Exhibit 10.67
Execution Copy
COMMERCIALIZATION AGREEMENT
by and among
ANDRX PHARMACEUTICALS, INC.,
GENPHARM, INC.
and
XXXXXXX URBAN DEVELOPMENT CO.
dated as of October 30, 2002
COMMERCIALIZATION AGREEMENT
This COMMERCIALIZATION AGREEMENT, dated as of October 30, 2002 (this
"AGREEMENT"), is by and among ANDRX PHARMACEUTICALS, INC., a Florida corporation
("ANDRX"), GENPHARM, INC., a Canadian corporation ("GENPHARM"), and XXXXXXX
URBAN DEVELOPMENT CO., a Delaware corporation ("KUDCO").
W I T N E S S E T H
WHEREAS, ANDRX, GENPHARM and KUDCO are engaged, among other things, in
the business of developing, manufacturing and/or marketing the generic forms of
pharmaceutical products; and
WHEREAS, KUDCO desires that the KUDCO Product, a bioequivalent version
of the branded pharmaceutical product Prilosec(R), is launched for commercial
sale in the United States at the soonest practicable time;
NOW, THEREFORE, the parties hereto, for good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, and
intending to be legally bound, hereby agree as follows:
SECTION 1
DEFINITIONS
1.1 CERTAIN DEFINITIONS. For purposes of this Agreement, the following
terms shall have the meanings set forth below:
"ACTIVITIES" shall mean the manufacturing, marketing and selling of one
of the ANDRX Product, GENPHARM Product or KUDCO Product, as applicable, in the
Territory, including all regulatory actions in connection therewith.
"AFFILIATES" shall mean, with respect to any Person, any Persons
directly or indirectly controlling, controlled by, or under common control with,
such other Person. For purposes of this Agreement, the term "controlled"
(including the terms "controlled by" and "under common control with"), as used
with respect to any Person, shall mean the direct or indirect ability or power
to direct or cause the direction of management policies of such Person or
otherwise direct the affairs of such Person, whether through ownership of voting
securities or otherwise.
"ANDRX ANDA" shall mean Abbreviated New Drug Application No. 75-347, as
in effect from time to time, and any other Abbreviated New Drug Application now
or hereafter owned or controlled by ANDRX or any of its Affiliates, but in each
case only in connection with a 10 mg or 20 mg omeprazole delayed-release
pharmaceutical product.
"ANDRX PRODUCT" shall mean any pharmaceutical product defined in the
ANDRX ANDA.
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"APPELLATE COURT DECISION" (*)
"APPELLATE COURT DECISION DATE" shall mean the date on which an
Appellate Court Decision is final and a mandate has issued.
"ASTRA" shall mean Astra Aktiebolag et al. and its Affiliates.
"BUSINESS DAY" shall mean a day on which commercial banks are open for
business in Xxxxxxxxx, Xxxxxxxxx, Xxxxxxx, Xxxxxxx and Miami, Florida.
"COMMERCIAL LAUNCH DATE" shall mean the first date on which an
aggregate amount of at least 60,000,000 capsules of the KUDCO Product have been
commercially sold in the Territory, or, if earlier, the effective date of any
Injunction, provided that KUDCO receives Net Damages as a result of such
Injunction equal to at least the Net Profit that would have been earned on
60,000,000 capsules.
"COSTS OF GOODS SOLD" (*)
"DAMAGES" shall mean any and all actions, costs, losses, claims,
liabilities, fines, penalties, royalties, demands, damages and expenses, court
costs, and reasonable fees and disbursements of counsel, consultants and expert
witnesses incurred or suffered by a party hereto (including interest which may
be imposed in connection therewith).
"EXCLUSIVITY PERIOD" shall mean the one hundred eighty (180) day
exclusive marketing period awarded to ANDRX and/or GENPHARM under the
Xxxxx-Xxxxxx Act in connection with the ANDRX ANDA and GENPHARM ANDA.
"FDA" shall mean the United States Food and Drug Administration.
"FDCA" shall mean the United States Federal Food, Drug and Cosmetic
Act, as amended.
"GAAP" shall mean generally accepted accounting principles in the
United States, as from time to time in effect.
"GENPHARM ANDA" shall mean Abbreviated New Drug Application No. 75-268,
as in effect from time to time, and any other Abbreviated New Drug Application
now or hereafter owned or controlled by GENPHARM or any of its Affiliates, but
in each case only in connection with an 10 mg or 20 mg omeprazole
delayed-release pharmaceutical product.
"GENPHARM PRODUCT" shall mean any pharmaceutical product defined in the
GENPHARM ANDA.
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(*) Marked text omitted pursuant to an application for an order for
confidential treatment filed separately with the Securities and
Exchange Commission (the "Commission") by Andrx Corporation.
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"GROSS MARGIN" shall mean, for the KUDCO Product during any period, (a)
the Net Sales of such Product during such period, less (b) the Cost of Goods
Sold for such Product during such period.
"XXXXX-XXXXXX ACT" shall mean "The Drug Price Competition and Patent
Term Restoration Act of 1984", Pub. L. Xx. 00-000, 00 Xxxx. 0000 (1984)
(codified as amended in scattered sections of 15 U.S.C., 21 U.S.C., 28 U.S.C.,
35 U.S.C., and 42 U.S.C.), as amended from time to time.
"INJUNCTION" shall mean a temporary restraining order, a preliminary
injunction, an injunction or other equitable relief granted by any court,
administrative agency, arbitrator or government body that prohibits or prevents
KUDCO from conducting Activities involving the KUDCO Product.
"KUDCO ANDA" shall mean Abbreviated New Drug Application No. 75-410, as
in effect from time to time.
"KUDCO PRODUCT" shall mean (i) the pharmaceutical product defined in
the KUDCO ANDA, and (ii) any version of the pharmaceutical product Prilosec(R),
the rights to which KUDCO or its Affiliates directly or indirectly receives from
Astra.
"MONTH" shall mean, as the case may be, one of the twelve calendar
months in any calendar year.
"NET DAMAGES" shall mean (a) seventy-two percent (72%) of the aggregate
amount of any money damages actually received by KUDCO in any litigation or
settlement relating to an Injuction in respect of lost sales of the KUDCO
Product during the Profit Share Time Periods, LESS (b) to the extent not awarded
or otherwise received in connection with litigation or settlement, the aggregate
amount of any fees, costs or expenses incurred by KUDCO or its Affiliates in
connection with (i) such Injunction, (ii) any related litigation and/or (iii)
the settlement thereof.
"NET PROFIT" shall mean, for the KUDCO Product during any period, (a)
the Gross Margin of such Product during such period, less (b) the Other Costs
related to the KUDCO Product during such period.
"NET SALES" shall mean, with respect to the KUDCO Product, the gross
amount invoiced to Third Parties for the KUDCO Product in the Territory, less
provisions for:
(a) reasonable and customary trade discounts, promotional allowances,
cash discounts, customer refunds and credits (excluding returns,
which are treated below), customer and government rebates and any
other similar allowances which effectively reduce the net selling
price to the extent incurred and as evidenced and supported by
written arrangements;
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(b) returns based on KUDCO's historical experience, currently
estimated at 2%, and specific returns when known, probable and
estimable, and in excess of the existing allowance;
(c) chargebacks based upon historical experience and/or similar
experience with existing single source or multi-source generic
products (as then applicable) adjusted on a timely basis for
known and estimable events as evidenced by written arrangements;
and
(d) specific retroactive price or shelf stock adjustments and price
equalizations when known, probable and estimable.
