EXHIBIT 10.41
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Restated and Amended
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Nabumetone Agreement
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This AGREEMENT is made this 30th day of June, 1997, between XXXXXX
TECHNOLOGY COMPANY, a Delaware general partnership ("Xxxxxx") by Napp
Technologies, Inc., a Delaware corporation and the Managing General Partner of
Xxxxxx, with its principal office at 000 Xxxxxx Xxxxxx, Xxxxxx Xxxxx, Xxx
Xxxxxx, 00000 ("HCC") and XXXXXX PHARMACEUTICAL, INC., a Delaware corporation
with its principal office at 00 Xxxx Xxxx, Xxxxxx, Xxxxxxxxxxxxx, 00000
("Xxxxxx").
W I T N E S S E T H
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WHEREAS, Xxxxxx and Hoechst Celanese Corporation ("HCC") are parties to
that certain agreement dated 30 April, 1996 with respect to Nabumetone
("Nabumetone Agreement"); and
WHEREAS, Xxxxxx is acquiring HCC's bulk pharmaceutical ingredient
manufacturing facility in Coventry, Rhode Island and as part of such acquisition
will be assuming the rights and obligations of HCC under the Nabumetone
Agreement in toto ("Acquisition"); and
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WHEREAS, Xxxxxx and Xxxxxx wish to amend and restate the terms of the
Nabumetone Agreement to reflect the rights and obligations of Xxxxxx and Xxxxxx
that will govern the relationship between Xxxxxx and Xxxxxx upon and after the
Acquisition and to terminate and cancel the Nabumetone Agreement.
Now, Therefore, Xxxxxx and Xxxxxx agree as follows:
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ARTICLE 1: EFFECTIVE DATE; CANCELLATION
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1.1 This Restated and Amended Nabumetone Agreement shall be with effect
from and after the date that Xxxxxx assumes all the rights and all the
obligations of HCC under the Nabumetone Agreement as part of the Acquisition.
1.2 On the date Xxxxxx assumes all the rights and all the obligations of
HCC under the Nabumetone Agreement, this Agreement shall control the rights and
obligations of Xxxxxx and Xxxxxx.
ARTICLE 2: DEFINITIONS
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As used in this Agreement, the following terms shall have the meanings set
forth below:
2.1. "ANDA" shall mean Abbreviated New Drug Application.
2.2. "Commercial Year" shall mean the twelve (12) month period following
the first commercial market date for the Product and each anniversary date of
that date.
2.3. "CCOGS" shall mean Xxxxxx'x cost of goods sold which shall include
Xxxxxx'x direct material costs, direct utilities costs, direct waste disposal
costs and direct quality control costs, and overhead costs (allocated in
accordance with generally accepted accounting principles utilizing capacity
based standards) including indirect labor, supervision, repairs, maintenance,
supplies, utilities costs (which are not direct utilities costs), property
taxes, environmental safety and health administration costs, waste disposal
costs (which are not direct waste disposal costs), administration and financial
costs, quality assurance costs, purchasing, information systems and engineering
costs, and warehousing costs incurred in connection with the manufacture of the
Product and excluding any divisional or corporate allocation.
2.4. "Coventry Plant" shall mean Xxxxxx' manufacturing facility located in
Coventry, Rhode Island.
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2.5. "DMF" shall mean Drug Master File.
2.6. "FDA" shall mean the United States Food and Drug Administration.
2.7. "Gross Margin" shall have the meaning ascribed to it in Article 10.3
of this Agreement.
2.8. "RhodesCOGS" shall mean Xxxxxx' cost of goods sold which shall
include Xxxxxx' direct material costs, direct utilities costs, direct waste
disposal costs and direct quality control costs, and overhead costs (allocated
in accordance with generally accepted accounting principles utilizing capacity
based standards) including indirect labor, supervision, repairs, maintenance,
supplies, utilities costs (which are not direct utilities costs), property
taxes, environmental safety and health administration costs, waste disposal
costs (which are not direct waste disposal costs), administration and financial
costs, quality assurance costs, purchasing, information systems and engineering
costs, and warehousing costs incurred at the Coventry Plant in connection with
the manufacture of the Substance and excluding any divisional or corporate
allocation.
2.9. "Net Product Sales" shall mean the quantity of Product sold times
Xxxxxx'x selling price for the Product minus the amount of any Product rebates,
discounts, allowances and returns.
2.10. "Paragraph IV Certification" shall have the meaning ascribed to it
in 21 CFR (S)314.50.
2.11. "Patent" shall have the meaning ascribed to in Article 13.1 of this
Agreement.
2.12. "Person" shall mean any individual, corporation, partnership, firm,
joint venture, association, joint-stock company, trust, unincorporated
organization, or other entity.
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2.13 "Product" or "Products" shall mean the pharmaceutical generic
preparation of Nabumetone in dosage form.
2.14. "Substance" shall mean the pharmaceutical generic substance
Nabumetone from which the Product is made in bulk form.
