increases the need for a radiation
delivery system that is capable of locating tumors and
delivering radiation with high precision.
Adaptive radiation therapy.
Adaptive radiation
therapy involves adjusting a patients radiation therapy
plan between fractions to account for changes in the
patients anatomy, the amount and location of the radiation
received by the patient, and the size, shape and location of the
tumor. While there is no widely accepted definition of adaptive
radiation therapy, it has been characterized to include as
little as an adjustment to the physical position of the patient
relative to the radiation source prior to treatment, as occurs
during IGRT, rather than adjustment to the treatment plan. We
believe that adaptive radiation therapy requires continual
adjustments to the treatment plan facilitated by both the
regular acquisition of updated quantitative images showing the
location, geometry and density of the tumor, as well as
verification of the actual radiation dose received by the
patient throughout the entire course of treatment. We believe
that achieving truly adaptive radiation therapy currently
represents the most significant challenge for existing radiation
therapy systems.
Limited versatility and precision.
The C-arm
configuration of traditional radiation therapy systems has a
limited range and speed of motion due to its size and mechanical
structure. Most existing MLCs, which modulate or shape the
radiation beams, also have mechanical limitations that reduce
their beam-shaping ability and the speed at which they operate.
These design elements limit the motion and dynamic range of IMRT
intensities capable of being delivered by traditional radiation
therapy systems and often make it impractical to deliver
radiation from more than five to nine treatment angles during a
typical treatment session. These limited treatment angles reduce
the ability to deliver precisely targeted radiation that avoids
healthy tissue. Such imprecision may prevent clinicians from
treating tumors near sensitive structures,
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such as the eye or the spinal cord, or from retreating patients
in an area of the body that was previously exposed to radiation
and may be unable to tolerate additional exposure.
Limited ability to provide frequent, quantitative
images.
Precise radiation therapy requires
frequent capture of images that accurately depict the size,
shape, location and density of the tumor, which we refer to as
quantitative images. Many traditional radiation therapy systems
either do not incorporate CT imaging functionality or use
imaging technologies that do not have the ability to generate
quantitative images. Lacking this data, traditional radiation
therapy systems measure the amount of radiation emitted by the
device based on the systems performance specifications.
This calculation does not provide the clinician with data
regarding the amount of radiation that was actually received by
the patient or what tissue within the patients body
received any particular amount of radiation. In addition, most
radiation therapy systems that have imaging capabilities are not
capable of performing daily imaging of the patient due to
concerns about the additional radiation exposure associated with
most imaging technologies. Since it is common for internal
organs to shift and for the size of the tumor to change during
the course of treatment, failure to obtain updated images and
adapt the treatment plan throughout the course of treatment may
result in a portion, or potentially all, of the radiation dose
missing the tumor and instead being absorbed by healthy tissue.
Failure to integrate multiple functions.
Many
traditional radiation therapy systems were designed solely for
the purpose of delivering radiation and therefore do not possess
integrated imaging, treatment planning, dose verification or
quality assurance capabilities necessary for more advanced
treatment protocols. Some systems have subsequently been adapted
to include certain elements of this functionality by
incorporating modular add-on devices to legacy linear
accelerator designs. These separate modular components can
provide imaging, treatment planning, quality assurance
procedures or post-treatment analysis functionality. However,
this modular approach often requires the clinician to
reconfigure and recalibrate the system between patient imaging,
treatment planning, radiation delivery and quality assurance,
which can increase the time required to plan and deliver
treatments.
More versatile treatment capabilities.
The
Hi Art systems high-speed ring gantry and MLC allow
treatment to be delivered continuously in a helical pattern 360
degrees around the patients body, allowing radiation
delivery from thousands of angles to improve radiation dose
distribution without extending the time it takes to complete
comparable procedures using other systems. In addition, the
versatility of the Hi Art system enables an operator to
provide IMRT, IGRT or stereotactic treatments anywhere within a
cylindrical volume of 80 centimeters (2.6 feet) in diameter
and up to 160 centimeters (5.3 feet) long. This broad
treatment field allows large areas of the body to be treated in
a single session and facilitates complex treatments, such as
total bone irradiation, which specifically irradiates bone
marrow, and the treatment of widely distant tumors. The
Hi Art systems precision and range of treatment
angles also enable the treatment of hard to reach tumors, such
as spinal tumors, as well as treatments that can be challenging
or impractical to treat with other traditional radiation therapy
systems because of the need to avoid or minimize radiation
delivery to critical structures.
Daily, quantitative imaging for better identification of
tumors, dose verification and treatment
planning.
The Hi Art system is the only
commercially available radiation therapy system offering
integrated quantitative CT imaging capabilities, which depict
the density of tumors and healthy tissue more accurately than
traditional radiation therapy systems. Our integrated
mega-voltage computerized tomography, or MVCT, which we market
as our CTrue technology, enables quantitative imaging and
delivers less radiation during the imaging process compared to
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the imaging technologies used by other commercially available
radiation therapy systems. This lower dose allows the clinician
to collect daily, quantitative images, which can be used to
monitor changes in the patients internal anatomy and
quickly and accurately quantify the amount of radiation absorbed
by specific areas of the patients body, including both
tumors and healthy tissue. We believe that daily, quantitative
images are essential to optimizing patient treatment by enabling
clinicians to adapt the treatment plan in response to anatomical
changes and the cumulative amount of radiation received by
specific areas within the patient over time. We believe that
both of these factors can have a significant impact on the
targeting and amount of the radiation dose to be delivered.
Fully integrated treatment system for more precise radiation
delivery.
We believe that the integration of our
CTrue imaging technology, treatment planning and helical
delivery of radiation beams shaped by the MLC enables highly
precise radiation delivery. Our planned adaptive software allows
clinicians to establish at the time of treatment the precise
contours of a tumor and any sensitive structures at risk. The
Hi Art system uses a highly efficient dose computation
algorithm to ensure that the radiation beam conforms to the
patients tumor and avoids sensitive structures, providing
a highly-targeted dose distribution. These features
significantly benefit patients by maximizing the radiation
delivered to cancerous tissues and minimizing damage to nearby
healthy tissues. In addition, because the Hi Art system can
precisely deliver a high dose of targeted radiation, we believe
that our system reduces the temporary side effects and permanent
damage to healthy tissue associated with traditional radiation
therapy systems. This capability allows clinicians to accelerate
the treatment regimen by maximizing the radiation delivered to
tumor cells in fewer fractions.
Efficient clinical workflow for IGRT and adaptive radiation
therapy.
The Hi Art system integrates into a
single system all of the key elements for radiation therapy,
including treatment planning, CT image-guided patient
positioning, treatment delivery, quality assurance and adaptive
planning. The imaging and treatment planning capabilities of
many traditional systems are more modular or require cumbersome
add-ons or separate treatment planning systems that result in
clinicians taking more steps between scanning, planning and
treatment of patients, and may reduce the precision of
treatment. Conversely, the integrated imaging and treatment
features of the Hi Art system allow clinicians to scan,
plan and treat cancer patients easily and efficiently. This
capability enables healthcare providers to increase patient
throughput for sophisticated IGRT and adaptive radiation therapy
procedures using the Hi Art system. Daily images can be
easily accessed remotely, via our TomoPortal web-enabled
interface, to verify patient positioning and define patient
treatment strategies due to anatomical changes.
Low barriers to installation and
implementation.
All external beam radiation
systems must be housed in rooms which have special radiation
shielding to capture any radiation not absorbed by the patient.
The Hi Art systems size and self-contained design
allow customers to retrofit the Hi Art system into existing
treatment rooms previously used for legacy radiation therapy
systems and avoid, or reduce, the significant construction costs
that can be associated with building new, larger treatment
rooms, which are required to install many other radiation
therapy systems. With both imaging and radiation delivery
capabilities in its ring gantry, the Hi Art system requires
less space than other systems, which use large moving arms to
position the linear accelerator or incorporate adjacent imaging
equipment used for treatment planning. In addition, because the
Hi Art system has an integrated radiation beam stop, which
captures radiation that passes through the patient, it requires
less radiation shielding in treatment room walls as compared to
the shielding required by a traditional system. We also
preassemble, test and commission each Hi Art system at our
manufacturing facility, and ship the system almost fully
assembled. This assembly process allows radiation beam
on within four days and treatments to begin within
45 days after delivery in most cases.
Platform for further technological advancements in adaptive
radiation therapy.
We believe that the
Hi Art system is the only commercially available treatment
device that enables adaptive
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radiation therapy because of its unique ability to provide
daily, quantitative images, high speed delivery of radiation
helically from 360 degrees around the body and real-time
verification of the dose received by the patient. We believe
that the combination of these design features and our integrated
treatment planning and optimization software will allow us to
continue to enhance the Hi Art systems adaptive
capabilities to a point where clinicians will routinely and
easily adjust a patients treatment as needed.
Increase market awareness of the Hi Art systems
clinical and economic benefits.
In order to
expand our installed base of Hi Art systems, we intend to
continue to position the Hi Art system as the most advanced
radiation therapy system for treating a wide range of cancers
effectively and efficiently. We intend to accomplish this
through traditional sales and marketing efforts, such as
tradeshows, educational symposia,
e-business
avenues, marketing collateral, case studies and direct mail
campaigns. An important aspect of our sales and marketing
efforts is also to raise awareness of the Hi Art system
among patient populations who are increasingly educated about
treatment options and therefore help to drive adoption of new
technologies by clinicians. We also intend to educate clinicians
about using the Hi Art system to treat tumors that they may
currently believe can be adequately treated using competing
technologies in order to drive sales to smaller treatment
centers that may only have one treatment system.
Expand our worldwide sales presence.
Our early
sales and marketing efforts were primarily focused on North
America. As of December 31, 2006, we had 78 systems
installed in North America out of a total of
108 systems installed globally. In the last two years, we
began to establish both direct and indirect sales capabilities
in Western Europe and Asia where we believe that there is
significant potential to expand our installed base. We intend to
add additional direct sales representatives to further penetrate
the United States market, while investing in direct and indirect
sales and marketing capabilities in international markets. In
particular, we plan to expand our sales and marketing
capabilities in India, China, the Middle East and Eastern Europe
during 2007.
Increase our profitability through cost reductions and
improved operating leverage.
Over the last two
years our operating margins have been impacted by our decision
to invest in our global service and support infrastructure,
including the establishment of spare part depots and the
addition of personnel to support our international operations
and anticipated future growth. In addition, we incurred
increased costs due to higher component costs during early
production and the higher failure rates of certain components.
In order to increase our profitability, we will seek to decrease
our reliance on single-source suppliers of key components in
order to enable us to negotiate better prices with a wider range
of suppliers and to improve component reliability. In addition,
a number of opportunities exist to reduce costs through
re-engineering higher cost components. We will also seek to
increase our profitability by leveraging our investments in our
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global service and support infrastructure, which we believe
positions us to better absorb the costs associated with
increased sales volumes.
Continue to enhance our customer service and support
capabilities.
We believe that an important
differentiating feature of our business is our strong customer
support. We have invested heavily in our customer service and
support infrastructure in the United States and internationally.
We provide comprehensive customer support beginning with a
dedicated site-planning and installation team and continuing
through training, product technical support, access to physicist
support, field service engineering and value-added maintenance
services. We intend to build upon our infrastructure and
technology advantages by hiring additional support personnel,
implementing regional training programs and expanding the number
of local spare parts depots to continually augment and refine
our customer service.
Enhance the Hi Art systems treatment capabilities
through on-going research and development
initiatives.
In order to increase patient
throughput and increase our customers return on their
investment, our research and development initiatives are focused
on more fully automating the treatment optimization and adaptive
therapy processes thereby decreasing the time necessary for
clinicians to develop and adapt treatment plans. For example, we
recently released pilot versions of our RTstat software, which
allows clinicians to generate a treatment plan in three to five
minutes while the patient is positioned on the Hi Art
systems treatment couch. We expect to release the RTstat
software to customers in 2007. We are also engaged in
initiatives to accommodate real-time patient movements during
treatment. We believe that these developments will further
improve the precision of treatment offered by the Hi Art
system and increase patient throughput. In addition, we believe
that our work in remote and automatic quality assurance should
reduce the amount of time and resources needed to perform system
verification and maintenance. We believe that these developments
will improve the precision of treatment and increase patient
throughput.
Continue to expand and protect our intellectual property
portfolio.
The Hi Art system is comprised of
multiple sophisticated proprietary components. We hold or
license 21 U.S. patents, 29 pending U.S. patent
applications, 61 foreign patents and 77 foreign patent
applications, including 16 U.S. patents, 61 foreign patents
and 19 foreign patent applications licensed from the Wisconsin
Alumni Research Foundation, or WARF. These patents cover various
components and techniques incorporated into the Hi Art
system, such as the MLC and aspects of the helical delivery of
therapeutic radiation, that we believe will allow us to maintain
a competitive advantage in the field of radiation treatment. We
will continue to seek patent protection for our new inventions
and seek licensing rights for inventions of others that can add
substantial value to our products and services.
Increase our commercial opportunities and growth through
acquisitions, investments, or third party
collaborations.
We believe that we can increase
our commercial opportunities through a combination of strategic
acquisitions, investments and collaborations with third parties.
We seek to identify opportunities to acquire or collaborate in
the development of new technologies that leverage our existing
operational infrastructure and distribution, provide our
customers with improved or additional capabilities or expand our
growth opportunities into new markets. For example, we currently
have research and development collaborations for the development
of a compact, lower-cost, intensity modulated proton therapy
system, a new patient treatment couch and new accessories for
use with the Hi Art system. We will continue to evaluate
opportunities to vertically integrate through acquisition or
investment in suppliers of key components.
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TomoGateway.
TomoGateway links our customer
call centers directly to a customers Hi Art system
over a secure connection. Using this direct connection, our
support staff can perform online diagnostics, examine system log
files and look at real-time data to assist customers in
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identifying and addressing problems with their units. Such
real-time data allows us to provide our customers with continual
support and enables our customers to maintain high levels of
system operability. Access to TomoGateway is included at no
additional charge during the standard one-year warranty period
and with Total TLC and Partnership TLC.
TomoExchange.
TomoExchange is a secure,
web-based tool that is designed to provide a communication
portal between TomoTherapy and our customers and to facilitate
communication and collaboration among all end users of
Hi Art. The platform features
e-mail
integration and a product feedback tool as well as an on-line
forum that allows customers to share information about the
Hi Art system, learn about relevant upcoming events and
review important announcements. TomoExchange is available to all
customers operating the Hi Art system.
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design, development, testing and clinical investigations
involving humans;
manufacturing;
packaging, labeling, marketing and sales;
distribution, including importing and exporting;
possession and disposal; and
recalls and replacements.
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an office building totaling approximately 61,000 square
feet under a lease expiring 2014;
a manufacturing facility totaling approximately
64,000 square feet under a lease expiring 2018; and
a portion of an office building totaling approximately
17,000 square feet under a lease expiring 2008.
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101
II-4
51
Chief Executive Officer and
Director
55
President, Co-Founder and Director
51
Chief Financial Officer and
Treasurer
57
Chief Operating Officer
57
Vice President of Business
Development
41
Vice President of Research
50
Vice President of Global Sales
45
Vice President of Marketing
57
Vice President of Regulatory
Affairs and Quality
37
Vice President, Secretary and
General Counsel
52
Chairman of the Board of Directors
and
Co-Founder
82
Director
70
Director
51
Director
64
Director
72
Director
61
Director
61
Director
(1)
Member of the nominating and corporate governance committee.
(2)
Member of our audit committee.
(3)
Member of our compensation committee.
73
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75
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appoints and oversees a firm to serve as independent auditor to
audit our consolidated financial statements;
is responsible for reviewing the independence, qualifications,
performance and quality control procedures of the independent
auditor;
discusses the scope and results of the audit with the
independent auditor;
reviews and considers the adequacy of our internal accounting
controls, financial reporting processes, critical accounting
policies and audit procedures;
pre-approves all audit and non-audit services to be performed by
the independent auditor;
reviews our annual and quarterly financial statements with our
management and independent auditor;
reviews and resolves any disagreements between our management
and our independent auditor in connection with the preparation
of our financial statements;
establishes procedures for the confidential, anonymous
submission by our employees of concerns or complaints regarding
questionable accounting or auditing matters;
reviews and approves all related party transactions involving us
and our directors and executive officers; and
prepares the report that the Securities and Exchange Commission
requires us to include in our annual proxy statement.
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reviewing and recommending approval of compensation of our
executive officers and compensation plans in which our executive
officers and directors participate;
reviewing and administering our stock incentive plans;
reviewing and making recommendations to our board with respect
to incentive compensation and equity plans;
approving the compensation paid to our chief executive officer
and directors; and
preparing the report that the Securities and Exchange Commission
requires us to include in our annual proxy statement.
a willful failure to deal fairly with us or our shareholders in
connection with a matter in which the director or officer has a
material conflict of interest;
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a violation of criminal law, unless the director or officer had
reasonable cause to believe his or her conduct was unlawful;
a transaction from which the director or officer derived an
improper personal profit; or
a willful misconduct.
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81
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Bonus Based on 2006 Revenue
Bonus Multiplier Based on 2006 Operating Income
Percent of Target
2006
2006
Bonus Amount to
Operating
Bonus
Revenue
Income
Multiplier
(in millions)
(in millions)
0
%
Less than $2
0
60
%
Greater than $2 and less than $4
.50
80
%
Greater than $4 and less than $6
.75
100
%
Greater than $6 and less than $10
1.00
120
%
Greater than $10
1.25
160
%
82
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Target
Maximum
Incentive
Incentive
Payment
Payment
$
255,000
$
420,750
96,000
158,400
91,520
151,008
103,534
170,831
110,367
182,106
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Amount
$
380,409
348,552
353,702
371,226
Amount
$
750,818
687,104
697,404
732,532
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Option
All other
Year
Salary
Bonus(1)
Awards(2)
Compensation(3)
Total
2006
$
322,500
$
316,800
$
9,189
$
14,302
$
662,791
2006
216,300
139,776
4,142
14,191
374,409
2006
406,600
(4)
146,432
3,108
22,462
578,602
2006
247,200
159,744
16,985
423,929
2006
206,000
133,120
6,631
11,139
356,890
(1)
Consists of bonuses earned in 2006 which are payable in 2007.
(2)
The value of option awards granted to our named executive
officers has been estimated pursuant to SFAS No. 123(R) for
2006. All options awarded had exercise prices equal to the
valuation of our stock performed by independent valuation firms.
For a discussion of assumptions made in the valuation, see
Note A to our financial statements for the year ended
December 31, 2006 included elsewhere in this prospectus.
(3)
Includes contributions made to a 401(k) plan, insurance
premiums, vehicle allowance and patent awards.
(4)
Salary includes commissions paid under earned commission
arrangement.
All other
Option Awards:
Exercise or Base
Grant Date Fair
Grant
Number of Securities
Price of Option
Market Value of
Date
Underlying Options (#)(1)
Awards ($/Sh)(2)
Option Awards
12/7/2006
136,000
$
6.75
$
485,190
12/7/2006
54,400
6.75
194,080
12/7/2006
40,800
6.75
145,565
12/7/2006
108,800
6.75
388,159
(1)
Stock options vest 50% on December 7, 2008, and 25% each
year thereafter.
(2)
Represents the fair value per share of common stock as valued by
our board of directors on the date of grant.
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Number of
Number of
Securities
Securities
Underlying
Underlying
Option
Unexercised
Unexercised
Option
Option
Grant
Options (#)
Options (#)
Exercise
Expiration
Date
Exercisable
Unexercisable
Price ($)
Date(1)
1/3/2005
89,015
1,180,511
$
2.82
1/3/2011
11/17/2005
51,000
153,000
3.46
11/17/2011
12/7/2006
136,000
6.75
12/7/2012
3/1/2003
326,400
0.29
3/1/2013
3/17/2005
20,400
61,200
2.82
3/17/2015
11/17/2005
13,770
41,310
3.46
11/17/2011
12/7/2006
54,400
6.75
12/7/2012
6/17/2003
68,000
0.29
6/17/2013
6/1/2004
102,000
34,000
0.61
6/1/2014
3/17/2005
40,800
122,400
2.82
3/17/2011
11/17/2005
13,770
41,310
3.46
11/17/2011
12/7/2006
40,800
6.75
12/7/2012
11/17/2005
34,000
102,000
3.46
11/17/2011
6/1/1999
348,432
0.08
6/1/2009
5/23/2001
6,800
0.10
5/23/2011
11/26/2003
32,640
0.29
11/26/2013
11/17/2005
17,000
51,000
3.46
11/17/2011
12/7/2006
108,800
6.75
12/7/2012
(1)
Stock options vest 25% each year beginning one year after the
date of grant, except for the options granted on
December 7, 2006, which vest 50% at December 7, 2008
and 25% each year thereafter.
