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Exhibit 10.21
DEVELOPMENT AND LICENSE AGREEMENT*
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AGREEMENT, dated June 9, 1998, between HOWMEDICA INC. ("Howmedica"), a
Delaware corporation, with an address at 000 Xxxxxxxx Xxxxxxxxx, Xxxxxxxxxx, Xxx
Xxxxxx 00000, and Orthovita, Inc. ("Orthovita"), a Pennsylvania corporation,
with an office at 00 Xxxxx Xxxxxx Xxxxxxx, Xxxxxxx, Xxxxxxxxxxxx 00000.
WHEREAS, Orthovita and Howmedica desire to work together in the further
development of Orthovita's proprietary composite, high-strength bis-GMA resin
based upon combeite with a bioactive interface which Orthovita calls
"Orthocomp(TM)" in the Field of Use; and
WHEREAS, in connection with such development Orthovita has and may acquire
additional interests in certain Patents and Proprietary Information (as herein
defined) relating to the Product, and Howmedica desires to obtain exclusive
licenses to the Patents and the Proprietary Information, and Orthovita is
agreeable to granting such licenses pursuant to the terms of this Agreement; and
WHEREAS, Orthovita and Howmedica are simultaneously herewith entering into
a Supply Agreement (hereinafter called the "Supply Agreement") by which
Orthovita will supply quantities of the Product to Howmedica, in accordance with
the terms of said agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
provided herein, the parties hereby agree as follows:
1. Definitions. For purposes of this Agreement the following definitions
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shall be applicable:
A. "Affiliate" means, with respect to any party, if applicable, its respective
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direct or indirect ultimate parent company, if any, and any company, firm
or other entity more than fifty percent (50%) of whose issued and voting
capital or share participation is owned or controlled, directly or
indirectly, by said party or by its parent company, but only for so long as
said ownership or control shall continue.
B. "Field of Use" means joint replacement surgery.
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C. "Net Sales" means the gross amount charged for sales by Howmedica, its
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Affiliates or sublicensees of the Product to third parties less deductions
for: (a) sales, excise, use or similar
* Certain portions of this Exhibit 10.21 have been omitted based upon the
company's request for confidential treatment. These omitted portions have been
separately filed with the Securities and Exchange Commission.
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taxes actually paid and separately identified on the invoice or other
documentation maintained in the ordinary course of business; (b) normal and
customary trade and cash discounts allowed and actually taken; and (c)
actual amounts repaid or credited to customers on account of rejections or
returns, rebates or retroactive price reductions. Sales between or among
Howmedica and its Affiliates or permitted sublicensees shall be excluded
from the computation of Net Sales. Sales by Howmedica, its Affiliates or
permitted sublicensees of Products which are combined with the sale of
other products ("bundled") will be part of Net Sales, and the sales price
of the Product in such transactions will, in the absence of an invoice
price, be deemed to be the price charged to third parties in arms length
transactions for similar
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quantities of Product. Product provided to customers at no charge will not
be considered as Net Sales.
D. "Patents" means all rights and interests of Orthovita in the patents and
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patent applications, if any, as described in Appendix I.
E. "Product" means the product or products described in Appendix I, attached
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hereto and made a part hereof.
F. "Proprietary Information" means all rights and interests of Orthovita, now
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owned or hereafter during the Term of Agreement acquired or developed by
Orthovita, to all know-how, trade secrets and scientific and technical
information relating to the Product in the Field of Use.
G. "Specifications" shall mean the specifications jointly established by the
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parties which are attached hereto as Exhibit A.
H. "Term of Agreement" means the term of this Agreement as provided in
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paragraph 13 hereof.
I. "Territory" means all countries of the world.
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J. "Valid Claim" means a claim of an unexpired United States or foreign Patent
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which has not been withdrawn, canceled, disclaimed or revoked, not held
invalid by a court of competent jurisdiction or administrative body in an
unappealed or unappealable decision.