2.15. "Technical Royalty" shall have the meaning ascribed to it in Article
10.4 of this Agreement.
2.16. "Territory" shall mean the United States, including Puerto Rico.
ARTICLE 3: RESEARCH AND DEVELOPMENT OBLIGATIONS
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3.1. RHODE's OBLIGATIONS:
(a) Xxxxxx shall use its best efforts and shall employ its research
and development facilities and services to the end that Xxxxxx shall have the
capability to produce commercial quantities of the Substance.
(b) Such research and development by Xxxxxx includes, but is not
limited to, the following:
(i) meeting the specifications for the Substance set forth in
Exhibit "A," attached hereto and made a part hereof. The
specifications can be modified by mutual agreement of the Parties.
When required pursuant to the notification requirements of 21 C.F.R.
(S)313.70, Xxxxxx agrees to notify Xxxxxx prior to implementing any
significant changes to its Substance manufacturing process that will
impact Rhode's ability to meet the specifications set forth in Exhibit
X. Xxxxxx further agrees that all such manufacturing changes will be
within DMF;
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(ii) producing an agreed-upon pilot quantity of Substance and
delivering to Xxxxxx such amount of such agreed amount of pilot
quantity as Xxxxxx, in its sole discretion, may request;
(iii) developing, compiling, and delivering to Xxxxxx technical
and regulatory information and documentation applicable to the
Substance; and
(iv) developing and compiling the technical know-how to produce
commercial quantities of Substance and put in place the equipment and
facility for such production.
(c) Xxxxxx shall exercise due diligence in performing the
aforementioned work.
(d) Xxxxxx shall permit Xxxxxx to visit its premises and have
reasonable access to its employees and substantive work papers concerning the
aforementioned work.
(e) Xxxxxx shall keep Xxxxxx informed about the current status of all
communications with the FDA concerning the Substance.
(f) with respect to Article 3 (b) (ii), the pilot quantity of
Substance Xxxxxx shall acquire as a result of the Acquisition and have in
inventory and available for Xxxxxx'x orders therefor is set forth on Exhibit B
and the Parties recognize that the amount set forth on Exhibit B may be less as
of the date of the Acquisition in the event Xxxxxx orders pilot quantities of
the Substance from HCC prior to the Acquisition.
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3.2. Xxxxxx'x OBLIGATIONS:
(a) Xxxxxx shall formulate the Product, conduct necessary stability
studies, pilot scale-up, bioequivalency studies, and apply to the FDA for
approval of an ANDA in Xxxxxx'x name for the Product;
(b) Xxxxxx shall develop scaled-up manufacturing processes to produce
commercial quantities of the Product, and validate these processes for FDA
approval.
(c) Xxxxxx shall inform Xxxxxx of the progress of development and the
submission of the ANDA to the FDA;
(d) Xxxxxx shall keep Xxxxxx informed about the current status of all
communications with the FDA concerning the Product; and
(e) Xxxxxx shall exercise due diligence in performing the
aforementioned work.
ARTICLE 4: RESEARCH AND DEVELOPMENT COSTS
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4.1. Xxxxxx shall bear the costs associated with the research and
development of a manufacturing process to produce the Substance on a pilot
scale. Pilot quantities of the Substance shall be supplied to Xxxxxx for a
purchase price of $[ /*/ ] per kilogram.
4.2. Xxxxxx shall bear the costs associated with the research and
development relating to ANDA approval and manufacturing of FDA approved
validation batches of Product.
ARTICLE 5: AGREEMENT OF PURCHASE AND SALE
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5.1. Pursuant to the terms and conditions of this Agreement and any
renewal thereof as set forth in Article 6 herein, Xxxxxx shall manufacture and
supply Xxxxxx with all of its
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requirements of the Substance, and Xxxxxx shall purchase all its requirements of
the Substance from Xxxxxx for use in prescription drug products.
5.2. Notwithstanding the foregoing, Xxxxxx shall have the right to
purchase Substance from an alternative source in order to qualify such
alternative source in the event it becomes necessary to purchase the Substance
from an alternative source as a result of Xxxxxx' inability to supply Xxxxxx
with all of its requirements of the Substance, as permitted pursuant to this
Agreement.
5.3. Xxxxxx shall not supply Substance for use in the development or
manufacture of the Product to another company for prescription use prior to the
FDA's acceptance of Xxxxxx'x XXXX submission.
5.4. In the event that a product or products containing the Substance is
approved by the FDA as an Over the Counter ("OTC") product and Xxxxxx is
approved by the FDA to sell such product or products, the Parties agree to
negotiate in good faith a profit sharing arrangement based upon the market
conditions that generally prevail in the OTC market and upon the conclusion of
such an arrangement between the Parties, the purchase and supply obligations
provided for in this Agreement shall apply.