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Option Awards
Number of Shares
Acquired on
Value Realized
Exercise (#)
on Exercise ($)
304,489
$
1,146,884
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Fees Earned or
Option
All Other
Paid in Cash ($)
Awards ($)(3)
Compensation ($)
Total ($)
$
$
$
123,817
$
123,817
16,000
16,000
15,000
19,565
34,565
23,500
23,500
29,500
29,500
25,900
12,000
(4)
37,900
20,000
20,000
16,500
19,565
36,065
(1)
Thomas R. Mackie is paid by the company as a part-time employee.
His other compensation includes his salary, insurance, 401(k)
and bonus that was accrued in 2006.
(2)
Paul J. Reckwerdt and Frederick A. Robertson are full-time
employees and their compensation is set forth in the preceding
tables.
(3)
The value of option awards granted to our executive officers has
been estimated pursuant to SFAS No. 123(R) for 2006.
(4)
Consists of fees paid for services pursuant to a consulting
agreement. The agreement was terminated in 2006.
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99
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each person known to us to be the beneficial owner of more than
5% of our common stock;
each of our executive officers;
each of our directors;
all of our executive officers and directors as a group; and
each selling shareholder.
Assuming Exercise of
Overallotment Option
Number of Shares
Number of
Percentage of
Beneficially Owned
Percentage of Shares Beneficially Owned
Shares
Shares
Before
Number of
After
Before
After
Number of
Beneficially
Beneficially
Offering
Shares Offered
Offering
Offering
Offering
Shares Offered
Owned
Owned
6,597,135
185,800
6,411,335
17.3
%
13.3
%
417,724
5,993,611
12.4
%
4,918,857
129,659
4,789,198
12.9
9.9
291,506
4,497,692
9.3
4,792,656
138,243
4,654,413
12.6
9.6
310,803
4,343,610
9.0
2,318,460
66,382
2,252,078
6.1
4.7
149,242
2,102,836
4.3
2,080,125
60,815
2,019,310
5.5
4.2
136,726
1,882,584
3.9
2,019,779
59,051
1,960,728
5.3
4.1
132,760
1,827,968
3.8
838,007
838,007
2.2
1.7
838,007
1.7
2,449,093
2,449,093
6.4
5.1
2,449,093
5.1
403,022
403,022
1.1
%
*
403,022
*
68,170
68,170
*
*
68,170
*
265,370
265,370
*
*
265,370
*
404,872
404,872
1.1
*
404,872
*
68,170
68,170
*
*
68,170
*
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Assuming Exercise of
Overallotment Option
Number of Shares
Number of
Percentage of
Beneficially Owned
Percentage of Shares Beneficially Owned
Shares
Shares
Before
Number of
After
Before
After
Number of
Beneficially
Beneficially
Offering
Shares Offered
Offering
Offering
Offering
Shares Offered
Owned
Owned
202,266
202,266
*
*
202,266
*
40,970
40,970
*
*
40,970
*
2,430,439
2,430,439
6.4
5.0
2,430,439
5.0
4,792,656
138,243
4,654,413
12.6
9.6
310,803
4,343,610
9.0
54,827
54,827
*
*
54,827
*
6,597,135
185,800
6,411,335
17.3
13.3
417,724
5,993,611
12.4
281,902
8,242
273,660
*
*
5,358
268,302
*
27,200
27,200
*
*
27,200
*
13,600
13,600
*
*
13,600
*
13,600
13,600
*
*
13,600
*
18,951,299
332,285
18,619,014
48.6
%
37.9
%
733,885
17,885,129
36.4
%
389,017
11,273
377,744
1.0
*
25,342
352,402
*
16,831
492
16,339
*
*
1,107
15,232
*
287,358
8,401
278,957
*
*
18,888
260,069
*
200,762
5,870
194,892
*
*
13,196
181,696
*
128,846
3,767
125,079
*
*
8,470
116,609
*
82,519
2,391
80,128
*
*
5,376
74,752
*
131,003
3,830
127,173
*
*
4,330
122,843
*
97,934
2,784
95,150
*
*
6,257
88,893
*
746,433
21,707
724,726
2.0
1.5
48,804
675,922
1.4
81,221
2,353
78,868
*
*
5,292
73,576
*
50,494
1,476
49,018
*
*
3,320
45,698
*
506,467
14,808
491,659
1.3
1.0
33,290
458,369
*
174,387
5,018
169,369
*
*
11,284
158,085
*
77,062
2,254
74,808
*
*
5,065
69,743
*
25,840
755
25,085
*
*
1,699
23,386
*
46,974
1,374
45,600
*
*
3,087
42,513
*
25,840
755
25,085
*
*
1,699
23,386
*
*
Less than 1%
(1)
Consists of 3,143,678 shares of common stock issuable upon
the conversion of Series B, C and D convertible preferred
stock held by Venture Investors Early Stage Fund III Limited
Partnership,
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1,615,076 shares of common stock issuable upon the
conversion of Series A and D convertible preferred stock
held by Venture Investors Early Stage Fund II Limited
Partnership, 1,596,389 shares of common stock issuable upon
the conversion of Series B, C, D and E convertible
preferred stock held by Advantage Capital Wisconsin Partners I
Limited Partnership, 214,794 shares of common stock held by
Venture Investors Early Stage Fund II Limited Partnership,
14,438 shares of common stock issuable upon the exercise of
options held by Venture Investors Early Stage Fund III Limited
Partnership, 6,620 shares of common stock issuable upon the
exercise of options held by Advantage Capital Wisconsin Partners
I Limited Partnership and 6,140 shares of common stock
issuable upon the exercise of options held by Venture Investors
Early Stage Fund II Limited Partnership. Venture Investors, LLC
is the general partner of Advantage Capital Wisconsin Partners I
Limited Partnership, Venture Investors Early Stage Fund II
Limited Partnership and Venture Investors Early Stage Fund II
Limited Partnership. The investment decisions of Venture
Investors, LLC are generally made collectively by its managers,
John P. Neis, Roger Ganser, Scott Button, George Arida, Winslow
Sargeant and Paul Weiss. Each such manager disclaims beneficial
ownership of the shares held by the foregoing entities except to
the extent of his or her pecuniary interest therein. The address
of the foregoing individuals and entities is c/o Venture
Investors, LLC 505 South Rosa Road, #201, Madison,
Wisconsin 53719.
(2)
Consists of 429,541 shares of common stock,
4,462,116 shares of common stock issuable upon the
conversion of Series A, B, C and D convertible preferred
stock, and 27,200 shares of common stock issuable upon the
exercise of options. Avalon Technology LLC is controlled by
Avalon Capital Group Inc. The controlling shareholder of Avalon
Capital Group Inc. is Theodore Waitt and, as such,
Mr. Waitt is considered to be the beneficial owner of these
securities. Mr. Waitt disclaims beneficial ownership of the
shares held by the foregoing entity except to the extent of his
pecuniary interest therein. The address of the foregoing
individual and entities is Post Office Box 2409,
La Jolla, California 92038, c/o Avalon Capital Group.
(3)
Consists of 4,765,456 shares of our common stock issuable
to Endeavors Group, LLC upon the conversion of Series C, D
and E convertible preferred stock and 27,200 shares of
common stock issuable upon the exercise of options. Michael J.
Cudahy is the managing member of The Endeavors Group, LLC and,
by virtue of his position, may be deemed to be the beneficial
owner of these securities. Each of the managing member and other
members of Endeavors Group, LLC disclaims beneficial ownership
of the shares held by Endeavors Group, LLC except to the extent
of any pecuniary interest therein. The address of the foregoing
individual and entity is c/o Endeavors Groups, LLC,
9100 N. Swan Road, Milwaukee, Wisconsin 53224.
(4)
Consists of 2,291,260 shares of common stock issuable upon
the conversion of Series B, C, D and E convertible
preferred stock and 27,200 shares of common stock issuable
upon the exercise of options. The investment decisions of Open
Prairie Ventures I, L.P. are made collectively by its
Investment Committee, the members of which are James M. Schultz,
Michael D. Peck, Dennis Beard, Jason Wrone and Lisa Probst. Each
member of the Investment Committee disclaims beneficial
ownership of the shares held by Open Prairie Ventures I,
L.P., except to the extent of his or her pecuniary interest
therein. The address of Open Prairie Ventures I, L.P. and
the foregoing individuals is 400 East Jefferson, Effingham,
Illinois 62401.
(5)
The investment decisions of Ascension Health Ventures LLC are
made by Anthony J. Speranzo, Senior Vice President and Chief
Financial Officer. Mr. Speranzo disclaims beneficial ownership
of the shares held by Ascension Health Ventures LLC, except to
the extent of his pecuniary interest therein. The address of
Ascension Health Ventures, LLC and Mr. Speranzo is 4600
Edmundson Road, Post Office Box 45998, St. Louis, Missouri
63145.
(6)
The investment decisions of the Wisconsin Alumni Research
Foundation are made by Carl Gulbrandsen, Managing Director.
Mr. Gulbrandsen disclaims beneficial ownership of the
shares held by the Wisconsin Alumni Research Foundation except
to the extent of his pecuniary interest therein. The address of
the foregoing individual and entity and Mr. Gulbrandsen is
614 Walnut Street,
13
th
Floor,
Madison, Wisconsin 53705.
102
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(7)
Consists of 475,951 shares of common stock and
362,056 shares of common stock issuable upon the exercise
of options.
(8)
Consists of 1,140,224 shares of common stock held by Cosmic
Debris, LP, 952,702 shares of common stock held by
Mr. Reckwerdt, 322,167 shares of common stock issuable to
Mr. Reckwerdt under our Series A investment agreement and
34,000 shares of common stock issuable upon the exercise of
options.
(9)
Consists of 382,622 shares of common stock and
20,400 shares of common stock issuable upon the exercise of
options.
(10)
Consists of 27,200 shares of common stock and 40,970 shares
of common stock issuable upon the exercise of options.
(11)
Consists of 170,000 shares of common stock and
95,370 shares of common stock issuable upon the exercise of
options.
(12)
Consists of 387,872 shares of common stock and
17,000 shares of common stock issuable upon the exercise of
options.
(13)
Consists of 27,200 shares of common stock and
40,970 shares of common stock issuable upon the exercise of
options.
(14)
Consists of 188,666 shares of common stock and
13,600 shares of common stock issuable upon the exercise of
options.
(15)
Consists of 40,970 shares of common stock issuable upon the
exercise of options.
(16)
Consists of 2,074,272 shares of common stock,
322,167 shares of common stock issuable to Mr. Mackie
under our Series A Investment Agreement and
34,000 shares of common stock issuable upon the exercise of
options.
(17)
Consists of 4,765,456 shares of our common stock issuable
to Endeavors Group, LLC upon the conversion of Series C, D
and E convertible preferred stock and 27,200 shares of
common stock issuable upon the exercise of options.
Mr. Cudahy is the managing member of The Endeavors Group,
LLC and, by virtue of his position, may be deemed to be the
beneficial owner of the securities. Mr. Cudahy disclaims
such beneficial ownership except to the extent of his pecuniary
interest therein.
(18)
Consists of 40,800 shares of common stock issuable upon the
exercise of options and 14,027 shares of common stock.
(19)
Consists of 3,143,678 shares of common stock issuable upon
the conversion of Series B, C and D convertibles preferred
stock held by Venture Investors Early Stage Fund III
Limited Partnership, 1,615,076 shares of common stock
issuable upon the conversion of Series A and D convertible
preferred stock held by Venture Investors Early Stage Fund II
Limited Partnership, 1,596,389 shares of common stock
issuable upon the conversion of Series B, C, D and E
convertible preferred stock held by Advantage Capital Wisconsin
Partners Limited Partnership, 214,794 shares of common
stock held by Venture Investors Early Stage Fund II Limited
Partnership, 14,438 shares of common stock issuable upon
the exercise of options held by Venture Investors Early Stage
Fund III Limited Partnership, 6,620 shares of common stock
issuable upon the exercise of options held by Advantage Capital
Wisconsin Partners I Limited Partnership and 6,140 shares
of common stock issuable upon the exercise of options held by
Venture Investors Early Stage Fund II Limited Partnership.
Venture Investors LLC is the general partner of Advantage
Capital Wisconsin Partners I Limited Partnership, Venture
Investors Early Stage Fund II Limited Partnership and
Venture Investors Early Stage Fund III Limited Partnership.
The investment decisions of Venture Investors, LLC are taken
collectively by six managers, including Mr. Neis. Each such
manager and Mr. Neis disclaim such beneficial ownership
except to the extent of his pecuniary interest therein. The
address of Mr. Neis is c/o Venture Investors, LLC,
505 South Rosa Road, #201, Madison, Wisconsin 53719.
(20)
Consists of 197,744 shares of common stock and
84,158 shares of common stock issuable upon the conversion
of Series E convertible preferred stock.
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(21)
Consists of 27,200 shares of common stock issuable upon the
exercise of options.
(22)
Consists of 13,600 shares of common stock issuable upon the
exercise of options.
(23)
Consists of 13,600 shares of common stock issuable upon the
exercise of options.
(24)
Consists of 389,017 shares of common stock issuable upon
the conversion of Series B, C, D and E convertible
preferred stock. The investment decisions of 780 TomoTherapy
Partners are made by Michael E. Skindrud, managing partner and
Richard J. Bliss, managing partner. Each of Mr. Skindrud
and Mr. Bliss disclaims such beneficial ownership, except to the
extent of his pecuniary interest therein. The address of the
foregoing individuals and entity is c/o Godfrey & Kahn,
S.C., 1 East Main Street, Suite 500, Madison, WI 53703.
(25)
Consists of 16,831 shares of common stock issuable upon the
conversion of Series E convertible preferred stock. The
investment decisions of AKRA Investments, LLC are made by Robert
F. Schultz, President. Mr. Schultz disclaims such
beneficial ownership except to the extent of his pecuniary
interest therein. The address of the foregoing individual and
entity is Post Office Box 1225, Effingham, Illinois 62401.
(26)
Consists of 66,118 shares of common stock,
221,240 shares of common stock issuable upon the conversion
of Series B, C, D and E convertible preferred stock. Baird
Venture Partners I Limited Partnership is an affiliate of Robert
W. Baird & Co. Incorporated, a registered
broker-dealer. Robert W. Baird & Co. is an underwriter
of this offering. The shares were acquired in the ordinary
course of the selling shareholders investment business and
not for the purposes of resale or distribution. Based on
information provided by or on behalf of Baird Venture Partners I
Limited Partnership, at the time of the purchase of the
securities to be resold, it had no agreements, plans or
understandings, directly or indirectly, with any person to
distribute the securities. The investment decisions of Baird
Venture Partners I Limited Partnership are made by Paul Purcell,
Paul Carbone, Bob Venable, Peter Shagory and William Filip. The
foregoing individuals disclaim such beneficial ownership except
to the extent of any pecuniary interest therein. The address of
the foregoing individuals and entity is
777 East Wisconsin Avenue, Milwaukee,
Wisconsin 53202.
(27)
Consists of 46,137 shares of common stock,
154,625 shares of common stock issuable upon the conversion
of Series B, C, D and E convertible preferred stock. BVP I
Affiliates Fund Limited Partnership is an affiliate of
Robert W. Baird & Co. Incorporated, a registered
broker-dealer. Robert W. Baird & Co. is an underwriter
of this offering. The shares were acquired in the ordinary
course of the selling shareholders investment business and
not for the purposes of resale or distribution. Based on
information provided by or on behalf of BVP I Affiliates
Fund Limited Partnership, at the time of the purchase of
the securities to be resold, it had no agreements, plans or
understandings, directly or indirectly, with any person to
distribute the securities. The investment decisions of BVP I
Affiliates Fund Limited Partnership are made by Paul
Purcell, Paul Carbone, Bob Venable, Peter Shagory and William
Filip. The foregoing individuals disclaim such beneficial
ownership except to the extent of any pecuniary interest
therein. The address of the forgoing individuals and entity is
777 East Wisconsin Avenue, Milwaukee, Wisconsin 53202.
(28)
Consists of 128,846 shares of common stock issuable upon
the conversion of Series B, C and D convertible preferred
stock. The address of Mr. Hanson is 3440 High Point Road,
Madison, Wisconsin, 53719.
(29)
Consists of 81,785 shares of common stock issuable upon the
conversion of Series B, C, D and E convertible preferred
stock and 734 conversion of Series D convertible
preferred stock underlying Series D warrants. The address
of Mr. Kelly is 1007 Hillside Avenue, Madison, Wisconsin,
53705.
(30)
Consists of 131,003 shares of common stock issuable upon
the conversion of Series B, C, D and E convertible
preferred stock. The investment decisions of Grey Ghost, LLC are
made by Max G. Lagally, Member. Mr. Lagally disclaims such
beneficial ownership except to the extent of his pecuniary
interest therein. The address of the foregoing individual and
entity is 5110 Juneau Road, Madison, Wisconsin 53705.
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(31)
Consists of 97,934 shares of common stock issuable upon the
conversion of Series B, C, D and E convertible preferred
stock. The address of Mr. Laskis is 150 East Gilman, Post
Office Box 1497, Madison, Wisconsin, 53701.
(32)
Consists of 742,484 shares of common stock issuable upon
the conversion of Series B, C and D convertible preferred
stock and 3,949 shares of common stock issuable upon the
conversion of Series D convertible preferred stock
underlying Series D warrants. The investment decisions of
Mayo Foundation for Medical Education and Research are made by
Jeffrey G. Torborg, New Ventures Manager. Mr. Torborg
disclaims such beneficial ownership, except to the extent of his
pecuniary interest therein. The address of the foregoing
individual and entity is Mayo Clinic Health Solutions, 200 First
Street SW, Rochester, Minnesota 55905.
(33)
Consists of 80,498 shares of common stock issuable upon the
conversion of Series B, C, D and E convertible preferred
stock and 723 shares of common stock issuable upon the
conversion of Series D convertible preferred stock
underlying Series D warrants. The address of Ms. Ross
is 150 East Gilman, Post Office Box 1497, Madison, Wisconsin,
53701.
(34)
Consists of 50,494 shares of common stock issuable upon the
conversion of Series E convertible preferred stock. The
investment decisions of SKL Investment Group, LLC are made by
Steven L. Grissom, Administrative Officer. Mr. Grissom
disclaims such beneficial ownership, except to the extent of his
pecuniary interest therein. The address of the foregoing
individual and entity is 121 South 17th Street, Post Office Box
1097, Mattoon, Illinois 61938.
(35)
Consists of 506,467 shares of common stock issuable upon
the conversion of Series D and E convertible preferred
stock. The investment decisions of State of Wisconsin Investment
Board are made by Chris Prestigiacomo, Portfolio Manager.
Mr. Prestigiacomo disclaims such beneficial ownership,
except to the extent of his pecuniary interest therein. The
address of the foregoing individual and entity is
121 E. Wilson St., Madison, Wisconsin 53703.
(36)
Consists of 174,387 shares of common stock issuable upon
the conversion of Series B, C, D and E convertible
preferred stock. The address of Mr. Walsh is 150 East
Gilman, Post Office Box 1497, Madison, Wisconsin, 53701.
(37)
Consists of 77,062 shares of common stock issuable upon the
conversion of Series B, C, D and E convertible preferred
stock. The investment decisions of Allan A. Weissburg Revocable
Trust are made by Allan A. Weissburg, Trustee.
Mr. Weissburg disclaims such beneficial ownership, except
to the extent of his pecuniary interest therein. The address of
the foregoing individual and entity is 11502 Hemingway Drive,
Reston, VA 20194. The address of Mr. Weissburg is 11502
Hemingway Drive, Reston, Virginia, 20194.
(38)
Consists of 25,840 shares of common stock issuable upon the
conversion of Series B convertible preferred stock. The
address of Mr. Weissburg is 4213 Winnequah Road, Monona,
Wisconsin, 53716.
(39)
Consists of 46,974 shares of common stock issuable upon the
conversion of Series B and C convertible preferred stock.
The address of Mr. Weissburg is 4213 Winnequah Road,
Monona, Wisconsin, 53716.
(40)
Consists of 25,840 shares of common stock issuable upon the
conversion of Series B convertible preferred stock. The
address of Mr. Weissburg is 4213 Winnequah Road, Monona,
Wisconsin, 53716.
105
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106
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Shares of Common
Stock Issuable
Upon Conversion
Aggregate
of the Series E
Purchase Price
Preferred Stock
$
399,992
67,325
5,767,600
970,784
999,996
168,316
20,200
3,400
83,337
14,027
499,998
84,158
429,541 shares issuable to Avalon Technology, LLC;
214,794 shares issuable to Venture Investors Early Stage
Fund II Limited Partnership;
322,167 shares issuable to T. Rockwell Mackie; and
322,167 shares issuable to Paul J. Reckwerdt.
107
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Number of
Name of
Directors
Director
One director
Sam R. Leno
One director
Frances S. Taylor
One director
Michael J. Cudahy
One director
John P. Neis
One director
Cary J. Nolan
Two directors
T. Rockwell Mackie
Paul J. Reckwerdt
(1)
Holder of 5% or more of our equity securities.
