TECHNICAL COLLABORATION AGREEMENT
THIS TECHNICAL COLLABORATION AGREEMENT (the "Agreement") is
entered into as of this day of January, 1997, by and between
(Global Pharmaceutical Corporation ("Global"), a Delaware
corporation with its principal place of business at Castor and
Xxxxxxxxxx Xxxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000-0000, and
Genpharm, Inc., a Canadian corporation ("Genpharm"), with its
principal place of business at 00 Xxxxxxx Xxxx, Xxxxxxxxx, Xxxxxxx,
Xxxxxx X0X 0X0.
WITNESSETH:
WHEREAS, Global and Genpharm are parties to that certain
Agreement, dated as of December 15, 1995 (as amended, the "Genpharm
Agreement"), providing for, among other things, the manufacture by
Global of Ranitidine on behalf of Genpharm; and
WHEREAS, both Global and Genpharm have mutually agreed that
as a result of the occurrence of certain events subsequent to the
execution of the Genpharm Agreement, it is in their respective best
interests for the Genpharm Agreement to be terminated, effective
upon and conditioned upon execution and delivery of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants
hereinafter set forth and other good and valuable consideration,
receipt of which is hereby acknowledged, the parties agree as
follows:
ARTICLE I
TERMINATION OF GENPHARM AGREEMENT
Section 1.01. Each of Genpharm and Global hereby agrees
that, effective upon the execution of this Agreement, and
notwithstanding the provisions of Article 12 of the Genpharm
Agreement, the Genpharm Agreement shall be terminated, with neither
party thereto having any further responsibilities or liabilities
thereunder. No prior or existing default on the part of either
Genpharm or Global with respect to the performance of any of its
responsibilities, duties or obligations under the Genpharm
Agreement shall be deemed to have occurred, with any such default
being hereby waived in all respects. Notwithstanding the foregoing,
it is understood and agreed that the Merck Warrant (as such term is
defined in Section 4.09 hereof) shall be unaffected by the
termination of the Genpharm Agreement and shall continue in full
force and effect in accordance with its terms, except as and to the
extent modified by Section 4.09 hereof.
Section 1.02. (a) During the term of this Agreement, at
Genpharm's option, Global shall supply to Genpharm or any of its
affiliates packaging with respect to Ranitidine. If Global does
supply such packaging, Genpharm shall pay to Global "Global's
Cost" (as hereinafter defined) within thirty (30) calendar days of
the date of Global's invoice for such amounts, notwithstanding the
terms of Section 4.03(c) hereof. Global's Cost shall mean all
direct costs of the packaging of that quantity of Ranitidine
requested by Genpharm to be packaged by Global limited solely to
supplies and labor costs (including costs of handling, quality
assurance, quality control, packaging mechanics and packaging
personnel) used to package such Ranitidine, plus an additional
twenty percent (20%) with respect to amounts packaged by Global,
if any, constituting the Excess (as defined in Section 4.03
hereof). In no event shall costs include depreciation or costs
associated with the sales department, research and development,
administration or plant overhead (which is limited to utilities,
insurance and real estate taxes). Global's agreement to provide
such packaging shall be subject to the applicable terms of Section
4.03 hereof.
(b) Genpharm shall provide to Global in writing a twelve
(12) month rolling forecast of Genpharm's packaging requirements
for Ranitidine (the "Forecast"). The first Forecast shall be
delivered to Global at least sixty (60) days prior to the first
scheduled shipment date pursuant to a purchase order for
Ranitidine packaging, and the first such scheduled shipment date
will begin the commencement of Year 1. On or before the same
numerical day in each of the other calendar months of each year (a
"Forecast Date") throughout the term of this Agreement, Genpharm
will provide a written Forecast (i) by quarter, for each of the
next four (4) quarters commencing on such applicable Forcast Date
and (ii) by month, for each of the next three months commencing on
such applicable Forecast Date. The initial quarterly and monthly
forecasts will be provided to Global by Genpharm at the same time
as the delivery of the first Forecast. If Genpharm elects to have
Global provide packaging, Genpharm shall provide to Global, not
less than once per calendar month, with a purchase order which
shall represent a firm order (a "Firm Order") for the packaging of
Ranitidine. Each Firm Order shall be accompanied (or preceded) by
a sufficient supply of Ranitidine in order for Global to satisfy
the packaging requirements of such Firm Order. Global shall have
sixty (60) days from the date of its receipt of the Firm Order and
such sufficient supply of Ranitidine to fulfill the packaging
requirements of such Firm Order
Global will not be deemed in default of the terms of this
Agreement if it fails to meet Geripharm's packaging requirements
for a specified month which either (x) exceed ten (10) percent of
the original forecast for that month included in the monthly
forecast delivered pursuant to subsection (ii) of the preceding
paragragraph (y) exceed by ten (10) percent the original forecast
for the month preceding that month, included in the monthly
forecast delivered pursuant to subsection (ii) of the preceding
paragraph; provided, however, Global shall use its commercially
reasonable efforts to fulfill the
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packaging requirements of each Firm Order which are in excess of
the forecasted requirements.
ARTICLE II
RESPONSIBILITIES OF GENPHARM
Section 2.01. Genpharm shall continue to render to Global
all available information in Genpharm's possession or, to the
extent Genpharm has not heretofore commenced to render to Global
such information, promptly following the execution of this
Agreement shall render to Global all available information in its
possession, in all instances to help Transfer to Global Genpharm's
"know-how" relating to the manufacturing process of producing the
Products set forth on Schedule I hereto (the "Products", which
term shall include the Additional Products provided for in Section
2.02 below) in solid dosage form. This "know-how" shall include,
but not be limited to, to the extent in Genpharm's possession, all
biological, chemical, pharmacological, toxicological,
pharmaceutical, physical, analytical, safety, quality control,
manufacturing and clinical data and information, if any, and all
instructions, processes, formulae, files, raw material sources
expert opinions, bio-equivalent study results and information, if
any, relating to the manufacture, use, sale or marketing of any of
the Products.
Section 2.02. Genpharm and Global shall each use its
respective good faith efforts to mutually agree upon at least two
additional products (the "Additional Products") to be designated
as "Products" hereunder and included in Schedule I hereto, by not
later January 15, 1997.
Section 2.03. Genpharm shall use its good faith efforts to
provide Global with true, correct and complete information and
know-how with respect to the Products; provided, however, that
subject to the foregoing, Genpharm makes no representations or
warranties whatsoever with respect to the Products or the factual
accuracy or completeness of any of the files or other information
given by Genpharm to Global with respect to the Products. Genpharm
shall have no further obligation other than delivering the
aforementioned information to Global.