2. Development Program. Orthovita and Howmedica will collaborate in the
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further development of the Product. The responsibilities of Orthovita and
Howmedica, respectively, shall be as follows:
A. Orthovita shall use reasonable commercial efforts to complete the
development of the Product to meet the Specifications. Orthovita shall keep
Howmedica informed on a current basis of its performance of development
activities hereunder. Orthovita shall also be responsible for conducting
human clinical trials of the Product under protocols agreed to by
Howmedica; for filing and pursuing to issuance an application for Premarket
Approval ("PMA") in the United States; for filing and pursuing to approval
the CE xxxx in the European Community; and for pursuing regulatory
approvals in all other countries (except Japan) deemed necessary and
appropriate by Howmedica and Orthovita.
B. Howmedica shall be responsible for demonstration of the safety and efficacy
of the Product in animals and for Roentgenographic Stereophotogrammetry
Analysis ("RSA") testing. Howmedica shall also be responsible for pursuing
regulatory approval for the Product in Japan. The protocol for any human
clinical trials for Japan shall be agreed to by Orthovita.
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C. Orthovita and Howmedica shall each permit representatives of the other
party to visit their respective facilities and will assist the other party
in performing its obligations to complete the development program.
3. Payments. Howmedica shall make the following payments to Orthovita upon
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the achievement of the milestone events specified below:
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Milestone Events Payment
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Demonstration that Product meets Specifications $ XXXX
and is safe and efficacious in animals
Submission by Orthovita of U.S. IDE $ XXXX
Receipt of CE xxxx in European Union $ XXXX
Receipt of U.S. PMA $ XXXX
Receipt of Japanese regulatory approval $ XXXX
Each of the foregoing payments shall be made to Orthovita within ten (10)
business days of Howmedica's knowledge of the occurrence of the applicable
milestone event by wire transfer of immediately available funds, as directed by
Orthovita. The parties will use their respective best commercial efforts to
achieve the first milestone event specified above by the third anniversary of
this Agreement. If the first milestone event has not been achieved prior to
such third anniversary, either party may terminate this Agreement by notice to
the other. Such termination will be the sole remedy of either party for the
failure of the first milestone to be achieved.
4. License; Technical and Regulatory Assistance; and Rights of Reference.
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A. Orthovita hereby grants to Howmedica exclusive licenses (including the
right to sublicense, subject to Orthovita's prior written approval, which
shall not be unreasonably withheld) in the Territory under the Patents and
the Proprietary Information to use and sell the Product for all
applications in the Field of Use.
B. From the third anniversary of Howmedica's first commercial sale of the
Product until the fifth anniversary of such sale, or upon such earlier date
as Howmedica shall have the right to terminate the Supply Agreement
pursuant to Section 6.2(c) thereof, Howmedica shall have the further right
to obtain exclusive licenses (including the right to sublicense without
restriction to an Affiliate or to a third party sublicensee, subject to
Orthovita's prior written approval, which shall not be unreasonably
withheld in the event that Howmedica's proposed sublicense to a third party
is in connection with its termination of the Supply Agreement pursuant to
Section 6.2(c) thereof and provided further that the sublicensee agrees not
to sell bis-GMA products for any healthcare application during the life of
the Patents) in the Territory under the Patents and Proprietary Information
to make, have made, import and have imported the Product for all
applications in the Field of Use (herein called the "Additional Licenses"),
provided that Howmedica has performed all of its obligations under the
Supply Agreement, by giving Orthovita a minimum of 180 days prior notice of
its intention to obtain the Additional Licenses. Following receipt of such
notice, Orthovita will provide all reasonable technical assistance as may
be necessary in order to complete the effective transfer to Howmedica of
all Proprietary Information needed to manufacture the Product, and
Howmedica will reimburse Orthovita's reasonable expenses in connection with
providing such technical assistance. The
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parties agree to cooperate in an orderly transfer of manufacturing from
Orthovita to Howmedica. Upon Howmedica's having established a manufacturing
facility sufficient to supply its requirements for the Product and
obtaining all required regulatory approvals and certifications for
operation of such facility, (i) Howmedica shall pay to Orthovita the sum of
U.S. $7,000,000 by wire transfer of immediately available funds, as
directed by Orthovita; (ii) the Supply Agreement shall terminate, except
for any supply or payment obligations which the parties may have under the
Supply Agreement on such date, which they shall fulfill; and (iii)
Howmedica will thereafter use reasonable commercial efforts to manufacture
and sell the Product.
