EXHIBIT 10.25
EXECUTION COPY
MASTER DEVELOPMENT, LICENSE AND SUPPLY AGREEMENT
by and between
CIMA LABS INC.
and
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]
dated as of December 18, 2001
TABLE OF CONTENTS
PAGE
SECTION 1 DEFINITIONS................................................................................1
SECTION 2 GRANT OF LICENSES; LICENSE OPTION..........................................................5
2.1 Grant of Licenses..............................................................................5
2.2 Sublicenses....................................................................................6
2.3 Marketing, Distribution and Sale...............................................................6
SECTION 3 PRODUCT DEVELOPMENT........................................................................6
3.1 Obligations of CIMA............................................................................6
3.2 Obligations of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***]...............................................7
3.3 License of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.***] Technology.........................................7
3.4 Additional Products............................................................................7
3.5 Regulatory Matters.............................................................................7
SECTION 4 ROYALTY, COST OF GOODS AND MILESTONE PAYMENTS..............................................7
4.1 Royalty and Milestone Payments.................................................................7
4.2 Records and Audit..............................................................................8
4.3 Quarterly Reports of Royalties.................................................................9
4.4 Annual Reports of Costs of Goods...............................................................9
4.5 Sales and Marketing Estimates..................................................................9
SECTION 5 SUPPLY OF PRODUCT..........................................................................9
5.1 Supply of Product..............................................................................9
5.2 Identification................................................................................10
5.3 Trade, Sample and Placebo Product Price.......................................................11
5.4 Forecasts, Delivery and Quality...............................................................11
5.5 Rejection and Replacement.....................................................................11
5.6 Invoice and Payment...........................................................................12
5.7 Supply Disruption; Alternate Manufacturing Site...............................................12
5.8 CIMA's Obligation to Continue Manufacture.....................................................12
SECTION 6 CONDITIONS PRECEDENT TO THE CLOSING; CLOSING DATE.........................................13
6.1 Conditions Precedent to [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]'s Obligations.....................13
TABLE OF CONTENTS
(continued)
PAGE
6.2 Conditions Precedent to CIMA's Obligations....................................................13
6.3 Closing Date..................................................................................14
SECTION 7 REPRESENTATIONS AND WARRANTIES OF CIMA....................................................14
7.1 Organization, Power and Authority.............................................................14
7.2 Due Authority; No Breach......................................................................15
7.3 Intellectual Property.........................................................................15
7.4 Technology Rights.............................................................................15
7.5 Litigation....................................................................................16
7.6 Governmental Approval.........................................................................16
7.7 Brokerage.....................................................................................16
7.8 Supply........................................................................................16
SECTION 8 REPRESENTATIONS AND WARRANTIES OF [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***].................16
8.1 Organization, Power and Authority.............................................................16
8.2 Due Authority; No Breach......................................................................16
8.3 Brokerage.....................................................................................17
8.4 Litigation....................................................................................17
8.5 Governmental Approval.........................................................................17
SECTION 9 ADDITIONAL COVENANTS AND AGREEMENTS OF THE PARTIES........................................17
9.1 Governmental Filings..........................................................................17
9.2 Compliance with Law...........................................................................18
9.3 Recall........................................................................................18
9.4 Confidentiality...............................................................................18
9.5 Expenses......................................................................................19
9.6 Reasonable Efforts............................................................................19
9.7 Publicity.....................................................................................19
9.8 Cooperation...................................................................................19
9.9 Competition; No Sale for Resale...............................................................20
9.10 Conflicting Rights............................................................................20
9.11 Patent and Trademark Maintenance..............................................................20
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TABLE OF CONTENTS
(continued)
PAGE
9.12 Infringement; Enforcement of Proprietary Rights...............................................22
9.13 Supply of Products............................................................................22
9.14 Liability Insurance...........................................................................22
9.15 Referral of Orders and Inquiries..............................................................22
9.16 Deemed Breach of Covenant.....................................................................23
SECTION 10 INDEMNIFICATION...........................................................................23
10.1 Indemnification...............................................................................23
10.2 Notice and Opportunity To Defend..............................................................23
10.3 Indemnification Payment Obligation............................................................24
10.4 Indemnification Payment Adjustments...........................................................24
10.5 Indemnification Payment.......................................................................25
10.6 Survival......................................................................................25
SECTION 11 TERMINATION...............................................................................25
11.1 Termination...................................................................................25
SECTION 12 MISCELLANEOUS.............................................................................27
12.1 Successors and Assigns........................................................................27
12.2 Notices.......................................................................................27
12.3 Waiver; Remedies..............................................................................28
12.4 Survival of Representations...................................................................28
12.5 Independent Contractors.......................................................................28
12.6 Entire Agreement..............................................................................28
12.7 Amendment.....................................................................................28
12.8 Counterparts..................................................................................28
12.9 Governing Law.................................................................................28
12.10 Arbitration...................................................................................28
12.11 Captions......................................................................................29
12.12 No Third-Party Rights.........................................................................29
12.13 Severability..................................................................................29
12.14 Attachments...................................................................................29
12.15 Force Majeure.................................................................................29
12.16 Consents......................................................................................29
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TABLE OF CONTENTS
(continued)
PAGE
SCHEDULES
Schedule 3.1......Master Development Schedule
Schedule 4.1(a)...Royalty Rates
Schedule 4.1(b)...Development Fee and Milestone Payments
Schedule 5.1(b)...[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] Purchase Order
Schedule 5.3......Cost of Goods
Schedule 5.4(d)...Quality Assurance Addendum
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MASTER DEVELOPMENT, LICENSE AND SUPPLY AGREEMENT
This MASTER DEVELOPMENT, LICENSE AND SUPPLY AGREEMENT (this
"Agreement"), dated as of December 18, 2001, is by and between CIMA LABS INC., a
Delaware corporation ("CIMA"), and [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], a
Delaware corporation ("[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]").