ARTICLE III
RESPONSIBILITIES OF GLOBAL
Section 3.01. Based upon the information provided to it
pursuant to Article II above, Global shall be responsible for, and
shall pay the financial cost associated with, the further
(development of the Products and for the cost of regulatory
submissions including the bio-equivalence studies relating to the
Products. Global shall
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use its good faith commercially reasonable efforts to pursue such
development and submit such studies is promptly as practicable.
Section 3.02. Based upon the information provided to it
pursuant to Article II above and such further development of the
Products by Global as provided in Section 3.01 hereof, Global shall
use its good faith efforts to file with the United States Food and
Drug Administration (the "FDA") not less than the following number
of Abbreviated New Drug Applications ("ANDAs") for approval to
manufacture and sell Products within the time periods set forth
below:
(a) the first ANDA to be filed by not later than
November 30, 1997;
(b) the second ANDA to be filed by not later than
December 31, 1997;
(c) the third ANDA to be filed by not later than May 31,
1998; and
(d) the fourth ANDA to be filed by not later than
December 31, 1998.
Global shall provide written notice to Genpharm on or prior
to the date six (6) months before each of the respective dates on
which ANDAs must, be filed with the FDA, as provided in subsections
(a) through (d) above, indicating the Product with respect to which
such ANDA will be filed (the "Product Notice").
In the event Global fails to file an ANDA by the required
date indicated, then the following percentages of profits to Global
generated by the sale of Ranitidine shall be lost:
Missed Filing Date Percentage of Profit Lost
------------------ -------------------------
(i) one ANDA by November 30, 1997 and
one ANDA by December 31, 1997 75%
(ii) May 31, 1998 50%
(ii) December 31, 1998 25%
Thus, for example, Global's profit from sales of Ranitidine
shall be reduced by 75% unless both the first ANDA is filed by
November 30, 1997 and the second ANDA is filed by December 31,
1997. As a further example, if the first two ANDAs are not filed by
November 30, 1997 and December 31, 1997, respectively and the third
or fourth ANDA is not filed by its required date, then Global shall
not be entitled to any profits from sales of Ranitidine. Or, for
example, if the first two ANDAs are timely filed and the third ANDA
is not filed by May 31, 1998, then Global's profit from sales of
Ranitidine shall be reduced by 50%.
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Notwithstanding anything to the contrary contained in this
Section 3.02 or Section 3.03 hereof, in the event the Additional
Products are not so designated by January 15, 1997, then (i) the
"May 31, 1998" date referred to in this Section 3.02 and the
"June 30, 2001" date referred to in Section 3.03 below shall be
extended by one day for each day beyond January 15, 1997 that
occurs until the first Additional Product is so designated, and
(ii) the "December 31, 1998" date referred to in this Section
3.02 and the "July 31, 2001" date referred to in Section 3.03
below shall be extended by one day for each day beyond January
15, 1997 that occurs until the second Additional Product is so
designated. Thus, for example, if the first Additional Product is
agreed upon and designated as such on January 31, 1997 and the
second Additional Product is agreed upon and designated as such
on February 15, 1997, then the dates May 31, 1998 and December
31, 1998 appearing in this Section 3.02 shall instead refer to
June l6, 1998 and January 31, 1999, respectively, and the dates
June 30, 2001 and July 31, 2001 appearing in Section 3.03 below
shall instead refer to July 16, 2001 and August 31, 2000,
respectively.
Section 3.03. Global shall use its good faith reasonable
efforts to secure approvals from the FDA ("Regulatory Approvals")
for the first two ANDAs (as provided for above in Section 3.02)
by April 30, 2000 and May 31, 2000, respectively, and the third
and fourth ANDA approvals (as provided for above in Section 3.02)
by June 30, 2001 and July 31, 2001, respectively (collectively
the "Approval Dates," which term shall refer to the applicable
extended date, if any, in accordance with the provisions of the
last paragraph of Section 3.02 hereof). In this regard, Global
shall use its good faith commercially reasonable efforts to
conduct such preparations, validations, testings and analysis and
to make such reports to the FDA in order to enable Global to
obtain such approval of the FDA.
Section 3.04. Upon receipt of such Regulatory Approval for
a Product, Global shall manufacture such Product for sale in the
United States (the "Territory") in accordance with the Regulatory
Approval, the good manufacturing practices prescribed from time
to time by the FDA and all other requirements of the FDA to
ensure that such Product may be marketed in the Territory. Global
shall deliver to Genpharm copies of all notices and
correspondence between Global and the FDA regarding good
manufacturing practice inspections of any and all manufacturing
facilities operated by Global within ten (10) days of receipt or
delivery thereof, as the case may be.
Section 3.05. Upon receipt of Regulatory Approval for a
Product, Global agrees to use its commercially reasonable good
faith efforts to promote the sale of, solicit orders for, and
stimulate interest in such Product in the Territory, such efforts
to be not less than those that it uses to promote the sale of
similar product marketed by it.
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Section 3.06. Global agrees that it shall not, during the
term of this Agreement, use any, of the know-how transferred
hereunder to obtain Regulatory Approval to market any of the
Products outside of the Territory nor will it, during the term of
this Agreement, sell the Products outside of the Territory or to
anyone inside the Territory if Global reasonably expects that
person to sell or export the Product outside of the Territory. If
Global is notified by Genpharm that one of its customers is
exporting a Product outside of the Territory in any material
respect (unless such customer is a branch of the United States
government or a branch of any state or local government thereof),
Global shall either cease to supply such customer or obtain (and
enforce, if necessary) an undertaking from such customer not to
sell such Product outside of the Territory. In the event the
foregoing provisions are or become unenforceable or are unlawful
in the Territory, then the unenforceable or unlawful provisions
thereof shall be deemed replaced by the most restrictive
comparable provision on marketing or sale of the Product
outside of the Territory as is lawful and enforceable in the
Territory. Genpharm acknowledges that Global will use reasonable
efforts to prevent its customers from exporting the Product out
of the Territory, but shall not be held responsible if, despite
such efforts, it is unsuccessful in so doing (subject to Global's
obligations to cease to supply or to obtain and enforce the
undertakings as contemplated above).
Section 3.07. Global shall comply with all applicable
laws, rules and regulations relating to the manufacturing,
labelling, advertising and marketing of the Products within the
Territory as well as to the packaging of Ranitidine, if requested
to do so under Section 1.02 hereof, and shall assume sole
responsibility for all credit risks and collection of receivables
with respect to the Products sold by it or by any third party
selling the Products pursuant to contractual arrangements with
Global (hereafter referred to as a "Distributor" and collectively
as "Distributors") and in respect of all dealings between Global
and its customers and any third parties from whom Global sources
any goods, or services required by it in connection with the
manufacture, marketing or sale of the Products. Global shall be
solely responsible for conducting all quality control tests as it
deems necessary prior to the sale or other release of the
Products in the Territory.
