EXHIBIT 10.5
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[CERTAIN INFORMATION HAS BEEN OMITTED HEREIN PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2. THE REDACTED MATERIAL
HAS BEEN SEPARATELY FILED WITH THE COMMISSION]
Agreement
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Between
SICOR S.p.A, with its registered office in Milan, Xxx Xxxxxx, 00, tax number
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IT06827530152 (hereinafter "Sicor"),
on the one side,
and
ALCO CHEMICALS Ltd., Swiss branch, with its registered office in Lugano
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(Switzerland), Via X. Xxxxxxxxx, 7 (hereinafter "Alco"),
on the other side.
Premises
- Whereas Sicor manufactures chemical products for the pharmaceutical industry
(hereinafter "Products");
- Whereas Alco has collaborated with Sicor for the marketing of the Products;
- Whereas the Parties intend for this Agreement to govern their relationship;
- Whereas Alco has the commercial know-how and the means necessary to
adequately carry out the promotion and sale of the Products;
- Whereas there existed a prior commercial relationship ("concessione di
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vendita") between the Parties, the nature of which is not to be considered an
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agency relationship ("rapporto di agenzia").
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In light of the above, the Parties hereby agree to the following:
1. APPOINTMENT AS AGENT
1.1 Sicor grants to Alco, which accepts, the appointment as agent without
representation powers and without exclusivity (Non-exclusive Agent) for the
worldwide sale, excluding customers that reside in or carry out their activity
in the countries listed in Appendix 1 (the borders shall be those in existence
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at the signing of this Agreement), of the Products listed in Appendix 2.
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1.2 Sicor reserves the right to exclude from this appointment the promotion and
sale of products listed in Appendix 2 with respect to certain customers with
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whom Sicor has a direct sales relationship and that, in total, do not represent
more than 10% of Sicor's annual sales revenue. For 1994, said customers are
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listed in Appendix 3. For subsequent years, Sicor shall notify Alco of the
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names of said customers on or before October 30th of each calendar year, for the
following year.
1.3 Alco, with reference to the Products listed in Appendix 2, shall be the
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exclusive agent with reference to customers located in or that carry out their
principle activity in the following countries: Japan, Korea, Taiwan (the borders
shall be those in existence at the signing of this Agreement).
1.4 Excluding the countries set forth in Article 1.3, for the purposes of this
Agreement (not applicable to the territories set forth in Appendix 1 and with
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respect to the customers set forth in Article 1.2), Sicor may promote the sale
of the Products directly or by means of third parties, notwithstanding Article
2.3.
2. RIGHTS OF ALCO
2.1 On the sales made on behalf of Sicor, Alco (whether as Exclusive Agent
pursuant to Article 1.3 or Non-exclusive Agent pursuant to Article 1.1.) shall
have the right to a commission of 5% on the annual sales revenue for properly
executed transactions or part thereof in the event the transaction has only been
partially executed.
No commission shall be owed to Alco in the event the sales are effectuated
at a price lower than that indicated on the Sicor-Alco price agreement in effect
at the time of sale.
Moreover, no commission shall be owed to Alco for any sales by Sicor to
customers set forth in Article 1.2.
2.2 Alco, upon the simple written request of Sicor, shall be subject to a "star
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del credere" and thus shall respond to Sicor with the proper execution of the
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matter. In such case, Alco shall have the right to a higher commission equal to
1% of the annual sales revenue.
2.3 On sales made by other agents on behalf of Sicor pursuant to Article 1.4 or
on sales made directly by Sicor, Alco, notwithstanding Article 1.2, shall have
the right to a commission equal to the positive difference, if any, between any
commissions owed by Sicor to other agents or intermediaries and 5% of annual
sales revenue for the duly executed transactions or part thereof in the event
the transaction has only been partially executed.
Thus for example, if for a given transaction a commission of 3% is owed to a
third party agent, Sicor shall owe a commission of 2% to Alco. However, if a
commission of 5% is owed to a third party agent, Sicor shall owe no commission
to Alco.
2.4 No commission shall be owed to Alco for sales made directly by Alco in its
capacity as a sales agent.
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2.5 Upon the request of Alco, Sicor undertakes to supply any requested
documents for the Products in the territories subject to this Agreement.
3. THE RESPONSIBILITIES OF ALCO
3.1 Alco undertakes the following:
3.1.1 Alco shall, for the duration of this Agreement, perform its duties
diligently and in good faith in order to increase sales of the Products.
3.1.2 Alco shall not take actions that would interfere or obstruct the sale of
the Products.
3.1.3 Alco shall be bound by the "star credere" in accordance with Article 2.2.
of this Agreement.