W I T N E S S E T H
WHEREAS, CIMA is engaged, among other things, in the business of
research, development, manufacturing and commercialization of pharmaceutical
products through its proprietary drug delivery technologies;
WHEREAS, [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] is engaged, among
other things, in the business of marketing and selling of pharmaceutical
products;
WHEREAS, subject to the terms and conditions set forth in this
Agreement, CIMA and [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] wish to collaborate
in the development, registration, marketing and sale of certain prescription
products; and
WHEREAS, subject to the terms and conditions set forth in this
Agreement, CIMA wishes to license to [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] and [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] wishes to license
from CIMA rights to CIMA's DuraSolv(TM), PakSolv(TM) and OraSolv(TM)
technologies for use with such prescription products.
NOW, THEREFORE, the parties hereto, intending to be legally bound,
hereby agree as follows:
SECTION 1
DEFINITIONS
For purposes of this Agreement, the following terms shall have the
meanings set forth below:
"Activities" shall mean the development, manufacturing, marketing,
selling and distributing of the Products in the Territory as contemplated by
this Agreement.
"Affiliates" shall mean, with respect to any Person, any Persons
directly or indirectly controlling, controlled by, or under common control with,
such other Person. For purposes hereof, the term "controlled" (including the
terms "controlled by" and "under common control with"), as used with respect to
any Person, shall mean the direct or indirect ability or power to direct or
cause the direction of management policies of such Person or otherwise direct
the affairs of such Person, whether through ownership of voting securities or
otherwise.
"Annual Net Sales" shall mean, for any Year, the Net Sales for such
Year.
"API" for each Product shall mean the active ingredient specified on
Schedule 3.1 hereto with respect to such Product.
"cGMP" shall mean current Good Manufacturing Practices, as determined
by the FDA from time to time.
"CIMA" shall have the meaning given in the preamble and shall include
its Affiliates.
"CIMA Intellectual Property" shall mean, collectively, (i) the CIMA
Patents, (ii) the CIMA Technology, (iii) the CIMA Trademarks, and (iv) the CIMA
Marketing Materials.
"CIMA Marketing and Market Research Data" shall mean, with respect to
the Products, all CIMA marketing data, studies, market research data and reports
that pertain to the Products, and any further market research data that pertains
to the Products whose disclosure to [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] is not prohibited by confidentiality obligations under
agreements, dated prior to the date hereof, between CIMA and Persons who are not
Affiliates of CIMA.
"CIMA Marketing Materials" shall mean all labeling, marketing and
promotional materials and inserts currently used by CIMA that are useful in
connection with the Activities.
"CIMA Patents" shall mean United States patent nos. 6,024,981 and
6,221,392 (Rapidly Dissolving Robust Dosage Form) and any patents and patent
applications resulting therefrom, including any extension, reissue, renewal,
reexamination or continuation-in-part of such patent or patent application. To
the extent that the OraSolv(R) and PakSolv(TM) technology is used with respect
to any Product pursuant to Schedule 3.1, the term "CIMA Patents" shall, with
respect to such Product, be deemed to include United States patent nos.
5,178,878, 6,155,423, 6,269,615 and 6,311,462 and any patents and patent
applications resulting therefrom, including any extension, reissue, renewal,
reexamination or continuation-in-part of such patent or patent application.
"CIMA Technology" shall mean all of the CIMA Patents and all of CIMA's
trade secrets, technology, know-how and all other information necessary for the
manufacture of the Products including, without limitation, that relate to CIMA's
DuraSolv(R), PakSolv(TM) and OraSolv(R) technologies.
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"CIMA Trademarks" shall mean the CIMA(R), DuraSolv(R), PakSolv(TM) ,
OraSolv(R) and Meltabs(R) trademarks.
"Closing Date" shall have the meaning given in Section 6.3 hereof.
"Completion Date" shall mean, with respect to any Product, the date on
which [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] determines, in its reasonable
discretion, such Product is ready for submission to the FDA with three months
stability data on the pilot scale (equal to [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***], whichever is greater).
"Cost of Goods" shall have the meaning set forth on Schedule 5.3
hereto.
"Damages" shall mean any and all actions, costs, losses, claims,
liabilities, fines, penalties, demands, damages and expenses, court costs, and
reasonable fees and disbursements of counsel, consultants and expert witnesses
incurred by a party hereto (including interest which may be imposed in
connection therewith), but excluding any punitive, exemplary or consequential
damages.
"Defective" shall mean, as to the Product, the failure of such to
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] conform to the Specifications, this
Agreement and all applicable law, including, without limitation, the FFDCA and
the PDMA.
"Development Schedule" shall mean the schedule of development
activities set forth on Schedule 3.1 hereto.
"FDA" shall mean the United States Food and Drug Administration.
"FFDCA" the United State Federal Food, Drug and Cosmetic Act, as
amended from time to time, together with any rules or regulations promulgated
thereunder.