Section 3.08. Global shall not specifically discount the
price of the Product for the benefit of Global's other products
or otherwise use the Product as a loss leader or incentive to
procure the sale of Global's other products. Rebate programs
generally available to customers of Global on the purchase of
pharmaceutical products shall not be prohibited by this Section
3.08.
ARTICLE IV
PROFITS
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Section 4.01. In connection with the commercial sale of
any Products, Global and Genpharm shall allocate the gross
profits on any such sales between them ("Percentage Royalty") at
the rate of 80% for Global and 20% for Genpharm, respectively. As
used herein, the terms "gross profit" shall mean with respect to
a particular quantity of Product sold, net revenue received from
the sale of that quantity of Product less the Production cost for
that quantity of Product; "net revenue" shall mean gross revenue
less, without duplication, (i) bona fide allowances (excluding
allowances for uncollected receivables), rebates, credits and
returns accepted or made in the ordinary course of business and
(ii) all taxes and delivery fees charged to the customer and
shown separately on the invoices; and "production cost" shall
mean with respect to a particular quantity of Product, all direct
costs of producing and packaging that quantity of Product plus an
allocation of indirect costs of producing that quantity of
Product limited solely to labor cost (wages and overtime for
personnel directly involved in manufacturing the Product),
supplies used in the manufacturing of the Product and maintenance
of equipment used in the manufacture of the Product. In no event
shall indirect costs include depreciation or costs associated
with sales department, research and development or
administration. For avoidance of doubt, there shall be no
deduction for sales and marketing costs in determining "gross
profit".
Section 4.02. In addition to the profit participation
provided for in Section 4.01 above, to the extent Genpharm or any
of its affiliates (i) directly purchases for the purpose of resale
any Product and (ii) such Products are shipped directly to
Genpharm or any of its affiliates, Global shall pay to Genpharm a
commission for sales and distribution of 12.5% of such net sales
of Products sold to Genpharm or any of its affiliates for further
resale. The term "net sales" shall mean gross sales less, without
duplication, (x) bona fide allowances (excluding allowances for
uncollected receivables), rebates, credits and returns accepted or
made in the ordinary course of business and (y) all taxes and
delivery fees charged to Genpharm or any of its affiliates and
shown separately on the invoices. Genpharm shall provide Global,
not less than monthly, with a list of all sales made during the
preceding month of Products purchased hereunder from Global
claimed to have been sold and distributed by Genpharm or any of
its affiliates, together with specific detailed information to
support such claim. Global shall have thirty (30) days from
receipt of such list to dispute that any such sales were directly
sold and distributed by Genpharm or any of its affiliates. Neither
Genpharm nor any of its affiliates shall specifically discount
the price of any Products so sold for the benefit of any of
Genpharm's or any of its affiliates' other products, or otherwise
use any such Product as a loss leader or incentive to procure the
sale of any of Genpharm's or any of its affiliates' other
products; it being understood and agreed that rebate programs
generally available to customers of Genpharm or any of its
affiliates on the purchase of pharmaceutical products shall not be
prohibited by the provisions of this sentence. All costs incurred
in connection with such sales and distribution, other than the
direct cost of producing and packaging the Product sold, shall be
borne by Genpharm. All commissions due to Genpharm pursuant to
this Section 4.02 shall be payable quarterly.
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Section 4.03. (a) Until the date six months after the date
of the initial United States shipment of Ranitidine by other than
Glaxo Wellcome plc. (the "Initial Shipment"), but in no event
before December 31, 1997, Global shall be entitled to receive its
"Applicable Percentage" (as defined in Section 4.03(d) hereof of
"Genpharm's Gross Profits of Ranitidine" herein defined as (i) the
monies actually received by Genpharm and its affiliates (solely
for the purposes of this Section 4.03, collectively, "Genpharm")
in connection with the United States sales of Ranitidine by
Genpharm, or by third parties authorized by Genpharm to sell
Ranitidine, less (ii) production costs (as defined in 4.01
above). For avoidance of doubt, there shall be no deduction for
sales and marketing costs in determining "Genpharm's Gross Profits
of Ranitidine".
(b) Commencing on the date six months after the date of the
Initial Shipment, but in no event before December 31, 1997, and
thereafter, Global shall be entitled to receive its Applicable
Percentage of Genpharm's Gross Profits of Ranitidine.
(c) All amounts to be received by Global hereunder shall be
paid, and the record keeping requirements of the applicable party
shall be performed, in the same manner and on the same timing as
set forth in this Article IV for Products. Notwithstanding the
foregoing (except as provided in Section 1.02 hereof), until and
through September 30, 1997, all such amounts due to Global from
Genpharm shall accrue and shall not be payable to Global, with all
such accrued payments to be made by Genpharm to Global in a lump
sum on October 1, 1997. All sales (including pricing terms) of
Ranitidine in the United States by Genpharm to any of its
affiliated entities shall be made on no more favorable terms than
those given to any entity not affiliated with Genpharm. In
addition, Genpharm shall not specifically discount the price of
Ranitidine sold by it in the United States for the benefit of
Genpharm's other products or otherwise use Ranitidine as a loss
leader or incentive to procure the sale of Genpharm's other
products.
(d) The Applicable Percentage under 4.03(a) shall be as
follows:
(i) Provided Global in any given calendar year
provides packaging for 30% or less of Ranitidine sold in the
United States which generated Genpharm's Gross Profits of
Ranitidine during such calendar year, Global shall be entitled to
receive an amount equal to 5% of 30% of Genpharm's Gross Profit of
Ranitidine in such calendar year (or part thereof);
(ii) Provided Global in any given calendar year
provides packaging for more than 30% of Ranitidine sold in the
United States which generated Genpharm's Gross Profits of
Ranitidine during such calendar year (the "Excess"), Global shall
be entitled to receive in amount equal to 5% of 30% of Genpharm's
Gross Profit of Ranitidine in such calendar year (or part thereof)
plus, with respect to the Excess only in such calendar year (or
part thereof), an amount equal to (x) 2% of the Excess over 30% of
Genpharm's Gross Profits of Ranitidine resulting from sales of
Ranitidine for
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which Global actually provided packaging and (y) an overhead
recovery on the Excess packaged limited to no more than $3.00 per
1,000 tablets packaged.