3.1.4 Alco shall observe all existing laws and regulations in all countries in
relation to the Products.
3.1.5 Alco shall not, for the duration of this Agreement, make or market
(whether directly or indirectly) any competing products.
3.1.6 Alco shall not imitate, produce or amend the Products.
3.1.7 Alco shall promote the sale of the Products using only the name and
trademark of Sicor. Alco shall not cancel or cover distinctive signs, including
but not limited to signs relative to any patents, trademarks or other
intellectual property owned by Sicor.
3.1.8 Alco shall notify Sicor no later than the end of October of each calendar
year, of the budget to be implemented for the following calendar year for each
of the Products.
3.1.9 Alco shall promptly transmit to Sicor the purchase orders it receives.
3.1.10 Alco guarantees that it will transmit sales orders of at least
$20,000,000.00 per year to Sicor. Said minimum may be modified by the
Parties at the end of each contractual period (as defined by Article 7.1),
by giving at least three (3) months notice.
3.1.11 Alco shall indemnify Sicor for any damages suffered due to negligence or
breach of obligations set forth in this Agreement or by Italian law.
[4.] PROMOTION OF PRODUCTS
4.1 Alco shall define with Sicor on or before the end of October of each year,
the promotion plan for the sale of the
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Products to be implemented the following calendar year. Said plan may be
modified on the basis of market conditions subject to the obligation of a
reasonably sufficient promotion in relation to the budget (Article 3.1.8 ) and
the minimum guaranteed sales revenue (Article 3.1.10).
4.2 All publicity and promotional activities of the Products must be pre-
approved by Sicor.
4.3 As otherwise agreed in writing, Alco shall be exclusively responsible for
the expenses of the agency relationship.
4.4 Alco undertakes to maintain, for the duration of this Agreement, sufficient
personnel and organization for the sale of the Products and in particular, to
maintain a sales network sufficient to perform its responsibilities on a timely
basis.
4.5 Alco shall provide Sicor with all information relating to the competitors,
manufacturing improvements and trends in offers and requests that impact the
market conditions. Alco shall also provide all other information relative to
this Agreement that Sicor may reasonably request.
5. PATENT RIGHTS
5.1 Sicor maintains exclusive ownership of industrial trademark and patent
rights in general, as well as the rights to brand-names. Alco shall enter into
all agreements with Sicor (including but not limited to licensing for use),
carry out all formalities and take all necessary or useful actions to safeguard
the Sicor's rights in the territory where Alco promotes the sale of the
Products.
5.2 Alco shall inform Sicor of all unauthorized uses of Sicor's trademark or
patent rights of which it becomes aware. Upon Sicor's request, Alco will
participate in suits, administrative proceedings and whatever else might be
reasonably necessary to protect Sicor's intellectual property rights (including
but not limited to trademarks) in the territory where Alco carries out its
activities.
6. EXCLUSION OF JOINT-VENTURE OR PARTNERSHIP
This Agreement is to be concluded between two companies without a dependent
relationship or some other subject in common and does not constitute an
association, partnership or joint-venture and, except where expressly agreed in
writing otherwise, neither of the Parties is authorized to act as the agent of
the other, make declarations to third parties, assume guarantees for the other's
account or in any way obligate the other to a third party.
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7. COMMENCEMENT AND TERMINATION OF THE AGREEMENT. TERMINATION CLAUSES.
WITHDRAWAL
7.1 This Agreement (except for any anticipated termination) will have a
duration of three (3) years, beginning January 1, 1994 and ending December 31,
1996, at which time it is understood that the Agreement will be automatically
renewed annually, unless a Party has given at least six (c) months notice of its
intention to terminate the Agreement.
7.2 In addition to those anticipated by the applicable law, Sicor can make use
of the following express termination clauses:
7.2.1 in the case of a breach by Alco of any of its obligations contained in
this Agreement (except as provided in Article 7.2.2), when Alco fails to meet
its obligations and within fifteen (15) days of Alco's receipt of a notice of
breach from Sicor;
7.2.2 whenever Alco, without the express written consent of Sicor, tries to
transfer or sell to a third party all or part of its rights and obligations
under this Agreement, or to assign a third party as sub-agent.
7.3 Moreover, Sicor can withdraw from the Agreement in the following cases:
7.3.1 whenever, as the result of the lack or cancellation of permits,
authorizations or licenses, Alco is not able to begin or to continue sales
promotion of some of the Products in some of its exclusive territory or in some
other territory where Alco, as an agent, undertakes activity related to the
Products;
7.3.2 whenever Alco is subject to proceedings executed individually or jointly,
or whenever operations are ceased for more than thirty (30) consecutive days
(except for the summer holidays);
7.3.3 whenever it is impossible or Alco is unable, to perform its obligations
under this Agreement;
7.3.4 whenever control of Alco passes to shareholders or others whom Sicor,
upon its sole evaluation, finds to be unsuitable;
8. THE EFFECTS OF TERMINATION OF THIS AGREEMENT
In any termination of this Agreement:
8.1 Alco shall return all materials of whatever nature in its possession or
control relative to the Products or to Sicor (except ordinary technical
correspondence between the Parties).