ARTICLE 6: TERM
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The initial term of this Agreement shall commence on the date of the
Acquisition and shall conclude on the seventh anniversary date of the first
Commercial Year unless sooner terminated as provided herein ("Initial Term").
Thereafter, this Agreement can be renewed for successive twelve (12) month
periods by mutual agreement.
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ARTICLE 7: ORDERS AND SHIPMENTS
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7.1. Xxxxxx and Xxxxxx will keep each other informed with respect to
activities and undertakings in respect of their obligations hereunder, including
without limitation, progress in the development of scaled-up manufacturing
processes for the Substance and the Product and the status and progress of the
patent litigation contemplated by Article 13.1 hereof to the end that Parties
will jointly estimate the beginning date of the first Commercial Year not less
than 24 months in advance of the beginning date of the first Commercial Year
("Joint Estimate Date"). The Joint Estimate Date shall not be less than 28
months from the date of Xxxxxx'x submission of the ANDA to the FDA.
7.2. The Parties recognize that determining the Joint Estimate Date is
inherently speculative. Therefore, neither party will hold the other party
liable hereunder in the event that the Joint Estimate Date ultimately proves to
be incorrect.
7.3. On the date the parties determine the Joint Estimate Date, Xxxxxx
will provide Xxxxxx with a good faith estimate of Xxxxxx'x maximum annual
requirements of the Substance as of the Joint Estimate Date. If, in any
subsequent Commercial Year of this Agreement, Xxxxxx determines that its future
annual maximum requirements for the Substance will exceed Rhode's manufacturing
capacity for the Substance, Xxxxxx shall send Xxxxxx 18 months advance written
notice of Xxxxxx'x projected additional maximum annual requirements and Xxxxxx
may, in its sole discretion, determine whether or not to increase its capacity
for producing the Substance in order to meet Xxxxxx'x additional requirements.
Xxxxxx shall notify Xxxxxx as promptly as possible of its decision in this
regard.
7.4. At least ninety (90) days prior to the commencement of a Commercial
Year, Xxxxxx shall present to Xxxxxx Xxxxxx'x best estimate of its annual
requirements for the
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Substance during the upcoming Commercial Year on a quarterly basis. Xxxxxx will
also notify Xxxxxx at least sixty (60) days before each quarter of its estimated
monthly requirements for that and the next quarter which requirements will
supersede those provided pursuant to the above annual forecast. Xxxxxx will base
resources decisions at the Coventry Plant on Xxxxxx'x annual estimated purchases
and thus Xxxxxx'x failure to achieve those estimated purchases will result in
year end cost adjustments by Xxxxxx.
7.5. Xxxxxx will place firm orders for the Substance at least forty-five
(45) days before each required shipment date. Both Parties agree to work
together to reduce lead time for orders and deliveries.
7.6. Xxxxxx will accept deliveries of Substance from Xxxxxx based on
orders placed pursuant to this Article 7. Xxxxxx will not be required to
deliver, in any calendar year, additional quantities of Substance exceeding ten
percent (10%) of the quantity of Xxxxxx'x annual estimated purchases for that
Commercial Year provided by Xxxxxx under Article 7.4. Xxxxxx will supply the
additional quantity of Substance by reducing the inventory of Substance
specified in Article 8 herein.
ARTICLE 8: INVENTORY REQUIREMENT
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8.1. At all times during the term of this Agreement and any extension
thereof, Xxxxxx will maintain an inventory of at least twenty (20) percent of
Xxxxxx'x estimated purchases of Substance from Xxxxxx for the next two quarters,
as set forth in Article 7.4.
8.2. In the event that Xxxxxx supplies an additional quantity of substance
to Xxxxxx pursuant to Article 7, the amount of such additional quantity shall be
credited against the inventory requirement provided for in this Article 8.
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ARTICLE 9: REGULATORY MATTERS
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9.1. Xxxxxx agrees to take reasonable steps (i) to file its ANDA for the
Product in 1997 and (ii) to secure FDA approval for the Product. Xxxxxx and
Xxxxxx agree to take all necessary action to obtain and maintain any approvals
necessary to permit Xxxxxx to sell the Product under Xxxxxx'x name in compliance
with applicable federal and state drug laws.
9.2. Xxxxxx and Xxxxxx will make available to each other within three (3)
days of receipt regulatory correspondence covering the following issues:
regulatory letters, Product recalls, withdrawal of Product, and correspondence
bearing on the safety and efficacy of the Product.
9.3. In order to facilitate Xxxxxx'x quality assurance activities with
respect to the Product, Xxxxxx agrees to allow Xxxxxx at least once per year at
mutually agreeable times to inspect/audit Xxxxxx facilities and records
pertaining to manufacture, testing, storage, and packaging for compliance with
Good Manufacturing Practices.
ARTICLE 10: PROFIT SHARING, AUDITS, BILLING, AND TERMS
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10.1. Xxxxxx will use best marketing and sales practices to maximize sales
and execute a product strategy, within the framework of applicable laws and
regulations, to optimize sales of the Product in the Territory.