The Applicable Percentage under 4.03(b) shall be as follows:
(iii) Provided Global in any given calendar year
provides packaging for 30% or less of Ranitidine sold in the
United States which generated Genpharm's Gross Profits of
Ranitidine during such calendar year, Global shall be entitled to
receive an amount equal to 10% of 30% of Genpharm's Gross Profit
of Ranitidine in such calendar year.
(iv) Provided Global in any given calendar year
provides packaging for more than 30% of Ranitidine sold in the
United States which generated Genpharm's Gross Profits of
Ranitidine during such calendar year (the "Excess"), Global shall
be entitled to receive an amount equal to 10% of 30% of
Genpharm's Gross Profit of Ranitidine in such calendar year plus,
with respect to the Excess only in such calendar year, an amount
equal to (x) 2% of the excess over 30% of Genpharm's Gross
Profits of Ranitidine resulting from sales of Ranitidine for
which Global actually provided packaging and (y) an overhead
recovery on the Excess packaged limited to no more than $3.00 per
1,000 tablets packaged.
Notwithstanding anything to the contrary contained herein,
in the event Global shall fail to supply at least 80% of a Firm
Order for packaging pursuant to the provisions of Section 1.02
hereof after Genpharm's election to require Global to provide
such packaging, Global shall not be entitled to share in any
portion of Genpharm's Gross Profits of Ranitidine with respect
to such Firm Order, and in the event that Global supplies at
least 80% of a Firm Order but fails to supply 100% of such Firm
Order, Global's right to share in Genpharm's Gross Profits of
Ranitidine with respect to such Firm Order shall be reduced by 1%
for each 1% of the Firm Order not supplied; provided, however,
that Global will not be in default under this Agreement and the
foregoing will not apply to the extent that Global fails to
supply packaging in excess of the amounts presented in the
Forecast, subject to the terms of Section 1.02(b) hereof. For
example, if Genpharm requests packaging for 1,000,000 bottles
and Global packages 900,000 bottles, and Genpharm's Gross Profit
of Ranitidine for the sale of that 1,000,000 bottles of
Ranitidine is $2,000,000, at a time when Global is entitled to
receive 10% of 30% of Genpharm's Gross Profit of Ranitidine,
Global shall receive $54,000 (as opposed to $60,000), assuming no
Excess.
By way of examples:
If Genpharm's Gross Profits of Ranitidine prior to the date
which is six months after the date of the Initial Shipment is $5
million, and Global packaged
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30% or less of Ranitidine manufactured by Genpharm for sale in the
United States, Global is entitled to receive from Genpharm
$75,000;
(2) If Genpharm's Gross Profit of Ranitidine
subsequent to the date which is six months after the date of the
Initial Shipment is $20 million, and Global packaged 30% or less
of Ranitidine manufactured by Genpharm for sale in the United
States. Global is entitled to receive from Genpharm $600,000.
(3) If Genpharm's Gross Profits of Ranitidine
subsequent to the date which is six (6) months after the date of
the Initial Shipment is $5 million, and Global packaged 40% of
Ranitidine manufactured by Genpharm for sale in the United States,
Global is entitled to receive from Genpharm $160,000 ($150,000
plus $10,000) plus overhead recovery on the Excess packaged
limited to no more that $3.00 per 1,000 tablets packaged.
Section 4.04. Percentage Royalty shall be payable
quarterly, within thirty (30) days after the end of each calendar
quarter with respect to the sales of the Product in the applicable
calendar quarter. Said quarters shall terminate on the last day of
March, June, September and December. Each Percentage Royalty
payment to Genpharm shall be accompanied by the following:
(a) a sales summary reasonably satisfactory to Genpharm
showing all sales of the Product during the months
in the immediately preceding calendar quarter;
(b) a detailed statement showing all returns and all
credits, rebates, allowances and other debits and
credits relevant to the calculation of gross
profits for the months in the immediately preceding
calendar quarter, or any prior quarter to the extent
not previously accounted for, together with copies
of all documentation to support allowable
adjustments used in computing gross profits during
the period in question;
(c) a certificate signed by the Chief Financial Officer
of Global certifying that, to the best of his
knowledge, information and belief, after reasonable
investigation, the foregoing statements contemplated
in (a) and (b) above are true and correct and do not
omit any material information required to be
provided pursuant to this Section 4.04; and
(d) a summary of the calculation of the Percentage
Royalty payable to Genpharm on such date.
For purposes of this Agreement a sale shall be considered
to have been made at the time the Product is shipped to the
customer.
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Section 4.05. Global shall provide to Genpharm, promptly
following a request therefor, additional information concerning any
sales (including, without limitation, in respect of any sale, the
date of the shipment, the name of the customer or code number
designated by Global for such purpose if it does not wish to reveal
the name of such customer to Genpharm, the number of units of the
Product in each strength involved and the invoice price charged by
Global), credits, returns, allowances and other credits and debits
previously reported to Genpharm pursuant to Section 4.04 hereof.
Section 4.06. The obligation to pay Percentage Royalty
contained herein and to provide the reports and information
contemplated herein and the right of Genpharm to have access to the
records and to conduct audits or investigations pursuant to Section
4.07 hereof shall survive the expiration or termination of this
Agreement and shall apply to the Products sold by Global on or
prior to the effective date of the termination or expiration of
this Agreement and to the Products sold following such effective
(date of termination or expiration of this Agreement in respect of
which Global received orders prior to such effective date of
termination of this Agreement.
Section 4.07. (a) Global shall keep complete and accurate
records and books of account containing all information required
for the computation and verification of the "production cost" and
the amounts to be paid to Genpharm hereunder as well as records
and information relating to Global's cost of packaging Ranitidine
and shall, upon reasonable written notice from Genpharm, make
available or, at Genpharm's request, supply to Genpharm copies of
such records. Global further agrees that at the request of
Genpharm, it will permit one or more accountants selected by
Genpharm, except any to whom Global has some reasonable
objection, on not less than two (2) business days' notice, to
have access during ordinary working hours to such records as may be
necessary to audit, with respect to any payment report period
ending prior to such request, the correctness of any report or
payment made under this Agreement, or to obtain information as to
the payments due for any such period in the case of failure (of
Global to report or make payment pursuant to the terms of this
Agreement.
(b) Should any such accountant discover information
indicating inaccuracy in any of Global's reports or payments or
non-compliance by Global with any of such terms and conditions, and
should Global fail to acknowledge in writing to Genpharm the
deficiency or non-compliance discovered by such accountant within
ten (10) business days of being advised of same in writing by the
accountant, the accountant shall have the right to make and
retain copies (including photocopies) of any pertinent portions of
the records and books of account which relate to or disclose the
claimed deficiency or non-compliance (to the extent not
acknowledged by Global). Global shall provide full and complete
access to the accountant to Global's Pertinent books and records.