"Force Majeure" shall mean acts of God, explosion, fire, flood,
tornadoes, thunderstorms, earthquake or tremor, war whether declared or not,
terrorism, civil strife, riots, embargo, losses or shortages of power, labor
stoppage, substance shortages, damage to or loss of product in transit, currency
restrictions, or events caused by reason of laws, regulations or orders by any
government, governmental agency or instrumentality or by any other supervening
or unforeseeable circumstances reasonably beyond the control of each party.
"GAAP" shall mean generally accepted accounting practices in the United
States as in effect from time to time.
"Indemnified Party" shall have the meaning given in Section 10.2
hereof.
"Indemnifying Party" shall have the meaning given in Section 10.2
hereof.
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"Latent Defect" shall mean a defect that results in a recall under
Section 9.3.
"Launch or Launched" shall mean, with respect to each Product, the date
when such Product is first made commercially available by [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***]
"Licensed Assets" shall have the meaning set forth in Section 2.1
hereof.
"Net Sales" shall mean, with respect to the Products, the gross amount
invoiced to unrelated third parties for the Products in the Territory, less:
(a) trade and reasonable and customary cash discounts allowed;
(b) refunds, rebates, chargebacks, retroactive price
adjustments and any other allowances which effectively reduce the net
selling price;
(c) returns, credits and allowances; and
(d) freight, taxes and insurance.
Such amounts shall be determined from books and records maintained in accordance
with GAAP, consistently applied.
"PDMA" shall mean the Prescription Drug Marketing Act of 1987, as
amended from time to time, together with any rules or regulations promulgated
thereunder.
"Person" shall mean a natural person, a corporation, a partnership, a
trust, a joint venture, a limited liability company, any governmental authority
or any other entity or organization.
"Product" shall mean any of the pharmaceutical products described on
Schedule 3.1, it being understood that additional products may be added to
Schedule 3.1 after the date hereof in accordance with Section 3.4.
"Promotional Materials" shall mean any advertising and promotional
labeling bearing a name (trade name or generic name) used in the promotion of
any of the Products, including, without limitation, promotional materials
produced by or on behalf of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]
(examples include, but are not limited to, journal ads, brochures, service
items, managed care pull through sheets, formulary presentations, price lists,
monographs, Internet pages and telephone or television advertisements) and
materials produced by outside sources (examples include, but are not limited to,
medical reprints, textbooks and CME materials) to the extent funded by, created
in cooperation with, reviewed, or distributed by [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***]. The definition of Promotional Materials shall also include
press releases and other releases of information to the media regarding the
Products.
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"Quarter" shall mean, as the case may be, the three months ending on
March 31, June 30, September 30 or December 31 in any Year.
"Satisfactory Completion" shall mean, with respect to any Development
Phase for any Product, the completion of such Development Phase in a manner that
is: (i) appropriate to support the commercialization of the Product; (ii)
appropriate for the completion of the development of such Product on, prior to,
or within [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] of the target Completion Date
set forth in respect of such Product on Schedule 3.1; and (iii) consistent with
this Agreement.
"[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***]" shall have the meaning given
in the preamble and shall include its Affiliates.
"[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] Technology" shall mean all of
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***]'s patents, trade secrets, technology,
know-how and all other information necessary to the manufacture of the Products.
"[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] Trademarks" shall have the
meaning given in Section 9.11(c).
"Specifications" shall mean with respect to any Product, at any time,
the specifications for such Product that are included in the Quality Assurance
Addendum set forth on Schedule 5.4(d).
"Territory" shall mean Canada, Mexico and the fifty (50) states, the
District of Columbia and the territories and possessions comprising the United
States of America, including Puerto Rico.
"Year" shall mean a calendar year during the term of this Agreement.
SECTION 2
GRANT OF LICENSES; LICENSE OPTION
2.1 Grant of Licenses.
(a) CIMA hereby grants to [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] an exclusive license for the term of this
Agreement under the following assets to market, distribute and sell the
Products,
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for all indications and for all agreed upon Product line extensions, in
the Territory (such assets are referred to herein collectively as the
"Licensed Assets"):
(i) all current and future regulatory filings,
approvals, registrations and governmental authorizations that
relate to the Products in the Territory;
(ii) the CIMA Intellectual Property; and
(iii) the CIMA Marketing and Market Research Data.
(b) CIMA grants to [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] an exclusive, royalty bearing license to use the CIMA
Trademarks to market, distribute and sell the Products, during the term
of this Agreement, for all indications and for all agreed upon Product
line extensions in the Territory.