108
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approved by a majority of the members of our board of directors
and by a majority of the disinterested members of our board of
directors; and
on terms no less favorable to us than those that we believe
could be obtained from unaffiliated third parties.
109
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110
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decreasing the amount of earnings and assets available for
distribution to holders of common stock;
restricting dividends on the common stock;
diluting the voting power of the common stock;
impairing the liquidation rights of the common stock; or
delaying, deferring or preventing changes in our control or
management.
111
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112
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a merger or share exchange;
a sale, lease, exchange, mortgage, pledge, transfer or other
disposition of assets equal to 5% or more of the market value of
the stock or consolidated assets of the resident domestic
corporation or 10% of its consolidated earning power or income;
the issuance of stock or rights to purchase stock with a market
value equal to 5% or more of the outstanding stock of the
resident domestic corporation;
the adoption of a plan of liquidation or dissolution; or
certain other transactions involving an interested shareholder.
its principal offices are located in Wisconsin;
it has significant business operations located in Wisconsin;
more than 10% of the holders of record of its shares are
residents of Wisconsin; or
more than 10% of its shares are held of record by residents of
Wisconsin.
113
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the board of directors approved the acquisition of the stock
prior to such shareholders acquisition date;
the business combination is approved by a majority of the
outstanding voting stock not beneficially owned by the
interested shareholder; or
the consideration to be received by shareholders meets certain
fair price requirements of the statute with respect to form and
amount.
the aggregate value of the per share consideration is equal to
the highest of:
the highest price paid for any common shares of the corporation
by the significant shareholder in the transaction in which it
became a significant shareholder or within two years before the
date of the business combination;
the market value of the corporations shares on the date of
commencement of any tender offer by the significant shareholder,
the date on which the person became a significant shareholder or
the date of the first public announcement of the proposed
business combination, whichever is higher; or
the highest preferential liquidation or dissolution distribution
to which holders of the shares would be entitled; and
either cash, or the form of consideration used by the
significant shareholder to acquire the largest number of shares,
is offered.
114
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acquire more than 5% of its outstanding voting shares at a price
above the market price from any individual or organization that
owns more than 3% of the outstanding voting shares and has held
such shares for less than two years, unless a similar offer is
made to acquire all voting shares and all securities which may
be converted into voting shares; or
sell or option assets of the corporation which amount to 10% or
more of the market value of the corporation, unless the
corporation has at least three independent directors (directors
who are not officers or employees) and a majority of the
independent directors vote not to have this provision apply to
the corporation.
115
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169,848 shares, which are not subject to the
180-day
lock-up
period described below, may be sold immediately upon the date of
this prospectus;
250,875 shares, which are not subject to the
180-day
lock-up
period described below, may be sold beginning 90 days after
the date of this prospectus;
33,199,580 additional shares may be sold upon expiration of the
180-day
lock-up
period described below, 18,245,256 of which would be
subject to volume, manner of sale and other limitations under
Rule 144; and
the remaining 3,787,534 shares will be eligible for resale
pursuant to Rule 144 upon the expiration of various one
year holding periods during the six months following the
expiration of the
180-day
lock-up
period.
116
Table of Contents
transactions relating to shares of common stock or other
securities acquired in open market transactions, unless such
transaction would result in the filing of any reports pursuant
to Section 16 of the Securities Exchange Act of 1934;
bona fide gifts (which shall include, in the case of an
individual, a gift occurring at death by will or intestacy, and
transfers during lifetime to a trust or other entity for bona
fide estate planning or tax purposes); and
distributions to limited partners or shareholders or transfers
to controlled or controlling entities or entities under common
control, provided that in the case of any transfer or
distribution pursuant to this or the immediately preceding
bullet point, each donee, distributee or other transferee shall
enter into a similar
lock-up
agreement.
one percent of our then-outstanding shares of common stock,
which is expected to equal approximately 483,453 shares
immediately after this offering; and
the average weekly trading volume of our common stock on the
Nasdaq Global Market during the four calendar weeks preceding
the filing of a notice of the sale on Form 144.
117
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118
Table of Contents
an individual who is a citizen or resident of the United States;
a corporation, partnership or any other organization taxable as
a corporation or partnership for U.S. federal tax purposes,
created or organized in the United States or under the laws of
the United States or of any state thereof or the District of
Columbia;
an estate, the income of which is included in gross income for
United States federal income tax purposes regardless of its
source; or
a trust (A) if (i) a United States court is able to
exercise primary supervision over the trusts
administration and (ii) one or more United States persons
have the authority to control all of the trusts
substantial decisions or (B) that has a valid election in
effect under applicable United States Treasury Regulations to be
treated as a United States person.
insurance companies;
real estate investment companies, regulated investment companies
or grantor trusts;
tax-exempt organizations;
financial institutions;
brokers or dealers in securities or currencies;
partnerships or other pass-through entities;
regulated investment companies;
pension plans;
holders that own or are deemed to own more than 5% of our common
stock;
119
Table of Contents
owners that hold our common stock as part of a straddle, hedge,
conversion transaction, synthetic security or other integrated
investment;
persons that received our common stock as compensation for
performance of services;
persons that have a functional currency other than the United
States dollar; and
certain former citizens or residents of the United States.
120
Table of Contents
the gain is effectively connected with your conduct of a trade
or business in the United States (and if an applicable United
States income tax treaty so provides, is also attributable to a
permanent establishment or a fixed base maintained by you), in
which case you generally will be taxed at the graduated U.S.
federal income tax rates applicable to U.S. persons and, if you
are a foreign corporation, the additional branch profits tax
described above in Distributions on Our Common Stock
may apply; or
you are an individual who is present in the United States for
183 days or more in the taxable year of the sale, exchange
or disposition and certain other conditions are met, in which
case you will be subject to a 30% tax on the net gain derived
from the disposition, which may be offset by your U.S. source
capital losses, if any.
121
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122
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Number
of Shares
Per Share
Without Option
With Option
$
$
$
$
$
$
$
$
$
$
$
$
123
Table of Contents
offer, pledge, sell or contract to sell any common stock;
sell any option or contract to purchase any common stock;
purchase any option or contract to sell any common stock;
grant any option, right or warrant for the sale of any common
stock;
lend or otherwise dispose of or transfer any common stock;
request or demand that we file a registration statement related
to the common stock; or
enter into any swap or other agreement that transfers, in whole
or in part, the economic consequence of ownership of any common
stock whether any such swap or transaction is to be settled by
delivery of shares or other securities, in cash or otherwise.
124
Table of Contents
the valuation multiples of publicly traded companies that the
underwriters believe to be comparable to us;
our financial information;
the history of, and the prospects for, our company and the
industry in which we compete;
an assessment of our management; its past and present
operations, and the prospects for, and timing of, our future
revenue;
the present state of our development; and
the above factors in relation to market values and various
valuation measures of other companies engaged in activities
similar to ours.
125
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126
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127
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Table of Contents
F-2
Table of Contents
F-3
Table of Contents
Year Ended December 31,
2004
2005
2006
$
45,460
$
75,754
$
156,102
28,078
50,047
102,653
17,382
25,707
53,449
6,492
11,372
21,397
7,827
14,197
23,119
14,319
25,569
44,516
3,063
138
8,933
(31
)
179
(1,202
)
3,032
317
7,731
151
78
(7,184
)
2,881
239
14,915
(2,140
)
2,881
239
12,775
(41,960
)
(68,075
)
(46,253
)
$
(39,079
)
$
(67,836
)
$
(33,478
)
$
(5.40
)
$
(8.48
)
$
(3.78
)
7,234,229
7,995,629
8,855,870
F-4
Table of Contents
Shareholders Equity (Deficit)
Redeemable Convertible
Additional
Total
Preferred Stock
Common Stock
Paid-in
Unearned
Accumulated
Shareholders
Shares
Amount
Shares
Amount
Capital
Compensation
Deficit
Equity (Deficit)
18,897,472
$
35,597
6,909,230
$
69
$
816
$
(1
)
$
(45,588
)
$
(44,704
)
41,960
(41,960
)
(41,960
)
558,993
6
31
37
25
(25
)
26
26
3,808,000
6,677
2,881
2,881
22,705,472
84,234
7,468,223
75
872
(84,667
)
(83,720
)
68,075
(68,075
)
(68,075
)
969,674
9
141
150
159,332
182
2,356,435
13,911
239
239
25,221,239
166,402
8,437,897
84
1,013
(152,503
)
(151,406
)
46,253
(46,253
)
(46,253
)
826,394
9
970
979
232
232
(444
)
(444
)
8
12,775
12,775
25,221,239
$
212,663
9,264,291
$
93
$
1,771
$
$
(185,981
)
$
(184,117
)
F-5
Table of Contents
Year Ended December 31,
2004
2005
2006
(in thousands)
$
2,881
$
239
$
12,775
859
1,678
3,053
26
232
3,078
44
100
(7,797
)
(15
)
(16
)
31
(214
)
(3,265
)
(9,199
)
(4,815
)
(7,561
)
(12,543
)
(11,743
)
55
(553
)
(176
)
3,191
2,087
6,618
(7,429
)
26,590
(15,084
)
1,996
6,558
9,110
660
3,360
6,350
1,701
242
2,384
(6,857
)
18,443
3,902
(2,861
)
(2,205
)
(10,974
)
(707
)
(1,832
)
(4,671
)
(133
)
(378
)
(3,568
)
(4,170
)
(16,023
)
900
(66
)
(70
)
(25
)
4,880
13,911
8
182
37
150
979
4,851
14,173
1,862
(5,574
)
28,446
(10,259
)
7,524
1,950
30,396
$
1,950
$
30,396
$
20,137
$
15
$
36
$
97
205
172
$
368
$
$
1,797
444
F-6
Table of Contents
F-7
Table of Contents
F-8
Table of Contents
December 31,
December 31,
2005
2006
$
13,344
$
30,091
5,921
4,762
9,018
5,173
$
28,283
$
40,026
December 31,
December 31,
2005
2006
$
3,122
$
5,166
2,054
3,706
1,257
1,522
3,087
6,744
3,202
9,520
20,340
(2,864
)
(4,871
)
$
6,656
$
15,469
5 to 10 years
3 to 5 years
Lesser of useful life or the
remaining lease term
December 31,
December 31,
2005
2006
$
2,539
$
7,210
(770
)
(1,861
)
$
1,769
$
5,349
F-9
Table of Contents
December 31,
December 31,
2005
2006
$
2,681
$
2,923
6,119
10,138
651
(244
)
(6,528
)
(7,510
)
$
2,923
$
5,307
F-10
Table of Contents
Persuasive evidence of an arrangement
exists.
The Company requires evidence of a
purchase order with a customer specifying the terms and
conditions of the product or services to be delivered, typically
in the form of a signed quotation or purchase order from the
customer.
Title and risk of loss have been transferred to the
customer.
During the installation phase, each
System is fully tested to confirm that it functions within
operating specifications. Upon completion of the test
procedures, the customer signs the acceptance test procedures
document, or ATP, acknowledging acceptance of the system.
Revenue for the sale of systems is recognized upon receipt of
the signed ATP.
The sales price is fixed or determinable.
All
contract terms are fixed in the signed quotation or purchase
order received from the customer. The contracts do not contain
rights of cancellation, return, exchanges or refunds.
Collection is reasonably assured.
Due to the
fact that the Companys sales are to hospitals and cancer
treatment centers with significant resources, the Company
considers accounts receivable to be fully collectible. In
addition, the Companys contracts generally require staged
payments as follows: 20% to 30% down payment, 60% to 70% due
upon shipment and 10% due upon final acceptance by the customer.
F-11
Table of Contents
Year Ended December 31,
2004
2005
2006
$
44,984
$
73,593
$
148,121
476
2,161
7,981
$
45,460
$
75,754
$
156,102
F-12
Table of Contents
F-13
Table of Contents
Year Ended December 31,
2004
2005
2006
$
0.40
$
0.03
$
1.68
(0.24
)
$
0.40
$
0.03
$
1.44
$
(5.40
)
$
(8.48
)
$
(3.78
)
7,234,229
7,995,629
8,855,870
Year Ended December 31,
2004
2005
2006
22,705,472
25,221,239
25,221,239
1,288,669
1,288,669
1,288,669
5,030,198
8,168,416
9,621,579
29,024,339
34,678,324
36,131,487
F-14
Table of Contents
Year Ended
December 31,
2006
(unaudited)
$
(33,478
)
8,855,870
$
(3.78
)
$
(33,478
)
46,253
$
12,775
8,855,870
25,221,239
1,288,669
35,365,778
$
0.36
8,855,870
25,221,239
1,288,669
4,764,605
40,130,383
$
0.32
2,152,113
2,152,113
F-15
Table of Contents
Year Ended December 31,
2004
2005
2006
$
42,710
$
59,049
$
88,937
2,750
5,552
33,586
11,153
33,579
$
45,460
$
75,754
$
156,102
F-16
Table of Contents
F-17
Table of Contents
$
34
114
133
137
330
127
$
875
Year Ended December 31,
2004
2005
2006
$
40
$
57
$
172
111
21
441
151
78
613
(7,797
)
$
151
$
78
$
(7,184
)
F-18
Table of Contents
2004
2005
2006
35.0
%
35.0
%
35.0
%
2.1
33.3
2.1
5.6
3.8
5.9
(35.8
)
(52.9
)
(135.4
)
(3.6
)
4.3
(1.9
)
5.3
(1.2
)
5.0
%
24.5
%
(92.9
)%
December 31,
2005
2006
$
9,570
$
4,585
1,861
1,643
1,111
2,905
1,307
979
13,849
10,112
544
694
118
134
50
234
712
1,062
13,137
9,050
(13,137
)
(1,253
)
$
$
7,797
F-19
Table of Contents
$
1,962
2,021
2,080
2,139
2,041
8,945
$
19,188
F-20
Table of Contents
December 31,
2005
2006
25,687
25,687
3,686
3,686
9,353
9,353
5,987
5,987
3,839
3,839
2,356
2,356
25,221
25,221
$
4,588
$
4,828
12,587
13,316
10,804
11,344
7,843
8,267
14,000
14,832
$
49,822
$
52,587
$
2,938
$
2,938
8,828
8,828
8,895
8,895
6,734
6,734
13,911
13,919
$
41,306
$
41,314
F-21
Table of Contents
F-22
Table of Contents
F-23
Table of Contents
F-24
Table of Contents
Shares
Number of
Weighted-
Available
Options
Average
for Grant
Outstanding
Exercise Price
574,774
4,102,652
$
0.15
3,142,857
(886,720
)
886,720
2.18
(558,993
)
0.07
25,165
(25,165
)
0.29
2,856,076
4,405,214
0.57
2,720,000
(4,334,135
)
4,334,135
3.13
(969,675
)
0.15
66,912
(66,912
)
0.86
1,308,853
7,702,762
2.06
3,264,000
(2,341,833
)
2,341,833
6.63
(826,416
)
1.18
62,254
(62,254
)
3.04
2,293,274
9,155,925
$
3.30
F-25
Table of Contents
Number of
Fair Value
Intrinsic
Options
Estimate
Value per
Granted
Exercise Price
per Share
Share
34,000
$
4.99
$
4.99
$
46,920
5.35
5.35
108,800
5.35
5.35
190,313
6.75
6.75
3,400
6.75
6.75
1,958,400
6.75
6.75
Average
Number of
Remaining
Number of
Options
Contractual Life
Options
Weighted-Average
Outstanding
(Years)
Exercisable
Exercise Price
826,880
3.13
826,880
$
0.08
1,440,549
6.45
1,375,949
0.34
4,550,064
6.98
1,211,231
3.13
186,320
5.40
2,152,112
5.92
9,155,925
6.27
3,414,060
1.26
$
46,695,218
$
24,376,388
F-26
Table of Contents
Year Ended December 31,
2004
2005
2006
5.0
5.0
4.25
5.0
%
5.0
%
3.8-5.1
%
N/A
N/A
65
%
0
%
0
%
0
%
0
%
0
%
2.9
%
F-27
Table of Contents
F-28
Table of Contents
Table of Contents
Table of Contents
Item 13.
Other
Expenses of Issuance and Distribution.
$
21,534
20,625
125,000
290,000
800,000
450,000
15,000
77,841
$
1,800,000
Item 14.
Indemnification
of Directors and Officers.
(i)
by majority vote of a disinterested quorum of the Board of
Directors,
(ii)
by independent legal counsel chosen by a quorum of disinterested
directors or its committee,
(iii)
by a panel of three arbitrators (one of which is chosen by a
quorum of disinterested directors),
(iv)
by the vote of the shareholders,
II-1
Table of Contents
(v)
by a court; or
(vi)
by any other method permitted in Section 180.0858 of the
Wisconsin Business Corporation Law.
Item 15.
Recent
Sales of Unregistered Securities.
II-2
Table of Contents
Item 16.
Exhibits
and Financial Statement Schedules.
(a)
Exhibits
II-3
Table of Contents
Exhibit
10
.4
License Agreement, dated
February 22, 1999, by and between the Registrant and
Wisconsin Alumni Research Foundation, as amended
10
.5**
Equity Agreement, dated
February 22, 1999, by and between the Registrant and
Wisconsin Alumni Research Foundation
10
.6**
Employment Agreement by and
between the Registrant and Frederick A. Robertson, M.D.
10
.7**
Employment Agreement by and
between the Registrant and Stephen C. Hathaway
10
.8**
Employment Agreement by and
between the Registrant and Paul J. Reckwerdt
10
.9**
Employment Agreement by and
between the Registrant and John H. Hughes
10
.10**
Employment Agreement by and
between the Registrant and Gustavo H. Olivera
10
.11
Development and OEM Supply
Agreement by and between the Registrant and Analogic
Corporation, dated January 27, 2003
10
.12
Manufacturing and Supply Agreement
by and between the Registrant and Siemens Medical Solutions USA,
Inc., dated November 14, 2003, as amended
10
.13**
Lease Agreement, dated
January 26, 2005, as amended, by and between the Registrant
and Old Sauk Trails Park Limited Partnership for the property
located at 1240 Deming Way, Madison, WI
10
.14**
Lease Agreement, dated
October 28, 2005, by and between the Registrant and
Adelphia, LLC for the property located at 1209 Deming Way,
Madison, Wisconsin
10
.15**
Time Sharing Agreement, effective
December 2005, by and between the Registrant and Cozzens and
Cudahy Air, Inc.
10
.16**
Incentive Stock Option Plan, as
amended, and forms of option agreements thereunder
10
.17**
2000 Stock Option Plan, as
amended, and forms of option agreements thereunder
10
.18**
2002 Stock Option Plan, as
amended, and forms of option agreements thereunder
10
.19**
2007 Equity Incentive Plan
10
.20**
2007 Employee Stock Purchase Plan
10
.21**
Standard Terms and Conditions of
Sale
10
.22**
International Standard Terms and
Conditions of Sale
10
.23**
Tomo Lifecycle Care (TLC) and
Partnership Terms and Conditions
10
.24**
Logistics Services Agreement
between the Registrant and Kuehne + Nagal Inc., dated
September 7, 2005
10
.25
Purchase Order between the
Registrant and ReMedPar, Inc., dated February 7, 2007
10
.26**
Form of Director and Executive
Officer Indemnification Agreement
10
.27**
Form of Noncompetition Agreement
10
.28**
Form of Assignment of Inventions
Agreement
10
.29**
Form of Confidentiality Agreement
10
.30
Variable Pay Plan
21
.1**
Subsidiary of the Registrant
23
.1
Consent of Grant Thornton LLP,
independent registered public accounting firm
23
.2*
Consent of Michael Best &
Friedrich LLP (included in Exhibit 5.1)
23
.3
Consent of Virchow Krause
Valuation, LLC
24
.1**
Power of Attorney (included in
signature page to Registration Statement)
*
To be filed by amendment.
**
Previously filed.
Confidential treatment has been requested for portions of this
exhibit. These portions have been omitted from the Registration
Statement and submitted separately to the Securities and
Exchange Commission.
Table of Contents
Item 17.
Undertakings.
II-5
Table of Contents
II-6
Table of Contents
By:
II-7
Table of Contents
Director
April 19, 2007
Director
April 19, 2007
II-8
Table of Contents
Exhibit
1
.1*
Form of Underwriting Agreement
3
.1**
Amended and Restated Articles of
Incorporation of the Registrant, as currently in effect
3
.2
Form of Amended and Restated
Articles of Incorporation of the Registrant, to be in effect
upon completion of the offering
3
.3**
Bylaws of the Registrant, as
currently in effect
3
.4**
Form of Amended and Restated
Bylaws of the Registrant, to be in effect upon completion of the
offering
4
.1**
Form of the Registrants
Common Stock Certificate
4
.2**
Form of Series D warrant
issued by Registrant on February 18, 2004
5
.1*
Opinion of Michael Best &
Friedrich LLP, counsel to the Registrant, as to the validity of
our common stock (including consent)
10
.1**
Amended and Restated Investment
Agreement, dated February 8, 2007, by and among the
Registrant and the other parties thereto, as amended
10
.2**
Loan Agreement, dated
February 11, 1999, by and between the Registrant and
Venture Investors Early Stage Fund II Limited Partnership,
as amended
10
.3**
Note and Warrant Purchase
Agreement, by and among the Registrant and the other parties
thereto dated May 1, 2003, as amended
10
.4
License Agreement, dated
February 22, 1999, by and between the Registrant and
Wisconsin Alumni Research Foundation, as amended
10
.5**
Equity Agreement, dated
February 22, 1999, by and between the Registrant and
Wisconsin Alumni Research Foundation
10
.6**
Employment Agreement by and
between the Registrant and Frederick A. Robertson, M.D.