In the event that the accountant shall have questions which are
not in its judgment answered
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by such books and records, the accountant shall have the right to
confer with officers of Global, including Global's Chief Financial
Officer, upon reasonable notice and during reasonable working
hours. The accountant shall use his good faith efforts to minimize
any disruption to the business activities of Global. Genpharm
shall be solely responsible for all costs and expenses relating to
such investigation/audit, except in the event, any audit under
this Section shall reveal an underpayment or understatement of the
amount payable to Genpharm by more than five percent (5%) for the
period in question, in which case Global shall reimburse Genpharm
for all costs and expenses relating to such investigation/audit.
It is understood and agreed that Genpharm shall only have the
right to audit such books and records of Global pursuant to this
Section 4.07 no more often than one time in any contract year
unless earlier in such contract year or prior contract year such
investigation revealed a discrepancy of more than five percent
(5%) w1th respect to any reporting period, as aforesaid, in which
case Genpharm shall have the right to audit such books and records
three times in such contract year. For purposes of this Agreement,
a contract year shall be a period of twelve (12) months commencing
on either the date of this Agreement or on an anniversary thereof.
Unless the disclosure of same is reasonably required by Genpharm
in connection with any litigation or arbitration arising out of
such audit, the accountant shall not reveal to Genpharm the name
or address (or other information reasonably tending to identify
the location of a customer) of any customer of Global but shall
identify such customer to Genpharm, if necessary, by the customer
code number used by Global in its reporting obligations to
Genpharm. Global may, as a condition to providing any accountant
access to its books and records, require such accountant to
execute a reasonable confidentiality agreement consistent with the
terms of this Section 4.07.
(C) Genpharm shall keep full and accurate books and
records, in accordance with good accounting practice, and
relating to Ranitidine and the transactions described in this
Agreement. Global shall have the right, by its authorized
representative, to, at its expense, inspect, copy and make
excerpts from Genpharm's books and records relating to the
transactions described in this Agreement on reasonable notice and
at reasonable times.
Section 4.08. If any payment is not made within ten (10)
days of its due date hereunder, then such overdue payments shall
bear interest from the date the same is due until paid, calculated
at the floating rate of two percent (2%) above Chemical Bank's
announced prime rate in the United States or the highest rate
permitted by law, whichever is less. Any adjustment to the prime
rate as quoted by Chemical Bank from time to time shall result in
a corresponding adjustment to the rate of interest payable
hereunder, the rate of interest quoted by Chemical Bank at the
close of business on each day to be the rate applicable for such
date. In the event such prime rate quoted by Chemical Bank is not
available, then Genpharm and Global shall jointly in good faith
select, in lieu thereof, the prime rate (or its equivalent) quoted
by any other bank located in New York City.
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Section 4.09. In the event an FDA approval referred to in
Section 3.03 hereof is not obtained on or before the Approval Date
specified therefor, then, solely for purposes of computing the
number of shares of common stock, $.01 par value, of Global
issuable in connection with that certain Common Stock Purchase
Warrant, Series B, dated November 8, 1995 (the "Merck Warrant"),
issued to Merck KGaA (in accordance with the second paragraph of
the textual portion of such warrant), all profits Global receives
hereunder from that missed Approval Date and forward that are
generated by sales of Ranitidine and all other Products as to
which Genpharm transferred its substansive know-how relating to
the manufacturing process of producing the Products in solid
dosage form (pursuant to Article II hereof) shall be multiplied by
two. The provisions of this Section 4.09 shall survive any
termination of this Agreement.
ARTICLE V
CUSTOMERS
Section 5.01. Upon approval of each ANDA by the FDA, Global
and Genpharm shall each have the right to market and sell Products
to their existing customers. In the event any existing customer of
Global or Genpharm is not also an existing customer of the other,
such other party shall not sell any Products to such customer for
so long as this Agreement is in effect. Each of Genpharm and
Global shall furnish to the other a list of their respective
existing customers with respect to proposed sales of the Products.
This list shall be updated monthly by each of Genpharm and Global.
Section 5.02. If at the time of an approval by the FDA both
Global and Genpharm are selling products to the same customer,
then Global and Genpharm agree to negotiate in good faith a
mutually satisfactory resolution with respect to sales of Products
to the customer. If no resolution is reached, each of Global and
Genpharm shall be allowed to continue to sell Products to that
customer.
Section 5.03. Should a conflict occur as to whether
Genpharm or Global shall sell to a particular customer that
neither is currently selling, then the parties shall alternate as
to which of them shall have the right to sell to such prospective
customer; provided that the first party to sell each such
prospective customer shall be that party that Genpharm and Global
shall mutually agree would be the one most likely to generate the
greatest sales; provided, further, that in the event Genpharm or
Global is not in a position to supply the Product to such
customer on the terms and conditions customarily required by that
customer (e.g., manufacturer's label vs. private label), and it
is that party's "turn" to have the right to sell to such
prospective customer, then the other party shall be given the
right to sell the Product to that customer, with the party who
has foregone on the opportunity to sell to the prospective
customer receiving a
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"credit" to be applied to the next prospective customer as to
which such party can supply product as required.
ARTICLE VI
CONFIDENTIALITY
Section 6.01. Under the terms of this Agreement, Genpharm
or Global (either one, in such capacity, being referred to as the
"Disclosing Party") may disclose or reveal to Global or Genpharm
(in such capacity, the "Receiving Party") either orally, in
writing, or by inspection, information that may be non-public,
proprietary or confidential in nature. Such information, simply
referred to herein as "Information", might include, but is not
limited to, files, raw material sources, processes, formulations,
manufacturing techniques, trade secrets, bio-equivalence study
results and other information that is not ascertainable from
public or published information or trade sources. The Receiving
Party shall treat the Information received by it as confidential,
and neither the Receiving Party, nor any affiliate or any other
entity controlled by the Receiving Party, nor, any officer, agent
or employee of any of them shall disclose such Information to any
third party, or use such Information for any purpose unrelated to
the matters contemplated by this Agreement, except Information
which (a) the Receiving Party can show was in the Receiving
Party's possession or was known to the public or in the published
literature prior to disclosure or the availability of such
Information to the Receiving Party, or (b) subsequent to the time
of disclosure or the availability of such Information to the
Receiving Party, the Information becomes known to the public or
finds its way into the published literature through no fault of
the Receiving Party, its officers, agents or employees, or (c) is
lawfully acquired by the Receiving Party from a third party who
is not under confidentiality agreement with the Disclosing Party
with respect to such Information.