(c) The license to [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] will be exclusive in that CIMA will not grant any
licenses of the Licensed Assets or the CIMA Trademarks (i) in the
Territory to any other Person with respect to the Products or any other
products containing the same active ingredient [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] as any Product or (ii) anywhere
in the world with respect to any products having an identical
formulation as any Product, in each case, during the term of this
Agreement
(d) In the event that a third party is interested in
developing, manufacturing or marketing an equivalent formulation of a
Product outside the Territory, CIMA and [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] agree as follows:
(i) CIMA shall be entitled to solicit interest and enter initial
discussions with any third parties for making a product having
a formulation equivalent to that of a Product commercially
available in any country or countries outside the Territory;
(ii) upon receiving a bona fide proposal from a third party for the
development and/or license of a formulation equivalent to that
of a Product, but prior to initiating development activities
or granting a license to such third party for such equivalent
formulation, CIMA shall provide [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] a notice (a "License
Notice") of its intent to initiate development activities or
grant such license in a specific country or countries which
shall identify such country or countries and shall describe in
detail the formulation proposed to be licensed; and
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(iii) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]
shall provide CIMA a notice within forty-five (45) days of its
receipt of the License Notice that either: A) [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] does not intend to
market the Product in such country or countries, in which case
CIMA shall be free to initiate development activities and/or
license the formulation described in the License Notice to a
third party; or B) [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] does intend to market the Product in
such country or countries, in which case this Agreement shall
be amended to include such country or countries in the
Territory and to allow CIMA to perform any necessary
development work. [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] shall have one (1) year from the date
of its notice to CIMA to demonstrate significant progress
towards bringing the Product to market in such country or
countries. If [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] fails to demonstrate significant progress
within one (1) year or fails thereafter to demonstrate
continued activities to market the Product in such country or
countries, [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***]'s license to the Product in that country or
countries will terminate in thirty (30) days after
re-notification by CIMA that [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] is not in compliance
with this Section 2.1(d)(iii).
2.2 Sublicenses. [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall have the
right to extend the licenses granted pursuant to this Section 2 in whole or in
part to any Affiliate of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], provided that
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] is not then in default with respect to
any of its obligations to CIMA under this Agreement. All the terms and
provisions of this Agreement shall apply to the Affiliate to which this license
has been extended to the same extent as they apply to [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***], and the operations of the Affiliate shall be deemed to be the
operations of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] and [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION
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OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall
account therefor and be responsible for the performance of such Affiliate of all
of its obligations hereunder. In addition, [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] shall have the right to extend the licenses granted pursuant to
this Section 2 in whole or in part to Persons who are not Affiliates of
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] with the prior written consent of CIMA,
which consent shall not unreasonably be withheld or delayed.
2.3 Marketing, Distribution and Sale. After each Launch,
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] shall use its commercially reasonable
efforts to market, distribute and sell the launched Product in the Territory.
Such efforts shall be consistent with industry norms, given the product profile,
product potential and the state of the market at Launch.
SECTION 3
PRODUCT DEVELOPMENT
3.1 Obligations of CIMA. CIMA shall be responsible for the satisfactory
performance of each of the development activities set forth on Schedule 3.1 at
least by the times set forth on Schedule 3.1.
3.2 Obligations of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***].
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] shall, in a timely fashion, supply CIMA
or cause CIMA to be supplied with sufficient quantities of API for CIMA to
perform the development activities described on Schedule 3.1 and the supply
activities described in Sections 5.1 and 5.5.
3.3 License of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] Technology.
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] hereby grants to CIMA a non-exclusive
license under the [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] Technology so that
CIMA may carry out its obligations under Section 3.1. Such license may not be
sublicensed without the prior written consent of [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***].
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3.4 Additional Products. [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] may,
with the prior written consent of CIMA, such consent not to be unreasonably
withheld, supplement Schedule 3.1 after the date hereof by adding additional
products thereto in order to increase the number of Products subject to this
Agreement or to replace any Product previously terminated under Section 11.1 (c)
or (d), in which case each such additional product(s) shall be deemed a
"Product" within the meaning hereof, provided that any Product added pursuant to
this Section 3.4 shall be subject to terms, including development schedules,
comparable to then existing Products. This Agreement shall be amended as
necessary to accommodate such additional or replacement Products and terms
related thereto.
3.5 Regulatory Matters. All Product, other than Prototypes, supplied to
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] shall be produced under cGMP and in
accordance with the Specifications. CIMA shall furnish [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] with a Certificate of Analysis with a cGMP statement to
demonstrate that each shipment of Product has been manufactured under cGMP and
other FDA guidelines and in accordance with the Specifications. In addition,
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] reserves the right, at its own expense,
to audit the facility of CIMA, including its processes, records and other facets
of the operation as may be necessary to assure that all applicable regulations
have been complied with, and the Specifications have been met. CIMA shall permit
duly authorized representatives of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] to
audit all manufacturing and processing operations at reasonable times with a
prior appointment. The right to audit shall commence with the effective date of
this Agreement. These audits will be conducted to assure compliance with all
pertinent acts, regulations, and guidelines promulgated by the FDA and other
regulatory authorities, as well as standards then in effect in the regulatory
environment. Such audits will be permitted during normal business hours and will
be performed with a minimum of disruption.
SECTION 4
ROYALTY, COST OF GOODS AND MILESTONE PAYMENTS
4.1 Royalty and Milestone Payments.
(a) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall make royalty
payments to CIMA, at the times, in the amounts and subject to the conditions set
forth on Schedule 4.1(a).
-9-
(b) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall make Milestone
Payments and Development Fee Payments to CIMA as set forth on Schedule 4.1(b).
(c) In the event of (i) any patent infringement of the CIMA Technology
that has a materially adverse effect on any Product, and/or (ii) the occurrence
of an interruption in the supply of any Product for a period of [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] or more, then, in each case, the obligation of
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] to make any payments pursuant to
Sections 4.1(a) or 4.1(b) or Schedules 4.1(a) or 4.1(b) shall, in each case,
terminate with respect to such Product(s) and be deemed waived by CIMA and shall
be promptly renegotiated in good faith by [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] and CIMA. Any renegotiated obligations pursuant to this Section
4.1(c) shall be retroactively effective to the date the applicable event
described above occurred.