10
.7**
Employment Agreement by and
between the Registrant and Stephen C. Hathaway
10
.8**
Employment Agreement by and
between the Registrant and Paul J. Reckwerdt
10
.9**
Employment Agreement by and
between the Registrant and John H. Hughes
10
.10**
Employment Agreement by and
between the Registrant and Gustavo H. Olivera
10
.11
Development and OEM Supply
Agreement by and between the Registrant and Analogic
Corporation, dated January 27, 2003
10
.12
Manufacturing and Supply Agreement
by and between the Registrant and Siemens Medical Solutions USA,
Inc., dated November 14, 2003, as amended
10
.13**
Lease Agreement, dated
January 26, 2005, as amended, by and between the Registrant
and Old Sauk Trails Park Limited Partnership for the property
located at 1240 Deming Way, Madison, WI
10
.14**
Lease Agreement, dated
October 28, 2005, by and between the Registrant and
Adelphia, LLC for the property located at 1209 Deming Way,
Madison, Wisconsin
10
.15**
Time Sharing Agreement, effective
December 2005, by and between the Registrant and Cozzens and
Cudahy Air, Inc.
10
.16**
Incentive Stock Option Plan, as
amended, and forms of option agreements thereunder
10
.17**
2000 Stock Option Plan, as
amended, and forms of option agreements thereunder
10
.18**
2002 Stock Option Plan, as
amended, and forms of option agreements thereunder
10
.19**
2007 Equity Incentive Plan
10
.20**
2007 Employee Stock Purchase Plan
10
.21**
Standard Terms and Conditions of
Sale
10
.22**
International Standard Terms and
Conditions of Sale
Table of Contents
Exhibit
10
.23**
Tomo Lifecycle Care (TLC) and
Partnership Terms and Conditions
10
.24**
Logistics Services Agreement
between the Registrant and Kuehne + Nagal Inc., dated
September 7, 2005
10
.25
Purchase Order between the
Registrant and ReMedPar, Inc., dated February 7, 2007
10
.26**
Form of Director and Executive
Officer Indemnification Agreement
10
.27**
Form of Noncompetition Agreement
10
.28**
Form of Assignment of Inventions
Agreement
10
.29**
Form of Confidentiality Agreement
10
.30
Variable Pay Plan
21
.1**
Subsidiary of the Registrant
23
.1
Consent of Grant Thornton LLP,
independent registered public accounting firm
23
.2*
Consent of Michael Best &
Friedrich LLP (included in Exhibit 5.1)
23
.3
Consent of Virchow Krause
Valuation, LLC
24
.1**
Power of Attorney (included in
signature page to Registration Statement)
*
To be filed by amendment.
**
Previously filed.
Confidential treatment has been requested for portions of this
exhibit. These portions have been omitted from the Registration
Statement and submitted separately to the Securities and
Exchange Commission.
2
3
|
Shawn D. Guse
|
Vice President, Secretary, and General Counsel
|
Dated: April ___, 2007
|
4
Page 1 of 18
Page 2 of 18
Cumulative Product Units Sold | Royalty Per | |||
or Leased | Product Unit | |||
[ * ]
|
$[ * ] | |||
[ * ]
|
$[ * ] | |||
[ * ]
|
$[ * ] |
Page 3 of 18
Page 4 of 18
Page 5 of 18
Page 6 of 18
Page 7 of 18
(a) |
Wisconsin Alumni Research Foundation
Attn: Managing Director 614 Walnut Street Madison, Wisconsin 53705 |
||
(b) |
TomoTherapy Incorporated
Attn: President P.O. Box 8024 Madison, Wisconsin 53708-8024 |
Page 8 of 18
WISCONSIN ALUMNI RESEARCH FOUNDATION | ||||||
|
||||||
By:
|
/s/ Richard H. Leazer | Date: 2/24, 1999 | ||||
|
||||||
|
Richard H. Leazer, Managing Director | |||||
|
||||||
TOMOTHERAPY INCORPORATED | ||||||
|
||||||
By:
|
/s/ Paul J. Reckwerdt | Date: 2/24, 1999 | ||||
|
||||||
|
Paul J. Reckwerdt, Vice-President | |||||
|
||||||
Reviewed by WARFs Attorney: | ||||||
|
||||||
/s/ Elizabeth L.R. Donley | 2/27, 1999 | |||||
Elizabeth L.R. Donley, Esq. |
Page 9 of 18
Page 10 of 18
Page 11 of 18
Page 12 of 18
APPLICATION | |||||||||
REFERENCE | PATENT | ISSUE | SERIAL | ||||||
NUMBER | COUNTRY | NUMBER | DATE | NUMBER | |||||
RADIATION THERAPY SYSTEM (Swerdloff, Mackie, Holmes) | |||||||||
|
|||||||||
P92138EP |
EPO
|
| | 97113657.7 | |||||
|
|||||||||
DYNAMIC COLLIMATOR FOR RADIATION THERAPY (Swerdloff, Mackie, Holmes, Reckwerdt) | |||||||||
|
|||||||||
P92138US |
UNITED STATES
|
5,442,675. | 8/15/95. | | |||||
|
|||||||||
VERIFICATION SYSTEM FOR RADIATION THERAPY (Swerdloff, Mackie, Holmes) | |||||||||
|
|||||||||
P92140US |
UNITED STATES
|
5,394,452. | 2/28/95. | | |||||
P92140IL |
ISRAEL
|
109962 | |||||||
|
|||||||||
MULTI-LEAF RADIATION ATTENUATOR FOR RADIATION THERAPY (Swerdloff, Mackie, Holmes) | |||||||||
|
|||||||||
P92142US |
UNITED STATES
|
5,351,280. | 9/27/94. | | |||||
P92142DE |
GERMANY
|
94920712.0 | |||||||
P92142FR |
FRANCE
|
94920712.0 | |||||||
P92142GB |
UNITED KINGDOM
|
94920712.0 | |||||||
P92142IL |
ISRAEL
|
109962 | |||||||
P92142JP |
JAPAN
|
8-511451 | 12/03/96 | ||||||
P92142NL |
NETHERLANDS
|
94920712.0 |
Page 13 of 18
Page 14 of 18
APPLICATION | ||||||||||||
REFERENCE | PATENT | ISSUE | SERIAL | |||||||||
NUMBER | COUNTRY | NUMBER | DATE | NUMBER | ||||||||
DYNAMIC BEAM FLATTENING APPARATUS FOR RADIATION THERAPY (Swerdloff, Mackie, Holmes) | ||||||||||||
|
||||||||||||
P95201US
|
UNITED STATES | 5,625,663. | 04/29/97. | |||||||||
|
||||||||||||
INTERFACE FOR RADIATION THERAPY MACHINE(SwerdIoff, Mackie, Holmes) | ||||||||||||
P95202US
|
UNITED STATES | 5,661,773 | 08/26/97 | |||||||||
|
||||||||||||
RADIATION THERAPY SYSTEM WITH CONSTRAINED ROTATIONAL FREEDOM (Swerdloff, Mackie, Holmes) | ||||||||||||
|
||||||||||||
P95254US
|
UNITED STATES | 5,724,400. | 03/03/98. | |||||||||
|
||||||||||||
METHOD AND APPARATUS FOR CALIBRATION OF RADIATION THERAPY EQUIPMENT AND VERIFICATION OF RADIATION TREATMENT (Mackie, Reckwerdt, McNutt) | ||||||||||||
|
||||||||||||
P98069US
|
UNITED STATES | | | | ||||||||
|
||||||||||||
RADIATION THERAPY SYSTEM WITH CONSTRAINED ROTATIONAL FREEDOM AND DYNAMIC COLLIMATOR (Swerdloff, Mackie, Holmes) | ||||||||||||
|
||||||||||||
P98167IL
|
ISRAEL | |
Page 15 of 18
Licensee:
|
Agreement No: | |||||||
|
||||||||
Inventor:
|
P#: | P | ||||||
|
||||||||
Period Covered:
|
From: | / / | Through: | / / | ||||
|
||||||||
|
||||||||
Prepared By:
|
Date: | |||||||
|
||||||||
Approved By:
|
Date: | |||||||
Report Type:
|
o | Single Product Line Report: | ||
|
||||
|
o | Multiproduct Summary Report. Page 1 of Pages | ||
|
||||
|
o | Product Line Detail. Line: Tradename: Page: | ||
|
||||
Report Currency:
|
o | U.S. Dollars o Other |
Gross | Less | Net | Royalty | Period Royalty Amount | ||||||||||||||||||||
Country | Sales | Allowances | Sales | Rate | This Year | Last Year | ||||||||||||||||||
U.S.A.
|
||||||||||||||||||||||||
Canada
|
||||||||||||||||||||||||
Europe:
|
||||||||||||||||||||||||
Japan
|
||||||||||||||||||||||||
Other:
|
||||||||||||||||||||||||
TOTAL:
|
||||||||||||||||||||||||
Page 16 of 18
A. | Date development plan initiated and time period covered by this report. | |
B. | Development Report (4-8 paragraphs). |
1. | Activities completed since last report including the object and parameters of the development, when initiated, when completed and the results. | ||
2. | Activities currently under investigation, i.e., ongoing activities including object and parameters of such activities, when initiated, and projected date of completion. |
C. | Future Development Activities (4-8 paragraphs). |
1. | Activities to be undertaken before next report including, but not limited to, the type and object of any studies conducted and their projected starting and completion dates. | ||
2. | Estimated total development time remaining before a product will be commercialized. |
D. | Changes to initial development plan (2-4 paragraphs). |
1. | Reasons for change. | ||
2. | Variables that may cause additional changes. |
E. | Items to be provided if applicable: |
1. | Information relating to Product that has become publicly available, e.g., published articles, competing products, patents, etc. | ||
2. | Development work being performed by third parties other than TomoTherapy to include name of third party, reasons for use of third party, planned future uses of third parties including reasons why and type of work. | ||
3. | Update of competitive information trends in industry, government compliance (if applicable) and market plan. |
Page 17 of 18
Page 18 of 18
a. | Design: ANALOGIC shall design the Components in accordance with the Engineering Requirement Specification (SPECIFICATION) attached as Exhibit 1 , in accordance with the Milestones attached as Exhibit 2 . |
b. | Development Test Bed: ANALOGIC shall provide to TOMOTHERAPY one (1) prototype of the Components. Each party shall perform all tests required of it respectively, by the Prototype Testing section of the Development Plan as set forth in the SPECIFICATION and the prototype will be suitable for regulatory testing. | ||
c. | First (1 st ) Pilot Production Components: In accordance with Milestones ANALOGIC shall produce and deliver to TOMOTHERAPY three (3) 1st pilot production Components which meet the criteria specified in the SPECIFICATION. Each party shall perform all tests required of it as set forth in the SPECIFICATION. TOMOTHERAPY may request changes to the design of the 1 st pilot production Components in accordance with Section l(g), below. Certain components of the 1 st pilot production Components such as the BCS, DCS, RCS, DAS, and cabling will not have been manufactured per the cGMP/QSR guidelines. The components of the Components which do not meet these guidelines will have to be exchanged, remanufactured, or brought into compliance by other means prior to shipment to an end user. The methodology, documentation, and costs of how this will be accomplished will be mutually agreed upon on a component by component basis. | ||
d. | Second (2 nd ) Pilot Production Components: In accordance with Milestones and any modifications or changes to the SPECIFICATION requested by TOMOTHERAPY and agreed to by ANALOGIC, ANALOGIC shall produce and deliver to TOMOTHERAPY six (6) 2 nd pilot production units of the Components which incorporate any such changes to the prototype or the 1 st pilot production Components, and meet the SPECIFICATION. ANALOGIC shall perform all tests required to meet the SPECIFICATIONS. TOMOTHERAPY may request changes to the design of pilot production Components in accordance with Section l(g), below. With the shipment of any 2 nd pilot production Components (assuming the design has been frozen and the final documentation has been completed) and all future Components to TOMOTHERAPY, ANALOGIC will provide to TOMOTHERAPY a technical file which meets the requirements of cGMP/QSR and/or CE MDD. | ||
e. | NRE: TOMOTHERAPY will pay ANALOGIC for the Non-Recurring Engineering (NRE) in accordance with the agreed milestones attached as Exhibit 2. | ||
f. | Manufacturing: The Components with the exception of 1.c will be manufactured by ANALOGIC so as to qualify and validate all manufacturing processes in accordance with the Good Manufacturing Practices and the Quality System Regulation promulgated by the United States Food and Drug Administration (FDA) and International Standards Organizations ISO 9001. | ||
For a period commencing with the shipment to a clinical user (in this Agreement, clinical user includes TOMOTHERAPYs Centers of Excellence institutions) of the first pilot production HI-ART II meeting SPECIFICATIONS and continuing for a period of four and one half years thereafter, ANALOGIC will be the exclusive manufacturer of the Components, provided however, that ANALOGICS manufacturing exclusivity for tables only applies to the [ * ] units ordered |
by TOMOTHERAPY. After the first [ * ] tables are purchased by TOMOTHERAPY, TOMOTHERAPY may procure or manufacture another table. However, it is understood by the Parties that ANALOGIC owns all rights to its table design. Similarly, after the 4 and one half year manufacturing exclusivity for the Components, TOMOTHERAPY may procure or manufacture the Components of another design. It being understood by the Parties that ANALOGIC owns all rights to its Components design. | |||
g. | Engineering Changes: ANALOGIC shall transmit to TOMOTHERAPY for approval all proposed Engineering Change Orders (ECO) that have, or could potentially have, an impact on the form, fit, function, SPECIFICATIONS or regulatory approvals of the Components. Specifically in regard to the impact on regulatory approvals, all ECOs relating to those ANALOGIC Components which are called out in TOMOTHERAPYS standards construction file shall be transmitted to and approved by TOMOTHERAPY. TOMOTHERAPY is responsible for insuring that ANALOGIC has an updated list of relevant Components, which are listed, in TOMOTHERAPYS standard construction file. TOMOTHERAPY must respond within 48 hours after receiving all ECO information. ECOs which do not effect fit, form or function will not require approval by TOMOTHERAPY. TOMOTHERAPY will not need to approve any ECO which is required by regulatory authority. These requirements shall remain in effect throughout the production phase of this Agreement. If TOMOTHERAPY desires to make a change to the SPECIFICATION for the Components at any time, it will make a written request for change to ANALOGIC and ANALOGIC will respond in writing as to the effect(s) of the change (Change Implications), if any, including without limitation, the Components availability, Components price, and NRE. ANALOGIC will not be obliged to proceed with making any requested changes unless the parties above first agree to the change implications in writing. ANALOGIC will provide copies of all final Engineering Changes Orders that are required by regulatory authority, that impact any ANALOGIC Component listed in the standards construction file, or those requested by TOMOTHERAPY. These copies will include the cover page and excerpts that sufficiently describe the change. | ||
h. | Records; Regulatory Approval: |
i. | During the term of this Agreement, ANALOGIC shall keep detailed records of all materials, processes, designs, protocols, and tests relevant to the Components and all information required by the United States Food and Drug Administration (FDA) for approval of the manufacturing and marketing of the Components that are not explicitly the responsibility of TOMOTHERAPY under this Agreement. However, certain components of the 1 st pilot production as described in section l.c may not follow cGMP and will be brought into compliance by an agreed method on a component by component basis. ANALOGIC shall submit copies of such records to TOMOTHERAPY upon TOMOTHERAPYS request. TOMOTHERAPY will be responsible for filing |
with the FDA and obtaining all other necessary regulatory approvals to market and sell the System. | |||
ii. | ANALOGIC hereby agrees to make available to TOMOTHERAPY all technical information within its control with respect to the Components and ANALOGICs operations that is required by regulatory clearances such as the United States Food and Drug Administration to obtain 510(k) approval and required by a notified body to obtain the CE mark. TOMOTHERAPY shall treat all such information as Confidential Information in accordance with Section 16 of this Agreement. | ||
iii. | In the event that any component or any of the Components designed or manufactured by ANALOGIC of the Product are recalled by TOMOTHERAPY or ANALOGIC solely as the result of (A) ANALOGICs gross negligence or willful misconduct, (B) the recalled Components failure to meet the SPECIFICATIONS, (C) ANALOGICs failure to comply with Quality System Regulation, Good Manufacturing Practices, or ISO 9001,or (D) any other material breach of this Agreement by ANALOGIC, ANALOGIC at its option shall either: provide replacement parts to TOMOTHERAPY as soon as is reasonably possible or accept the return of the affected units from TOMOTHERAPY for repair by ANALOGIC. The Parties will cooperate fully with each other (including obtaining advance approval of all recall-related expenses to be paid by ANALOGIC, which approval shall not be unreasonably withheld) in effecting any recall of the Components and communicating with purchasers, users and the media. ANALOGIC shall not be responsible for any recall related expenses arising from any other recall, including incompatibility of the Components with any other part of the System unless such compatibility is required in the Specifications. If any recall or other event requiring corrective action occurs for any reason, than those set forth in the first sentence of this paragraph (iii)s including due to (AA) use of any TOMOTHERAPY products or software in combination with the Components (where the combination itself gives rise to the recall and not the Components alone), (BB) modification of the ANALOGIC software by any party (including TOMOTHERAPY) other than ANALOGIC, or (CC) any other act or omission on TOMOTHERAPYS part, then all costs and expenses associated with the recall or other event, including the cost of replacement parts and/or return and repair of the affected units, shall be borne solely by TOMOTHERAPY. | ||
iv. | ANALOGIC will notify TOMOTHERAPY immediately of any Quality System Regulation audit of ANALOGIC by the United States Food and Drug Administration or other inspection of ANALOGICs records or its facilities by any federal, state regulatory agency as well as the results of such audit or inspection. | ||
v. | TOMOTHERAPY shall have the right to conduct an appropriate audit of ANALOGICs relevant records and operations to evaluate compliance to the applicable sections of the cGMPs- QSR, and ISO 9001. Such audits will be at a date acceptable to both ANALOGIC and TOMOTHERAPY and will be |
a. | In performing the Development Work, ANALOGIC will utilize systems, sub-systems, parts, software, know-how, and other intellectual and physical property that it owned and/or had in its possession prior to the commencement of the Development Work (ANALOGIC Information). Similarly, TOMOTHERAPY may utilize systems, subsystems, parts, software, know-how, and other intellectual and physical property that it owned and/or had in its possession prior to the commencement of the Development Work (TOMOTHERAPY Information). With respect to ANALOGIC Information and TOMOTHERAPY Information, the Parties agree as follows: |
i. | ANALOGIC owns the Proprietary Technology embedded in the ANALOGIC Information and any improvements to it developed by ANALOGIC during the course of the Development Work. | ||
ii. | TOMOTHERAPY owns the Proprietary Technology embedded in the TOMOTHERAPY Information and any improvements to it developed by TOMOTHERAPY during the course of the Development Work. | ||
iii. | To the extent that ANALOGIC develops Proprietary Technology | ||
improvements to TOMOTHERAPY Information during the course of performing the Development Work, and except as provided in Section 13.d. below, ANALOGIC owns the improvements (but not the underlying TOMOTHERAPY Information) and grants TOMOTHERAPY a license to use, modify, market and sublicense the ANALOGIC improvements to the TOMOTHERAPY Information, and TOMOTHERAPY may assign the same to a third party but only with ANALOGICs consent which consent will not be unreasonably withheld, except that TOMOTHERAPY may assign the same without ANALOGICs consent in connection with the assignment this Agreement pursuant to Section 24 of this Agreement. | |||
iv. | To the extent that TOMOTHERAPY develops Proprietary Technology improvements to ANALOGIC Information during the course of performing the Development Work, TOMOTHERAPY owns the improvements (but not the underlying ANALOGIC Information) and grants ANALOGIC a license to use, modify, market and sublicense the TOMOTHERAPY improvements to the ANALOGIC Information, and ANALOGIC may |
assign the same to a third party but only with TOMOTHERAPYs consent which consent will not be unreasonably withheld. | |||
v. | Either Party may develop new Proprietary Technology during the course of the Development Work that is embedded in the Components and that is not an improvement to the Information of the-Party (as covered in subsections 2 a. iii and iv above) (Development Information). The Party that created the Development Information owns the Development Information, and may use, modify, market, sublicense, and transfer such Development Information for any purpose other than for Radiation Therapy Delivery (as defined below), and may use, modify, market, sublicense, and transfer the Development Information for Radiation Therapy Delivery only with the written consent of the other Party, which consent may not be unreasonably withheld, subject however to the rights of TOMOTHERAPY set forth in the final sentence of this paragraph. The owner of the Development Information hereby grants to the other Party a license to use, modify , market, and sublicense the Development Information, and may transfer such license, for any purpose other than for Radiation Therapy Delivery (as defined below), and such licensee may use, modify, market, sublicense, and transfer the license to the Development Information for Radiation Therapy Delivery only with the written consent of the other Party, which consent may not be unreasonably withheld, subject however to the rights of TOMOTHERAPY set forth in the final sentence of this paragraph. For purposes of this Agreement, Radiation Therapy Delivery means any system delivering external beam radiation in a medical context, and does not include radiation therapy planning. Notwithstanding the foregoing, TOMOTHERAPY may use, modify, market, and sublicense all Development Information in connection with the development, manufacture and sale of its Product without the consent of ANALOGIC, and may assign its own Development Information and its license to Development Information owned by ANALOGIC without ANALOGICs consent in connection with the sale or transfer of substantially all of its assets in a transaction to which the provisions of Section 24 of this Agreement apply, provided that in conjunction with the sale or transfer of TOMOTHERAPYS assets to a third party, that the third party agrees to be bound by all of the terms of this Agreement, as set forth in Section 24 of this Agreement for Analogic to manufacture and supply to the receiver of the assets all of the Components which are the subject of this agreement manufactured or supplied by ANALOGIC. | ||
vi. | Development Information, that is jointly created by the Parties shall be treated as separately owned by each Party, but each Partys interest shall be subject to the rights and restrictions imposed by the preceding paragraph v on separately owned = Development Information,, without the obligation of the Parties to account to each other for or share with the other party the proceeds arising from such jointly created Development Information. |
vii. | Nothing herein is intended to give one Party any rights to the Proprietary Technology of the other Party existing on the date of this Agreement is entered into, except as is necessary to achieve the purposes of this Agreement during the term of this Agreement and any mutually agreed upon extensions to this Agreement. |
b. | While ANALOGIC owns the rights to the patient table pallet design that is to be delivered to TOMOTHERAPY pursuant to the Statement of Work and may supply this exact table pallet to other customers, ANALOGIC acknowledges and agrees that it will not knowingly supply this exact table pallet for use by Third Parties in Radiation Therapy Delivery. | ||