Section 6.02. All Information received by the Receiving
Party from the Disclosing Party shall remain the property of the
Disclosing Party, and all written Information, with all copies
and extracts thereof, shall forthwith be delivered to the
Disclosing Party upon its request.
Section 6.03. The parties hereto agree that the
restrictions on the Receiving Party contained herein are
necessary for the protection of the Disclosing Party and any
breach thereof could possibly cause the Disclosing Party
irreparable damage for which there is no adequate remedy at law.
Accordingly, if the Disclosing, Party has reason to believe that
the Receiving Party is about to breach or is breaching this
Agreement in such a manner as to cause the Disclosing Party
irreparable harm and, if the Disclosing Party has so notified the
Receiving Party and the Receiving Party has not indicated a
willingness to refrain from taking the action which the
Disclosing Party claims would constitute or is a breach on the
Receiving Party's part and that
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would cause the Disclosing Party irreparable harm, then the
Disclosing Party may file suit with a court of competent
jurisdiction in order to seek an injunction in favor of enjoining
such threatened or continued breach of the Receiving Party's
obligations hereunder. The right of the Disclosing Party to obtain
injunctive relief shall not be considered a waiver of the
Disclosing Party's rights to pursue any other remedies it may have
at law or in equity.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES OF GLOBAL
Section 7.01. Global represents and warrants to Genpharm as
follows: Global is a corporation, duly authorized and existing
under the laws of Delaware; Global has the corporate power and
authority to execute, deliver and perform this Agreement and the
transactions contemplated hereby and the execution and delivery of
this Agreement have been duly authorized by Global; the
execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby do not and
will not violate or conflict with any provision of Global's
Certificate of Incorporation or Bylaws or, to the best knowledge
of the individuals signing this Agreement, any agreement,
instrument, law or regulation to which Global is a party or by
which Global is bound; except as provided herein, no other
governmental approval or authorization of this Agreement or the
acts or transactions contemplated hereby is required by law or
otherwise in order to make this Agreement binding upon Global; and
this Agreement and all other instruments required hereby to be
executed and delivered to Genpharm by Global are, or when
delivered to Genpharm in accordance herewith, will be, legal,
valid and binding instruments of Global enforceable in accordance
with their respective terms. GLOBAL MAKES NO REPRESENTATIONS OR
WARRANTIES EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT.
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES OF GENPHARM
Section 8.01. Genpharm represents and warrants to Global
as follows: Genpharm is a corporation duly authorized and existing
under the laws of Canada; Genpharm has the power and authority to
execute, deliver and perform this Agreement and the transactions
contemplated hereby, and the execution and delivery of this
Agreement have been duly authorized by Genpharm; the execution,
delivery and performances of this Agreement and the consummation
of the transactions contemplated hereby do not and will not
violate or conflict with any provision of Genpharm's Certificate
of Incorporation or Bylaws (or other organizational and governing
documents) or, to the best of the knowledge of the individuals
signing this Agreement,
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any agreement, instrument, law or regulation to which Genpharm is
a party or by which Genpharm is bound; except as provided herein,
no other approval or authorization of this Agreement or the acts
or transactions contemplated hereby is required by law or or
otherwise in order to make this Agreement binding upon Genpharm;
and this Agreement, and all other instruments required hereby to
be executed and delivered to Global by Genpharm are, or when
delivered will be, legal, valid and binding instruments of
Genpharm enforceable in accordance with their respective terms.
GENPHARM MAKES NO REPRESENTATIONS OR WARRANTIES EXCEPT AS
EXPRESSLY SET FORTH IN THIS AGREEMENT.
ARTICLE IX
WARRANTIES AND INDEMNIFICATION
Section 9.01. With respect to its activities and obligations
hereunder, each party warrants and covenants that it will use its
best efforts to fully comply with all federal, state and local
laws, regulations, standards and guidelines, and those of any
other governmental body (including foreign laws, regulations,
standards, and guidelines, if any) having jurisdiction over the
conduct of such tests and activities that are required under the
terms of this Agreement.
Section 9.02. Global shall defend, indemnify and hold
Genpharm and its affiliates and the officers, directors and
employees of Genpharm and its affiliates harmless from and against
any and all claims, demands, loss, damage, liability, settlement
amounts costs or expenses whatsoever (including reasonable
attorneys' fees and cost) arising from or related to any claim,
action or proceeding made or brought against such party by a
third party as a result of any breach of representation or
warranty by Global hereunder, or as a result of any act or
omission by Global hereunder, unless such liability arises from a
breach of this Agreement or the act or omission by Genpharm.
Section 9.03, Genpharm shall defend, indemnify and hold
Global and the officers, directors and employees of Global
harmless from and against any and all claims, demands, loss,
damage, liability, settlement amounts, costs of expenses
whatsoever (including reasonable attorneys' fees and costs)
arising from or related to any claim, action or proceeding made or
brought against such party by a third party as a result of any act
or omission by Genpharm in connection with the manufacture and
sale of Ranitidine, unless such liability arises from a breach of
this Agreement or the act or ommission by Global.
Section 9.04. In the event of any claim, action or
proceeding for which a party is entitled to indemnity hereunder,
the party seeking indemnity ("Claimant") shall notify the other
party ("Indemnitor") of such matter in writing, providing copies
of all
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relevant documents. Indemnitor shall promptly assume
responsibility for and shall have full control of the defense of
such matter, including settlement negotiations and any legal
proceedings. Claimant shall fully cooperate in Indemnitor's
handling and defense thereof.
ARTICLE X
TERM
Section 10.01. The rights and duties under this Agreement
shall commence on signing of this Agreement and shall continue in
effect until July 26, 2002. This Agreement may be terminated only
as expressly provided in this Agreement or upon the mutual
written agreement of the parties hereto.
Section 10.02. Notwithstanding anything herein to the
contrary, the obligations of the parties under Articles VI and IX
shall survive any termination of this Agreement.
ARTICLE XI
DEFAULT AND TERMINATION
Section 11.01. (a) Subject to the terms of Section 3.02
hereof, Genpharm may terminate this Agreement as to a specific
Product if Global does not submit an ANDA for such Product to the
FDA on or prior to the date nine (9) months following the date
such Product is proposed to be filed as indicated in the
respective Product Notice. At such time as Genpharm elects to
terminate this Agreement with respect to a Product pursuant to
this Section 11.01(a), Global shall transfer to Genpharm all the
"know-how" with respect to such Product in Global's possession.