10.2. Within thirty (30) days after the end of each month, Xxxxxx will
forward a Summary of RhodesCOGS, as that term is defined in Article 2.8 hereof,
to Xxxxxx. At that time Xxxxxx will also invoice Xxxxxx for the amount of the
Substance purchased by Xxxxxx during the
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preceding month. The Substance purchase price shall be equal to
[ /*/ ]. Payment is due thirty (30) days from the date of the invoice.
10.3. In consideration for Xxxxxx assistance and indemnification in
connection with the Patent litigation contemplated by Article 13 hereof, Xxxxxx
hereby agrees to share with Xxxxxx Xxxxxx'x profit arising out of the commercial
sale of the Product in accordance with the following formula:
[ /*/ ]
WHERE
[ /*/ ] and
"Technical Royalty" has the meaning ascribed to it in Article 10.4 herein.
10.4.
(a) Subject to the provisions of Article 10.4 (b) and Article 10.4
(c), in the event that the challenge to the Patent contemplated by Article 13.1
is concluded either by judicial resolution or settlement and following such
judicial resolution or settlement Xxxxxx can manufacture, market or sell the
Product and such manufacture, marketing or sale does not constitute an
infringement of the Patent in the Territory, Xxxxxx will pay a technical royalty
(herein referred to as the "Technical Royalty") for four (4) years. The
Technical Royalty is graduated and is based upon a Commercial Year, as that term
is defined in Article 1 hereof. The
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Technical Royalty for the first Commercial Year of this Agreement shall be
[ /*/ ] of Xxxxxx'x Gross Margin. The Technical Royalty for the second and
third Commercial Years shall be [ /*/ ] of Xxxxxx'x Xxxxx Margin for each
of those years. The Technical Royalty for the fourth Commercial Year shall be
[ /*/ ] of Xxxxxx'x Gross Margin.
(b) In the event that the challenge to the Patent contemplated by
Article 13.1 is not concluded either by judicial resolution or settlement as
provided in Article 10.4 (a) or Rhode's manufacture of the Substance infringes
any other patent in the Territory, no Technical Royalty will be owed to Xxxxxx.
(c) If any company other than the owner of the Patent described in
Article 13 files an ANDA with respect to the Product in advance of Xxxxxx'x
XXXX, Xxxxxx can, at its sole discretion, unilaterally elect to terminate this
Agreement by providing written notice to Xxxxxx of Xxxxxx' decision to terminate
this Agreement, or Xxxxxx can continue with this Agreement and if the earlier
filed company successfully challenges the Patent by a judicial resolution that
the Patent is invalid, no Technical Royalty will be owed to Xxxxxx. Should
Xxxxxx decide to challenge the validity of the Patent at a later date, Xxxxxx
shall first offer Xxxxxx the opportunity to reinstate the provisions of this
Agreement, which offer Xxxxxx shall accept or reject within thirty (30) days.
If Xxxxxx terminates this Agreement pursuant to this Article 10.4 (c), Xxxxxx
may thereafter seek an alternative source of the Substance and manufacture and
sell the Product without any obligation or liability to Xxxxxx.
10.5 Within thirty (30) days of the end of each month during each
Commercial year of this Agreement, Xxxxxx shall prepare a CCOGS summary and
forward it to Xxxxxx. The Xxxxxx
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summary shall include the gross product sales in Dollars for the preceding
month, the Product rebates, discounts, allowances and returns for the same
period deducted from Xxxxxx'x xxxxx product sales, and CCOGS. This information
will be utilized to determine the Technical Royalty and the Profit Share to be
paid to Xxxxxx, as described in the preceding subsections of this Article 10.
Xxxxxx will xxxx Xxxxxx quarterly (according to the following schedule: January
2nd, April 1st, July lst, and October 1st) for the Technical Royalty and Profit
Share due for the three (3) months preceding each of the dates specified
immediately above and the payment is due thirty (30) days from the date of
Xxxxxx' invoice.
10.6. If at any time during the term of this Agreement Xxxxxx is unable to
sell the Product at the prevailing average market price without its Gross Margin
falling to or below [ /*/ ], Xxxxxx and Xxxxxx agree to meet to determine if
cost savings can be achieved that will permit Xxxxxx to sell the Product at
prevailing market conditions with a minimum Gross Margin of [ /*/ ].
10.7. Once each year, Xxxxxx and Xxxxxx may, upon thirty (30) days written
notice to the other Party, audit the books and records of the other Party at
Xxxxxx or Xxxxxx'x offices, as applicable, to determine the accuracy of the
other Party's financial and cost determinations hereunder.