4.2 Records and Audit.
(a) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] and its Affiliates
shall keep full, true and accurate books of account containing all particulars
that may be necessary for the purpose of showing the amounts payable to CIMA
hereunder. Such books of account shall be kept at [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***]'s principal place of business or the principal place of business
of the appropriate Affiliate of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] to
which this Agreement relates. Such books and the supporting data shall be open,
at all reasonable times and upon reasonable notice during the term of this
Agreement and for 2 years after its termination, to the inspection by a firm of
certified public accountants selected by CIMA and reasonably acceptable to
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***], for the limited purpose of verifying
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***]'s royalty statements; provided, however,
that such examination shall not take place more often than once each Year and
shall not cover more than the preceding 3 Years, with no right to audit any
period previously audited. Except as otherwise provided in this Section, the
cost of any such examination shall be paid by CIMA. In the event that any such
inspection reveals a deficiency in excess of [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] of the reported royalty for the period covered by the
inspection, [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall promptly pay
CIMA the deficiency, plus interest at the
-10-
rate of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] per annum, and shall reimburse
CIMA for the fees and expenses paid to such accountants in connection with their
inspection. In the event that any such inspection reveals a deficiency that is
less than [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] of the reported royalty for the
period covered by the inspection, [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall
promptly pay CIMA the deficiency, plus interest at the rate of [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] per annum. The parties agree that neither party shall
be required to retain books and records with respect to the above other than
books and records relating to the current Year and the immediately preceding 3
Years.
(b) CIMA shall keep full, true and accurate books and records that may
be necessary for the purpose of determining the actual Costs of Goods incurred
by CIMA as contemplated hereunder. Such books and records shall be kept at
CIMA's principal place of business. Such books and records and the supporting
data shall be open, at all reasonable times and upon reasonable notice during
the term of this Agreement and for 2 years after its termination, to inspection
by a firm of certified public accountants selected by [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] and reasonably acceptable to CIMA, for the limited purpose of
verifying CIMA's Costs of Goods; provided, however, that such examination shall
not take place more often than once each Year and shall not cover more than the
preceding 3 Years, with no right to audit any period previously audited. Except
as otherwise provided in this Section, the cost of any such examination shall be
paid by [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***]. In the event that any such
inspection reveals a discrepancy between CIMA's actual Costs of Goods and that
invoiced to [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], in favor of CIMA,
in excess of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] of the reported
Costs of Goods for the period covered by the inspection, CIMA shall promptly pay
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] the amount of such discrepancy, plus
interest at the rate of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] per annum, and
shall reimburse [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] for the fees and
expenses paid to such accountants in connection with their inspection. In the
event that any such inspection reveals a discrepancy between CIMA's actual Costs
of Goods and that invoiced to [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], in
favor of CIMA, that is less than [***CONFIDENTIAL TREATMENT
-11-
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] of the reported Cost of Goods for the period covered by the
inspection, CIMA shall promptly pay [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] the amount of such discrepancy, plus interest at the rate of
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] per annum. The parties agree that
neither party shall be required to retain books and records with respect to the
above other than books and records relating to the current Year and the
immediately preceding 3 Years.
4.3 Quarterly Reports of Royalties. In any Year, [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] shall, within sixty (60) days after the end of each
Quarter, deliver to CIMA true and accurate reports, certified by an authorized
official of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], setting forth the
actual Annual Net Sales and total royalties due under Section 4.1(a) for such
Year. If no royalties are due, [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall
so report.
4.4 Annual Reports of Costs of Goods. CIMA shall, not later than 60
days prior to the Launch of each Product and, thereafter, not later than 60 days
after January 1 of each Year, deliver to [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] true and accurate reports, certified by an authorized official
of CIMA, setting forth in reasonable detail the information necessary to
calculate the Cost of Goods for each Product in accordance with Schedule 5.3.
Product delivered to [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] between January 1
and February 28 each year shall be invoiced to [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] at the price applicable to Product delivered to [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] during the immediately preceding calendar year. Then on
or about February 28 of each year CIMA shall transmit to [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] a corrected invoice for Product delivered between
January 1 and February 28 of each year taking into account the final amount of
any such price increase or decrease, and setting forth the applicable additional
charges or credits.
4.5 Sales and Marketing Estimates. [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] shall provide CIMA with a non-binding estimate of its Annual Net
Sales by quarter for each Product [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND
-12-
EXCHANGE COMMISSION.***] prior to the Launch of each Product. Thereafter, prior
to September 30th in any year following the Launch of such Product,
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] shall provide CIMA with non-binding
estimate of its Annual Net Sales of such Product by quarter for the following
year.
SECTION 5
SUPPLY OF PRODUCT
5.1 Supply of Product.
(a) For the term of this Agreement, or for as long as CIMA manufactures
any of the Products hereunder, whichever is shorter, [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] agrees to purchase from CIMA and CIMA agrees to supply
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] with all of [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***]'s requirements for the Products, Product samples and Product
placebos for their subsequent use, sale, lease or transfer by [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***].