(b) Genpharm may terminate this Agreement as to a specific
Product if Global does not obtain the Regulatory Approval for
such Product by the respective date set forth in Section 3.03 (as
such date is determined by reference to the respective Product
Notice); provided, however, that Genpharm may not terminate this
Agreement as to such Product if failure to receive the Regulatory
Approval with respect to such Product is the result of delays
caused solely by the FDA. The burden of proof with respect to the
cause of delays in receipt of any Regulatory Approval shall be on
Global, and such burden of proof as to the delay being caused
solely by the FDA shall be satisfied if Global can demonstrate
that it has timely filed and diligently prosecuted the ANDA with
respect to such Product. At such time as Genpharm elects to
terminate this Agreement with respect to a Product pursuant to
this Section 11.01(b), Global shall
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transfer to Genpharm all the "know-how" with respect to such
Product in Global's possession,
Section 11.02. Genpharm shall have the right to terminate
this Agreement upon written notice to Global in the event that
any one or more of the following events shall become applicable
to Global:
(a) and order is made or a resolution or other action of
Global is taken for the dissolution, liquidation, winding
up or other termination of its corporate existence;
(b) Global commits an act of bankruptcy, becomes
insolvent, makes an assignment for the benefit of its
creditors or proposes to its creditors a reorganization,
arrangement, composition or re-adjustment of its debts or
obligations or otherwise proposes to take advantage of or
shelter under any statute in force in the United States
for the protection of debtors;
(c) if any proceeding is taken with respect to a
compromise or arrangement, or to have Global declared
bankrupt, or to have a receiver appointed in respect of
Global or a substantial portion of its property, and such
proceeding is instituted by Global or is not opposed by
Global or if such proceeding is instituted by a person
other than Global and Global does not proceed diligently
and in good faith to have such proceeding withdrawn
forthwith;
(d) a receiver or a receiver and manager of any of the
assets of Global is appointed and such receiver or
receiver and manager is not removed within sixty (60) days
of such appointment unless Global diligently contests, in
good faith, the valdity of the appointment of such
receiver or receiver and manager; or
(e) Global ceases or takes steps to cease to carry on its
business;
provided, however, that Genpharm shall not have the right to
terminate this Agreement upon the occurrence of the events set
forth in subsections (a) through (e) hereof as long as, following
the occurrence of any such events, Global continues to operate
its business with respect to the transactions described herein.
Section 11.03. In the event that Global is unable to
produce a Product at any time following receipt of a Regulatory
Approval with respect to such Product (the "Terminating
Product"), Global shall provide written notice to Genpharm (the
"Terminating Notice") stating that it is unable to produce the
Terminating Product and Global shall use its commercially
reasonable good faith efforts to appoint a substitute
manufacturer for the Terminating Product reasonably acceptable to
Genpharm. On the date six (6) months after the date of the
Terminating Notice, if Global has neither resumed production of
the Terminating Product nor appointed a substitute
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manufacturer reasonably acceptable to Genpharm, Genpharm shall
have the right to terminate this Agreement with respect to the
Terminating Product and upon such termination Global shall
transfer the "know-how" in its possession with respect to the
Terminating Product to Genpharm. Thereafter, Genpharm or its
affiliates may either endeavor to manufacture the Terminating
Product or Genpharm may designate another manufacturer for the
Terminating Product (Genpharm or its affiliates, if any of them
propose to manufacture the Terminating Product, or such substitute
manufacturer designated by Genpharm are hereinafter referred to as
the "Alternate Manufacturer"). Global shall have the right to
purchase the Terminating Product from the Alternate Manufacturer
upon the same terms as set forth in Sections 4.01, 4.02 and 4.04
hereof, except that references in such Sections to "Genpharm"
shall mean "Global" and references to "Global" in such Sections
shall mean "Genpharm".
Section 11.04 Nothing contained in this Article XI shall be
construed or interpreted to diminish or in any way limit any other
rights which may be provided for elsewhere in this Agreement,
including without limitation those set forth in Section 4.09
hereof, nor shall such rights limit the provisions hereof.
ARTICLE XII
INSURANCE
Section 12.01. (a) Genpharm and Global shall each maintain
insurance in at least the following amounts prior to the first
shipment of any Products as contemplated by this Agreement:
(i) Commercial General Liability insurance, including
premises, products, operations, and contractual coverage,
in the total amount of not less than $1,000,000 per claim
and annual aggregate; and
(ii) Workers' Compensation insurance in the amount required
by law.
(b) Genpharm and Global shall each maintain insurance in at
least the following amounts subsequent to the first shipment of
any Products as contemplated by this Agreement:
(i) Commercial General Liability insurance, including
premises, products, operations, and contractual coverage,
in the total amount of not less than $2,000,000 per claim
and annual aggregate;
(ii) Umbrella insurance, including premises, products,
operations, and contractual coverage, in the total amount
of not less than $5,000,000 per occurrence and annual
aggregate; and
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(iii) Workers' Compensation insurance in the amount
required by law.
Section 12.02. Genpharm shall have its insurance carrier or
carriers furnish to Global certificates that all insurance
required under this Agreement is in force, such certificates to
indicate any deductible and/or self-insured retention, and the
effective expiration dates of policies, and such certificates to
stipulate that Global shall be given thirty (30) days' written
notice of any cancellation, non-renewal or material change in the
policy.
Global shall have its insurance carrier or carriers furnish
to Genpharm certificates that all insurance required under this
Agreement is in force, such certificates to indicate any
deductible and/or self-insured retention, and the effective
expiration dates of policies, and such certificates to stipulate
that Genpharm shall be given thirty (30) days' written notice of
any cancellation, non-renewal or reduction in insurance coverage
below the amounts specified in Section 12.01 above or other
material change in the policy.
Section 12.03. Global shall name Genpharm, and Genpharm
shall name Global, as additional insured parties under their
respective Commercial General Liability and umbrella insurance
policies described in Section 12.01 hereof.
ARTICLE XIII
MISCELLANEOUS
Section 13.01. Each of Global and Genpharm is solely
responsible for the safety and health of its employees and
compliance with the federal, state, provincial and local safety
and health regulations governing their respective facilities,
including but not limited to providing its employees with all
required information and training concerning any potential hazards
involved in the manufacture, receipt, storage, handling and supply
of the Products and Ranitidine, as applicable, and taking any
precautionary measures to protect its employees from such hazards.
Section 13.02. This Agreement embodies the entire agreement
of the parties on the subject matter herein. All prior
understandings, writings, discussions, and agreements relating to
the subject matter of this Agreement are hereby expressly
superseded by this Agreement.