8.2 Alco shall lose all rights to the use of patents and trademarks possibly
granted in accordance with this Agreement and
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in particular, will stop using the name Sicor on its letterhead and on any other
material.
8.3 Alco, upon the simple request of Sicor, shall give to Sicor a complete list
containing the personal data and addresses of clients interested in the
Products.
8.4 Alco shall transfer to Sicor, renouncing any future use, all permits,
authorizations and licenses possibly granted to Alco by the competent
authorities with specific reference to the marketing of the Products.
8.5 Alco shall not have the right to any form of indemnity, except that
possibly made compulsory by the law concerning agency relationships.
9. OBLIGATIONS OF CONFIDENTIALITY
9.1 Alco shall rigorously maintain confidentiality. It shall not divulge to
third parties nor use itself, any information learned during the performance of
this Agreement relating to the Products, including techniques marketed, as well
as any information regarding Sicor - information communicated by Sicor or
obtained by Alco through any other means in order to effectuate this Agreement.
9.2 The confidentiality obligation referred to in Article 9.1 above, does not
include the information, or part thereof:
9.2.1 that is within the public domain, except that which has been made public
as a result of actions by Alco or by a person who answers to Alco;
9.2.2 that is made known and registered by Alco before communication on the
part of Sicor;
9.2.3 that is communicated to Alco by a source other than Sicor without some
violation of Alco's confidentiality obligation;
9.2.4 that is independently developed by Alco without having in any way
utilized the information received as a result of this Agreement.
10. NON-TRANSFERABILITY OF RIGHTS
The rights and obligations derived from this Agreement are personal to the
Parties and may not be transferred without the express written consent of the
other Party. Neither Party may transfer or sell to third parties all or part of
their rights and obligations under this Agreement. This excludes Alco's power
to discount matured credits with financial institutions for commissions.
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11. MISCELLANEOUS PROVISIONS
11.1 This Contract states and contains all the agreements in existence between
the Parties in reference to the Products and will be dated January 1, 1994. It
rescinds with a retroactive effect and substitutes all effects for, preceding
agreements, declarations and pledges between the Parties, whether written or
oral, made at any time, of any nature and content, concerning the subject
regulated by the present Agreement, except for the contract concerning the
agency arrangement ("la Concessione di Vendita," discussed in the premises.
11.2 The rights of the Parties provided for in this Agreement are not intended
to be in any way waived or limited in case of the tolerance by one of Parties
for the breach of the other. Similarly, a waiver of the enforcement of ones
rights following a breach shall not be considered a waiver with respect to
subsequent or repeated breaches.
11.3 Any modification, substitution or termination of this Agreement, in whole
or in part, must be in writing.
11.4 Any clauses of this Agreement that are found to be invalid or ineffective,
shall be stricken while all the other clauses remain valid and effective. Both
Parties are obliged to negotiate in good faith for a substitute for the invalid
or ineffective clause that can satisfy the legitimate interests of both Parties.
12. APPLICABLE LAW AND ARBITRATION CLAUSE
12.1 Italian law governs this Agreement.
12.2 Any controversies that might arise between the Parties concerning the
interpretation, execution or termination of this Agreement shall be settled by
an arbitration panel pursuant to the Italian Code of Civil Procedure. The panel
shall be composed of three (3) arbitrators, the first two (2) to be nominated by
the Parties and the third to be agreed upon by the first two or, in default, by
the President of the Court of Milan.
The applicable procedures shall be those established for international
arbitration pursuant to article 832 of the Italian Code of Civil Procedure, as
provided for by articles 816 to 831 of the Italian Code of Civil Procedure in so
far as they do not deviate from the norms of international arbitration.
The arbitration shall take place in Milan.
13. COMMUNICATIONS
13.1 Any communications made necessary by this Agreement shall be sent by
registered mail, return receipt requested, to the following addresses:
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- to Sicor at Xxx Xxxxxx, 00, Xxxxx
- to Alco at Xxx X. Xxxxxxxxx, 0, Xxxxxx Paradiso
13.2 Or at whatever other address for communications the other Party has
provided in accordance with Article 13.1 above.