If KUDCO or any of its respective Affiliates sells the KUDCO Product in
combination with any other product at a single price or rate or at a discount
for collectively buying such products, then Net Sales with respect to the KUDCO
Product shall equal the number of units of the KUDCO Product sold together with
the non-KUDCO Product multiplied by the lowest net selling price at which KUDCO
sold the KUDCO Product individually to similar customers for similarly sized
orders.
Such amounts shall be determined in accordance with GAAP, consistently applied.
"OTHER COSTS" (*)
"PDMA" shall mean the Prescription Drug Marketing Act of 1987, as
amended from time to time, together with any rules or regulations promulgated
thereunder.
"PERSON" shall mean a natural person, a corporation, a partnership, a
trust, a joint venture, a limited liability company, any governmental authority
or any other entity or organization.
"PRILOSEC(R) LITIGATION" shall mean the patent infringement lawsuits
filed by Astra against, INTER ALIA, ANDRX, GENPHARM, Cheminor Drugs, Ltd. (now
Xx. Xxxxx'x Laboratories, Inc.), Xxxxxxx Pharma, Inc. and KUDCO under 35
U.S.C.ss.271(e)(2) regarding omeprazole (Prilosec(R)), consolidated before Judge
Xxxxxxx X. Xxxxx of the United States District Court for the Southern District
of New York as IN RE OMEPRAZOLE (S.D.N.Y., MDL Docket No. 1291 (BSJ)).
"PRILOSEC(R) APPEAL" shall mean any appeal(s) from the judgment entered
in the Prilosec(R) Litigation, or any portion thereof, including without
limitation any appeal(s) relating to the validity, enforceability, or
infringement of any of the patents that were the subject of the Prilosec(R)
Litigation.
"PROPRIETARY INFORMATION" shall mean, as the case may be, ANDRX
Proprietary Information, GENPHARM Proprietary Information or the KUDCO
Proprietary Information.
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(*) Marked text omitted pursuant to an application for an order for
confidential treatment filed separately with the Commission by Andrx
Corporation.
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"PRUDENT PRACTICES" shall mean, with respect to a particular act or
omission, that such act or omission is (i) in accordance with reasonably prudent
practices of the pharmaceutical industry in the Territory, (ii) with respect to
ANDRX and GENPHARM, after an Appellate Court Decision in favor of ANDRX or
GENPHARM, as applicable, (iii) not prohibited by any judgment, order, injunction
(including any Injunction), decree or award of any court, administrative agency,
arbitrator or government body against or binding upon, ANDRX, GENPHARM or KUDCO,
as applicable, or upon the securities, property or business of ANDRX, GENPHARM,
or KUDCO, as applicable, or (iv) not in violation of any applicable law or
regulation of any jurisdiction as such law or regulation relates to ANDRX,
GENPHARM or KUDCO, as applicable, or to the property or business of ANDRX,
GENPHARM or KUDCO, as applicable.
"TERRITORY" shall mean the fifty (50) states, the District of Columbia
and the territories, protectorates and possessions comprising the United States
of America, including Puerto Rico.
"THIRD PARTY" shall mean, with respect to any Person party hereto, any
other Person that is not an Affiliate of such Person party hereto.
1.2 INTERPRETATION. Unless otherwise provided, for purposes of this
Agreement, the following rules of interpretation shall apply:
ACCOUNTING TERMS. All accounting terms not specifically defined in this
Agreement shall be construed in accordance with GAAP.
TIME PERIOD. In the event that any act is to be done or step to be
taken pursuant to this Agreement on a day which is not a Business Day, such act
may be done or step taken on the next succeeding Business Day.
GENDER AND NUMBER. Any reference in this Agreement to gender shall
include all genders, and words imparting the singular number only shall include
the plural and vice versa.
HEADINGS. The division of this Agreement into Articles, Sections and
other subdivisions and the insertion of headings are for convenience of
reference only and shall not affect or be utilized in construing or interpreting
this Agreement. All references in this Agreement to any "Section" are to the
corresponding Section of this Agreement unless otherwise specified.
HEREIN. The words such as "HEREIN", "HEREINAFTER", "HEREOF" and
"HEREUNDER" refer to this Agreement as a whole and not merely to a subdivision
in which such words appear unless the context otherwise requires.
INCLUDING. The word "INCLUDING" or any variation thereof means
"including, without limitation" and shall not be construed to limit any general
statement that it follows to the specific or similar items or matters
immediately following it.
SCHEDULES AND EXHIBITS. The SCHEDULES and EXHIBITS attached to this
Agreement shall be construed with and as an integral part of this Agreement to
the same extent as if the same had been set forth verbatim herein.
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SECTION 2
PRODUCT LAUNCH
2.1 GENERAL. ANDRX, GENPHARM and KUDCO acknowledge and agree that a
purpose of this Agreement is to accelerate KUDCO's ability to be in a position
to launch the KUDCO Product, a bioequivalent version of the branded
pharmaceutical product Prilosec(R), should it determine to do so, for commercial
sale in the Territory at the soonest practical time in accordance with this
Agreement.
2.2 LAUNCH OF KUDCO PRODUCT.
(a) KUDCO desires and hereby agrees to launch, if in
accordance with clause (iii) and clause (iv) of the definition of
Prudent Practices, the KUDCO Product for commercial sale in the
Territory as soon as practical following the date the FDA grants KUDCO
final approval to market the KUDCO Product. ANDRX and GENPHARM
acknowledge that KUDCO has informed them that such launch shall not
occur earlier than December 2, 2002.
(b) Attached as EXHIBIT A hereto are two letters, dated as of
the date hereof (the "RELINQUISHMENT LETTERS") and duly executed by
ANDRX and GENPHARM, as applicable, pursuant to which ANDRX and GENPHARM
each irrevocably relinquishes its exclusive marketing rights under the
Xxxxx-Xxxxxx Act in respect of the ANDRX Product and the GENPHARM
Product, as applicable, such relinquishment only to become effective
immediately prior to the final marketing approval of the KUDCO Product.
ANDRX and GENPHARM shall each do, in accordance with Section 6.1, all
things reasonably necessary or, in KUDCO's reasonable judgment,
desirable to cause the FDA to accept the Relinquishment Letters as soon
as possible after the date hereof.
2.3 LAUNCH OF ANDRX PRODUCT, GENPHARM PRODUCT. ANDRX and GENPHARM each
agrees to launch, if in accordance with Prudent Practices, the ANDRX Product or
GENPHARM Product, as applicable, for commercial sale in the Territory as soon as
practical.
2.4 ACTIVITIES INVOLVING KUDCO PRODUCT. Subject to Section 2.2(a),
KUDCO shall have sole responsibility and discretion over the KUDCO Product and
any Activities involving the KUDCO Product, including any regulatory matters,
launch, pricing and marketing decisions, recalls, rebates, distribution and
other decisions regarding the KUDCO Product.