C. During the term of the Supply Agreement, if Howmedica shall fail to
purchase the minimum amount of Product specified in Exhibit C to the Supply
Agreement for any year for any geographic region listed in said exhibit,
and if Howmedica shall further fail to make the payment to Orthovita for
such region as specified in Section 4.1(b) of the Supply Agreement, then
Orthovita shall have the right to terminate Howmedica's license rights
hereunder for such region.
D. In the event that Howmedica shall obtain the Additional Licenses, it may be
that Howmedica will have the Product manufactured at a facility controlled
by Howmedica, in addition to or instead of a facility controlled by
Orthovita. It is the intention of the parties that each shall cooperate
with the other to effectuate such a possibility as follows:
(a) (i) Howmedica shall have the right to designate a Howmedica or Howmedica
Affiliate facility as a site of a manufacture of the Product during the
term of this Agreement, and shall make such a designation by notifying
Orthovita in writing. In the event that Howmedica makes such a notification
during the pendency of a PMA before the U.S. Food and Drug Administration
("FDA"), Orthovita shall cooperate with Howmedica in amending the PMA to
seek approval for the Howmedica facility as a manufacturing site. In the
event that Howmedica makes such a designation after approval of the PMA,
Orthovita shall cooperate with Howmedica in obtaining approval of a
supplement to the PMA for the Howmedica facility as a manufacturing site;
(b) (ii) In the event that Orthovita is unable to provide Howmedica's
requirements of the Product under the Supply Agreement, Orthovita and
Howmedica shall cooperate to take steps to assure that Howmedica may obtain
PMA approval from FDA in its own name for manufacture of the Product at a
facility designated by Howmedica, or to take such other steps as are
reasonable and which would effectuate the purposes of this Agreement to
assure that an adequate supply of Product is available to Howmedica;
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(c) (iii) Orthovita hereby provides to Howmedica a right of reference to any
of its submissions to FDA, which reference would be related to
implementation of the provisions of this Section 4(D). Orthovita shall
provide written confirmation to FDA of the right of reference to FDA at
appropriate times during the term of this Agreement; and
(iv) The parties expect that the objectives described in this Section
4(D) may require the making of regulatory submission to health ministries
or their representatives outside the United States, including authorization
for CE marking in the European Union. The parties agree to cooperate to
take appropriate steps to effectuate any such filings.
A. In any sublicense hereunder, the sublicensee shall be prohibited from
further sublicensing and shall acknowledge that it is subject to the terms
and conditions of the license granted to Howmedica under this Agreement.
Notwithstanding any such sublicense, Howmedica shall remain primarily
liable to Orthovita for all of Howmedica's duties and obligations contained
in this Agreement, and any act or omission of a sublicensee which would be
a breach of this Agreement if performed by Howmedica shall be deemed to be
a breach by Howmedica of this Agreement.
5. Improvements. All improvements, modifications or alterations to the
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Product made or developed during the Term of Agreement by Orthovita and related
to the Field of Use, including any related patents and scientific or technical
information, know-how or trade secrets, shall be deemed automatically subject to
this Agreement and shall be included within the definitions of Product, Patents
and Proprietary Information, as the case may be. Orthovita shall, from time to
time, promptly disclose to Howmedica all such improvements, modifications or
alterations.
6. Names. Orthovita hereby grants to Howmedica a fully-paid, royalty-free
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license to use the trademark Orthocomp(TM) in connection with Howmedica's, or
its sublicensees', sales of the Product. Howmedica or its sublicensees shall
xxxx all Products sold in the United States with all applicable patent numbers.
All Products shipped to and/or sold in other countries shall be marked and
labeled in such a manner as to conform with all applicable laws of the country
where the Products are sold.
7. Confidentiality.
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A. Confidential Information. Except as expressly permitted by this Agreement,
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each party hereto (the "Receiving Party") agrees that it will not, without
the prior written consent of the other party (the "Disclosing Party"),
disclose to any person or entity any information relating to the
Proprietary Information, the Product or the Patents or the related business
that is disclosed to
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it by the Disclosing Party (including, without limitation, documents,
software products, specifications, customer lists, technical information or
know-how, financial information, marketing or business plans), and is
marked "Confidential" or would reasonably be regarded in the industry as
confidential or proprietary (collectively, the "Confidential Information").