ARTICLE 11: TERMINATION
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11.1. Either Party will have the right to terminate this Agreement by
giving three (3) years notice in writing to the other party; however, no
termination can take effect during the Initial Term unless one or more of the
following events occur, in which case either party must give due notice:
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(a) Insolvency or bankruptcy of the other Party or the inability or
failure of the other Party to perform any financial obligations as the same
become due;
(b) Demonstrable inability of the other Party to perform its
material obligations under this Agreement; and/or
(c) The enactment of any law, order or regulation by a governmental
unit in the Territory that would render it impracticable or impossible for the
other Party to perform it obligations hereunder.
(d) Pursuant to Article 10.4(c) of this Agreement.
11.2. Upon the occurrence of any of the events set forth in Article 11.1,
either Xxxxxx or Xxxxxx may so notify the other Party in writing, specifying in
reasonable detail the claimed occurrence. If the condition referred to in such
notice has not been cured within one hundred twenty (120) days from receipt of
the notice, this Agreement shall thereupon terminate; provided, however, that if
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such condition reasonably cannot be cured within said period, it shall be
sufficient to prevent termination if the party seeking to effect a cure gives
notice to the other within said period that it will diligently pursue a cure and
in fact diligently works to the effect a cure, setting forth in reasonable
detail the action taken, and thereafter cures the condition within a period
ending not later than two hundred forty (240) days after receipt of the original
notice of default. Xxxxxx may purchase the Substance from other suppliers, as
provided in Article 14 hereof, in the event of a reduction, due to an event
identified in this Article, in the quantities of the Substance Xxxxxx is able to
purchase from Xxxxxx.
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ARTICLE 12: WARRANTY
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Xxxxxx warrants that the Substance delivered to Xxxxxx will conform to the
specifications set forth on Exhibit A and the containers in which the Substance
is shipped will conform to the specification set forth in Exhibit X. Xxxxxx
further warrants that the Substance to be supplied to Xxxxxx hereunder will
conform to and will be manufactured in conformity with applicable FDA and State
regulations. THIS WARRANTY IS THE ONLY WARRANTY, EXPRESS OR IMPLIED, MADE BY
XXXXXX AS TO THE SUBSTANCE, AND ALL OTHER WARRANTIES, INCLUDING MERCHANTABILITY
OR FITNESS FOR ANY PARTICULAR PURPOSE, ARE DISCLAIMED. Except as otherwise
provided in this Agreement, the exclusive remedy for breach of warranty will be
prompt replacement of the nonconforming Substance at Xxxxxx' expense with a like
amount of the Substance conforming to the above-stated warranty. For purposes
hereof, replacement may include reprocessing of the Substance if done in a
period of time commercially reasonable to Xxxxxx. In no event xxxx Xxxxxx be
liable to Xxxxxx for any alteration, change, improper packaging or other
improper treatment of Substance by Xxxxxx other than in accordance with Xxxxxx'
instructions; nor xxxx Xxxxxx be liable to Xxxxxx for any damage arising solely
from Xxxxxx'x marketing, production, advertising, distribution or sale of
Product that conforms to the warranty set forth above.
ARTICLE 13: INDEMNITY; SETTLEMENT
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13.1. Xxxxxx and Xxxxxx acknowledge that Xxxxxx, in seeking FDA approval
to market the Product, shall certify in the XXXX Xxxxxx submits to the FDA that
the Patent is invalid or that the Patent will not be infringed by the
manufacture, use, or sale of the Product. In the event that SmithKline Xxxxxxx,
Inc., the owner of United States Patent No. 4420639 ("Patent"),
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institutes an action to enforce its rights pursuant to the Patent, Xxxxxx agrees
that Xxxxxx will be solely responsible for selecting the defense counsel and
managing the defense and the litigation and Xxxxxx will fully cooperate in the
defense of that action. Subject to the foregoing, Xxxxxx will indemnify Xxxxxx
in accordance with the terms of Article 13.2.
13.2. Xxxxxx will defend, indemnify and hold harmless Xxxxxx and its
affiliates (and each of their employees, officers, directors and stockholders)
from and against any and all claims, liabilities, assessed damages, costs and
expenses (including, without limitation, costs and expenses of investigation and
settlement, court costs and attorneys' fees and expenses regardless of outcome,
but excluding any indirect, incidental or consequential damages or losses and
lost profits) arising solely out of any allegation of infringement of the Patent
in the Territory with respect to the Product and any allegation of infringement
of any other patent in the Territory with respect to Xxxxxx, manufacture of the
Substance, including those associated with any Patent action in the Territory
brought by SmithKline Xxxxxxx. Xxxxxx' indemnification obligation described
herein shall be subject to the limitations of liability set forth in Articles 12
and 15.3 hereof, where the claims, liabilities, assessed damages, costs and
expenses arise solely out of any claim of defect in the Substance or the failure
of the Substance to conform to the express warranty set forth in Article 12
hereof. Xxxxxx will defend, indemnify and hold harmless Xxxxxx and its
affiliates (and each of their employees, officers, directors and stockholders)
from and against any and all claims, liabilities, assessed damages, costs and
expenses (including, without limitation, costs and expenses of investigation and
settlement, court costs, attorneys' fees and expenses regardless of outcome and
costs incurred by Xxxxxx under contracts with its customers requiring Xxxxxx to
pay the difference between the price charged such customer by Xxxxxx and the
price paid by such customer to cover a failure to supply by Xxxxxx, but
excluding any
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indirect, incidental or consequential damages or losses and lost profits) to the
extent caused by Xxxxxx' inability to manufacture the Substance.