2.5 ACTIVITIES INVOLVING ANDRX PRODUCT OR GENPHARM PRODUCT. Subject to
Section 2.3, ANDRX and GENPHARM shall each have sole responsibility and
discretion over the ANDRX Product or GENPHARM Product, as applicable, and any
Activities involving the ANDRX Product or GENPHARM Product, as applicable,
including any regulatory matters, launch, pricing and marketing decisions,
recalls, rebates, distribution and other decisions regarding the ANDRX Product
or GENPHARM Product, as applicable.
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2.6 DILIGENCE IN LITIGATION. Each of the parties agrees that, to the
extent it has standing and can do so in good faith and in accordance with any
applicable ethical and legal obligations (as determined by such Person's legal
counsel), such party shall, at its own expense, diligently and timely proceed
with the prosecution and/or defense of, as applicable, any Prilosec(R) Appeal
consistent with the unilaterally determined strategy of such party in its own
discretion. This provision shall not require any party to dismiss or fail to
prosecute any part of any proceeding.
SECTION 3
FINANCIAL TERMS
3.1 NET PROFIT SHARING.
(a) KUDCO shall pay to each of ANDRX and GENPHARM fifteen
percent (15%) of the Net Profit from the KUDCO Product from the date on
which it or any Affiliate first sells any unit of KUDCO Product until
the date that is one hundred and eighty (180) days following the
Commercial Launch Date. Such payment shall be made in accordance with
Section 3.1(d).
(b) After the one hundred and eighty (180) day period
described in Section 3.1(a) has lapsed, KUDCO shall thereafter pay to
each of ANDRX and GENPHARM nine percent (9%) of the Net Profit from the
KUDCO Product until the earlier of (i) an Appellate Court Decision Date
or (ii) the date that is five hundred and forty-seven (547) days
following the Commercial Launch Date. Such payment shall be made in
accordance with Section 3.1(d).
(c) From and after an Appellate Court Decision Date or, in the
event that the five hundred and forty-seven (547) day period described
in Section 3.1(b) has lapsed prior to an Appellate Court Decision Date,
KUDCO shall pay to each of ANDRX and GENPHARM six and one quarter
percent (6.25%) of the Net Profit from the KUDCO Product during the
seven hundred and thirty (730) day period from and after the earlier of
(i) an Appellate Court Decision Date or (ii) the date that is five
hundred and forty-seven (547) days following the Commercial Launch
Date. Such payment shall be made in accordance with Section 3.1(d).
(d) Net Profit owing by KUDCO under this Section 3.1 shall be
payable Monthly (a "MONTHLY INSTALLMENT") by the wire transfer of
immediately available funds to such account or accounts as are
designated by ANDRX or GENPHARM, as applicable. A Monthly Installment
shall be paid within sixty (60) days after the last Business Day of the
applicable Month; provided, however, that the Monthly Installments in
respect of the Month in which the first commercial sale of the KUDCO
Product occurs and the first full Month thereafter shall be paid within
ninety (90) days after the last Business Day of the applicable Month.
Each Monthly Installment shall be based upon KUDCO's reasonable
estimate of the Net Profit earned during the applicable Month, and one
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or more subsequent Monthly Installments shall be adjusted, without
duplication, to account for any discrepancy between the Net Profit
estimated and those actually earned during such applicable Month.
Except as stated in this Section 3.1, KUDCO shall have no obligation to
share Net Profits with ANDRX or GENPHARM under this Agreement. KUDCO
shall have no obligation to share Net Profits under more than one of
Sections 3.1(a), 3.1(b) or 3.1(c) with respect to the sale of any
particular unit of KUDCO Product, it being understood that Net Profits
may be reclassified from one time period referred to in Section 3.1(a),
3.1(b) or 3.1(c) (each A "PROFIT SHARE TIME PERIOD") into another or
from a time period outside the Profit Share Time Periods into one of
them, in each case as per Section 3.1(e).
(e) (*)
(f) In the event an Injunction is effective prior to or during
the Profit Share Time Periods from time to time, KUDCO shall share with
ANDRX and GENPHARM any Net Damages it receives in respect of such
Injunction in accordance with the percentages set forth in Section
3.1(a), 3.1(b) and 3.1(c), as appropriate. Such Net Damages shall be
paid by the wire transfer of immediately available funds to such
account or accounts as are designated by ANDRX or GENPHARM, as
applicable, within ten (10) Business Days following KUDCO's receipt of
such Net Damages. In the event there are no Net Damages in connection
with such Injunction, then the Profit Share Time Periods shall be
deemed tolled for the duration of such Injunction.
3.2 NEGATIVE NET SALES. In the event that the Net Sales during any
Month are negative, whether due to price reductions, returns, retroactive price
or shelf stock adjustments, price equalizations or otherwise, each of ANDRX and
GENPHARM shall, to the extent it has previously received Net Profit pursuant to
Section 3.1, reimburse KUDCO for ANDRX's or GENPHARM's, as applicable,
proportionate share of such negative Net Sales, such proportionate share to
equal the percentage interest of ANDRX or GENPHARM, as applicable, in Net
Profits in effect, in whole or on average if in part, during such Month.
Reimbursements of negative Net Sales owing by ANDRX or GENPHARM, as applicable,
under this Section 3.2 shall be payable Monthly (a "MONTHLY REIMBURSEMENT") by
the wire transfer of immediately available funds to such account or accounts as
are designated by KUDCO. A Monthly Reimbursement shall be paid within 60 days
after the last Business Day of the applicable Month. Each Monthly Reimbursement
shall be based upon KUDCO's reasonable estimate of the negative Net Sales during
the applicable Month and one or more subsequent Monthly Reimbursements shall be
subsequently adjusted, without duplication, to account for any discrepancy
between the negative Net Sales estimated and those actually suffered during such
applicable Month. KUDCO may offset a Monthly Reimbursement against future
Monthly Installments if such Monthly Reimbursement is not timely paid or the
parties otherwise so agree. This Section 3.2 shall survive any termination of
this Agreement for a period of two (2) years.
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(*) Marked text omitted pursuant to an application for an order for
confidential treatment filed separately with the Commission by Andrx
Corporation.
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3.3 RECORDS AND AUDIT. KUDCO and its Affiliates shall keep full, true
and accurate books of account containing all particulars that may be necessary
for the purpose of showing the amounts payable hereunder (including the
calculation of Net Sales, Gross Margin, Other Costs, Net Profit and Net Damages)
to ANDRX or GENPHARM. Such books of account shall be kept at KUDCO's principal
place of business or the principal place of business of the appropriate
Affiliate of KUDCO to which this Agreement relates. Such books and the
supporting data shall be open, at all reasonable times and upon reasonable
notice during the term of this Agreement and for two (2) years after its
termination, to the inspection of a firm of certified public accountants,
selected by ANDRX and GENPHARM and reasonably acceptable to KUDCO, for the
purpose of verifying KUDCO's Net Profit statements; provided, however, that such
inspection shall not occur more than once per calendar year. All information
learned in connection with, or generated as a result of, any such inspection
shall be treated as KUDCO Proprietary Information for all purposes hereunder
and, prior to commencing any such inspection, the relevant certified public
accountants shall enter into a written agreement, in form and substance
reasonably satisfactory to KUDCO, to be bound by the confidentiality provisions
hereof, as they relate to KUDCO Proprietary Information. Except as otherwise
provided in this Section 3.3, the cost of any such examination shall be paid by
ANDRX or GENPHARM, as applicable. In the event that any such inspection reveals
a deficiency in excess of 5% of a Monthly Installment (as adjusted pursuant to
this Agreement prior to such inspection) covered by the inspection, KUDCO shall
promptly pay ANDRX or GENPHARM, as applicable, the deficiency, plus interest,
and shall reimburse ANDRX or GENPHARM, as applicable, for the reasonable and
documented fees and expenses paid to such accountants in connection with their
inspection of such period.