c. | TOMOTHERAPY acknowledges and agrees that ANALOGIC is an OEM supplier of subassemblies, whole instruments and systems. It also acknowledges that it understands ANALOGIC intends to continue to remain in this business and, subject to any limitations imposed upon it hereunder, may even design and manufacture products that contain some or all of the technology and designs used in the Components, including, among other things, certain mechanics, circuitry and software, proprietary to ANALOGIC. In addition, the Components may embody certain patented features as well. |
a. | Upon TOMOTHERAPYS acceptance of the pilot production Components, (which acceptance shall be in accordance with the Components meeting the SPECIFICATIONS), TOMOTHERAPY shall provide ANALOGIC with a rolling twelve (12) month forecast of its purchase requirements for the Components, updated on a monthly basis. The initial forecast will be accompanied by a firm purchase order for the first six (6) months subject to the lead time defined below, and a projection of orders for the following six (6) months. Three months thereafter, firm purchase orders shall be furnished on the first week of each rolling month for Components to be delivered in the third full calendar month following the month in which ANALOGIC receives the purchase order. Projections of orders shall be for the parties planning purposes only, and, except for a firm commitment to purchase Components for the next three months, shall not constitute binding commitments upon TOMOTHERAPY. TOMOTHERAPY may modify any purchase order up to ninety (90) days prior to the beginning of the month covered by such purchase order. TOMOTHERAPY agrees that for economic and production efficiency reasons ANALOGIC requires a consistent and steady production flow (no production breaks month to month). | ||
b. | ANALOGIC shall acknowledge promptly each TOMOTHERAPY purchase order in writing and confirm delivery dates. Each order shall be subject to a lead-time of 120 days (Lead Time). TOMOTHERAPY acknowledges that some components used in |
the manufacture of the Components may be designated by ANALOGIC as Long-lead-time Items (LLTIs). ANALOGIC shall be authorized in writing by TOMOTHERAPY to place orders for sufficient quantities of LLTIs necessary to meet TOMOTHERAPYS projected purchases set forth on its forecasts. In the event that forecasted quantities of Components are not actually ordered by TOMOTHERAPY, TOMOTHERAPY shall reimburse ANALOGIC for the LLTIs unique to TOMOTHERAPYS Components purchased by ANALOGIC in connection with such forecasted quantities which cannot be used elsewhere within ANALOGIC, or cancelled, or returned to the vendor. The reimbursement value of such LLTIs shall be [ * ]%. | |||
c. | All sales of the Components shall be subject to the terms and conditions of this Agreement. Except with respect to transaction-specific items such as quantities, requested delivery dates, destinations and shipping instructions, purchase orders or other similar documents issued by TOMOTHERAPY are for TOMOTHERAPYS administrative convenience only. No other terms or conditions contained in a purchase order or such other similar document shall be of any force or effect. If there is any conflict or difference in interpretation between such transaction specific items in a TOMOTHERAPY purchase order and this Agreement, the terms and conditions of this Agreement shall supersede those of such purchase order. | ||
d. | Subject to the lead time requirements set forth herein, ANALOGIC shall be ready and able to timely supply all quantities of Components ordered by TOMOTHERAPY that are within its forecast and/or accepted by ANALOGIC. ANALOGIC shall not be liable for failure or delay in filling TOMOTHERAPY orders because of any cause beyond the control of or occurring without the fault of ANALOGIC. | ||
e. |
Should any parts or sub-components used by ANALOGIC in manufacturing the
Components either become unavailable for purchase and Analogic is advised thereof
by its supplier, or unavailable for a reasonable price, ANALOGIC shall give
TOMOTHERAPY notice thereof. Subject to such time limitations imposed on
ANALOGIC by the component manufacturer(s) or distributor(s), as the case may be,
during which ANALOGIC can acquire such components, TOMOTHERAPY may
exercise last time buy rights for the
component(s) by authorizing ANALOGIC to place purchase orders within the 30 days following such notice from ANALOGIC to TOMOTHERAPY. The cost of the unique Components (components which are purchased specifically for TOMOTHERAPYS Product) which cannot be used elsewhere within ANALOGIC purchased pursuant to the last time buy shall be paid for in full by TOMOTHERAPY and maintained as dedicated inventory owned by TOMOTHERAPY and TOMOTHERAPY will receive a corresponding credit when the component is used in the Components by reducing the Components price by [ * ]%. Alternatively, Analogic may agree to redesign the relevant component or components for a mutually agreed upon price. |
a. | The price to be paid by TOMOTHERAPY to ANALOGIC for the Components is set forth on Exhibit 3 hereto. These initial prices shall be valid for a period of two years |
following shipment to a clinical user of the first production HI-ART II (system #11) meeting SPECIFICATIONS. Thereafter, beginning on the second anniversary of the shipment to a clinical user of the first production HI-ART II meeting SPECIFICATIONS, and every [ * ] thereafter, the Parties shall review prices and quantities with the understanding that prices may be adjusted by mutual agreement in response to the world market for components, production yield, cost improvement, and other factors deemed relevant by the parties. If parties cannot reach a mutual agreement, the parties will follow the arbitration process outlined in section 23 hereafter. Unless otherwise specified or required by law, all prices will be quoted and billed exclusive of federal, state or local excise, sales or other similar taxes. Such taxes, when applicable, will appear as additional items on invoices. | |||
b. | ANALOGIC agrees that the price for the Components is at least as favorable to TOMOTHERAPY as the price and the terms upon which ANALOGIC sells comparable CT components to any other customer under similar circumstances. | ||
c. | Terms of payment are net 30 days from of the date of delivery or invoice; whichever is later, for shipments made. |
a. | In the event of a substantial or material breach of any term or condition of this Agreement by either party, which shall include, but not be limited to, non-payment of invoices when due which breach is not or cannot be corrected by the breaching party within thirty (30) days after notice (unless a longer time is expressly provided for herein), this Agreement may be terminated by the other party by giving notice of termination, to take effect forthwith upon the giving of such notice. Notwithstanding the foregoing, TOMOTHERAPY may terminate this Agreement with respect to an unexcused ANALOGIC breach related to failure to timely deliver Components only if ANALOGIC fails to deliver ordered Components within sixty (60) days of the scheduled delivery date specified in any TOMOTHERAPY purchase order that complies with TOMOTHERAPYS forecast and has been accepted by ANALOGLC. Additionally, a force majeure would be deemed an excused ANALOGIC breach. |
b. | This Agreement may be terminated immediately by the either party without the requirement of prior notice if the other party suspends operations, files or suffers to be filed against it a petition in bankruptcy, or the like, executes an assignment for the benefit of creditors, or is adjudicated as bankrupt by a court of competent jurisdiction. |
a. | ANALOGIC shall perform incoming inspection and testing on all materials it receives from any source for inclusion in any of the Components in accordance with ANALOGICs Corporate Quality Assurance Procedure Sampling Inspection/Testing by Attributes Procedure, as amended from time to time in the normal course of business. In no case shall non-conforming materials which affect the Components form, fit, or function be used in the manufacture of the Components. | ||
b. | The Components will be designed and manufactured by ANALOGIC in a manner that will qualify and validate all manufacturing processes in accordance with current Good Manufacturing Practices and the Quality System Regulations promulgated by the United States Food and Drug Administration (FDA) and ISO 9001 and for the Components after July 2002. | ||
c. | All the Components shall meet the SPECIFICATIONS and shall be subjected to ANALOGICs quality control systems and standards, which at all times will comply with applicable regulatory requirements. ANALOGIC shall permit TOMOTHERAPY to review periodically ANALOGICs relevant production and quality control procedures and records and to visit ANALOGICs facilities at reasonable times with a representative of ANALOGIC present. |
a. | Beginning with the first pilot production Components, ANALOGIC will inspect all outgoing Components to be supplied to TOMOTHERAPY to be strictly in accordance with SPECIFICATIONS and perform outgoing acceptance testing. TOMOTHERAPY will monitor the delivery and quality performance of ANALOGIC. | ||
b. | An overview or SCAR (Supplier Corrective Action Request) will be generated by TOMOTHERAPY on a quarterly basis or more frequently if necessary. The performance indicators to be applied shall cover: |
a. | ANALOGIC will provide Parts for a period of seven (7) years following the last serial delivery of the Components under this Agreement. The price of the Parts will be that listed in Exhibit 4, SPARE PARTS PRICE LIST (Which will be determined by the parties in good faith based on their prior practices, and otherwise based on industry standards). In the event that a Part becomes obsolete, ANALOGIC will provide TOMOTHERAPY notice as soon as ANALOGIC becomes aware of the anticipated obsolescence and offer TOMOTHERAPY the opportunity to make a last buy. In the event that ANALOGIC learns that a component used in manufacturing a Part of the Components will become obsolete, it will notify TOMOTHERAPY and TOMOTHERAPY may request ANALOGIC, at TOMOTHERAPYs expense, to re-engineer the Part using components that are not obsolete. | ||
b. | TOMOTHERAPY will provide ANALOGIC with Forecasts for Parts. On the 15 th of each month, TOMOTHERAPY will provide ANALOGIC a twelve (12) month Forecast of its Parts needs. The first three (3) months of the Parts Forecast consists a firm and binding commitment to purchase the Parts. ANALOGIC will not be obligated to deliver parts in excess of thirty (30) percent above the second three (3) months Parts Forecast. | ||
d. | ANALOGIC will provide a quotation for Parts within five (5) business days if TOMOTHERAPY seeks to purchase Parts not included in its Forecast and not in stock at ANALOGIC. | ||
e. | ANALOGIC will provide TOMOTHERAPY a list of all Parts that are Field Replacement Units (FRU). This list will contain the following information: (1) ANALOGIC part number; (2) ANALOGIC part description; (3) Price of new FRU; (4) FRU lead-time and (5) List of repairable and non-repairable FRUs; (6) Price for non-warranty repairable FRUs. | ||
f. | TOMOTHERAPY may return to ANALOGIC Parts, which are identified as repairable for warranty and out-of-warranty repairs. ANALOGIC will repair the Parts described in this sub-paragraph to the minimum allowable revision level within a targeted thirty (30) to forty-five (45) working day period from receipt of the returned Parts. |
g. | ANALOGIC will provide repair services for the Components and Parts for a period of seven years following the last serial delivery of the Components pursuant to this Agreement. |
a. | Except for Software, which is defined and provided for in Section 13, ANALOGIC warrants to TOMOTHERAPY that all of the Components sold to TOMOTHERAPY under this Agreement will be at the time of their delivery, free from defects in workmanship and material and in compliance with the Specifications. ANALOGIC further warrants that all of the Components sold to TOMOTHERAPY under this Agreement will, on the date of shipment by ANALOGIC, have been manufactured by ANALOGIC in accordance with the FDAs current Good Manufacturing Practices, Quality System Regulations, ISO 9001. | ||
b. | The warranty period for the Components shall be twelve (12) months from the date of shipment by TOMOTHERAPY to a customer of a System into which the Components have been integrated or fifteen (15) months from the date of shipment of the Components by ANALOGIC to TOMOTHERAPY, whichever period occurs earlier. ANALOGIC will, at its option, repair or replace defective Components returned during the warranty period at no cost to TOMOTHERAPY, provided that each Party is responsible for the shipping cost of the Components it sends to the other. | ||
c. | ANALOGIC shall perform an inspection and test of field-returnable Components to confirm that there is a defect requiring warranty repair or replacement. Returned Components found not to be defective or no longer under warranty shall be repaired at TOMOTHERAPYs expense at ANALOGICs then current standard rates for out of warranty repairs. | ||
These warranties are made upon the express condition that: |
i. | ANALOGIC is given prompt notice upon discovery by TOMOTHERAPY of such nonconformity, with an explanation of the alleged deficiencies. | ||
ii. | Such Product is returned to ANALOGIC at the expense of TOMOTHERAPY after receipt of a Return Authorization (RA) from ANALOGIC. Upon their repair or replacement, they shall be returned to TOMOTHERAPY as directed, at the expense of ANALOGIC. | ||
iii. | Examination of such Components by ANALOGIC discloses that the nonconformity actually exists and was not caused by accident, misuse, neglect, alteration, improper installation or use, improper repair or improper testing; and | ||
iv. | Such Components (including the Software, as defined below) have not been modified, altered or changed by any person other than ANALOGIC or its duly authorized repair agents, and other than modifications by TOMOTHERAPY as provided under Section 13 a. iii. of this Agreement. |
a. | Components may contain pre-existing ANALOGIC proprietary software (ANALOGIC proprietary software) and software licensed to ANALOGIC by independent third parties (ANALOGIC licensed Third Party Software). TOMOTHERAPY also may add TOMOTHERAPY Software to the Components and/or to the System(s) into which the Components are integrated that may be its own proprietary software or other software licensed by TOMOTHERAPY directly from other third parties (collectively, TOMOTHERAPY Software). ANALOGIC proprietary Software and ANALOGIC licensed Third-Party Software are sometimes referred to collectively herein as the ANALOGIC Software. ANALOGIC hereby grants to TOMOTHERAPY for the term of this Agreement, subject to the conditions set forth herein, a non-exclusive, non-transferable (except as provided in Section 24 of this Agreement) worldwide license: |
i. | to market and sublicense the ANALOGIC Software in object code form only; | ||
ii. | to use internally the ANALOGIC proprietary Software in source code form, solely for the purposes of understanding the operation of the Product, supporting TOMOTHERAPYs installed Product base, and accomplishing the purposes of clause (iii) below; and | ||
iii. | to make modifications and improvements to the ANALOGIC proprietary Software for distribution per clause (i) above. |
b. | During the term of this Agreement, TOMOTHERAPY may sublicense its distributors to distribute and sub-license the ANALOGIC Software solely in connection with Customers use of the Components which are part of a System purchased by the customer. | ||
c. | TOMOTHERAPY expressly acknowledges that this Agreement does not grant TOMOTHERAPY the right to copy, reproduce, or transmit in any form the ANALOGIC Software or any part thereof, or to authorize or permit others to do so, except as expressly provided herein. TOMOTHERAPY shall not reverse engineer, decompile or disassemble the ANALOGIC Software not provided hereunder in source code form. | ||
d. | Except as expressly provided herein, all right, title and interest in and to the ANALOGIC Software shall at all times remain and vest solely with ANALOGIC and its suppliers. TOMOTHERAPY shall have no access to or rights in the ANALOGIC licensed Third-Party Software in source code form. Except with respect to TOMOTHERAPY Software, TOMOTHERAPY agrees that it will not claim or assert title to the ANALOGIC Software, or attempt to transfer any title thereto to any third party. This does not apply to software developed specifically for TOMOTHERAPY, that does not interface directly with hardware that is supplied by ANALOGIC. For example, software developed under this contract that implements the general machine control scheme as defined by TOMOTHERAPY, or interfaces with standard 3rd-party components not supplied by ANALOGIC, shall be owned by TOMOTHERAPY. | ||
e. | In the event ANALOGIC changes hardware of the Components for whatever reason the firmware should continue to function to SPECIFICATIONS. | ||
f. | TOMOTHERAPYs SOLE AND EXCLUSIVE REMEDY AND ANALOGICS SOLE LIABILITY HEREUNDER SHALL BE TO REPLACE ANALOGIC SOFTWARE THAT DOES NOT MEET ANALOGICS LIMITED WARRANTY AS SOON AS IS REASONABLY PRACTICABLE, AND, IF REASONABLY POSSIBLE, TO MAKE THE REPLACEMENT SOFTWARE AVAILABLE TO TOMOTHERAPY VIA SECURE DOWNLOADING OVER THE INTERNET OR BY OTHER ELECTRONIC MEDIUM AGREEABLE TO THE PARTIES. THIS SOFTWARE WARRANTY IS IN LIEU OF AND EXCLUDES ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, ORAL OR WRITTEN, INCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND/OR FITNESS FOR A PARTICULAR PURPOSE. ANALOGIC WILL NOT IN ANY EVENT BE LIABLE FOR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER. TOMOTHERAPY ACKNOWLEDGES THAT ITS EXCLUSIVE REMEDIES SET FORTH HEREIN ALLOCATE RISKS BETWEEN THE PARTIES FAIRLY AND IN A MANNER WHICH UNDER NO CIRCUMSTANCES WILL CAUSE SUCH REMEDIES TO FAIL OF THEIR ESSENTIAL PURPOSE. |
g. | ANALOGIC SHALL HAVE NO LIABILITY OR RESPONSIBILITY FOR ANALOGIC SOFTWARE ALTERED OR MODIFIED BY TOMOTHERAPY WITHOUT ANALOGICS PERMISSION OR A THIRD PARTY OR FOR DAMAGES RESULTING FROM ACCIDENT, ABUSE, OR MISAPPLICATION OR FOR PROBLEMS DUE IN WHOLE OR IN PART TO THE USE OR MALFUNCTION OF ANY EQUIPMENT, SOFTWARE OR ACCESSORIES NOT SUPPLIED BY ANALOGIC OR THE INCOMPATIBILITY THEREOF WITH ANALOGIC SOFTWARE. | ||
h. | The Software and documentation is provided with restricted rights. Use, duplication, or disclosure by TOMOTHERAPY is subject to restrictions as set forth in FAR Section 52.227-14 (Alternate III) or subparagraph (c)(l)(ii) of the clause at DFAR 252.227-7013, Rights in Technical Data and Computer Software. Contractor/manufacturer is ANALOGIC Corporation, 8 Centennial Drive, Peabody, Massachusetts 01960. |
a. | Notwithstanding any other provisions hereof, each Party agrees to indemnify the other, its officers, agents, servants and employees against claims, damages, demands, suits, actions, judgments, liabilities, defaults, or costs and expenses, including attorneys fees, arising from claims made against or liability imposed upon the other, by a court of competent jurisdiction as a result of claims alleging personal injury, disability, death or property damage, or any form or type or wrongdoing or loss arising from such indemnifying Partys failure to perform its respective obligations hereunder, as well as, in TOMOTHERAPYs case, its obligations implicitly arising out of or in connection with the sale and/or transfer of the System, including without limitation, TOMOTHERAPYs burden of Customer training, service and support, its representations made in the course of reselling or distributing the System, and its distribution of related materials and literature. This indemnification shall be limited to the sum of $2,000,000 in any 12-month period commencing on August 1 st of any year. | ||
b. | Each Party hereto agrees that it will maintain product liability insurance adequate to fulfil the indemnification obligation hereunder in each such 12-month period commencing on August 1 st of each year. | ||
c. | In the event that a claim is made against a Party seeking indemnification, that Party shall promptly notify the other Party of the claim, allow the other Party to defend it in the name of such Party and to fully cooperate with its insurers, if relevant, and its counsel in the defense against the claim. |
a. | ANALOGIC will defend TOMOTHERAPY at ANALOGICs cost and expense, including reasonable attorneys fees, against any claim of infringement of a United States, Canadian, or European Union patent brought against TOMOTHERAPY to the extent that such a claim pertains to Components designed by ANALOGIC, provided |
that TOMOTHERAPY gives ANALOGIC prompt written notice of such claim and the right to maintain sole control of the defense and all negotiations for settlement of such claim. If a final injunction is obtained against TOMOTHERAPYS use of Components because of infringement of third Party intellectual property, ANALOGIC will, at ANALOGICs option and at ANALOGICs expense, either procure for TOMOTHERAPY the right to continue using the Components, replace or modify the Components so that the Components become non-infringing, or grant TOMOTHERAPY credit for the purchase price less reasonable depreciation of infringing Components and accept the return of Components sold by ANALOGIC to TOMOTHERAPY. Under the terms of this Agreement, ANALOGIC will not accept any liability, nor hold any person harmless from infringement claims relating to: (i) Components supplied by ANALOGIC containing components which have been manufactured or produced by others and which carry the original manufacturers patent indemnifications; (ii) Components purchased hereunder but altered by TOMOTHERAPY or others (excluding ANALOGIC and ANALOGICs authorized agents) to infringe such patent; and (iii) a combination of Components and other equipment; provided, however, that ANALOGIC shall defend such claim to the extent that such infringement claim would lie against the Product notwithstanding such alteration or combination. | |||
b. | Notwithstanding anything to the contrary in this Agreement, if any alleged infringement of a United States, Canadian, or European Union patent by Components arisen from designs developed and supplied by TOMOTHERAPY, then ANALOGIC shall not be required to repair or replace the Components at ANALOGICs cost or in any way indemnify TOMOTHERAPY as set forth in this Agreement. | ||
c. | TOMOTHERAPY agrees to defend ANALOGIC at TOMOTHERAPYs cost and expense, including reasonable attorneys fees, against any claim of patent infringement by reason of use by Analogic of TOMOTHERAPYs specifications, intellectual property, or other information in the Components. TOMOTHERAPY shall indemnify and hold ANALOGIC harmless against any loss, damage and cost reasonably incurred by ANALOGIC arising out of or related to such infringement claim. TOMOTHERAPYs obligations with respect to such infringement claims are expressly conditioned upon ANALOGIC giving TOMOTHERAPY prompt notice of such infringement claim and granting TOMOTHERAPY in writing exclusive control over ANALOGICs defense or settlement and cooperating with TOMOTHERAPY at TOMOTHERAPYs expense. |
If to TOMOTHERAPY:
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If to ANALOGIC | |
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TOMOTHERAPY, Inc.