With respect to the Confidential Information of the Disclosing Party, and
with respect to Confidential Information arising from this collaboration,
each party shall:
(i) use the Confidential Information only for the purpose of
performing its duties or exercising its rights under this Agreement
and for no other purpose, subject to the terms and conditions of
this Agreement;
(ii) safeguard the Confidential Information against disclosure to
others with the same degree of care as it exercises with its own
data of a similar nature, but not less than a reasonable degree of
care; and
(iii) not disclose the Confidential Information to others (except to
its directors, employees, consultants, agents, Affiliates, or the
employees or consultants of an Affiliate, who have a reasonable need
to know such Information and who are bound to the Receiving Party by
a like obligation of confidentiality and restriction on use) without
the express written consent of the other party.
B. Notice. In the event that the Receiving Party is requested or required by
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document requests, subpoena, civil investigative demand, interrogatories,
requests for information, or other similar process to disclose any
Confidential Information, the Receiving Party shall provide the Disclosing
Party with prompt notice of such request or demand or any other similar
process so that the Disclosing Party may seek an appropriate protective
order.
C. Exemption from Restrictions on Confidential Information. The obligations
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of Section 7(B) shall not apply to that Confidential Information of the
Disclosing Party which:
(i) the Receiving Party or its Affiliate can demonstrate by written
records was known to it prior to disclosure hereunder;
(ii) is now, or in the future becomes, public knowledge other than
through the acts or omissions of the Receiving Party or its
Affiliate;
(iii) is lawfully obtained by the Receiving Party or its Affiliate
from sources independent of the Disclosing Party;
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(iv) the Receiving Party can demonstrate was independently developed by
employees of the Receiving Party or its Affiliate without
application or use of such Confidential Information; or
(v) the Receiving Party is required to disclose by law or pursuant to
the direction of a court or government agency; provided the
Disclosing Party is first given a reasonable opportunity to contest
such disclosure.
D. Disclosure of Confidential Information in Regulatory Filings. Nothing
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contained herein is intended to prevent either party from using the
Confidential Information to make regulatory filings and to obtain necessary
or appropriate regulatory approvals as contemplated by this Agreement or to
prosecute or obtain Patents for products developed hereunder or in
disclosure documents prepared by either party to comply with applicable
securities laws.
E. Disclosure of Confidential Information Not a License. The furnishing of
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the Confidential Information of the Disclosing Party to the Receiving Party
shall not constitute any grant or license to the Receiving Party under any
legal rights now or hereinafter held by the Disclosing Party.
F. Remedy. Each party acknowledges that the restrictions contained in this
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Section 7 are, in view of the nature of the Confidential Information,
reasonable and necessary to protect the legitimate proprietary interests of
the Disclosing Party and that any breach of this Section by the Receiving
Party will result in substantial and irreparable harm to the Disclosing
Party. Accordingly, the Receiving Party agrees that damages at law may be
an inadequate remedy for breach of this Section and that the Disclosing
Party shall have available the right to obtain injunctive relief, enjoining
and restraining the Receiving Party from disclosing or using any
Confidential Information and specific performance, without the necessity of
proving actual damages for any such breach. The rights set forth in this
Section shall be in addition to all other rights the Disclosing Party may
have at law or in equity.
8. Payments. In consideration of the licenses and other rights granted to
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Howmedica herein, but only in the event that the Supply Agreement has
terminated, Howmedica shall make royalty payments to Orthovita equal to XXX% of
Net Sales of Product in countries where there is a Valid Claim of Patent and
XXX% of Net Sales of Product in countries where Orthovita has no such Valid
Claim of Patent. The foregoing payments shall be payable on Net Sales in each
country during the Term of Agreement applicable with respect to such country as
specified in Section 11 hereof. After the end of the Term of Agreement with
respect to any country, Howmedica shall not be required to make any further
payments to Orthovita for Net Sales in such country and shall have a fully-paid,
exclusive license for all applications in the Field of Use under the Patents,
the Proprietary Information and any trademark rights granted under Section 4
hereof.