3.4 MONTHLY REPORTS. In respect of any Month after the first commercial
sale of the KUDCO Product in which any of Sections 3.1(a), 3.1(b) or 3.1(c) is
in effect, KUDCO shall (i) within ten (10) Business Days of the last Business
Day of such Month, deliver to each of ANDRX and GENPHARM a written report (a
"MONTHLY REPORT") setting forth the estimated Net Sales, Cost of Goods Sold,
Gross Margin, Other Costs and Net Profit in respect of the KUDCO Product for
such Month and (ii) on or before making a Monthly Installment in respect of such
Month, deliver to each of ANDRX and GENPHARM a Monthly Report in respect of the
KUDCO Product for such Month. Such estimates shall be prepared by KUDCO in good
faith.
3.5 (*)
3.6 (*)
3.7 LATE PAYMENTS. Any amounts not paid by KUDCO, ANDRX or GENPHARM
when due under this Agreement shall be subject to interest from and including
the date payment is due through and including the date upon which ANDRX,
GENPHARM or KUDCO, as applicable, has collected immediately available funds in
an account designated by ANDRX, GENPHARM or KUDCO, as applicable, at a rate
equal to the prime rate of interest quoted in the Money Rates section of THE
WALL STREET JOURNAL, calculated daily on the basis of a 365-day year, as
applicable.
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(*) Marked text omitted pursuant to an application for an order for
confidential treatment filed separately with the Commission by Andrx
Corporation.
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SECTION 4
REPRESENTATIONS AND WARRANTIES OF ANDRX AND GENPHARM
Each of ANDRX and GENPHARM hereby represents and warrants solely on its
own behalf that:
4.1 ORGANIZATION, POWER AND AUTHORITY. Such Person is a corporation
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation. Such Person has all necessary corporate power
and authority to enter into, and be bound by the terms and conditions of, this
Agreement, and to perform its obligations hereunder.
4.2 DUE AUTHORITY; NO BREACH. The execution, delivery and performance
by such Person of this Agreement and the performance of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
by such Person. This Agreement is the legal, valid and binding obligation of
such Person, enforceable against such Person in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, moratorium, reorganization, or similar laws as from time to time in
effect. All persons who have executed this Agreement on behalf of such Person
have been duly authorized to do so by all necessary corporate action. Neither
the execution and delivery of this Agreement by such Person nor the performance
of the obligations contemplated hereby will (i) conflict with or result in any
violation of or constitute a breach of any of the terms or provisions of, or
result in the acceleration of any obligation under, or constitute a default
under any provision of the Articles of Incorporation or By-laws or similar
organizational document of such Person or any contract or any other obligation
to which such Person is a party or under which it is subject or bound, or (ii)
violate any judgment, order, injunction, decree or award of any court,
administrative agency, arbitrator or government body against, or affecting or
binding upon, such Person or upon the securities, property or business of such
Person, or (iii) constitute a violation by such Person of any applicable law or
regulation of any jurisdiction as such law or regulation relates to such Person
or to the property or business of such Person.
4.3 LITIGATION. Other than the Prilosec(R)Litigation and the
Prilosec(R)Appeal and the litigation captioned Xx. Xxxxx'x Laboratories, Inc. x.
Xxxxxxxx ET AL., 02-452, 02-1769 (D.N.J.), there are no pending or, to the best
of such Person's knowledge, threatened judicial, administrative or arbitral
actions, claims, suits or proceedings as of the date hereof against such Person
which, either individually or together with any other, would reasonably be
expected to have a material adverse effect on the ability of such Person to
perform its obligations under this Agreement.
4.4 GOVERNMENTAL APPROVAL. No consent, approval, waiver, order or
authorization of, or registration, declaration or filing with, any governmental
authority is required in connection with the execution and delivery of this
Agreement by such Person or, except for the FDA's acceptance of the
Relinquishment Letters, the performance by such Person of its obligations
hereunder.
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4.5 BROKERAGE. No broker, finder or similar agent has been employed by
or on behalf of such Person and no Person with which such Person has had any
dealings or communications of any kind is entitled to any brokerage commission,
finder's fee or any similar compensation, in connection with this Agreement or
the transactions contemplated hereby.
4.6 RELINQUISHMENT LETTERS. KUDCO may rely upon each of the
Relinquishment Letters and enforce such Relinquishment Letter, in its own name,
against ANDRX or GENPHARM, as applicable.
4.7 IMPLIED WARRANTIES. EXCEPT AS EXPRESSLY PROVIDED IN THIS SECTION 4,
NEITHER ANDRX NOR GENPHARM MAKES ANY REPRESENTATION OR WARRANTY HEREUNDER,
EITHER IN FACT OR BY OPERATION OF LAW, AND EACH OF ANDRX AND GENPHARM
SPECIFICALLY DISCLAIMS ANY AND ALL OTHER, IMPLIED OR STATUTORY WARRANTIES.
SECTION 5
REPRESENTATIONS AND WARRANTIES OF KUDCO
KUDCO represents and warrants that:
5.1 ORGANIZATION, POWER AND AUTHORITY. KUDCO is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware. KUDCO has all necessary corporate power and authority to enter into,
and be bound by the terms and conditions of, this Agreement, and to perform its
obligations hereunder.
5.2 DUE AUTHORITY; NO BREACH. The execution, delivery and performance
by KUDCO of this Agreement and the performance of the transactions contemplated
hereby have been duly authorized by all necessary corporate action by KUDCO.
This Agreement is the legal, valid and binding obligation of KUDCO, enforceable
against KUDCO in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, moratorium, reorganization, or
similar laws as from time to time in effect. All persons who have executed this
Agreement on behalf of KUDCO have been duly authorized to do so by all necessary
corporate action. Neither the execution and delivery of this Agreement by KUDCO
nor the performance of the obligations contemplated hereby will (i) conflict
with or result in any violation of or constitute a breach of any of the terms or
provisions of, or result in the acceleration of any obligation under, or
constitute a default under any provision of the Articles of Incorporation or
By-laws of KUDCO or any contract or any other obligation to which KUDCO is a
party or under which it is subject or bound, or (ii) violate any judgment,
order, injunction, decree or award of any court, administrative agency,
arbitrator or government body against, or affecting or binding upon, KUDCO or
upon the securities, property or business of KUDCO, or (iii) constitute a
violation by KUDCO of any applicable law or regulation of any jurisdiction as
such law or regulation relates to KUDCO or to the property or business of KUDCO.
5.3 LITIGATION. Other than the Prilosec(R) Litigation and the
Prilosec(R) Appeal, there are no pending or, to the best of KUDCO's knowledge,
threatened judicial, administrative or arbitral actions, claims, suits or
proceedings as of the date hereof against KUDCO which, either
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individually or together with any other, would reasonably be expected to have a
material adverse effect on the ability of KUDCO to perform its obligations under
this Agreement.