(b) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] agrees to initiate
purchases of the Products, Product samples and Product placebos hereunder by
issuing CIMA binding purchase orders not less than [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] prior to the required shipping date set forth therein. CIMA
agrees to accept any order issued in accordance with this Section 5.1(b) and to
meet the delivery dates specified thereon. All purchase orders hereunder shall
be on [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***]'s standard purchase order form
(a copy of which is attached as Schedule 5.1(b) hereto and which shall not, for
purposes of this Agreement only, be modified in any material respect without
CIMA's prior written consent, such consent not to be unreasonably withheld or
delayed) and shall be directed to CIMA at the address set forth below. The terms
and conditions of purchase enumerated on the reverse side of such standard
purchase order form shall prevail over any inconsistent or conflicting language
as may exist on invoices, confirmation or order acknowledgment forms of CIMA,
provided, however, that in the event any terms thereof are in conflict, or are
inconsistent with any terms of this Agreement, the terms and conditions hereof
shall prevail. No Product delivered by CIMA shall have a shelf life that is more
than [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE
-13-
COMMISSION.***] less than the maximum shelf life of such Product (other than
batches that were under investigation and batches for validation which shall
have not more than [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] less than the
maximum shelf life of such Product upon delivery to [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***]).
(c) Purchase order quantities shall be in full batch sizes that are
mutually agreed by the parties.
(d) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall cause the
amount of API that CIMA requires to perform its obligations pursuant to Schedule
3.1 and Sections 5.1 and 5.5 to be provided at no charge to CIMA
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] prior to date of tablet manufacture, as
well as [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] of safety stock. API must
conform to [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]'s then current raw
materials specifications. CIMA shall not be accountable for production or
shipment delays due to lack of API.
(e) EXCEPT AS SPECIFICALLY PROVIDED HEREIN, INCLUDING, WITHOUT
LIMITATION, SECTION 7.8, THE PRODUCT WILL BE SUPPLIED BY CIMA WITH NO WARRANTIES
OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABLILITY OR
FITNESS FOR A PARTICULAR PURPOSE.
5.2 Identification. [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] may
market the Products under its name, with its packaging and logo;
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] will, however, identify CIMA as the
supplier in a fair manner, reasonably acceptable to CIMA. CIMA will bear all the
costs of labeling the Product so as to appropriately display the
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] name provided [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] supplies all the appropriate graphics, designs, logos and
related and appropriate artwork at least a reasonable amount of time in advance
of any Product being manufactured. [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall
reimburse CIMA for any reasonable and documented costs incurred by CIMA in
making changes to the packaging required to manufacture the Products in
accordance with changes to the
-14-
PDMA or other applicable law or changes required by [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***], including, but not limited to plate and die charges due to
label changes and product identification requirements, and for any packaging
components rendered obsolete by the changes. In addition, CIMA shall pay for all
initial one-time set-up charges incurred by CIMA in respect of packaging each
Product. [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] may use CIMA's name and
derivations thereof in promoting, marketing and selling the Products in the
Territory; provided, however, that the particular formulation of any reference
to CIMA's name in any Promotional Material shall be subject to CIMA's review and
consent; and provided, further, that once the formulation of any such reference
has been reviewed and consented to by CIMA, any subsequent reference to CIMA's
name using such formulation shall not be subject to the further review or
consent of CIMA. All samples shall be clearly marked "for sample use only" or
some similar phrasing suggested by [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***].
5.3 Trade, Sample and Placebo Product Price. CIMA shall supply
Products, Product samples and Product placebos to [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] at the price set forth on Schedule 5.3.
5.4 Forecasts, Delivery and Quality.
(a) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall provide CIMA
with 12-month non-binding forecasts within 15 days after the end of each
Quarter. Such forecasts shall be revised and extended in each succeeding
Quarter.
(b) Delivery of the Products, Product samples and Product placebos
shall be in accordance with the means of transportation, destination and dates
set forth in [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]'s purchase order.
Delivery shall be EXW (Incoterms 2000) CIMA and CIMA shall load Products on to
collecting vehicle at CIMA's risk.
(c) All deliveries of the Products hereunder shall include a
Certificate of Analysis provided by the quality control manager of CIMA
attesting to the fact that such Products (i) have been manufactured by a process
which complies with cGMP and (ii) are of quality which is in accordance with
criteria established in the Specifications and all FDA requirements.
(d) The Products, Product samples and Product placebos supplied
hereunder shall have been manufactured by a process which complies with the
quality assurance addendum set forth on Schedule 5.4(d).
-15-
5.5 Rejection and Replacement.
(a) In the event [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] determines
that any Products, Product samples or Product placebos as manufactured and/or
packaged by CIMA is Defective, then, within [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] after delivery of such Products, Product samples or Product
placebos to [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] shall provide to CIMA a written notice of rejection,
specifying in reasonable detail the manner in which the Products are Defective
(the "Notice of Rejection"). If no written Notice of Rejection is given to CIMA
by [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.***] within such [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] period, such Products, Product samples or Product
placebos shall be deemed to have been accepted by [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***], [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***].