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9. Accounting and Procedures for Payments. Payments under Section 8 above
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shall be subject to the following provisions:
A. Sales between or among Howmedica, its Affiliates or sublicensees shall not
be subject to payments under Section 8 hereof, but in such cases payments
shall be calculated upon Net Sales to an independent third party. Howmedica
shall be responsible for payments on Net Sales by its Affiliates or
sublicensees.
B. Howmedica shall make payments to Orthovita on Net Sales during each
calendar quarter within XXX days after the end of each such quarter, and
each payment shall be accompanied by a report identifying the Product, Net
Sales (and the calculation thereof), and the amount payable to Orthovita,
as well as the computation thereof. All amounts shown in a foreign currency
on the sales invoice shall be converted into United States dollars by
Howmedica using "Standard Exchange Rates" in accordance with established
Accounting Policies and Procedures of Howmedica. All payments shall be made
in United States dollars and shall be remitted to Orthovita at its address
as first specified above.
C. Any taxes required to be paid or withheld by Howmedica, its Affiliates or
sublicensees for the account of Orthovita on amounts payable under this
Agreement shall be deducted from the amounts payable at the rates specified
by applicable law. In addition, Howmedica shall provide promptly to
Orthovita receipts from the government or taxing authority evidencing
payment of such taxes.
D. Howmedica, its Affiliates and sublicensees shall keep full and accurate
books and records setting forth gross sales, Net Sales, and amounts payable
to Orthovita. Howmedica shall permit Orthovita, at its expense, by
independent certified public accountants employed by Orthovita and
reasonably acceptable to Howmedica, to examine such books and records at
any reasonable time, but not later than three 3 years following the
rendering of any such reports, accountings and payments. The opinion of
said independent accountants regarding such reports, accountings and
payments shall be binding on the parties hereto.
10. Commercialization. Howmedica will use commercially reasonable efforts
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to promote and sell the Product, provided that nothing in this Agreement shall
require Howmedica to maximize sales of the Product nor prevent Howmedica, its
Affiliates or sublicensees from manufacturing, using or selling in any country
any products similar to or competitive with the Product other than products
containing bis-GMA resin. If Howmedica fails to commence sale of the Product in
any of the United States, Japan, Canada, United Kingdom, France, Spain, Italy or
Germany after a reasonable time following its or Orthovita's receipt of
regulatory approval applicable to any such country and if Orthovita identifies
one or more of such countries, then Howmedica shall have one hundred-eighty
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(180) days to commence selling the Product in such country. If Howmedica fails
to commence selling the Product within such 180-day period, Howmedica's license
rights specified in Section 4(A) above for such country may be terminated by
Orthovita by notice to Howmedica. Orthovita also agrees that nothing in this
Agreement shall in any way limit Howmedica's sole and exclusive right to
determine, in its discretion, the timing or manner of marketing, manufacturing
or advertising the Product, provided such marketing, manufacturing, or
advertising is in compliance with applicable laws and regulations.
11. Patents. The following provisions shall be applicable to the Patents:
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A. Orthovita shall have the right, following consultation with Howmedica, but
not the obligation, to defend or institute litigation in connection with
the Patents, the Proprietary Information or otherwise with respect to the
Product, and any such litigation shall be at Orthovita's expense and for
its sole benefit. If Orthovita fails to defend or prosecute any such
action, Howmedica shall have the right, following consultation with
Orthovita, but not the obligation, to defend or institute such litigation.
B. If Howmedica determines in good faith with respect to any country that, in
order to avoid infringement of any patent not licensed hereunder, it is
reasonably necessary to obtain a license in order to make, use or sell the
Product and to pay a royalty under such license, then Howmedica's
obligations to make payments under Section 8 hereof shall be reduced with
respect to Net Sales in such country by an amount equal to XXX% of the
royalty payable by Howmedica under such additional license.
C. Orthovita shall have the first right, at its own expense, to prepare, file,
prosecute, maintain and extend such patent applications and Patents
claiming the Product in countries of its choice throughout the world. If
Orthovita declines to file, prosecute or maintain such Patent Applications
or Patents issuing therefrom in any country where Howmedica requests such
action, Howmedica may, at its expense, undertake the filing, prosecution
and maintenance of such abandoned application or Patent.