5.4 GOVERNMENTAL APPROVAL. No consent, approval, waiver, order or
authorization of, or registration, declaration or filing with, any governmental
authority is required in connection with the execution and delivery of this
Agreement by KUDCO or, except for KUDCO's receipt of final marketing approval
for the KUDCO Product from the FDA, the performance by KUDCO of its obligations
hereunder.
5.5 BROKERAGE. No broker, finder or similar agent has been employed by
or on behalf of KUDCO and no Person with which KUDCO has had any dealings or
communications of any kind is entitled to any brokerage commission, finder's fee
or any similar compensation, in connection with this Agreement or the
transactions contemplated hereby.
5.6 ABILITY TO LAUNCH. To KUDCO's knowledge and subject to KUDCO's
receipt of final marketing approval for the KUDCO Product from the FDA, there is
no (i) judgment, order, injunction, decree or award of any court, administrative
agency, arbitrator or government body against, or affecting or binding upon
KUDCO or upon the securities, property or business of KUDCO, or (ii) any
applicable law or regulation of any jurisdiction as such law or regulation
relates to KUDCO or to the property or business of KUDCO, that, in each case,
prohibits or prevents KUDCO from launching the KUDCO Product in the Territory or
conducting Activities with respect to the KUDCO Product.
5.7 PATENT INFRINGEMENT. To KUDCO's knowledge, KUDCO's conduct of the
Activities in the Territory will not infringe the patent rights of any Third
Party; provided that KUDCO makes no representation pursuant to this Section 5.7
or otherwise under this Agreement with respect to any of the patents that were
the subject of the Prilosec(R) Litigation.
5.8 IMPLIED WARRANTIES. EXCEPT AS EXPRESSLY PROVIDED IN THIS SECTION 5,
KUDCO MAKES NO REPRESENTATION OR WARRANTY HEREUNDER, EITHER IN FACT OR BY
OPERATION OF LAW, AND KUDCO SPECIFICALLY DISCLAIMS ANY AND ALL OTHER, IMPLIED OR
STATUTORY WARRANTIES.
SECTION 6
ADDITIONAL COVENANTS AND AGREEMENTS OF THE PARTIES
6.1 GOVERNMENTAL FILINGS. ANDRX, GENPHARM and KUDCO each agree to
prepare and file whatever filings, requests or applications are required to be
filed with any governmental authority in connection with this Agreement and to
cooperate with one another as reasonably necessary to accomplish the foregoing.
6.2 COMPLIANCE WITH LAW. ANDRX, GENPHARM and KUDCO shall each comply
with all federal, state and local laws and regulations applicable to
manufacturing, marketing, sale and distribution of its respective Product or the
performance of their respective obligations hereunder, including the
Xxxxx-Xxxxxx Act, the FDCA and the PDMA. ANDRX, GENPHARM and KUDCO each shall
keep all records and reports with respect to its Product
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required to be kept by applicable laws and regulations, and each shall make its
facilities available at reasonable times during business hours for inspection by
representatives of governmental agencies. ANDRX, GENPHARM and KUDCO each shall
promptly notify the other after receipt of any notice or any other indication
whatsoever of any FDA or other governmental agency inspection, investigation or
other inquiry, or other material notice or communication of any type, involving
its respective Product or this Agreement. ANDRX, GENPHARM and KUDCO shall each
cooperate with each other during any such inspection, investigation or other
inquiry including, but not limited to, allowing upon request a representative of
the other to be present during the applicable portions of any such inspection,
investigation or other inquiry and providing copies of all relevant documents.
ANDRX, GENPHARM and KUDCO shall discuss any response to observations or
notifications received in connection with any such inspection, investigation or
other inquiry and each shall give the other an opportunity to comment upon any
proposed response before it is made. In the event of disagreement concerning the
form or content of such response, however, the Person subject to such
inspection, investigation or other inquiry shall be responsible for deciding the
appropriate form and content of any response with respect to any of its cited
activities.
6.3 CONFIDENTIALITY. GENPHARM and KUDCO shall treat as confidential all
confidential or proprietary information of ANDRX of which GENPHARM or KUDCO, as
applicable, becomes aware in connection with this Agreement (collectively,
"ANDRX PROPRIETARY INFORMATION"). GENPHARM and KUDCO shall neither disclose
ANDRX Proprietary Information to any third party nor use ANDRX Proprietary
Information for any purpose other than as set forth in this Agreement. ANDRX and
GENPHARM shall treat as confidential all confidential or proprietary information
of KUDCO of which ANDRX or GENPHARM, as applicable, becomes aware in connection
with this Agreement (collectively, "KUDCO PROPRIETARY INFORMATION"). ANDRX and
GENPHARM shall neither disclose KUDCO Proprietary Information to any third party
nor use KUDCO Proprietary Information for any purpose other than as set forth in
this Agreement. ANDRX and KUDCO shall treat as confidential all confidential or
proprietary information of GENPHARM of which ANDRX or KUDCO, as applicable,
becomes aware in connection with this Agreement (collectively, "GENPHARM
PROPRIETARY INFORMATION"). ANDRX and KUDCO shall neither disclose GENPHARM
Proprietary Information to any third party nor use GENPHARM Proprietary
Information for any purpose other than as set forth in this Agreement.
Nothing contained herein will in any way restrict or impair any party's
(the "USING PARTY'S") right to use, disclose or otherwise deal with any
Proprietary Information of one or more of the other parties hereto (as
applicable, the "DISCLOSING PARTY") which the Using Party, through competent
evidence, can demonstrate:
(a) at the time of disclosure, is known to the public or
thereafter becomes known to the public by publication or otherwise
through no fault of the Using Party;
(b) prior to the time of the disclosure, was in its possession
and was not obtained directly or indirectly from the Disclosing Party;
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(c) is independently and lawfully made available as a matter
of right to the Using Party by a third party who is not thereby in
violation of a confidential relationship with the Disclosing Party; or
(d) is developed by the Using Party independently of the
Proprietary Information received from the Disclosing Party.
Notwithstanding the foregoing, each Party shall have the right to disclose
information to the extent required to be disclosed by legal or regulatory
process; provided, in each case the Using Party timely informs the Disclosing
Party and uses reasonable efforts to limit the disclosure and maintain
confidentiality to the extent possible and permits the Disclosing Party to
intervene and contest or attempt to limit the disclosure.
Neither GENPHARM nor KUDCO shall obtain any right or license of any kind in, to
or under the ANDRX Proprietary Information hereunder. Neither ANDRX nor GENPHARM
shall obtain any right or license of any kind in, to or under the KUDCO
Proprietary Information hereunder. Neither ANDRX nor KUDCO shall obtain any
right or license of any kind in, to or under the GENPHARM Proprietary
Information hereunder.
6.4 EXPENSES. ANDRX, GENPHARM and KUDCO shall each bear its own direct
and indirect expenses incurred in connection with the negotiation and
preparation of this Agreement and, except as expressly set forth in this
Agreement, the performance of the obligations contemplated hereby.