Section 13.03 Nothing in this Agreement or in the
performance hereof shall have the effect of making Global and
Genpharm partners, joint venturers or each other's agents, and
neither shall have the right to act on behalf of or bind the other
except as expressly provided hereunder or otherwise expressly
agreed in writing.
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Section 13.04. All section headings used in this Agreement
are solely for the convenience of the parties and shall not affect
the meaning or interpretation of the provisions thereof.
Section 13.05. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York (not
including its choice of law principles). The parties hereto submit
to the exclusive jurisdiction and venue of the Supreme Court of the
State of New York and the Federal District Court for the Southern
District of New York for purposes of any legal action arising out
of this Agreement.
Section 13.06. This Agreement, and any of the terms hereof,
shall not be modified, amended or waived except by a written
instrument executed by the parties or, in the case of a waiver, by
the waving party. The failure of either party at any time to
require performance of any term hereof shall not affect its right
at a later time to enforce the term. The waiver by either party of
any condition or term hereof in any one or more instances shall not
be construed as a further or continuing waiver of such condition or
term.
Section 13.07. If any provision of this Agreement is, or
becomes or is deemed to be invalid, illegal or unenforceable in any
respect in any jurisdiction, such provision shall be deemed amended
to conform to applicable laws so as to be valid and enforceable or,
if it cannot be so amended without materially altering the
intention of the parties, it shall be stricken and the remainder
of this Agreement shall remain in full force and effect. In case
any one or more of the provisions contained in this Agreement shall
be held invalid, illegal or unenforceable in any respect in any
jurisdiction, the validity, legality and enforceability of such
provision or provisions shall not in any way be affected or
impaired thereby in any other jurisdiction; and the validity,
legality and enforceability of the remaining provisions contained
herein shall not in any way be otherwise affected or impaired
thereby.
Section 13.08. Any notice or other communication required
or permitted hereunder shall be in writing and shall be deemed to
have been duly given on the date of service if served personally or
three (3) days after the date of mailing if mailed, by registered
or certified mail, postage prepaid, or on the date of transmission
if by fax, or one day after delivery to an established overnight
courier service, in all instances to the respective addresses set
forth below:
To Global: Global Pharmaceutical Corporation
Xxxxxx & Xxxxxxxxxx Xxxxxxx
Xxxxxxxxxxxx, XX 00000
Attn: Xxx Xxxxxxxxxx,
President
FAX: (000) 000-0000
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With a copy to: Xxxxxxx X. Xxxxxxxx
Fulbright & Xxxxxxxx L.L.P.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
FAX: (000) 000-0000
To Genpharm: Genpharm,Inc.
00 Xxxxxxx Xxxx
Xxxxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0
Attn: Xxxx Tabaznik
FAX: (000) 000-0000
With a copy to: Xxxxxxx X. Xxxxxx
Xxxxx, Wiener & Levy LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
FAX: (000) 000-0000
Any party may change such party's address for notices by
notice duly given pursuant to this Section 13.08.
Section 13.09. Neither this Agreement nor any right or
obligation arising hereunder may be assigned by Global in whole or
in part, without the prior written consent of Genpharm, which
consent may be withheld in the absolute discretion of Genpharm.
This Agreement shall be binding upon any assignee and, subject to
the restrictions on assignment herein set forth, inure to the
benefit of the successors and assigns of each of Genpharm.
Section 13.10. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original; but such
counterparts shall together constitute but one and the same
instrument.
Section 13.11. No right or license shall be deemed to have
been granted under this Agreement to either party under any patents
or proprietary information of the other, except as expressly set
forth herein. Upon expiration or termination of this agreement,
each party shall return to the other any samples received from the
other party as well as any documents embodying or containing
confidential information of the other party, or provide the other
party with assurances that all such samples and documents and any
copies, extracts or digests thereof have been destroyed, except
that one archival copy of documents received from the other may be
retained to show what was received.
Section 13.12. (a) Words importing the singular shall
include the plural and vice versa; words importing a person shall
include an individual, corporation, partnership, association,
cooperation, joint venture or any other form of business or social
entity recognized under law.
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(b) "Affiliate" of a party hereto shall mean an entity
which controls, is controlled by, or its under common control with
such party. For the purposes of this definition, an entity shall
be deemed to control another entity if it owns or controls,
directly, or indirecty, at least twenty percent (20%) of the
voting equity of such other entity (or other comparable ownership
interest for any entity other than a corporation); provided,
however, that with respect to Section 4.02 hereof, an entity shall
be deemed to control another entity if it owns or controls,
directly or indirectly, at least fifty percent (50%) of the voting
equity of such other entity (or other comparable ownership
interest for any entity other than a corporation).
(C) Terms parenthetically defined elsewhere in this
Agreement shall, throughout this Agreement, have the meaning
therein provided.
Section 13.13. All disputes arising out of, or in relation
to, this Agreement (other than disputes arising out of any claim
by a third party in an action commenced against a party), shall be
referred for decision forthwith to a senior executive of each
party not involved in the dispute. If no agreement can be reached
through this process within thirty (30) days of request by one
party to the other to nominate a senior executive for dispute
resolution, than either party hereto shall be entitled to refer
such dispute to a single arbitrator for arbitration to be held in
New York, New York on an expedited basis in accordance with the
rules and regulations of the American Arbitration Association for
the resolution of international disputes. Any party demanding
arbitration shall, with service of its demand for arbitration,
propose a neutral arbitrator selected by it. In the event that the
parties cannot agree upon a neutral arbitrator within thirty (30)
days after the demand for arbitration, an arbitrator shall be
appointed by the American Arbitration Association who shall be a
partner in a New York, New York law firm having at least ten (10)
partners.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be signed by their duly authorized representatives,
intending to be legally bound hereby, as of the day and year
first written.
GLOBAL PHARMACEUTICAL CORPORATION
By: /s/ Xxx X. Xxxxxxxxxx
------------------------------
Name: Xxx X. Xxxxxxxxxx
Title: President
GENPHARM, INC.
By: /s/ X. X. Xxxxxxxxx
------------------------------
Name: X. X. Xxxxxxxxx
Title: Chairman
By: /s/ X. Xxxxxxxxx
------------------------------
Name: X. Xxxxxxxxx
Title: CEO
AGREED TO WITH RESPECT
TO SECTION 4.09 ONLY:
MERCK KGaA
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Authorized Agent
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SCHEDULE I
PRODUCTS
--------
Oxybutinin
Minocycline
Additional Products to be mutually agreed upon
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