12. Representations and Covenants. The parties hereby make the following
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representations and covenants:
A. Orthovita hereby represents and warrants to Howmedica that (i) Orthovita is
the legal and beneficial owner of the Patents and the Proprietary
Information and has not entered into any agreement with any other person or
firm granting any rights in the Field of Use to the Product, the Patents or
Proprietary Information or otherwise inconsistent with the provisions of
this Agreement; (ii) no approvals or consents of any institution, firm or
governmental entity are necessary with respect to the execution and
performance by Orthovita of this Agreement;
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(iii) to the best of Orthovita's knowledge the manufacture, use or sale of
the Product by Howmedica will not infringe any patents of third parties;
(iv) Orthovita has heretofore disclosed to Howmedica all material written
information and data in its possession regarding the Product's safety or
risk factors; and (v) this Agreement has been duly executed and delivered
by Orthovita and is valid binding and enforceable against Orthovita in
accordance with its terms.
B. Howmedica hereby represents to Orthovita that (a) no approvals or consents
of any institution, firm or governmental entity are necessary with respect
to the execution and performance by Howmedica of this Agreement, and (b)
this Agreement has been duly executed and delivered by Howmedica and is
valid, binding and enforceable against Howmedica in accordance with its
terms.
C. Orthovita agrees that Orthovita shall not, during the Term of Agreement,
directly or indirectly engage in or become associated with the design,
development or exploitation of any other implant cement which is
competitive with the Product when sold for applications in the Field of
Use.
D. Orthovita hereby further grants to Howmedica, and Howmedica hereby accepts,
an exclusive option to expand the Field of Use to include screw
augmentation and vertebroplasty applications. Howmedica may exercise said
option by giving notice to such effect to Orthovita at any time within the
period ending six (6) months from the date of this Agreement whereupon the
parties will negotiate in good faith for a period not to exceed 30 days
additional minimum purchase quantities for the Product for such
applications, which shall be included in an amendment to the Supply
Agreement. If Howmedica and Orthovita have not agreed on such additional
minimum purchase quantities within such 30 day period, Orthovita shall be
free to consummate a transaction relating to the Product for screw
augmentation and vertebroplasty applications with any third party. Upon
Howmedica's obtaining the rights to screw augmentation and vertebroplasty
applications for the Product, the term "Field of Use", when used in this
Agreement, shall be deemed to include such additional applications.
13. Term of Agreement. This Agreement shall be effective as of the date
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first set forth above and shall expire, unless sooner terminated pursuant to
Section 14, on a country-by country basis, upon the later of (i) the last to
expire of the Patents in such country with claims embracing the Products sold
therein; or (ii) 10 years after the date of first commercial sale of the Product
in such country by Howmedica, its Affiliates or sublicensees. Notwithstanding
the foregoing, if any Patent or Patents shall issue in the United States with
claims embracing the Product, the Term of Agreement with respect to the United
States shall be until the last to expire of such Patent or Patents. Upon
expiration of the Term of Agreement, the last sentence of Section 8 shall
survive such expiration.
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14. Termination. This Agreement shall terminate as follows:
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A. If at any time Howmedica shall, in its reasonable judgment, determine that
(i) Orthovita has failed to produce Product meeting the Specifications
prior to the third anniversary of this Agreement for reasons other than
Force Majeure; (ii) for medical or technical reasons it is not reasonably
practicable to sell or to continue to sell Product in one or more major
markets; (iii) (iv) governmental regulatory requirements in one or more
major markets make or would make registration or marketing of Product not
reasonably practicable; (v) for reasonable commercial reasons it shall not
be economically practicable to market or continue to market the Product; or
(vi) if Howmedica shall decide, at its discretion, permanently to cease to
sell the Product, then in each such case Howmedica, upon 60 days notice to
Orthovita, shall have the right, as Howmedica may elect, to terminate this
Agreement, whereupon this Agreement shall terminate 60 days after the date
of such notice.