13.3. Xxxxxx will defend, indemnify and hold harmless Xxxxxx and its
affiliates (and each of their employees, officers, directors and stockholders)
from and against any and all claims, liabilities, assessed damages, costs and
expenses (including, without limitation, costs and expenses of investigation and
settlement, court costs and attorneys' fees and expenses regardless of outcome,
but excluding any indirect, incidental or consequential damages or losses and
lost profits) to the extent caused by Xxxxxx'x marketing, production,
advertising, distribution or sale of Product that conforms to the express
warranty set forth in Article 12 hereof or caused by alterations to Substance or
Product made by Xxxxxx after delivery by Xxxxxx other than in accordance with
the directions of Xxxxxx, except to the extent such claim arises out of Xxxxxx'
breach of this Agreement, gross negligence or misconduct.
13.4. The Parties will cooperate and give each other prompt notice of
claims as to which indemnification may be claimed hereunder. The indemnifying
Party will not settle any claim or lawsuit relating to the Product without the
prior approval of the Indemnified Party, which approval will not be unreasonably
withheld.
13.5. Xxxxxx agrees that at no time in advance of a judicial resolution or
settlement of the challenge to the Patent contemplated by Article 13.1 shall it
unilaterally sell the Product. If Xxxxxx does so sell the Product, all
indemnification by Xxxxxx is waived.
13.6. The Parties recognize that the Patent litigation contemplated by
Article 13.1 may be resolved by means of a settlement with SmithKline Xxxxxxx,
Inc., the owner of the Patent ("Patent Owner"). The following provisions shall
apply in respect of attempting to conclude a settlement and with respect to a
settlement, as concluded.
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(a) [ /*/ ]
(b) [ /*/ ]
(c) [ /*/ ]
(d) [ /*/ ]
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(e) [ /*/ ]
(f) [ /*/ ]
(g) [ /*/ ]
(h) [ /*/ ]
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[ /*/ ]
ARTICLE 14: FORCE MAJEURE
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In the event of war, fire, flood, strike, labor trouble, accident, riot,
act of government authority (including changes in FDA laws and regulations),
lack of fuel or energy, natural disasters, or other contingencies, whether of
like or different nature, beyond the control of the Parties hereto, and
interfering with the production, supply, transportation, marketing, or
consumption of the Product or Substance, with the supply of raw materials used
in connection therewith or with due performance of this Agreement by any Party
("Force Majeure Event"), the Party affected thereby shall give prompt written
notice to the other. The Party affected by such event shall be excused from
performance of its obligations hereunder for the period that such event
continues; provided, however, that the Party affected by such event shall use
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all reasonable efforts to avoid or overcome the causes affecting performance,
and shall resume performance of
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its obligations hereunder as soon as possible. In the event of a reduction, due
to a Force Majeure Event, in the quantities of the Substance Xxxxxx is able to
purchase from Xxxxxx, Xxxxxx may purchase the Substance from other suppliers.
ARTICLE 15: HANDLING AND CLAIMS
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15.1. The Substance supplied under this Agreement will be delivered FOB
Rhode's Coventry Plant. Xxxxxx shall make shipping arrangements with the
appropriate carriers from the FOB point under the agreements that Xxxxxx has
with those carriers. Title and risk of loss passes to Xxxxxx when the Substance
is delivered to the carrier at the FOB point.
15.2. Each Party acknowledges that Substance and Product require special
handling, storage, transportation, treatment or use to comply with applicable
safety and environmental laws. At times when such Party has title and risk of
loss for Substance or Product, it will take all actions necessary to comply with
those laws and avoid spills or other dangers to persons, property or the
environment.
15.3. Notwithstanding any provision herein to the contrary, Xxxxxx will
test and inspect Substance for compliance with this Agreement within a
reasonable time after such shipment is received. All claims against Xxxxxx with
respect to any shipment of Substance, including claims for allegedly defective
goods or shortage, will be deemed waived unless made in writing and received by
Xxxxxx within sixty (60) days after Xxxxxx'x receipt of such shipment.
Variations in invoice quantity of one percent (1%) or less will be disregarded.
If these variations are consistently in one direction, Xxxxxx and Xxxxxx will
work to resolve them.
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ARTICLE 16: NOTICES
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16.1. All notices under this Agreement must be made in writing and mailed
or delivered to the following:
Xxxxxx: Xxxxxx Pharmaceutical, Inc.