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ANALOGIC Corporation | |
1240 Deming Way
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8 Centennial Drive | |
Madison, WI 53717
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Peabody, MA 01960 | |
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Attention: John J. Barni, CEO
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Attention:Lonnie Weaver | |
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Facsimile: 608-824-2996
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Facsimile: 978-977-6805 | |
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with a copy to:
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with a copy to: | |
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La Follette Godfrey & Kahn
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General Counsel | |
Attn: Michael E. Skindrud
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ANALOGIC Corporation | |
One East Main Street
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8 Centennial Drive | |
Madison, WI 53703
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Peabody, MA 01960 | |
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Facsimile: 608-257-0609
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Facsimile: 978-977-6802 |
TOMOTHERAPY
INCORPORATED a Wisconsin
corporation |
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By: | /s/ John J. Barni | ||
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Title: | CEO 2/4/03 | ||
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ANALOGIC Corporation,
a
Massachusetts corporation, |
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By: | /s/ (illegible) | ||
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Title: | CEO 2/5/03 | ||
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Document No. | Document Name | Revision No. | Page | |||||
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ANALOGIC-TOMOTHERAPY | |||||||
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DEVELOPMENT AND OEM SUPPLY | 5 | 1 OF 21 | |||||
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AGREEMENT EXHIBIT 1 |
Rev | CA No | Date | Comment | Originator | ||||
0
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- | 4/24/02 | Initial revision added PDU, Computers, disk components to first contract for review | D. Murray | ||||
1
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- | 6/25/02 | Modifications following review by Bob Riemer, Dave Murray, and many others | D Murray | ||||
2
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- | 1/14/03 | Modifications following phone discussion between Weaver, Riemer, Murray | D Murray | ||||
3
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- | 1/14/03 | Corrected issue with Section 10 heading | D Murray | ||||
4
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- | 1/20/03 | Change Exhibit 1 reference to Analogic family tree | D Murray | ||||
5
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- | 1/20/03 | Change Exhibit 1 reference to AN6500 (from TomoTherapy Gantry) | D Murray |
Document No. | Document Name | Revision No. | Page | |||||
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ANALOGIC-TOMOTHERAPY | |||||||
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DEVELOPMENT AND OEM SUPPLY | 5 | 2 OF 21 | |||||
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AGREEMENT EXHIBIT 1 |
1 | Scope | 4 | ||||||||
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1.1 | Identification | 4 | ||||||||
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1.2 | Statement of Systems Intended Use | 4 | ||||||||
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2 | Standards and Regulations | 4 | ||||||||
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3 | Types of Users | 5 | ||||||||
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4 | System Architecture | 5 | ||||||||
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4.1 | System Data Flow | 7 | ||||||||
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5 | Gantry Subsystem Requirements | 8 | ||||||||
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5.1 | Scope | 8 | ||||||||
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5.2 | Functional Requirements | 8 | ||||||||
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5.2.1 | General | 8 | |||||||
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5.2.2 | Gantry Frame | 8 | |||||||
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5.2.3 | Gantry Mechanical | 8 | |||||||
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5.2.4 | Gantry Component Mounting | 9 | |||||||
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5.2.5 | Slip Ring System | 9 | |||||||
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5.2.6 | Gantry Control | 10 | |||||||
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5.2.7 | Data Communication | 10 | |||||||
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6 | Couch Subsystem Requirements | 11 | ||||||||
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6.1 | Scope | 11 | ||||||||
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6.2 | Functional Requirements | 11 | ||||||||
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6.2.1 | General | 11 | |||||||
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6.2.2 | Mechanical | 11 | |||||||
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6.2.3 | Control | 11 | |||||||
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7 | DAS Subsystem Requirements | 13 | ||||||||
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7.1 | Scope | 13 | ||||||||
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7.2 | Functional Requirements | 13 | ||||||||
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7.2.1 | General | 13 | |||||||
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7.2.2 | Electronics | 13 | |||||||
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8 | Power Distribution Unit (PDU) Subsystem Requirements | 14 | ||||||||
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8.1 | Scope | 14 | ||||||||
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8.2 | Functional Requirements | 14 |
QUALITY RECORD, Template F4-18 REV A
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TomoTherapy, Inc. | |
Verify Latest Revision Before Using
|
COMPANY CONFIDENTIAL |
Document No. | Document Name | Revision No. | Page | |||||
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ANALOGIC-TOMOTHERAPY | |||||||
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DEVELOPMENT AND OEM SUPPLY | 5 | 3 OF 21 | |||||
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AGREEMENT EXHIBIT 1 |
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8.2.1 | General | 14 | |||||||
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8.2.2 | Electrical | 14 | |||||||
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8.2.3 | Control | 15 | |||||||
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9 | Control Computer Requirements | 16 | ||||||||
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9.1 | Scope | 16 | ||||||||
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9.2 | Functional Requirements | 16 | ||||||||
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9.2.1 | General | 16 | |||||||
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9.2.2 | Stationary Controller (STC) Hardware | 16 | |||||||
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9.2.3 | On-Board Controller (OBC) Hardware | 17 | |||||||
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9.2.4 | Data Receiver Server (DRS) Hardware | 17 | |||||||
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9.2.5 | Software Drivers | 17 | |||||||
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10 | Gantry Component Requirements | 19 | ||||||||
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10.1 | Scope | 19 | ||||||||
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10.2 | Functional Requirements | 19 | ||||||||
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10.2.1 | Circuit Boards | 19 | |||||||
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10.2.2 | List of Gantry Components with Analogic Involvement | 21 |
QUALITY RECORD, Template F4-18 REV A
|
TomoTherapy, Inc. | |
Verify Latest Revision Before Using
|
COMPANY CONFIDENTIAL |
Document No. | Document Name | Revision No. | Page | |||||
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ANALOGIC-TOMOTHERAPY | |||||||
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DEVELOPMENT AND OEM SUPPLY | 5 | 4 OF 21 | |||||
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AGREEMENT EXHIBIT 1 |
1.1 | Identification | ||
The following subsystems are addressed by this document: |
| TomoTherapy Hi-Art II Gantry Subsystem, including mounting of certain Analogic- and TomoTherapy-supplied components. | ||
| TomoTherapy Hi-Art II Couch Subsystem. | ||
| TomoTherapy Hi-Art II DAS Subsystem. | ||
| TomoTherapy Hi-Art II Communications Subsystem. | ||
| TomoTherapy Hi-Art II Power Distribution Unit (PDU) | ||
| TomoTherapy Hi-Art II Control Computers |
1.2 | Statement of Systems Intended Use | ||
The TomoTherapy HiArt system is intended to be used to provide conformal radiation therapy for patients who have been deemed acceptable candidates for radiation treatment of cancer. Its purpose is to precisely deliver beams of radiation, automatically tailored to the individual case, with immediate verification. |
The TomoTherapy HiArt System shall be designed to promote conformance with design standards: |
| IEC 60601-1: Medical Electric Equipment Part 1: General Requirements for Safety | ||
| UL 2601-1: Medical Electrical Equipment, Part 1: General Requirements for Safety (USA version of international requirements) | ||
| IEC 60601-1-2: Medical Electric Equipment Part 1: General Requirements for Safety; Electromagnetic Compatibility Requirements and Tests | ||
| IEC 60601-1-4: Medical Electric Equipment Part 1: General Requirements for Safety; 4. Collateral Standard: Programmable Electrical Medical Systems | ||
| IEC 60601-2-1: Medical Electric Equipment Part 2: Particular Requirements for Medical Electron Accelerators in the Range 1 MeV to 50 MeV | ||
| IEC 61217: Radiotherapy equipment coordinates, movements and scales (1996-08) | ||
| IEC/TR 62266 (2002-03): Medical electrical equipment: Guidelines for implementation of DICOM in radiotherapy |
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| ANSI/AAMI HE48: Human Factors Engineering Guidelines and Preferred Practices for the Design of Medical Devices. |
| Physicians/Oncologists | ||
| Technicians | ||
| Physicists | ||
| Service personnel |
The architecture for the TomoTherapy HiArt system can be broken down into three major subsystems: 1) Planning subsystem, 2) Delivery subsystem, and 3) Database server. |
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AGREEMENT EXHIBIT 1 |
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4.1 | System Data Flow | ||
The figure below illustrates the flow of data between each component of the HIART system. All data is accessed from, and saved to, the Database Server. | |||
Figure 2 System Data Flow |
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AGREEMENT EXHIBIT 1 |
5.1 | Scope |
The gantry subsystem includes the gantry frame, bearings, slip-rings, rotating mounting plate, and data communication components. |
5.2 | Functional Requirements |
5.2.1 | General |
5.2.1.1 | The gantry system shall conform to [*], [*], and [*] when incorporating Analogic components. | ||
5.2.1.2 | Communication software between Analogic components needed for the implementation of the TomoTherapy system shall be supplied, except for 3 rd party development tools and environments that may be sourced directly by TomoTherapy Inc. |
5.2.2 | Gantry Frame |
5.2.2.1 | The gantry frame shall be capable of supporting at least [*] kg with a safety factor of at least [*]. | ||
5.2.2.2 | The depth of the gantry frame shall be [*] mm or less. | ||
5.2.2.3 | The width of the gantry frame shall be [*] mm or less. | ||
5.2.2.4 | The maximum height of the entire gantry system shall be [*] mm or less. |
5.2.3 | Gantry Mechanical |
5.2.3.1 | The gantry shall be capable of rotating at a speed of up to [*] r.p.m. | ||
5.2.3.2 | The gantry bearing shall have a life exceeding [*] years normal clinical use at [*] r.p.m., under a load of [*] kg cantilevered at [*] mm. | ||
5.2.3.3 | The gantry must be sufficiently rigid to hold the position of the detector to within [*] ìm of the center of rotation, independently of gantry rotational position. | ||
5.2.3.4 | [*] | ||
5.2.3.5 | [*] | ||
5.2.3.6 | [*] | ||
5.2.3.7 | The gantry motor drive shall be capable of providing a steady state torque of at least [*] N.m. ([*] ft.lb). |
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5.2.3.8 | The gantry motor drive shall also be capable of providing sufficient additional torque to accelerate the fully-loaded gantry to the maximum specified rotation speed in less than [*] seconds. | ||
5.2.3.9 | The gantry motor drive controller shall control the gantry position to within [*] degree of the specified position. | ||
5.2.3.10 | The inside diameter of the unpopulated gantry before the external covers are fitted shall be [*] cm or greater. |
5.2.4 | Gantry Component Mounting |
5.2.4.1 | Provision shall be made on the gantry for the mounting of the linear accelerator, primary collimation system, collimating jaws, and multi-leaf collimator. | ||
5.2.4.2 | Provision shall be made on the gantry for the mounting of the CT detector, DAS, and associated power supplies. | ||
5.2.4.3 | Provision shall be made on the gantry for the mounting of a solid-state modulator power supply, solid-state modulator, magnetron, circulator, and associated electronics. | ||
5.2.4.4 | There must be sufficient space on the gantry for the mounting of a conventional modulator and power supply instead of the solid-state modulator. | ||
5.2.4.5 | Space shall be available on the gantry for the mounting of the on board computers. | ||
5.2.4.6 | Space shall be available on the gantry for the mounting of small low-voltage power supplies to supply the various electrical components. | ||
5.2.4.7 | Provision shall be made on the gantry to allow for the routing of cooling pipes or flexible tubing to and from the cooled components. | ||
5.2.4.8 | Provision shall be made on the gantry to allow for the routing of signal cables to the electronic components. | ||
5.2.4.9 | Provision shall be made on the gantry to allow for the routing of power cables to the electronic components, separated from the signal cables where possible. | ||
5.2.4.10 | Provision shall be made on the gantry to allow for the routing of compressed air to the MLC assembly, including mounting of an accumulator tank. |
5.2.5 | Slip Ring System |
5.2.5.1 | The gantry slip-ring system shall support two-way Ethernet communication with a data rate of at least [*] Mbit/sec, with necessary electronics provided to account for transmission line effects. | ||
5.2.5.2 | The gantry slip-ring system shall provide [*] low-power, low voltage lines for use in the hardware interlock system. | ||
5.2.5.3 | The gantry slip-ring system shall provide [*] power rings ([*] signal, [*] signal ground, [*] safety ground), capable of handling either [*] A per phase at [*] V or [*] A per phase at [*] V. |
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5.2.5.4 | The gantry slip-ring system shall provide [*] spare low power, low voltage slip ring. |
5.2.6 | Gantry Control |
5.2.6.1 | A gantry angle detection system shall be provided. | ||
5.2.6.2 | The instantaneous gantry angle to the within [*] degrees must be available to the control software on the rotating side. | ||
5.2.6.3 | The gantry angle must be made available across the data communication system (see below) with a known latency, to control stationary side components. |
5.2.7 | Data Communication |
5.2.7.1 | A one-way data transmission for sending DAS and monitor signal data from the rotating side to the stationary side of the gantry shall be provided. | ||
5.2.7.2 | The data transmission system shall be capable of detecting and signaling data transmission violation errors. | ||
5.2.7.3 | The data transmission system shall support transfer of up to [*] channels of DAS data at up to [*] views per second. | ||
5.2.7.4 | The underlying data transmission system technology shall be capable of transferring data fast enough to handle a multi-row detector of at least [*] rows, [*] channels per row, at [*] views per second. |
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6.1 | Scope | ||
The couch (table) subsystem includes the physical patient support and the control and output electronics and software interfaces associated with it. | |||
6.2 | Functional Requirements |
6.2.1 | General |
6.2.1.1 | The couch system shall conform to [*], and [*], when incorporating Analogic components. | ||
6.2.1.2 | Communication software between Analogic components needed for the implementation of the TomoTherapy system shall be supplied, except for 3 rd party development tools and environments that may be sourced directly by TomoTherapy Inc. |
6.2.2 | Mechanical |
6.2.2.1 | There shall be no metal structural members within the pallet in the scan region. | ||
6.2.2.2 | The total longitudinal couch travel shall be at least [*]m. | ||
6.2.2.3 | The maximum possible couch height when installed shall be no less than the height of the machine isocenter, namely [*] cm. Additional feet may need to be added to the couch by TomoTherapy or Analogic to achieve this. | ||
6.2.2.4 | The minimum possible couch height when installed shall be no greater than [*] cm. | ||
6.2.2.5 | The couch width shall be that of a standard [*] couch, namely [*] cm. | ||
6.2.2.6 | The couch thickness shall be [*]. | ||
6.2.2.7 | Total couch sag when maximally extended at a plane [*] mm from the cradle pivot, relative to an unloaded couch, shall not exceed [*]mm when a load of [*]kg is placed [*]mm from the cradle pivot. | ||
6.2.2.8 | In the case of couch failure, it shall be possible to release the couch pallet and withdraw the patient from the gantry bore. |
6.2.3 | Control |
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6.2.3.1 | At any time, the absolute longitudinal position of the couch to within [*]µm shall be available to control software via polling, at speeds of less than or equal to [*] mm/sec. | ||
6.2.3.2 | At any time, feedback on the absolute vertical position of the couch shall be available via a [*]. | ||
6.2.3.3 | It shall be possible to command the couch to move longitudinally at speeds as low as [*] µm/sec. | ||
6.2.3.4 | It shall be possible to command the couch to move longitudinally at speeds as high as [*] mm/sec. | ||
6.2.3.5 | The couch shall provide a software interface to allow a remote computer to control its movements and poll for feedback. | ||
6.2.3.6 | The couch shall be capable of signaling the controlling computer via hardware when an internal (watchdog) failure is detected. |
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7.1 | Scope | ||
The DAS subsystem includes the electronics to convert the detector signals and other rotating-side monitoring signals and provide it in a form that can be used by the rest of the system. | |||
7.2 | Functional Requirements |
7.2.1 | General |
7.2.1.1 | The radiation therapy system shall conform to [*], [*], and [*], when incorporating Analogic DAS components. | ||
7.2.1.2 | Communication software between Analogic components needed for the implementation of the TomoTherapy system shall be supplied, except for 3 rd party development tools and environments that may be sourced directly by TomoTherapy Inc. |
7.2.2 | Electronics |
7.2.2.1 | The DAS shall support at least [*] detector channels. | ||
7.2.2.2 | The DAS shall support [*] additional data channels for other on-board signals (some [*]V pulsed, some [*]V DC, some charge-based). | ||
7.2.2.3 | The DAS shall be designed to work with the [*], model number [*]. | ||
7.2.2.4 | The DAS shall provide a minimum of [*] bits of resolution. | ||
7.2.2.5 | The DAS shall support view rates of [*] to [*] Hz. | ||
7.2.2.6 | [*] | ||