6.5 REASONABLE EFFORTS. ANDRX, GENPHARM and KUDCO each hereby agrees to
use all reasonable efforts to take, or cause to be taken, all actions and to do,
or cause to be done all things necessary or proper to make effective the
transactions contemplated by this Agreement, including such actions as may be
reasonably necessary to obtain approvals and consents of governmental Persons,
including KUDCO's receipt of final marketing approval of the KUDCO Product from
the FDA. KUDCO shall take to the extent it has standing and can do so in good
faith and in accordance with any applicable ethical and legal obligations (as
determined by such Person's legal counsel) all steps reasonably necessary,
including the filing of lawsuits and appeals, to modify, vacate or reverse any
Injunction entered prohibiting Activities with respect to the KUDCO Product.
6.6 PUBLICITY. ANDRX, GENPHARM and KUDCO shall jointly issue the joint
press release attached as EXHIBIT B hereto at a time to be agreed by the
parties. ANDRX, GENPHARM and KUDCO each further agrees that no publicity release
or announcement concerning the transactions contemplated hereby shall be issued
without the advance written consent of the other, except as such release or
announcement may be required by law, in which case the party making the release
or announcement shall, before making any such release or announcement, afford
each of the other parties a reasonable opportunity to review and comment upon
such release or announcement. ANDRX, GENPHARM and KUDCO each recognize that
disclosure of this Agreement to the IRS and other tax authorities may be
required, and each waives the requirements of this Section 6.6 with respect to
disclosure to such entities.
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6.7 COOPERATION. If any party shall become engaged in or participate in
any investigation, claim, litigation or other proceeding with any third party,
including the FDA, relating in any way to this Agreement, each of the other
parties shall, at its own expense cooperate in all reasonable respects with such
party in connection therewith, including using its reasonable efforts to make
available to the other such employees who may be helpful with respect to such
investigation, claim, litigation or other proceeding, provided that, for
purposes of this provision, reasonable efforts to make available any employee
shall be deemed to mean providing a party with reasonable access to any such
employee at no cost for a period of time not to exceed 16 hours (e.g., two
8-hour business days). Thereafter, any such employee shall be made available for
such time and upon such terms and conditions (including, but not limited to,
compensation) as the parties may mutually agree.
6.8 DEEMED BREACH OF COVENANT. Neither ANDRX, GENPHARM nor KUDCO shall
be deemed to be in breach of any covenant contained in this Agreement if such
party's deemed breach is the result of any action or inaction on the part of any
other party.
SECTION 7
INDEMNIFICATION
7.1 INDEMNIFICATION.
(a) Each of ANDRX and GENPHARM shall severally indemnify,
defend and hold KUDCO (and its directors, officers, employees and
Affiliates) harmless from and against any and all Damages incurred or
suffered by KUDCO (and its directors, officers, employees and
Affiliates) as a consequence of:
(i) any breach of any representation or warranty made by
ANDRX or GENPHARM, as applicable, in this Agreement
or any agreement, instrument or document delivered by
ANDRX or GENPHARM, as applicable, pursuant to the
terms of this Agreement; or
(ii) any failure to perform duly and punctually any
covenant, agreement or undertaking on the part of
ANDRX or GENPHARM, as applicable, contained in this
Agreement.
(b) KUDCO shall indemnify, defend and hold each of ANDRX (and
its directors, officers, employees and Affiliates) and GENPHARM (and
its directors, officers and employees) harmless from and against any
and all Damages incurred or suffered by ANDRX (and its directors,
officers, employees and Affiliates) or GENPHARM (and its directors,
officers and employees), as applicable as a consequence of:
(i) any breach of any representation or warranty made by
KUDCO in this Agreement or any agreement, instrument
or document delivered by KUDCO pursuant to the terms
of this Agreement; or
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(ii) any failure to perform duly and punctually any
covenant, agreement or undertaking on the part of
KUDCO contained in this Agreement.
(c) Notwithstanding anything herein to the contrary, no party
shall have any right to seek indemnification hereunder or obligation to
provide indemnification based on any claim for patent infringement or
any claim asserted by Astra, it being understood that this Section
7.1(c) shall not affect the calculation of Other Costs.
7.2 NOTICE AND OPPORTUNITY TO DEFEND. Promptly after receipt by a party
hereto of notice of any claim which could give rise to a right to
indemnification pursuant to Section 7.1. such party (the "INDEMNIFIED PARTY")
shall give the indemnifying party or parties (the "INDEMNIFYING PARTY") written
notice describing the claim in reasonable detail. The failure of an Indemnified
Party to give notice in the manner provided herein shall not relieve the
Indemnifying Party of its obligations under this Section, except to the extent
that (i) such failure to give notice materially prejudices the Indemnifying
Party's ability to defend such claim or (ii) such notice is not given prior to
thirty (30) months following any termination of this Agreement, or, if such
notice relates to any obligation that survives the termination of this
Agreement, prior to the first anniversary of the termination of such obligation.
The Indemnifying Party shall have the right, at its option, to compromise or
defend, at its own expense and by its own counsel, any such matter involving the
asserted liability of the party seeking such indemnification. If the
Indemnifying Party shall undertake to compromise or defend any such asserted
liability, it shall promptly (and in any event not less than ten (10) days after
receipt of the Indemnified Party's original notice) notify the Indemnified Party
in writing of its intention to do so, and the Indemnified Party agrees to
cooperate fully with the Indemnifying Party and its counsel in the compromise or
defense against any such asserted liability. All reasonable costs and expenses
incurred in connection with such cooperation shall be borne by the Indemnifying
Party. If the Indemnifying Party elects not to compromise or defend the asserted
liability, fails to notify the Indemnified Party of its election to compromise
or defend as herein provided, fails to admit its obligation to indemnify under
this Agreement with respect to the claim, or, if in the reasonable opinion of
the Indemnified Party, the claim could result in the Indemnified Party becoming
subject to injunctive relief or relief that could materially adversely affect
the ongoing business of the Indemnified Party in any manner, the Indemnified
Party shall have the right, at its option, to pay, compromise or defend such
asserted liability by its own counsel and its reasonable costs and expenses
shall be included as part of the indemnification obligation of the Indemnifying
Party hereunder. Notwithstanding the foregoing, neither the Indemnifying Party
nor the Indemnified Party may settle or compromise any claim over the objection
of the other; provided, however, that consent to settlement or compromise shall
not be unreasonably withheld. In any event, the Indemnified Party and the
Indemnifying Party may participate, at their own expense, in the defense of such
asserted liability. If the Indemnifying Party chooses to defend any claim, the
Indemnified Party shall make available to the Indemnifying Party any books,
records or other documents within its control that are necessary or appropriate
for such defense. Notwithstanding anything to the contrary in this Section 7.2,
(i) the party conducting the defense of a claim shall (A) keep each of the other
parties informed on a reasonable and timely basis as to the status of the
defense of such claim (but only to the extent such other party is not
participating jointly in the defense of such claim), and (B) conduct the defense
of such claim in a prudent manner, and (ii) the Indemnifying Party shall not
cease to defend, settle or otherwise dispose of any claim
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without the prior written consent of the Indemnified Party (which consent shall
not be unreasonably withheld).