Lugano, January 1, 1994
signed by Sicor /s/ Xxxxxxx Xxxxxxxxx
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Alco /s/Xxxxx Xxxxx
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APPENDIX 1
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EXCLUDED COUNTRIES
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ITALY
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APPENDIX 2
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PRODUCT LIST
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CORTICOSTEROIDS
AMCINONIDE
BECLOMETHASONE DIPROPIONATE
BETAMETHASONE
BETAMETHASONE ACETATE
BETAMETHASONE BENZOATE
BETAMETHASONE DIPROPIONATE
BETAMETHASONE SODIUM PHOSPHATE
BETAMETHASONE VALERATE
CLOBETASOL PROPIONATE
CLOBETASONE BUTYRATE
DEFLAZACORT
DESONIDE
DESONIDE PIVALATE
DESONIDE SODIUM PHOSPHATE
DESOXIMETHASONE
DEXAMETHASONE
DEXAMETHASONE ACETATE
DEXAMETHASONE DIPROPIONATE
DEXAMETHASONE ISONICOTINATE
DEXAMETHASONE PIVALATE
DEXAMETHASONE SODIM PHOSPHATE
DEXAMETHASONE VALERATE
DIFLORASONE DIACETATE
DIFLUCORTOLONE VALERATE
FLUMETHASONE
FLUMETHASONE PIVALATE
FLUNISOLIDE ANHYDROUS
FLUOCINOLONE ACETONIDE
FLUOCINONIDE
FLUOROMETHOLONE
FLURANDRENOLIDE
HALCINONIDE
HYDROCORTISONE BUTYRATE
HYDROCORTISONE HEMISUCCINATE
HYDROCORTISONE SODIUM SUCCINATE BUFFERED
METHYLPREDNISOLONE
METHYLPREDNISOLONE ACETATE
METHYLPREDNISOLONE HEMISUCCINATE
METHYLPREDNISOLONE SODIUM SUCCINATE
METHYLPREDNISOLONE SODIUM SUCCINATE BUFFERED
PREDNISOLONE VALERATE ACETATE
TRIAMCINOLONE
TRIAMCINOLONE ACETONIDE
TRIAMCINOLONE DIACETATE
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TRIAMCINOLONE HEXACETONIDE
ANTIBIOTICS
BLEOMYCIN SULFATE
DAUNORUBICIN HYDROCHLORIDE
MITOMYCIN
HORMONES
CHLORMADINONE ACETATE
MEDROGESTONE
MEDROXYPROGESTERONE ACETATE
MEGESTROL ACETATE
OTHER PRODUCTS
PANCURONIUM BROMIDE
VECURONIUM BROMIDE
PIPECURONIUM BROMIDE
ATRACURIUM BESYLATE
MEPITIOSTANE
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APPENDIX 3
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EXCLUDED CLIENTS
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[CONFIDENTIAL TREATMENT REQUESTED]
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[Sicor S.p.A. Logo]
ALCO CHEMICALS LTD.
SWISS BRANCH
Xxx Xxx Xxxxxxxxx
00000 Lugano
January 2, 1996
MODIFICATION OF AGENCY AGREEMENT
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In regard to our agency agreement currently in force, signed on January 1,
1994, following up on the agreements made, I advise you that, effective January
1, 1996:
(i) your commission set forth in Article 2.3 of the agency agreement is
reduced from 5% to 3.5% and
(ii) the increase in commission for possible "del credere" guarantees, set
forth in Article 2.2 of the agreement, is reduced from 1% to 0.75%.
All the remaining provisions remain in effect and are confirmed.
We ask that you show your acceptance by sending a letter transcribing the
present terms and signed by you.
With best regards,
Sicor SpA
/s/ Xx. Xxxxxxx Xxxxxxxxx
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ALCO CHEMICALS LTD. [Logo] Swiss branch
FINE CHEMICALS AND PHARMACEUTICALS
SICOR SOCIETA ITALIANA
CORTICOSTEROIDI SPA
Xxx Xxxxxxxxx 0
X-00000 XXX (XX)
Lugano, January 15, 1996
AMENDMENT TO AGENCY AGREEMENT
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Dear Sirs:
We are in receipt of your letter of January 9, 1996 containing the following
text:
"In regard to our agency agreement currently in force, signed on January 1,
1994, following up on the agreements made, I advise you that, effective January
1, 1996:
(i) your commission set forth in Article 2.3 of the agency agreement is
reduced from 5% to 3.5% and
(ii) the increase in commission for possible "del credere" guarantees, set
forth in Article 2.2 of the agreement, is reduced from 1% to 0.75%.
All the remaining provisions remain in effect and are confirmed."
We confirm for you our approval of the foregoing and send you our most
cordial regards.
ALCO CHEMICALS LTD
/s/ Xxxxx Xxxxx
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