B. If either Howmedica or Orthovita breaches or defaults in the performance or
observance of any of the provisions of this Agreement, and such breach or
default is not cured within 60 days after the giving of notice by the other
party specifying such breach or default, the other party shall have the
right to terminate this Agreement upon a further 30 days notice. If any
representation or warranty of any party as contained in this Agreement
shall be materially incorrect or inaccurate, such shall be deemed to be a
material breach or default of this Agreement by such party.
C. If Howmedica fails to purchase the aggregate minimum quantities of Product
as set forth in Exhibit C to the Supply Agreement for three (3) consecutive
years, then Orthovita shall have the right to terminate this Agreement upon
90 days notice to Howmedica.
D. Either party may terminate this Agreement if the first milestone event
listed in Section 3 above has not been achieved on or before the third
anniversary of this Agreement upon (60) days notice to the other party.
E. Upon any termination of this Agreement by Howmedica under Section 14(A) or
by Orthovita under Sections 14(B) or (C) hereof, or by either party under
Section 14(D) hereof, all rights granted herein to Howmedica shall
terminate and revert to Orthovita.
F. Termination of this Agreement for any reason shall be without prejudice to
Orthovita's right to receive all payments accrued under Section 8 hereof
prior to the effective date of such termination and any other remedies
which either party may otherwise have.
G. Any termination of this Agreement shall also cause the termination of the
Supply Agreement.
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15. Force Majeure No party shall be liable for failure of or delay in
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performing its obligations set forth in this Agreement, and no party shall be
deemed in breach of its obligations, if such failure or delay is due to natural
disasters or any cause reasonable beyond the control of such party, but if and
only if the party affected shall have used reasonable efforts to avoid such
Force Majeure and to remedy it promptly if it shall have occurred.
16. Indemnification. Howmedica shall indemnify Orthovita against and
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hold Orthovita harmless from any and all causes of action, liability, damage,
loss or expense, including, without limitation, interest and penalties and
reasonable fees and disbursements of counsel and any claim, complaint, suit,
proceeding or cause of action (collectively, "Losses") resulting from or arising
out of:
(i) any negligence or intentional misconduct by Howmedica, its
officers, directors, shareholders, employees, Affiliates, agents,
sublicensees, successors and assigns relating to or in connection with
this Agreement or the Product;
(ii) any breach by Howmedica of any representation, warranty, covenant
or provision in this Agreement; or
(iii) the death of or injury to any person or persons, damage to
property, or any other claim, proceeding, demand, expense and liability
of any kind whatsoever resulting from the design, testing (including,
without limitation, clinical trials), production, manufacture, shipping,
handling, use (in commerce or otherwise), distribution, importation,
sale, consumption, promotion or advertisement of the Product,
(a) except for such Losses which are attributable to Orthovita's breach of its
representations as contained in this Agreement; provided, however, with
respect to any claim covered by the foregoing Howmedica indemnification,
Orthovita shall give Howmedica notice as soon as practicable of any such
claim or action and that Howmedica shall have the right to participate in
any compromise, settlement or defense thereof.
17. Miscellaneous.
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A. Survival. Sections 7(B), (C), (D), (E), (F) and (G), 9(D), 16 and 17(B)
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and all rights to payment and causes of action accrued prior to the
effective date of termination or expiration, and any other provisions
clearly meant to survive the termination or expiration of this Agreement
shall survive the termination of this Agreement or the expiration of the
Term of Agreement.
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B. Arbitration. Except as provided in Section 7(F), all controversies arising
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out of or in connection with this Agreement shall, without further recourse
to the courts, be finally determined by arbitration in accordance with the
following provisions:
(i) The arbitration tribunal shall comprise three arbitrators. Each
party shall appoint one arbitrator and the two arbitrators so appointed
shall appoint the umpire;
(ii) If either party fails to appoint its arbitrator within one month of
the receipt of a corresponding request by the other, or if the two
arbitrators appointed shall fail to reach agreement on the umpire within
one (1) month of the date of the last appointment, that arbitrator and/or
the umpire shall, at the request of the either party, be appointed by the
President of the American Arbitration Association;
(iii) The Arbitration Tribunal shall sit in New York, New York; and
(iv) The arbitration proceedings shall be governed by rules of procedure
as adopted by the arbitrators. If they should fail to agree on such rules
within thirty (30) days, then the arbitration proceeding will be governed
by the rules of the American Arbitration Association.