00 Xxxx Xxxx
Xxxxxx, XX 00000
Attention: General Counsel
Xxxxxx: Xxxxxx Technology Company
000 Xxxxxx Xxxxxx
Xxxxxx Xxxxx, XX 00000
Attention: Hans Xxxxx Xxxxxxxxxxxxx
with a copy to: Xxxxxx Technology Company
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxx
16.2. If either or both Parties employ purchase orders or acknowledgment
forms or other commercial forms in the administering of this Agreement, none of
the terms and conditions printed or otherwise appearing on such forms will be
applicable except to the extent that they reflect quantity, destination, mode of
shipment, or timing of deliveries.
ARTICLE 17: ASSIGNMENT
----------------------
17.1. This Agreement is not assignable or transferable by either Party
hereto, in whole or in part, without the prior written consent of the other
Party, except
(a) to its existing affiliates or parents, and to any successor of
substantially all of its business, and assets of either Xxxxxx or Xxxxxx which
relate to Substance or Product, or
-23-
(b) in the case of Xxxxxx, in whole or in part to subsidiaries or
affiliates of which a majority stock is owned or controlled, of the voting
directly or indirectly, by Xxxxxx or by any company owning, directly or
indirectly, one hundred percent (100%) of Xxxxxx, or
(c) in the case of Xxxxxx, to subsidiaries or affiliates of which a
majority of the voting stock is owned or controlled, directly or indirectly, by
Xxxxxx or by any company owning, directly or indirectly, one hundred percent
(100%) of Xxxxxx, provided that no such agreement shall serve to release the
assigning Party from liability for its obligations hereunder; and
17.2. This Agreement shall be binding upon, and shall inure to the benefit
of, the respective successors and permitted assigns of the Parties.
ARTICLE 18: APPLICABLE LAW
--------------------------
18.1. Both Parties agree that, in the event of a dispute relating to this
Agreement, they are prepared to explore resolution of the dispute through
negotiation or Alternative Dispute Resolution (ADR) techniques before pursuing
full-scale litigation. No lawsuit may be commenced unless a Party gives the
other side fifteen (15) days notice of its intent to initiate litigation.
18.2. This Agreement will be interpreted in accordance with the state laws
of Delaware. Any lawsuit or application for judicial relief of interpretation
by the Parties relating to this Agreement will be filed only in the State of
Delaware. The Parties hereby consent to the jurisdiction of the State of
Delaware over them in matters relating to this Agreement including, but not
limited to, performance, nonperformance, enforcement or interpretation.
-24-
ARTICLE 19: SEVERABILITY
------------------------
This Agreement is intended to be valid and effective under any applicable
law and, to the extent permissible shall be construed to avoid violation of or
invalidity under any applicable law. Should any provisions of this Agreement be
or become invalid, illegal or unenforceable under any applicable law, the other
provisions of this Agreement shall not be affected and shall remain in full
force and effect and to the extent permissible under applicable law, any such
invalid, illegal or unenforceable provision shall be deemed lawfully amended to
conform with the intent of the Parties. Nothing in this Article shall preclude
a Party hereto from bringing an action for failure of consideration in the event
a material provision of this Agreement shall be held invalid, illegal or
unenforceable.
ARTICLE 20: ENTIRE AGREEMENT
----------------------------
This Agreement contains the sole and entire understanding of the Parties
related to its subject matter and supersedes all prior or contemporaneous oral
or written Agreements concerning the subject matter.
ARTICLE 21: MODIFICATION
------------------------
This Agreement cannot be changed orally and no modification of this
Agreement will be recognized or have any effect, unless the writing in which it
is set forth is signed by Xxxxxx and Xxxxxx, nor will any waiver of any of the
provisions of this Agreement be effective unless in writing and signed by the
Party to be charged therewith.
ARTICLE 22: WAIVER
------------------
The failure of either Party to enforce, at any time, or for any period of
time, the provisions hereof or failure of either Party to exercise any option
herein will not be construed as a waiver of such provision or option and will in
no way effect that Party's right to enforce such
-25-
provisions or exercise such option. No waiver of any provision hereof will be
deemed a waiver of any succeeding breach of the same or any other provisions of
this Agreement.
ARTICLE 23: HEADINGS
--------------------
The headings herein are for the purpose of convenience of reference only
and are not intended to define or limit the contents of this Agreement.
-26-
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
by their respective duly authorized officers as of the date first written above.
XXXXXX PHARMACEUTICAL, INC. XXXXXX TECHNOLOGY COMPANY
by Napp Technologies, Inc.,
its Managing General Partner
By: /s/ Xxxx X. Xxxxx By: /s/ H. P. Kircehigaessner
--------------------------- ------------------------------
Printed Name: Xxxx X. Xxxxx Printed Name: H.P. Kircehigassner
----------------- --------------------
Title: Vice President Secretary Title: President
------------------------ ---------------------------
Exhibit A
Nabumetone Raw Material Specifications
1. Label Nabumetone.
2. Manufacturer Xxxxxx Technology Company.
3. Appearance A white or almost white,
crystalline powder.