(b) Upon receipt of a Notice of Rejection from [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] and in order to minimize any hardship to
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] 's customers, CIMA shall use its
reasonable best efforts to promptly supply to [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] a quantity of replacement Products, Product samples or Product
placebos meeting the Specifications equal to the size of the lot or lots which
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] claims was Defective so that such
replacement Products shall be received by [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] within 30 days following CIMA's receipt of [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***]'s Notice of Rejection. If CIMA agrees with
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] that such Product is Defective then CIMA
shall either replace the Defective Product at no cost to [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***], or refund or credit, as designated by
-16-
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***], the price paid for such Product plus
any applicable delivery charges, including, without limitation, shipping,
insurance and taxes, and any reasonable and documented out-of-pocket expense
that [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.***] may have incurred, within thirty
(30) days after written notice from [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***]. If CIMA disagrees with [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] as to whether such Product is Defective, the parties shall
cooperate to have the Product in dispute analyzed by an independent testing
laboratory of recognized repute jointly selected by [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] and CIMA. If the Product is determined by such laboratory to
meet the Specifications, then [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall
bear the cost of the independent laboratory testing and pay for the Product in
accordance with this Agreement. If the Licensed Product is determined not to
have met the Specifications at time of delivery, then CIMA shall bear the cost
of the independent laboratory testing. In addition, CIMA shall either replace
the Defective Product within thirty (30) days after the date of such
determination, at no cost to [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], or
refund or credit, as designated by [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], the
price paid for such Product plus any applicable delivery charges, including,
without limitation, shipping, insurance and taxes, and any reasonable and
documented out-of-pocket expense that [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] may have incurred, within thirty (30) days after written notice
from [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.***]. If CIMA is unable to replace any
such Product within thirty (30) days (or at any time that CIMA fails to deliver
the replacement Product at an agreed upon date), [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] shall have the right, at its sole discretion, to extend the
timeframe for delivery of replacement Product to a mutually agreed upon date,
or, in the alternative, to require CIMA to reimburse [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] for the price paid for such Product plus any applicable delivery
charges, including, without limitation, shipping, insurance and taxes and any
reasonable and documented out-of-pocket expense [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] may have incurred. Such reimbursement shall be made within
thirty (30) days of such notice.
-17-
5.6 Invoice and Payment. Upon shipment of any Products, Product samples
or Product placebos, CIMA shall be entitled to submit invoices therefor to
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***], and [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] agrees to remit payment within thirty (30) days from CIMA's
invoice date.
5.7 Supply Disruption; Alternate Manufacturing Site.
(a) CIMA shall use its best efforts to supply [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] with the Products in a timely manner in accordance with
the orders and forecasts received by CIMA pursuant to Sections 5.1(b) and
5.4(a), respectively. In any consecutive [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] period, should CIMA fail to supply [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] with a Product ordered for such [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] period pursuant to Section 5.1(b) (other than for reason of
Force Majeure), [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall have the right
to require CIMA to transfer the manufacture of such Product(s) to
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***]'s [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] facility or other designated [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] facility. Should CIMA cure its failure to supply any Product so
transferred, CIMA shall have the right to resume the manufacture of such Product
and [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.***] and CIMA shall transfer the
manufacture of such Product back to CIMA within a commercially reasonable amount
of time.
(b) CIMA shall, [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] establish a
second manufacturing plant as an alternate FDA-approved manufacturing site for
the Products however, the second manufacturing plant is not required to contain
a bottling capability
5.8 CIMA's Obligation to Continue Manufacture. If this Agreement
terminates or expires through no breach of [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION
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OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], CIMA
shall reasonably cooperate with [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] in
transferring the manufacture of the Products to [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***], its Affiliate or, subject to confidentiality obligations
consistent with Section 9.4, a third-party appointed by [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***], the parties shall develop a timing and payment
schedule for the transfer of the manufacture of the Products and CIMA shall
continue to supply the Products to [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]
pursuant to the terms of this Agreement until [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] from the date this Agreement is terminated or expires pursuant
to Section 11.1.
SECTION 6
CONDITIONS PRECEDENT TO THE CLOSING;
CLOSING DATE
6.1 Conditions Precedent to [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***]'s Obligations. Subject to waiver as set forth in Section 12.3,
all obligations of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] to close the
transactions contemplated under this Agreement are subject to the fulfillment or
satisfaction of each of the following conditions precedent:
(a) Representations and Warranties True as of the Closing Date. The
representations and warranties of CIMA contained in this Agreement or in any
schedule, certificate or document delivered by CIMA to [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] pursuant to the provisions hereof shall have been true
on the date hereof and shall be true on the Closing Date with the same effect as
though such representations and warranties were made as of such date.
(b) Compliance with this Agreement. CIMA shall have performed and
complied with all agreements and conditions required by this Agreement to be
performed or complied with by it prior to or by the Closing Date.
(c) Closing Certificate. [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall
have received a certificate
-19-
from CIMA, executed by an officer of CIMA, certifying in such detail as
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] may reasonably request that the
conditions specified in Sections 6.1(a) and 6.1(b), above, have been fulfilled
and certifying that CIMA has obtained all consents and approvals required
hereunder.
(d) No Threatened or Pending Litigation. On the Closing Date, no suit,
action or other proceeding, or injunction or final judgment relating thereto,
shall, to the best of CIMA's knowledge, be threatened or be pending before any
court or governmental or regulatory official, body or authority in which it is
sought to restrain or prohibit or to obtain damages or other relief in
connection with this Agreement or the consummation of the transactions
contemplated hereby, and no investigation that might result in any such suit,
action or proceeding shall be pending or, to the best of CIMA's knowledge,
threatened.