C. Assignment. This Agreement shall not be assignable by either party without
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the prior consent of the other, except that either party may assign this
Agreement, in whole or in part to any Affiliate of such party or to the
purchaser or successor in interest to substantially all of its business.
16
D. Notice. Any notice, consent or approval required under this Agreement
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shall be in writing sent by first class mail, postage prepaid, or by
facsimile (confirmed by mail) and addressed as follows:
If to Howmedica:
Howmedica Inc.
000 Xxxxxxxx Xxxxxxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Fax: (000) 000-0000
Attention: President
If to Orthovita:
Orthovita Inc.
00 Xxxxx Xxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxxxxxxx 00000
Fax: (000) 000-0000
Attention: [President]
All notices shall be deemed to be effective on the date of mailing. In case
any party changes its address at which notice is to be received, written
notice of such change shall be given without delay to the other party.
E. Entire Agreement. This Agreement sets forth the entire agreement and
----------------
understanding between the parties as to the subject matter hereof and has
priority over all documents, oral consents or understandings made between
Orthovita and Howmedica before the conclusion of this Agreement with
respect to the subject matter hereof; none of the terms of this Agreement
shall be amended or modified except in writing signed by the parties
hereto.
F. Waivers. A waiver by any party of any term or condition of this Agreement
-------
in any one instance shall not be deemed or construed to be a waiver of such
term or condition for any similar instance in the future or of any
subsequent breach hereof. All rights, remedies, undertakings, obligations
and agreements contained in this Agreement shall be cumulative and none of
them shall be a limitation of any other remedy, right, undertaking,
obligation or agreement of any party.
-17-
G. Severability. If and solely to the extent that any provision of this
------------
Agreement shall be invalid or unenforceable, or shall render this Agreement
to be unenforceable or invalid, such offending provisions shall be of no
effect and shall not effect the validity of the remainder of this Agreement
or any of its provisions.
H. Headings. Headings in this Agreement are included herein for ease of
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reference only and have no legal effect.
I. Counterparts. This Agreement may be executed in two or more counterparts,
------------
each of which shall be binding as of the date first written above, and all
of which shall constitute one and the same instrument. Each such copy shall
be deemed an original, and it shall not be necessary in making proof of
this Agreement to produce or account for more than one such counterpart.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first written above.
ORTHOVITA, INC.
By:
Title:
HOWMEDICA INC.
By:
Title:
APPENDIX I
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PRODUCT
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A composite, high-strength bis-GMA resin based upon combeite with a bioactive
interface.
PATENTS
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1. U.S. Patent No. 5,681,872 issued October 28, 1997
2. All other patents and applications in any country, now owned or hereafter
during the Term of Agreement acquired by Orthovita, relating to the Product,
methods of use or manufacturing process thereof.
3. All divisionals, continuations, continuations-in-part, patents of addition,
extensions and reissues if any patents or applications within the foregoing
paragraph 1 and 2 of this Appendix I.
EXHIBIT A
Description of Product
----------------------
A composite, high strength bis-GMA resin based upon combeite with a bioactive
interface.
Specifications
--------------
ESSENTIAL
MECHANICAL (Material Only)
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a). Axial Tensile Strength - XXXX
b). Fatigue Axial Tensile - Tensile XXXX
c). Modulus of elasticity XXXX. If not achievable then TS/E ratio applies
d). Axial Tensile Strength / Elastic Modulus Ratio XXXX
e). Fracture Toughness XXXX
f). Creep - XXXX
g). Shrinkage maximum - XXXX
h). Compressive Strength, XXXX
i). Cement - implant interface XXXX
HANDLING
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a). Total set time in minutes: XXXX
b). Maximum Exotherm XXXX
c). XXXX
d). XXXX
BIOCOMPATIBILITY
a). XXXX
b). XXXX
c). XXXX
d). XXXX
LESS ESSENTIAL
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CHEMISTRY
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a). XXXX
b). XXXX
HANDLING
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a). XXXX
b). XXXX
c). XXXX
d). XXXX
1) XXXX
2)XXXX