4. Identification [ /*/ ]
5. Chromatographic Purity [ /*/ ]
6. Nabumetone Alcohol [ /*/ ]%
7. Heavy Metals [ /*/ ]
8 . Residue On Ignition [ /*/ ]
9. Loss On Drying [ /*/ ]
10. Melting Range [ /*/ ]
11. Assay [ /*/ ]
12. Particle Size [ /*/ ]
13. Organic Volatile [ /*/ ]
Impurities,
Method IV:
/*/ Confidential portion has been omitted pursuant to a request for confidential
treatment and has been filed separately with the Commission.
Exhibit B
---------
NABUMETONE INVENTORY
--------------------
---------------------------------------------------------------------------------------------
LOCATION IN PRODUCT LOT NUMBER AMOUNT IN KGS
WAREHOUSE
---------------------------------------------------------------------------------------------
Mill Room NABUMETONE DRY NDCA-005 [ /*/ ]
---------------------------------------------------------------------------------------------
Xxxx Xxxx XXXXXXXXXX XXXXXX XXX-00000 [ /*/ ]
---------------------------------------------------------------------------------------------
5103 NABUMETONE DRY NDCA-002 [ /*/ ]
---------------------------------------------------------------------------------------------
5103 NABUMETONE MILLED NMEX-001 [ /*/ ]
---------------------------------------------------------------------------------------------
5103 NABUMETONE MILLED NMEX-001 [ /*/ ]
---------------------------------------------------------------------------------------------
5104 NABUMETONE MILLED NMCA-002 [ /*/ ]
---------------------------------------------------------------------------------------------
5104 NABUMETONE MILLED NMCA-002 [ /*/ ]
---------------------------------------------------------------------------------------------
5104 NABUMETONE MILLED NMCA-001 [ /*/ ]
---------------------------------------------------------------------------------------------
5105 NABUMETONE DRY NDCA-007 [ /*/ ]
---------------------------------------------------------------------------------------------
5105 NABUMETONE DRY NDCA-007 [ /*/ ]
---------------------------------------------------------------------------------------------
5105 NABUMETONE DRY NDCA-007 [ /*/ ]
---------------------------------------------------------------------------------------------
5105 NABUMETONE DRY NDCA-007 [ /*/ ]
---------------------------------------------------------------------------------------------
5106 NABUMETONE DRY NDCA-001 [ /*/ ]
---------------------------------------------------------------------------------------------
5107 NABUMETONE DRY NDCA-004 [ /*/ ]
---------------------------------------------------------------------------------------------
5107 NABUMETONE DRY NDCA-006 [ /*/ ]
---------------------------------------------------------------------------------------------
5107 NABUMETONE DRY NDCA-006 [ /*/ ]
---------------------------------------------------------------------------------------------
5107 NABUMETONE DRY NDCA-006 [ /*/ ]
---------------------------------------------------------------------------------------------
5108 NABUMETONE PURE NDCA-001 [ /*/ ]
---------------------------------------------------------------------------------------------
-----------------
/*/ Confidential portion has been omitted pursuant to a request for confidential
treatment and has been filed separately with the Commission.
---------------------------------------------------------------------------------------------
0000 XXXXXXXXXX XXXXXX XXX-00000 [ /*/ ]
---------------------------------------------------------------------------------------------
5108 NABUMETONE DRY NDCA-003 [ /*/ ]
---------------------------------------------------------------------------------------------
5108 NABUMETONE DRY NDCA-001 [ /*/ ]
---------------------------------------------------------------------------------------------
5109 NABUMETONE MILLED NMCB-007 [ /*/ ]
---------------------------------------------------------------------------------------------
5109 NABUMETONE MILLED NMCB-007 [ /*/ ]
---------------------------------------------------------------------------------------------
5109 NABUMETONE MILLED NMCB-007 [ /*/ ]
---------------------------------------------------------------------------------------------
0000 XXXXXXXXXX XXXXXX XXX-00000 [ /*/ ]
---------------------------------------------------------------------------------------------
0000 XXXXXXXXXX XXXXXX XXX-00000 [ /*/ ]
---------------------------------------------------------------------------------------------
------------------
/*/ Confidential portion has been omitted pursuant to a request for confidential
treatment and has been filed separately with the Commission.
APPENDIX TO FORM 10-K FILINGS TO DESCRIBE DIFFERENCES BETWEEN PRINTED AND
XXXXX-FILED TEXTS:
(1) Boldface typeface is displayed with capital letters, italic typeface is
displayed in normal type.
(2) Because the printed page breaks are not reflected, certain tabular and
columnar headings and symbols are displayed differently in this filing.
(3) Bullet points and similar graphic signals are omitted.
(4) Page numbering has been omitted.
(5) The registered xxxx symbol has been replaced by (R).
(6) The trade xxxx symbol has been replaced by (TM).