7.3 INDEMNIFICATION PAYMENT OBLIGATION. Excluding amounts payable to
ANDRX or GENPHARM under Section 3.1 or amounts payable to KUDCO under Section
3.2 or Section 3.6, no Indemnifying Party will have any obligations under
Sections 7.1(a) or 7.1(b) until the cumulative aggregate amount of Damages
incurred or suffered by the Indemnified Party which the Indemnifying Party is
otherwise subject to under this Agreement exceeds Five Hundred Thousand Dollars
($500,000) at which time the entire cumulative aggregate amount of such Damages
shall be covered. The provisions of this Section 7.3 shall not limit or
otherwise affect the obligations of any Indemnifying Party under any other
Section of this Agreement.
7.4 INDEMNIFICATION PAYMENT ADJUSTMENTS. The amount of any Damages for
which indemnification is provided under this Section 7 shall be reduced to take
account of any net tax benefit and shall be increased to take account of any net
tax detriment actually arising from the incurrence or payment of any such
Damages or from the receipt of any such indemnification payment and shall be
reduced by the insurance proceeds actually received and any other amount
actually recovered, if any, by the Indemnified Party with respect to any
Damages. If any Indemnified Party shall have received any payment pursuant to
this Section 7 with respect to any Damages and shall subsequently have received
insurance proceeds or other amounts with respect to such Damages, then such
Indemnified Party shall pay to the Indemnifying Party an amount equal to the
difference (if any) between (i) the sum of the amount of those insurance
proceeds or other amounts received and the amount of the payment by such
Indemnifying Party pursuant to this Section 7 with respect to such Damages and
(ii) the amount necessary to fully and completely indemnify and hold harmless
such Indemnified Party from and against such Damages; provided, however, in no
event will such Indemnified Party have any obligation pursuant to this sentence
to pay to such Indemnifying Party an amount greater than the amount of the
payment by such Indemnifying Party pursuant to this Section 7 with respect to
such Damages.
7.5 INDEMNIFICATION PAYMENT. Upon the final determination of liability
and the amount of the indemnification payment under this Section 7, the
appropriate party shall pay to the applicable party, as the case may be, within
ten (10) business days after such determination, the amount of any claim for
indemnification made hereunder by the wire transfer of immediately available
funds to such account or accounts as are designated by such other party.
7.6 SURVIVAL. Subject to the notice periods described in Section 7.2,
the provisions of Section 7 shall survive any termination of this Agreement.
Each Indemnified Party's rights under Section 7 shall not be deemed to have been
waived or otherwise affected by such Indemnified Party's waiver of the breach of
any representation, warranty, agreement or covenant contained in or made
pursuant to this Agreement, unless such waiver expressly and in writing also
waives any or all of the Indemnified Party's right under Section 7.
7.7 CONSEQUENTIAL DAMAGES. Notwithstanding anything to the contrary in
this Agreement, neither ANDRX, GENPHARM nor KUDCO shall be liable to the other
by reason of any representation or warranty, covenant or other term hereunder or
any duty of common law for any special, consequential, incidental or punitive
loss or damage, including lost profits, whether
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occasioned by the negligence of the respective parties, their employees or
agents or otherwise, it being understood that the foregoing shall not limit
KUDCO's payment obligations pursuant to Section 3.1.
7.8 EXCLUSIVE REMEDY. ANDRX, GENPHARM and KUDCO each acknowledge and
agree that, except for any injunctive relief if such remedy is appropriate under
the circumstances, the foregoing indemnification provisions of this Section 7
shall be the exclusive remedy of ANDRX, GENPHARM or KUDCO with respect to the
transactions contemplated by this Agreement. Notwithstanding the foregoing, the
parties acknowledge that claims under Section 3.1(e) may be made in accordance
with this Section 7.
SECTION 8
TERMINATION
8.1 TERMINATION. The term of this Agreement shall begin upon the date
hereof and, unless sooner terminated as hereinafter provided, shall end upon the
earlier of (i) October 20, 2007 or (ii) subject to Section 3.1(f), the date that
is one thousand two hundred and seventy-seven (1,277) days following the
Commercial Launch Date (the "EXPIRATION DATE"). Notwithstanding the foregoing,
this Agreement may be terminated prior to the Expiration Date as follows:
(a) [Intentionally Omitted]
(b) TERMINATION FOR DEFAULT. ANDRX, GENPHARM and KUDCO each
shall have the right to terminate this Agreement for default upon the
other's material failure to comply with the terms and conditions of
this Agreement. At least thirty (30) days prior to any such termination
for default, the party seeking to so terminate shall give the other
written notice of its intention to terminate this Agreement in
accordance with the provisions of this Section 8.1(b), which notice
shall set forth the default(s) which form the basis for such
termination. If the defaulting party fails to correct such default(s)
within thirty (30) days after receipt of notification, or if the same
cannot reasonably be corrected or remedied within thirty (30) days,
then if the defaulting party has not commenced curing said default(s)
within said thirty (30) days and be diligently pursuing completion of
same, then such party immediately may by written notice terminate this
Agreement with immediate effect.
(c) AUTOMATIC TERMINATION. This Agreement shall automatically
terminate in its entirety with immediate effect on the date that the
ANDRX Product or the GENPHARM Product may be lawfully and prudently
marketed in the Territory without risk of patent infringement.
(d) OTHER TERMINATION. Each of (i) ANDRX and GENPHARM or (ii)
KUDCO may by written notice terminate this Agreement in its entirety
with immediate effect in the event that (A) KUDCO has not received
final marketing approval from the FDA on or prior to March 31, 2003 or
(B) KUDCO is permanently enjoined from selling
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the KUDCO Product prior to April 20, 2007 and (x) no appeal is taken or
(y) said permanent injunction is affirmed on appeal, in each case such
that KUDCO is not performing and shall not in the future perform any
Activities with respect to the KUDCO Product prior to April 20, 2007.
8.2 CONTINUING OBLIGATIONS. Termination of this Agreement for any
reason shall not relieve the parties of any obligation accruing prior thereto or
any ongoing obligations hereunder including Section 3.1, and shall be without
prejudice to the rights and remedies of either party with respect to any
antecedent breach of the provisions of this Agreement. This Section 8.1 shall be
the exclusive means of termination hereof and shall not be in lieu of any other
remedies available under this Agreement to a party hereto for any default
hereunder on the part of each of the other parties. Without limiting the
generality of the foregoing, no termination of this Agreement, whether by lapse
of time or otherwise, shall serve to terminate the obligations of the parties
hereto under Sections 3.2, 3.3, 3.6, 6.3, 6.4, 6.6, 7, 8.2 and 9, and such
obligations shall survive any such termination in accordance with their
respective terms.
SECTION 9
MISCELLANEOUS
9.1 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and permitted assigns; provided, however, that neither ANDRX, GENPHARM nor KUDCO
may assign any of its rights, duties or obligations hereunder without the prior
written consent of each of the other parties hereto, which consent may not be
unreasonably withheld or delayed. Notwithstanding the foregoing, no prior
written consent shall be required for an assignment from time to time of this
Agreement (i) in connection with the acquisition by a Third Party of
substantially all of the assets or outstanding shares of, or merger with, ANDRX,
GENPHARM or KUDCO, as the case may be, if such Person caused such successor or
assignee to expressly assume its obligations hereunder pursuant to a signed
writing in form and substance reasonably satisfactory to each of the other
parties hereto, (ii) in connection with the acquisition by a Third Party of
substantially all of the assets relating to this Agreement of ANDRX, GENPHARM or
KUDCO, as the case may be, if such Person caused such assignee to expressly
assume its obligations hereunder pursuant to a signed writing in form and
substance reasonably satisfactory to each of the other parties hereto or (iii)
from ANDRX or KUDCO, as applicable, to such Person's Affiliates, provided that
no such assignment to such Person's Affiliates shall relieve the assignee of its
duties or obligations hereunder.