7.2.2.7 | [*] |
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8.1 | Scope | ||
The PDU subsystem includes electrical components to isolate and transform mains power, and distributing it to various components of the TomoTherapy Hi-Art II System. | |||
8.2 | Functional Requirements |
8.2.1 | General |
8.2.1.1 | The PDU shall be certified and labeled to comply with [*], [*], [*]. |
8.2.2 | Electrical |
8.2.2.1 | The PDU shall accept the following AC 3-phase input voltages at [*]Hz: [*]V, [*]V, [*]V, [*]V and [*]V. | ||
8.2.2.2 | For each allowable input voltage, a constant input voltage shall result in the nominal [*] output having a value between [*]% and [*]% of the [*]V value. | ||
8.2.2.3 | For each allowable input voltage, a constant input voltage shall result in the nominal [*] output having a value between [*]% and [*]% of the [*]V value. | ||
8.2.2.4 | There shall be a circuit breaker on the input side of the transformer, accessible from outside the PDU. All output side breakers shall not be accessible from outside the PDU. | ||
8.2.2.5 | The PDU shall be rated for [*]% duty cycle on all outputs. | ||
8.2.2.6 | The PDU shall provide [*]A at [*]VAC (3-phase) with a circuit breaker, for powering the gantry slip rings. A neutral and a safety ground shall also be supplied. | ||
8.2.2.7 | The PDU shall provide [*]A at [*] VAC (3-phase), with a circuit breaker, for powering the compressor. | ||
8.2.2.8 | The PDU shall provide [*]A at [*] VAC (3-phase), with a circuit breaker for powering the pump stand. | ||
8.2.2.9 | The PDU shall provide sufficient power, with a circuit breaker, for powering the couch supplied by Analogic. | ||
8.2.2.10 | The PDU shall provide sufficient power, with a circuit breaker, for powering the gantry drive supplied by Analogic. | ||
8.2.2.11 | The PDU shall provide a total of [*]A at [*] VAC (single phase) over 3 outlets, each with a circuit breaker, for powering the Stationary Controller (STC), lasers, and gantry display. |
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8.2.2.12 | The PDU shall provide [*]A at [*] VAC (single phase), with a circuit breaker, for powering the Data Receiver Server (DRS). This supply shall be protected by an uninterruptible power supply (UPS), delivering the rated load for a minimum of [*] minutes. | ||
8.2.2.13 | The PDU shall provide [*]A at [*] VAC (single phase), with a circuit breaker, for powering the Operator Station and monitor. | ||
8.2.2.14 | The PDU shall provide [*] ingress protection per [*]. | ||
8.2.2.15 | All power connections to the PDU shall be either hard-wired, or locking-type plugs. | ||
8.2.2.16 | The PDU shall monitor output voltage on the [*] outputs, and provide an output signal indicating whether or not the voltage is within [*]% to [*]% of the nominal value. |
8.2.3 | Control |
8.2.3.1 | The PDU shall be capable of disabling power to the disk in response to an external control signal (the disk off signal). | ||
8.2.3.2 | The PDU shall provide an output signal that indicates the status of the power phases. | ||
8.2.3.3 | The PDU outputs shall not be able to be turned on unless an external key switch control signal is active. | ||
8.2.3.4 | The PDU shall remove power from the outputs in response to either of two external control signals (the off or key enable signals). | ||
8.2.3.5 | The PDU outputs shall turn on if both of two external control signals (the key enable and system on signals) are active. | ||
8.2.3.6 | The PDU shall open the main input-side breaker in response to [*] (the [*]). | ||
8.2.3.7 | The PDU outputs shall not provide output power unless [*] (the [*]) is connected. | ||
8.2.3.8 | The PDU shall provide [*], [*] (for operating the door indicator system). | ||
8.2.3.9 | The PDU shall provide a [*]. The PDU shall provide [*]. |
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9.1 | Scope | ||
The Control Computers include the computer chassis, boards, and software components needed to control the operation of the TomoTherapy Hi-Art II delivery subsystem. The control computers include: On-board Controller (OBC), Stationary Controller (SBC), and Data Receiver Server (DRS). | |||
9.2 | Functional Requirements |
9.2.1 | General |
9.2.1.1 | All circuit boards used in the control computers shall be certified to [*], and be labeled as such. | ||
9.2.1.2 | All circuit boards used in the control computers shall be designed to standards [*] and [*]. | ||
9.2.1.3 | The control computers shall consist of three separate boxes: the Stationary Controller (STC); On-Board Controller (OCB), and Data Receiver Server (DRS). | ||
9.2.1.4 | The control computers shall each have status indicators indicating if the computer is functioning normally or in one or more error states. | ||
9.2.1.5 | The control computers shall each be constructed in a manner consistent with the requirements of [*]. | ||
9.2.1.6 | The control computers shall each be supplied with one [*]. | ||
9.2.1.7 | On each compute, Analogic shall pre-install a [*] and [*]. Alternatively, Analogic shall install a [*] supplied by TomoTherapy if and when it becomes available. The software supplied to Analogic will be subject to change, but shall be provided by TomoTherapy in a controlled way and with sufficient notice to allow integration into Analogics manufacturing process. |
9.2.2 | Stationary Controller (STC) Hardware |
9.2.2.1 | The STC shall provide I/O lines to control the gantry motor drive, supplied by Analogic. | ||
9.2.2.2 | The STC shall provide hardware I/O lines to interface with the [*]. | ||
9.2.2.3 | The STC shall provide an Ethernet connection to the delivery subsystem communications network and gantry displays. | ||
9.2.2.4 | The STC shall provide hardware I/O lines to interface with the [*]. | ||
9.2.2.5 | The STC shall provide hardware I/O lines to interface with the [*]. |
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9.2.2.6 | The STC shall provide hardware I/O lines to interface with the [*]. | ||
9.2.2.7 | The STC shall provide hardware I/O lines to interface with the [*]. | ||
9.2.2.8 | The STC shall provide hardware I/O lines to interface with the [*], supplied by [*]. | ||
9.2.2.9 | The STC shall provide hardware I/O lines to interface with [*] and [*] for [*] and [*]. |
9.2.3 | On-Board Controller (OBC) Hardware |
9.2.3.1 | The OBC shall be able to operate correctly when rotating at speeds between and including [*] r.p.m. and [*] r.p.m. | ||
9.2.3.2 | The OBC shall provide Ethernet connection to the delivery subsystem communications network. | ||
9.2.3.3 | The OBC shall provide hardware I/O lines to interface with the [*]. | ||
9.2.3.4 | The OBC shall provide hardware I/O lines to interface with the [*]. | ||
9.2.3.5 | The OBC shall provide hardware I/O lines to interface with the [*] ([*]) subsystem. | ||
9.2.3.6 | The OBC shall provide hardware I/O lines to interface with the [*] ([*]) subsystem. | ||
9.2.3.7 | The OBC shall provide an interface to the [*] ([*]) subsystem, supplied by [*]. | ||
9.2.3.8 | The OBC shall provide electronics to prepare the [*] and [*] for transfer over the high speed data transmission system, supplied by [*]. |
9.2.4 | Data Receiver Server (DRS) Hardware |
9.2.4.1 | The DRS shall provide an Ethernet connection to the delivery subsystem communications network. | ||
9.2.4.2 | The DRS shall provide a separate Ethernet port for connection to the external communications network (of which the TomoTherapy Hi-Art II Operator Station forms a part). | ||
9.2.4.3 | The DRS shall provide electronics to receive the [*] and [*] transferred over the high speed data transmission system, supplied by [*]. | ||
9.2.4.4 | The DRS shall provide a set of [*] ([*]), that can be used to implement [*] on [*] that are received from the [*]. |
9.2.5 | Software Drivers | ||
The following software drivers shall be supplied by Analogic with a royalty-free license to use on the TomoTherapy Hi-Art II System: |
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10.1 | Scope | ||
Analogic will supply a number of components on the gantry subsystem when delivered to TomoTherapy. These components include, but are not limited to, power supplies, circuit breakers, cables, and circuit boards. Analogic will perform the following tasks in relation to this work: |
| Developing, along with TomoTherapy, the system design. | ||
| Selecting and/or sourcing the components (see Section 10.2.2 below). | ||
| Designing and developing components (see Section 10.2.2 below). | ||
| Developing control software for selected components (as described in Exhibit 2, Milestones). | ||
| Fabricating, assembling, and integrating the Analogic portion of the Hi-Art II prototype subsystem. | ||
| Assisting TomoTherapy with integration of the Analogic-developed portion of the Hi-Art II prototype with the TomoTherapy-developed portion of the Hi-Art II prototype. |
10.2 | Functional Requirements |
10.2.1 | Circuit Boards | ||
Based upon TomoTherapy requirements specifications, Analogic shall design and manufacture the following circuit boards for use in the TomoTherapy Hi-Art II System: |
10.2.1.1 | MLC Control Board | ||
The MLC Control Board provides an interface from the [*] to the [*]. The board isolates the [*] signals from and routes power to the [*]. |
10.2.1.2 | PDU and Interlock Control Board |
| The PDU and Interlock Control Board provides an interface to the [*], [*] and [*]. It forwards the [*] to the [*] to disable the [*] and [*]. It also forwards the signal to the [*] to turn off the disk power. | ||
| The PDU and Interlock Control Board also interfaces with the [*] to break or make the interlock depending on the status of the [*] from the [*]. The status of the door interlock is [*]. |
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| The PDU and Interlock Control Board provides an interface to the [*] with the [*] to allow it to make and break the interlock. The [*] can also read the interlock status from the board. The board also requires the computers to send a [*]. | ||
| The PDU and Interlock Control Board provides an interface to [*] to allow [*] to any one of [*] preconfigured angles of [*],[*],[*], and [*] degrees. |
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QUALITY RECORD, Template F4-18 REV A
|
TomoTherapy, Inc. | |
Verify Latest Revision Before Using
|
COMPANY CONFIDENTIAL |
Document No. | Document Name | Revision No. | Page | |||||
|
ANALOGIC-TOMOTHERAPY | |||||||
-
|
DEVELOPMENT AND OEM SUPPLY | 5 | 21 OF 21 | |||||
|
AGREEMENT EXHIBIT 1 |
|
[*] | ||
|
[*] | [*] | |
|
[*] | [*] |
10.2.1.5 | Detector Gang Boards | ||
The detector gang boards interface between the [*] (model number [*]) backplane and the detector cables that lead to the Analogic DAS. Each board combines [*] backplane connectors ([*] channels) into a single [*] connector. |
10.2.2 | List of Gantry Components with Analogic Involvement | ||
In addition to the circuit boards, Analogic will supply other components and cables to be mounted on the gantry prior to shipment. | |||
The document in Exhibit lb ([*], [*], Analogic document number [*]) defines the components that will have Analogic involvement, including the circuit boards described above. | |||
For each component, Analogic will either manufacture the component, or source the component directly. In either case the cost of the component will be included in the Analogic quoted price. The component will be mounted on the [*] gantry by Analogic prior to shipment (some of the components may be unmounted before shipping as agreed by both parties). | |||
TomoTherapy will provide Analogic with a [*] assembly (TomoTherapy assembly part number [*]), which includes the [*] and [*] adjustors. These components will be mounted on the [*] gantry by Analogic before shipment. |
QUALITY RECORD, Template F4-18 REV A
|
TomoTherapy, Inc. | |
Verify Latest Revision Before Using
|
COMPANY CONFIDENTIAL |
Milestone # | Description | Payment Amount | Date Billed | |||||
|
||||||||
1
|
Contract Signing | $ | [*] | 10/01 | ||||
|
||||||||
2
|
Delivery of Rotating Test Bed | $ | [*] | 1/02 | ||||
|
||||||||
3
|
Design Review | $ | [*] | 10/01 | ||||
|
||||||||
4
|
Delivery of Table #1 | $ | [*] | 10/01 | ||||
|
||||||||
5
|
Delivery of DAS #1 | $ | [*] | 1/02 | ||||
|
||||||||
6
|
Delivery of Rx/PTM # 1 | $ | [*] | 5/02 | ||||
|
||||||||
7
|
Delivery of DAS #2 | $ | [*] | 3/02 | ||||
|
||||||||
8
|
Delivery of Rx/PTM #2 | $ | [*] | 5/02 | ||||
|
||||||||
9
|
Delivery of DAS #3 | $ | [*] | 4/02 | ||||
|
||||||||
10
|
Delivery of Rx/PTM #3 | $ | [*] | 9/02 | ||||
|
||||||||
11
|
Delivery of Table #2 | $ | [*] | 2/02 | ||||
|
||||||||
12
|
Delivery of Table #3 | $ | [*] | 4/02 | ||||
|
||||||||
13
|
Delivery of Gantry #1 | $ | [*] | 3/02 | ||||
|
||||||||
14
|
Delivery of Gantry #2 | $ | [*] | 4/02 | ||||
|
||||||||
15
|
Delivery of Gantry #3 | $ | [*] | 4/02 | ||||
|
||||||||
|
||||||||
|
Subtotal | $ | [*] |
1
Milestone # | Description | Payment Amount | Date Billed | |||||
|
||||||||
16
|
Upon Agreement of PDU Extension: | |||||||
|
PDU NRE #1 | $ | [*] | 12/01 | ||||
|
||||||||
17
|
Upon Delivery of PDU # 1: | |||||||
|
PDU NRE #2 | $ | [*] | 4/02 | ||||
|
PDU #1 | $ | [*] | 4/02 | ||||
|
||||||||
18
|
Upon Regulatory Approval: | |||||||
|
PDU NRE #3 | $ | [*] | 9/02 | ||||
|
||||||||
19
|
Upon Delivery of PDU #2 | $ | [*] | 4/02 | ||||
|
||||||||
20
|
Upon Delivery of PDU #3 | $ | [*] | 9/02 | ||||
|
||||||||
21
|
Upon Delivery of PDU #4 | $ | [*] | 11/02 | ||||
|
||||||||
22
|
Upon Delivery of PDU #5 | $ | [*] | |||||
|
||||||||
23
|
Upon Delivery of PDU #6 | $ | [*] | |||||
|
||||||||
24
|
Upon Delivery of PDU #7 | $ | [*] | |||||
|
||||||||
25
|
Upon Delivery of PDU #8 | $ | [*] | |||||
|
||||||||
26
|
Upon Delivery of PDU #9 | $ | [*] | |||||
|
||||||||
27
|
Upon Delivery of PDU #10 | $ | [*] | |||||
|
||||||||
|
||||||||
|
Subtotal | $ | [*] |
Milestone # | Description | Payment Amount | Date Billed | |||||
|
||||||||
28
|
Disk Casting for Test Bed | [*] | 1/02 | |||||
|
||||||||
|
Subtotal | [*] |
2
Milestone # | Description | Payment Amount | Date Billed | |||||
|
||||||||
29
|
Upon Agreement of Computers Extension: | |||||||
|
Computer Hardware NRE # 1 | $ | [*] | 1/02 | ||||
|
Computer Software NRE #1 | $ | [*] | 1/02 | ||||
|
||||||||
30
|
Upon Partial Delivery of Development Computer Set #1 | $ | [*] | 12/01 | ||||
|
||||||||
31
|
Upon Completion of Development Computer Set #1: | |||||||
|
Prototype OBC | 3/02 | ||||||
|
Prototype STC | $ | [*] | 8/02 | ||||
|
Computer Hardware NRE #2 | $ | [*] | 4/02 | ||||
|
||||||||
32
|
Upon Completion of Software Training Workshops: | |||||||
|
Computer Software NRE #2 | $ | [*] | 3/02 | ||||
|
||||||||
33
|
Upon Delivery of Computer Set #2: | |||||||
|
Computer Set #2 | $ | [*] | 5/02 | ||||
|
Rx/PTM #1 Credit (See Milestone # 6) | $ | [*] | 5/02 | ||||
|
Computer Hardware NRE #3 | $ | [*] | 5/02 | ||||
|
||||||||
34
|
Upon Delivery of Computer Set #3 | |||||||
|
Computer Set #3 | $ | [*] | 5/02 | ||||
|
Rx/PTM #2 Credit (See Milestone #8) | $ | [*] | 5/02 | ||||
|
||||||||
35
|
Upon Delivery of Computer Set #4 | |||||||
|
Computer Set #4 | $ | [*] | 9/02 | ||||
|
Rx/PTM #3 Credit (See Milestone # 10) | $ | [*] | 9/02 | ||||
|
||||||||
36
|
Upon Delivery of Computer Set #5 | $ | [*] | 11/02 | ||||
37
|
Upon Delivery of Computer Set #6 | $ | [*] | 12/02 | ||||
38
|
Upon Delivery of Computer Set #7 | $ | [*] | |||||
39
|
Upon Delivery of Computer Set #8 | $ | [*] | |||||
40
|
Upon Delivery of Computer Set #9 | $ | [*] | |||||
41
|
Upon Delivery of Computer Set #10 | $ | [*] | |||||
42
|
Upon Completion of Computer Software Support | |||||||
|
Computer Software NRE #3 | $ | [*] | 10/02 | ||||
|
||||||||
|
||||||||
|
Subtotal | $ | [*] |
3
Milestone # | Description | Payment Amount | Date Billed | |||
|
||||||
43
|
Delivery of Gantry #4 | $[*] | 9/02 | |||
|
||||||
44
|
Delivery of Table #4 | $[*] | 11/02 | |||
|
||||||
45
|
Delivery of DAS #4 | $[*] | 11/02 | |||
|
||||||
46
|
Delivery of Gantry #5 | $[*] | 9/02 | |||
|
||||||
47
|
Delivery of Table #5 | $[*] | ||||
|
||||||
48
|
Delivery of DAS #5 | $[*] | 12/02 | |||
|
||||||
49
|
Delivery of Gantry #6 | $[*] | 11/02 | |||
|
||||||
50
|
Delivery of Table #6 | $[*] | ||||
|
||||||
51
|
Delivery of DAS #6 | $[*] | ||||
|
||||||
52
|
Delivery of Gantry #7 | $[*] | 12/02 | |||
|
||||||
53
|
Delivery of Table #7 | $[*] | ||||
|
||||||
54
|
Delivery of DAS #7 | $[*] | ||||
|
||||||
55
|
Delivery of Gantry #8 | $[*] | ||||
|
||||||
56
|
Delivery of Table #8 | $[*] | ||||
|
||||||
57
|
Delivery of DAS #8 | $[*] | ||||
|
||||||
58
|
Delivery of Gantry #9 | $[*] | ||||
|
||||||
59
|
Delivery of Table #9 | $[*] | ||||
|
||||||
60
|
Delivery of DAS #9 | $[*] | ||||
|
||||||
|
||||||
|
Subtotal | $[*] |
4
Milestone # | Description | Payment Amount | Date Billed | |||||
|
||||||||
61
|
Upon Agreement | |||||||
|
System NRE #1 | $ | [*] | 3/02 | ||||
|
||||||||
62
|
System Design Review | |||||||
|
System NRE #2 | $ | [*] | 7/02 | ||||
|
||||||||
63
|
Completion of First 3 Man Months Software Development | |||||||
|
System Software NRE #1 | $ | [*] | 5/02 | ||||
|
||||||||
64
|
Completion of Second 3 Man Months Software Development | |||||||
|
System Software NRE #2 | $ | [*] | 7/02 | ||||
|
||||||||
65
|
Assembly of Gantry Subsystem #1 at Analogic | |||||||
|
System NRE #3 | $ | [*] | 10/02 | ||||
|
||||||||
66
|
Completion of Third 3 Man Months Software Development | |||||||
|
System Software NRE #3 | $ | [*] | 10/02 | ||||
|
||||||||
67
|
Test Bed Hardware Integration of Analogic and TomoTherapy | |||||||
|
Subsystems | |||||||
|
System NRE #4 | $ | [*] | 10/02 | ||||
|
||||||||
68
|
Delivery of Integrated Gantry Subsystem #1 | $ | [*] | 9/02 | ||||
69
|
Delivery of Integrated Gantry Subsystem #2 | $ | [*] | 11/02 | ||||
70
|
Delivery of Integrated Gantry Subsystem #3 | $ | [*] | 12/02 | ||||
71
|
Delivery of Integrated Gantry Subsystem #4 | $ | [*] | |||||
72
|
Delivery of Integrated Gantry Subsystem #5 | $ | [*] | |||||
73
|
Delivery of Integrated Gantry Subsystem #6 | $ | [*] | |||||
74
|
Delivery of Integrated Gantry Subsystem #7 | $ | [*] | |||||
75
|
Delivery of Integrated Gantry Subsystem #8 | $ | [*] | |||||
76
|
Delivery of Integrated Gantry Subsystem #9 | $ | [*] | |||||
|
||||||||
|
Subtotal | $ | [*] |
5
Milestone # | Description | Payment Amount | Date Billed | |||||
|
||||||||
77
|
Lot Charge (9 Disks) | $ | [*] | 10/02 | ||||
|
||||||||
|
||||||||
|
Subtotal | $ | [*] |
Milestone # | Description | Payment Amount | Date Billed | |||||
|
||||||||
78
|
Delivery of Prototype Bearing #1 | $ | [*] | |||||
|
||||||||
79
|
Delivery of Prototype Bearing #2 | $ | [*] | |||||
|
||||||||
|
||||||||
|
Subtotal | $ | [*] |
Milestone # | Description | Payment Amount | Date Billed | |||||
|
||||||||
80
|
15 Target Licenses (Computer Sets #1 - #5) | $ | [*] | 10/02 | ||||
|
||||||||
81
|
3 Target Licenses (Computer Set #6) | $ | [*] | 12/02 | ||||
|
||||||||
82
|
3 Target Licenses (Computer Set #7) | $ | [*] | |||||
|
||||||||
83
|
3 Target Licenses (Computer Set #8) | $ | [*] | |||||
|
||||||||
84
|
3 Target Licenses (Computer Set #9) | $ | [*] | |||||
|
||||||||
85
|
3 Target Licenses (Computer Set #10) | $ | [*] | |||||
|
||||||||
86
|
70 Target Licenses (@ $[*]/license) | $ | [*] | |||||
|
||||||||
|
||||||||
|
Subtotal | $ | [*] |
6
Payment | Date | |||||||
Milestone # | Description | Amount | Billed | |||||
|
||||||||
87
|
Gantry Power Interface Kit #1 | $ | [*] | 12/02 | ||||
|
||||||||
88
|
Gantry Power Interface Kit #2 | $ | [*] | 12/02 | ||||
|
||||||||
89
|
15:1 Gear Reducer | $ | [*] | 12/02 | ||||
|
||||||||
90
|
NRE | $ | [*] | 12/02 | ||||
|
||||||||
|
||||||||
|
Subtotal
|
$ | [*] |
7
Part # | Description | Quantity | Price (each) | |||
10-42956-01
|
Recon Computer Assy | [*] | $[*] | |||
|
||||||
10-60165-01
|
PDU Control Board 00B | [*] | $[*] | |||
|
||||||
10-41954-01
|
Base Control Comptr Assy | [*] | $[*] | |||
|
||||||
10-60204-01
|
MLC Control Board | [*] | $[*] | |||
|
||||||
10-60274-01
|
Sensor Bd Cal Assy | [*] | $[*] | |||
|
||||||
10-60274-02
|
Sensor Bd, Tick | [*] | $[*] | |||
|
||||||
10-60019-01
|
Gang Bd Assy Tested (8) | [*] | $[*] | |||
|
||||||
10-60113-01
|
Gang Bd Offset 2 Assy | [*] | $[*] | |||
|
||||||
10-60112-01
|
Gang Bd Offset 1 Assy | [*] | $[*] | |||
|
||||||
10-60276-01
|
Modulator Interface Bd 00D | [*] | $[*] | |||
|
||||||
10-60399-01
|
Aux Input Bd Rev 1 | [*] | $[*] | |||
|
||||||
10-44771-01
|
Disk Control Assy | [*] | $[*] | |||
|
||||||
10-27160-01
|
RTS DAS | [*] | $[*] | |||
|
||||||
10-42363-01
|
Table Control Assy | [*] | $[*] |
1-19 | 20-49 | 50- UP | ||
$[*] | $[*] | $[*] |
1. | SCOPE |
2. | PURCHASE ORDER PLACEMENT |
Oncology Care Systems Group |
4040 Nelson Avenue
Concord, CA 94520 |
1 |
Tel: (925) 246-8200
Fax: (925) 246-8284 |
ww.siemensmedical.com/oncology |
3. | PACKAGING |
4. | TERM |
5. | PRICING |
6. | PAYMENT TERMS |
7. | WARRANTY |
Oncology Care Systems Group |
4040 Nelson Avenue
Concord, CA 94520 |
2 |
Tel: (925) 246-8200
Fax: (925) 246-8284 |
ww.siemensmedical.com/oncology |
8. | LIMITATION OF LIABILITY |
9. | TERMINATION |
10. | EXPORT |
Oncology Care Systems Group |
4040 Nelson Avenue
Concord, CA 94520 |
3 |
Tel: (925) 246-8200
Fax: (925) 246-8284 |
ww.siemensmedical.com/oncology |
11. | INDEMNIFICATION |
a) | Bodily injury, Disability or Death |
b) | Intellectual Property Infringement |
Oncology Care Systems Group |
4040 Nelson Avenue
Concord, CA 94520 |
4 |
Tel: (925) 246-8200
Fax: (925) 246-8284 |
ww.siemensmedical.com/oncology |
c) | Product Liability Insurance |
12. | CONFIDENTIALITY |
Oncology Care Systems Group |
4040 Nelson Avenue
Concord, CA 94520 |
Tel: (925) 246-8200
Fax: (925) 246-8284 |
ww.siemensmedical.com/oncology |
5
a) | if such information is generally available from public sources other than as a result of the breach of this Agreement | ||
b) | if such information is received from a third party not under any obligation to keep such information confidential | ||
c) | if the recipient can demonstrate that such information was independently developed by the recipient without use of any confidential information of the other party or its Affiliates; and | ||
d) | if such information is marketing material such as catalogs or leaflets distributed to third parties as a part of sales and promotions. |
13. | GOVERNING LAW |
Oncology Care Systems Group |
4040 Nelson Avenue
Concord, CA 94520 |
6 |
Tel: (925) 246-8200
Fax: (925) 246-8284 |
ww.siemensmedical.com/oncology |
Siemens Medical Solutions USA, Inc. | TomoTherapy Incorporated | |||||||
Oncology Care Systems Division | 1240 Deming Way | |||||||
Concord, CA 94520 | Madison, WI 53717 | |||||||
Seller | Buyer | |||||||
|
||||||||
By: Ajit Singh, Ph.D. | By: Mr. John Barni | |||||||
Title: President | Title: CEO | |||||||
|
||||||||
Signature:
|
/s/ Ajit Singh | Signature: | /s/ John Barni | |||||
|
||||||||
|
||||||||
Date:
|
11/17/03 | Date: | 11/18/03 | |||||
|
||||||||
|
||||||||
By: Mr. Bernd Haetzel | ||||||||
Title: Vice-President Finance and Administration | ||||||||
|
||||||||
Signature:
|
/s/ Bernd Haetzel | |||||||
|
||||||||
|
||||||||
Date:
|
11-13-03 | |||||||
|
Oncology Care Systems Group |
4040 Nelson Avenue
Concord, CA 94520 |
7 |
Tel: (925) 246-8200
Fax: (925) 246-8284 |
ww.siemensmedical.com/oncology |
Oncology Care Systems Group | 4040 Nelson Avenue | Tel: (925) 246-8200 | www.siemensmedical.com/oncology | |||
Concord, CA 94520 | Fax: (925) 246-8284 |
SIEMENS
|
MSA- 50047-WMG
Amendment 03 |
Oncology Care Systems Group | 4040 Nelson Avenue | Tel: (925) 246-8200 | www.siemensmedical.com/oncology | |||
Concord, CA 94520 | Fax: (925) 246-8284 |
2
SIEMENS
|
MSA- 50047-WMG
Amendment 03 |
Oncology Care Systems Group | 4040 Nelson Avenue | Tel: (925) 246-8200 | www.siemensmedical.com/oncology | |||
Concord, CA 94520 | Fax: (925) 246-8284 |
3
SIEMENS |
MSA-50047-WMG
Amendment 03 |
to exceed the equivalent of [ * ]. Seller must obtain a purchase order from the Buyer for testing beyond the amount of [ * ]. | ||
EXCEPT AS EXPRESSLY SET FORTH IN THE PRECEDING SENTENCES AND/OR IN SPECIFICATIONS, SELLER MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, WITH RESPECT TO THE PRODUCTS. |
Each partys maximum liability to the other party relating to claims for property damage shall be limited to a maximum of $2,000,000 for performance under this Agreement. |
During the term of this Agreement and for five (5) years after the latter of either the termination of this Agreement or the termination of the last Statement of Work under this Agreement, each party shall use the same efforts it uses to protect its own confidential information (but in any event, no less than reasonable efforts to prevent its disclosure) to hold in strict confidence and to require its personnel to hold in strict confidence and not disclose to (1) any employee, director, or agent that does not need to know such information for the purpose of carrying out this Agreement or (2) any third party without the prior written consent of the disclosing party, and not use in any manner except for purposes of carrying out this Agreement and otherwise in accordance with the terms of this Agreement, any confidential information of the other party in its possession. Such confidential information specifically may include, without limitation, all engineering drawings, specifications and other technical documentation, any proposed design and specifications for future products and products in development, marketing plans, costs and pricing information, all third party information required to be maintained in confidence, and any other information that the disclosing party has marked as confidential. Promptly following termination of this Agreement or upon the request by or for the disclosing party, the receiving party shall surrender to the disclosing party or destroy all materials remaining in its possession containing any such confidential information including all copies, extracts, or transcriptions, regardless of media. | ||
For purposes of this Agreement and the Products and Statement of Work, information shall not be deemed confidential: |
a) | if such information is generally available from public sources other than as a result of the breach of this Agreement; | ||
b) | if such information is received from a third party not under any obligation to keep such information confidential; |
Siemens Medical Solutions USA, Inc. | ||||||
|
||||||
Oncology Care Systems Group
|
4040 Nelson Avenue | Tel: (925) 246-8200 | www.siemensmedical.com/oncology | |||
|
Concord, CA 94520 | Fax: (925) 246-8284 |
4
SIEMENS |
MSA-50047-WMG
Amendment 03 |
c) | if the recipient can demonstrate that such information was independently developed by the recipient without use of any confidential information of the other party or its Affiliates; and | ||
d) | if such information is marketing material such as catalogs or leaflets distributed to third parties as a part of sales and promotions. |
Neither party shall be liable to the other for a breach of these confidentiality obligations to the extent it is required by law or any governmental body to disclose any confidential information of the other party; provided, however, unless otherwise required by such governmental body or such law, the party providing such information to such governmental body or disclosing the same pursuant to requirement of law shall first notify the other party so as to enable the other party opportunity to take steps it deems appropriate to protect its confidential or proprietary information. |
All contractual notices from one party to the other under this Agreement shall be in writing and either personally delivered or sent via certified mail, (E-mail or other electronic media are not acceptable), postage prepaid and return receipt requested to: |
|
Buyer: | TomoTherapy, Inc. | ||
|
1240 Deming Way | |||
|
Madison, WI 53717 | |||
|
ATTENTION: Bob Evensen | |||
|
||||
|
Seller: | Siemens Medical Solutions USA, Inc. | ||
|
Oncology Care Group | |||
|
4040 Nelson Avenue | |||
|
Concord, CA 94520 | |||
|
ATTENTION: Manager, Strategic Procurement |
or to such other person or places as either party may designate from time to time by notice hereunder. Such notices shall be deemed effective upon personal delivery or deposit in the mails in accordance herewith. |
This Agreement contains all of the terms and conditions as they relate to the relationship between Buyer and Seller. Any terms and conditions, other than price, quantity, and shipping instructions, which may be specified on Buyers purchase order or on any Buyers Order Acknowledgement Form, are null and void unless expressly agreed upon in writing by Sellers representative responsible for Contract Administration. |
Siemens Medical Solutions USA, Inc. | ||||||
|
||||||
Oncology Care Systems Group
|
4040 Nelson Avenue | Tel: (925)246-8200 | ||||
|
Concord, CA 94520 | Fax: (925)246-8284 | www.siemensmedical.com/oncology |
5
SIEMENS |
MSA-50047-WMG
Amendment 03 |
Part Number | Description | |
|
||
[ * ]
|
AFC ASSY, G39 | |
[ * ]
|
ACCELERATOR ASSY,TOMO 6V | |
[ * ]
|
PWR SPL ASSY,ION PMP,12V-A20 | |
[ * ]
|
DRIVE ASSY-MAGN TUNER-M5 | |
[ * ]
|
DOSE CHAMBER ASSY | |
[ * ]
|
RF CIRCULATOR ASSY,KD2-G36 | |
[ * ]
|
INJECTOR ASSY,ELECT-G45 | |
[ * ]
|
TARGET ASSY,MONO 6MV / PRIMART | |
[ * ]
|
RF,DETECTOR MOUNT N | |
[ * ]
|
ATTENUATOR,RF 20DB N 250 watts | |
[ * ]
|
O-RING,BUNA-N 3.975-ID M4152TR | |
[ * ]
|
ACCELERATOR ASSY, TOP TOMO | |
[ * ]
|
TARGET, SPINNING TUNGSTEN |
Siemens Medical Solutions USA, Inc. | ||||||
|
||||||
Oncology Care Systems Group
|
4040 Nelson Avenue | Tel: (925) 246-8200 | www.siemensmedical.com/oncology | |||
|
Concord, CA 94520 | Fax: (925) 246-8284 |
6
SIEMENS |
MSA-50047-WMG
Amendment 03 |
DELETE in its entirety and REPLACE in lieu thereof the following Exhibit B: |
PN | Description | Base Price | Lead Times | |||||||||
[ * ] |
AFC ASSY, G39
|
$ | [ * ] | 60 days | ||||||||
[ * ] |
ACCELERATOR ASSY, TOMO 6V
|
$ | [ * ] | 90 days | ||||||||
[ * ] |
PWR SPL ASSY, ION PMP, 12V-A20
|
$ | [ * ] | 42 days | ||||||||
[ * ] |
DRIVE ASSY-MAGN TUNER-M5
|
$ | [ * ] | 75 days | ||||||||
[ * ] |
DOSE CHAMBER ASSY
|
$ | [ * ] | 120 days | ||||||||
[ * ] |
RF CIRCULATOR ASSY, KD2-G36
|
$ | [ * ] | 75 days | ||||||||
[ * ] |
INJECTOR ASSY, ELECT-G45
|
$ | [ * ] | 65 days | ||||||||
[ * ] |
TARGET ASSY, MONO 6MV / PRIMART
|
$ | [ * ] | 90 days | ||||||||
[ * ] |
RF,DETECTOR MOUNT N
|
$ | [ * ] | 60 days | ||||||||
[ * ] |
ATTENUATOR, RF 20DB N 250 watts
|
$ | [ * ] | 60 days | ||||||||
[ * ] |
0-RING,BUNA-N 3.975-ID M4152TR
|
$ | [ * ] | 60 days | ||||||||
[ * ] |
ACCELERATOR ASSY, TOP TOM0
|
$ | [ * ] | 90 days | ||||||||
[ * ] |
TARGET, SPINNING TUNGSTEN
|
$ | [ * ] | 90 days |
[ * ] | ||
Seller shall be entitled to the following break-point discounts on part numbers [ * ] and [ * ] when a twelve (12) month non-cancelable purchase order is placed for the following corresponding quantities. Each twelve (12) month period shall run from October 1 st of each year through September 30 th of the following year. | ||
The below stated discount break-points apply to all quantities stated on the aforementioned twelve (12) month purchase order. |
Discount | Quantities of PIN [ * ] and/or [ * ] | |
[ * ]%
|
If yearly PO quantity is 65 units or less | |
[ * ]%
|
If yearly PO quantity is between 66 and 85 units | |
[ * ]%
|
If yearly PO quantity is between 86 and 100 units | |
[ * ]%
|
If yearly PO quantity is between 101 and 130 units |
Siemens Medical Solutions USA, Inc. | ||||||
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Oncology Care Systems Group
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4040 Nelson Avenue | Tel: (925) 246-8200 | www.siemensmedical.com/oncology | |||
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Concord, CA 94520 | Fax: (925) 246-8284 |
7
SIEMENS |
MSA-50047-WMG
Amendment 03 |
Siemens Medical Solutions USA Inc.
|
TomoTherapy, Inc. | |
Oncology Care Systems Group
|
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By: Mr. Martin Wentzlik
|
By: Fred Robertson | |
Title: Chief Fiancial Officer
|
Title: CEO | |
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Signature:
/s/ Mr. Martin Wentzlik
|
Signature: /s/ Fred Robertson | |
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Date: 01/11/06
|
Date: January 23, 2006 | |
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By: Mr. Rolf Reimann
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Title: VP, Plant Management
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Signature: /s/ Rolf Reimann
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Date: 01/11/2006
|
Siemens Medical Solutions USA, Inc. | ||||||
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||||||
Oncology Care Systems Group
|
4040 Nelson Avenue | Tel: (925) 246-8200 | www.siemensmedical.com/oncology | |||
|
Concord, CA 94520 | Fax: (925) 246-8284 |
8
Seller: | Buyer: | |||||
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ReMedPar, Inc. | TomoTherapy Incorporated | |||||
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||||||
By:
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/s/ Mark Graham | By: | /s/ Shawn D. Guse | |||
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||||||
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Mark Graham | Shawn D. Guse | ||||
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President and CEO | Vice President, Secretary, and General Counsel |
1
2
8
| Employed by TomoTherapy on the incentive payout date; and |
| Not on a written corrective plan or higher during the performance period. |
| Focus on business results, |
| Provide goals that all employees understand, and |
| Ensure that the plan is easy to administer. |
| Operating income will be the trigger measure. This means that if the organization does not achieve its operating income goal, no plan payout will be made. This approach is taken because operating income is a measure of how much of a payout TomoTherapy can afford to pay. |
¾ | Reducing waste, | ||
¾ | Doing more with less, or | ||
¾ | Improving processes to accomplish tasks in less time with fewer process steps or with fewer resources. |
| Reliability, as defined and measured as up-time. This measure is intended to demonstrate production improvements, appropriate levels of maintenance, and timely repairs. Reliability will be used as a multiplier to provide an opportunity for lesser or greater plan payout potential. | |
We want to focus on reliability as one of the measures as reliability is fundamental to our positive market image. It will significantly impact our future ability to grow both revenues and operating income. |
Organizational | Operating | Plan Funding | ||||||
Performance | Income Goal | Level | ||||||
75%
|
$ | [*]M | 50 | % | ||||
100%
|
$ | [*]M | 100 | % | ||||
125%
|
$ | [*]M | 150 | % | ||||
|
||||||||
Target Achievement | Target | Modifier | ||||
Below Minimum
|
Less than [*]% | 0.95 (in other words, there will be a lower payment to reflect below 2006 reliability results performance) | ||||
|
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Minimum
|
[*]% | 1.00 (in other words, there will be no adjustment if achievement is maintained at prior years level) | ||||
|
||||||
Target
|
[*]% up-time | 1.05 (in other words, the payout will increase by [*]% to reflect higher than expected reliability) | ||||
|
||||||
Maximum
|
[*]% up-time | 1.10 (in other words, the payout will increase by [*]% to reflect higher than expected reliability) | ||||
Target | ||||||
Level | Definition | Opportunity | ||||
1
|
Contributes to task-related activities in support of tactical implementation
of short-term team goals.
|
[*] | % | |||
|
Has limited knowledge of concepts, practices, and procedures of particular field of specialization. Develops solutions to problems of limited scope and complexity following established policies and procedures. Works under general supervision. Role is narrow, specific in impact; and task-oriented. | |||||
|
||||||
2
|
Contributes to the tactical implementation of short term business goals. May
have some influence on the overall goals of the team.
|
[*] | % | |||
|
Responsible for applying the fundamental concepts, practices, and procedures of particular field of specialization to the completion of varied and moderately difficult assignments. Develops solutions based on general technical knowledge and |
Target
Level
Definition
Opportunity
experience. Understands related departments or
functions. Participates in determining objectives of assignments. Little or
moderate supervision required. May or may not have direct reports of limited
number. Has direct impact on short-term departmental goals.
Develops and implements tactical solutions to achieve short term business
goals. Manages, directs or monitors daily operations for workers or teams
engaged in a single task or multiple, but closely related tasks. Directly
impacts the short-term performance
of the unit(s) to which s/he is assigned.
[*]
%
Responsible for monitoring day-to-day operations for assigned work
teams/project areas. Provides direction, leadership, coaching, and technical
expertise to group of employees. Has impact/influence on budgeting,
controlling costs, planning, scheduling, and procedural/policy changes.
Translates long- and short-term business goals into tactical, functional
initiatives. Manages managers or is an individual contributor viewed as the
highest level expert within field. Directly impacts the short-term success of
a function or operation. Influences the development of overall objectives of
the function or operation.
[*]
%
Within a department or line of business, has direct accountability for
specific function or discipline of significant scope or technical
requirements. Trains and mentors staff; estimates staffing needs, assigns
work, and ensures projects are completed on schedule following established
procedures and schedules. Consults with manager for extraordinary and
exceptional issues. Expected to bring long-term view/perspective to individual
projects.
Translates long-term strategy into long- and short-term goals for a line of
business or organization-wide department.
[*]
%
Has oversight and accountability for implementation of long-term departmental
business strategies. Responsible for developing functions or departments
objectives to achieve long- and short-term plans. Ensures overall budgets,
schedules, and performance standards are realistically set and attained. Has
wide sphere of responsibility and knowledge and a direct impact on total
departments ability to deliver against performance goals. Generally
accomplishes results through others/lower management levels. Expected to drive
teams toward optimum balance of long-term and short-term performance and
initiatives.
Target | ||||||
Level | Definition | Opportunity | ||||
6
|
Works cross-functionally to direct the total company towards achieving its
mission and goals. Also develops and directs the long term vision for a
specific function(s) in support of overall company mission.
|
[*]% | ||||
|
Has shared accountability for total (global) company performance. Develops long-term strategies in support of corporate business goals and has direct accountability for overall operations in the department(s) s/he oversees. | |||||
|
||||||
7
|
Directs the overall vision, mission, strategic direction, and financial
results for the organization.
|
[*] | % | |||
|
Has ultimate accountability for companys worldwide performance and reputation. |
| Determining annually whether or not to recommend continuing the plan; |
| Determining eligibility; |
| Approving performance measures, threshold values, etc. for the applicable fiscal year; |
| Approving plan funding and individual incentive awards; |
| Resolving disputes or questions regarding the plan; |
| Recommending amendment or termination of the plan as necessary during the fiscal year; |
| Establishing the rules necessary to administer the plan; |
| The Board will have discretion to construe and interpret the plan; |
| All decisions of the Board will be final and binding on all persons; and |
| The Board may at any time elect to amend, suspend, or terminate the plan. |
| Employee participation and incentive opportunity; |
| Performance measurestypes of measures, level of organizational performance measured, and weighting of measures; and |
| Performance period and payout frequency. |
Subject: | Written Consent to Reference Virchow Krause Valuation, LLC Valuation in S-1 Filing of TomoTherapy Incorporated |