9.2 NOTICES. All notices or other communications required or permitted
to be given hereunder shall be in writing and shall be deemed to have been duly
given if delivered by hand or facsimile and confirmed in writing, or mailed
first class, postage prepaid, by registered or certified mail, return receipt
requested (mailed notices and notices sent by facsimile shall be deemed to have
been given on the date received) as follows:
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If to ANDRX, as follows:
Andrx Corporation
0000 Xxxxxx Xxxxx
Xxxxx, Xxxxxxx 00000
Facsimile: 000-000-0000
Attention: General Counsel
If to GENPHARM, as follows:
Genpharm, Inc.
00 Xxxxxxx Xxxx
Xxxxxxxxx, Xxxxxxx
Xxxxxx X0X 0X0
Facsimile: 000-000-0000
Attention: Vice President, Legal
If to KUDCO, as follows:
Xxxxxxx Urban Development Co.
0000 Xxxx Xxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxx 00000
Facsimile: 000-000-0000
Attention: President
or in any case to such other address or addresses as hereafter shall be
furnished as provided in this Section 9.2 by any party hereto to each of the
other parties.
9.3 WAIVER; REMEDIES. Any term or provision of this Agreement may be
waived at any time by the party entitled to the benefit thereof by a written
instrument executed by such party. No delay on the part of ANDRX, GENPHARM or
KUDCO in exercising any right, power or privilege hereunder shall operate as a
waiver thereof, nor shall any waiver on the part of either ANDRX, GENPHARM or
KUDCO of any right, power or privilege hereunder operate as a waiver of any
other right, power or privilege hereunder nor shall any single or partial
exercise of any right, power or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder.
9.4 SURVIVAL OF REPRESENTATIONS. Each of the representations and
warranties made in this Agreement shall continue for the term of this Agreement
and shall thereafter be extinguished.
9.5 INDEPENDENT CONTRACTORS. The parties hereto are independent
contractors, and nothing contained in this Agreement shall be deemed to create
the relationship of partners, joint venturers, or of principal and agent,
franchisor and franchisee, or of any association or relationship between the
parties other than as expressly provided in this Agreement. Each of GENPHARM and
KUDCO acknowledges that it does not have, and such Person shall not make
representations to any third party, either directly or indirectly, indicating
that such Person has, any authority to act for or on behalf of ANDRX or to
obligate ANDRX in any way whatsoever. Each of ANDRX and GENPHARM acknowledges
that it does not have, and such Person shall not make representations to any
third party, either directly or indirectly, indicating that such Person has, any
authority to act for or on behalf of KUDCO or to obligate KUDCO in any way
whatsoever.
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Each of ANDRX and KUDCO acknowledges that it does not have, and such Person
shall not make representations to any third party, either directly or
indirectly, indicating that such Person has, any authority to act for or on
behalf of GENPHARM or to obligate GENPHARM in any way whatsoever.
9.6 ENTIRE AGREEMENT. This Agreement, together with any Schedules or
Exhibits hereto, constitutes the entire agreement between the parties with
respect to the subject matter hereof and supersedes all prior agreements or
understandings of the parties relating thereto.
9.7 AMENDMENT. This Agreement may be modified or amended only by
written agreement of the parties hereto.
9.8 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original but all of which
together shall constitute a single instrument.
9.9 GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the laws of the State of New York excluding any choice of law
rules which may direct the application of the law of another state.
9.10 ARBITRATION. Any dispute, controversy or claim arising out of or
in connection with this Agreement, including Section 3.1(e), shall be determined
and settled by expedited arbitration in New York, New York, pursuant to the
Commercial Rules of Arbitration then in effect of the American Arbitration
Association except as set forth herein or as agreed in writing by the parties.
The parties agree that in connection with any such arbitration each party (i)
may seek provisional relief and (ii) shall take all steps necessary to have in a
United States location funds sufficient to pay the amount demanded by the other
party, it being understood that such funds need not be made available until the
time of the arbitral award and that this provision is specifically enforceable .
Said provisional relief shall be available from the panel or from a court of
competent jurisdiction, which the parties stipulate may be a state or federal
court in New York for these purposes. Any award rendered shall be final and
conclusive upon the parties and a judgment thereon may be entered in a court
having competent jurisdiction and may include an award of reasonable attorney's
fees to the substantially prevailing party, as such arbitral tribunal deems
appropriate, including with respect to claims made under Section 3.1(e). Any
arbitration hereunder shall be (i) submitted to an arbitration tribunal
comprised of three (3) independent members knowledgeable in the pharmaceutical
industry, one of whom shall be selected by KUDCO, one of whom shall be jointly
selected by ANDRX and GENPHARM, and one of whom shall be selected by the other
two arbitrators; (ii) allow for the parties to request discovery pursuant to the
rules then in effect under the Federal Rules of Civil Procedure for a period not
to exceed 90 days; and (iii) require the award to be accompanied by findings of
fact and a statement of reasons for the decision. Except where clearly prevented
by the area in dispute, both parties agree to continue performing their
respective obligations under this Agreement while the dispute is being resolved.
Arbitration shall not prevent any party from seeking injunctive relief where
such remedy is an appropriate form of remedy under the circumstances.
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9.11 CAPTIONS. All section titles or captions contained in this
Agreement, in any Schedule referred to herein or in any Exhibit annexed hereto,
and the table of contents, if any, to this Agreement are for convenience only,
shall not be deemed a part of this Agreement and shall not affect the meaning or
interpretation of this Agreement.
9.12 NO THIRD-PARTY RIGHTS. No provision of this Agreement shall be
deemed or construed in any way to result in the creation of any rights or
obligation in any Person not a party to this Agreement.
9.13 SEVERABILITY. If any provision of this Agreement is found or
declared to be invalid or unenforceable by any court or other competent
authority having jurisdiction, such finding or declaration shall not invalidate
any other provision hereof, and this Agreement shall thereafter continue in full
force and effect.
9.14 ATTACHMENTS. All Schedules, Exhibits and other attachments to this
Agreement are by this reference incorporated herein and made a part of this
Agreement for all purposes hereunder.
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IN WITNESS WHEREOF, the parties have caused this Commercialization
Agreement to be duly executed and delivered on the day and year first above
written.
ANDRX PHARMACEUTICALS, INC.
By:
-----------------------------
Title:
GENPHARM, INC.
By:
-----------------------------
Title:
XXXXXXX URBAN DEVELOPMENT CO.
By:
-----------------------------
Title:
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EXHIBIT A to
Commercialization Agreement
RELINQUISHMENT LETTERS
-25-
EXHIBIT B to
Commercialization Agreement
JOINT PRESS RELEASE
[To be agreed]
-26-