6.2 Conditions Precedent to CIMA's Obligations. Subject to waiver as
set forth in Section 12.3, all obligations of CIMA to close the transactions
contemplated under this Agreement are subject to the fulfillment or satisfaction
of each of the following conditions precedent:
(a) Representations and Warranties True as of the Closing Date. The
representations and warranties of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]
contained in this Agreement or in any schedule, certificate or document
delivered by [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] to CIMA pursuant to
the provisions hereof shall have been true on the date hereof and shall be true
on the Closing Date with the same effect as though such representations and
warranties were made as of such date.
(b) Compliance with this Agreement. [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] shall have performed and complied with all agreements and
conditions required by this Agreement to be performed or complied with by it
prior to or by the Closing Date.
(c) Closing Certificate. CIMA shall have received a certificate from
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***], executed by an officer of
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***], certifying in such detail as CIMA may
reasonably request that the conditions specified in Sections 6.2(a) and 6.2(b),
above, have been fulfilled and certifying that [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
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EXCHANGE COMMISSION.***] has obtained all consents and approvals required
hereunder.
(d) No Threatened or Pending Litigation. On the Closing Date, no suit,
action or other proceeding, or injunction or final judgment relating thereto,
shall, to the best of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]'s knowledge,
be threatened or be pending before any court or governmental or regulatory
official, body or authority in which it is sought to restrain or prohibit or to
obtain damages or other relief in connection with this Agreement or the
consummation of the transactions contemplated hereby, and no investigation that
might result in any such suit, action or proceeding shall be pending or, to the
best of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***]'s knowledge, threatened.
6.3 Closing Date.
(a) Subject to Section 6.3(b), below, the closing of the transactions
contemplated by this Agreement shall take place at 10:00 a.m., local time, on
December 18, 2001, or on such other date as may be mutually agreed upon in
writing by the parties (the "Closing Date"), at the offices of [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***].
(b) Each party hereby agrees to use its best efforts to consummate the
transactions contemplated herein, as modified, on or before December 18, 2001;
provided, however, that if the parties are unable to close the transactions
contemplated hereby by January 31, 2002, or such later date as shall be mutually
agreed to in writing by CIMA and [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], then
all of the rights and obligations of the parties under this Agreement shall
terminate without liability.
SECTION 7
REPRESENTATIONS AND WARRANTIES OF CIMA
CIMA hereby represents and warrants to [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] that:
7.1 Organization, Power and Authority. CIMA is a corporation duly
organized and validly existing under the laws of the State of Delaware. CIMA has
all necessary corporate power and authority to enter into, and be bound by the
terms and conditions of, this Agreement, and to license the Licensed Assets and
the CIMA Trademarks to [***CONFIDENTIAL
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TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] pursuant hereto.
7.2 Due Authority; No Breach. The execution, delivery and performance
by CIMA of this Agreement and each agreement or instrument contemplated by this
Agreement, and the performance of the transactions contemplated hereby and
thereby, have been duly authorized by all necessary corporate action by CIMA.
This Agreement is, and each agreement or instrument contemplated by this
Agreement, when executed and delivered by CIMA in accordance with the provisions
hereof, will be (assuming the due execution and delivery hereof and thereof by
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***]) the legal, valid and binding obligation
of CIMA, in each case enforceable against CIMA in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, moratorium, reorganization, or similar laws from time to time in
effect which affect the enforcement of creditors' rights generally and by legal
and equitable limitations on the availability of specific performance and other
equitable remedies against CIMA. All persons who have executed this Agreement on
behalf of CIMA, or who will execute on behalf of CIMA any agreement or
instrument contemplated by this Agreement, have been duly authorized to do so by
all necessary corporate action. Neither the execution and delivery of this
Agreement or any such other agreement or instrument by CIMA, nor the performance
of the obligations contemplated hereby or thereby, will (i) conflict with or
result in any violation of or constitute a breach of any of the terms or
provisions of, or result in the acceleration of any obligation under, or
constitute a default under any provision of the articles of incorporation or
by-laws of CIMA or any material contract or any other material obligation to
which CIMA is a party or to which it is subject or bound, or (ii) violate any
judgment, order, injunction, decree or award of any court, administrative
agency, arbitrator or governmental body against, or affecting or binding upon,
CIMA or upon the securities, property or business of CIMA, or (iii) constitute a
violation by CIMA of any applicable law or regulation of any jurisdiction as
such law or regulation relates to CIMA, or to the property or business of CIMA
except for such conflict, acceleration, default, breach or violation that is not
reasonably likely to have a material adverse effect on CIMA's ability to perform
its obligations under this Agreement or under any agreement or instrument
contemplated hereby.
7.3 Intellectual Property. CIMA is the lawful owner of the Licensed
Assets and CIMA Trademarks, CIMA can license the Licensed Assets and CIMA
Trademarks without the consent of any third party in the Territory, there is no
pending or overtly threatened claim against CIMA asserting that any of the
Licensed Assets or CIMA Trademarks infringes or violates the rights of third
parties in the Territory or that [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], by
practicing under the Licensed Assets and CIMA Trademarks in performing the
Activities, would violate any of the intellectual property rights of any third
party in the Territory, and nothing has come to the attention of CIMA which has,
or reasonably should have, led CIMA to believe that any of the Licensed Assets
and CIMA Trademarks infringes or violates the right of third parties in the
Territory. CIMA has not given any notice to any third parties asserting
infringement by such third parties upon any of the Licensed Assets and CIMA
Trademarks. CIMA is not aware of and has not received any communications
challenging the ownership, validity or effectiveness of any of the Licensed
-22-
Assets and CIMA Trademarks. CIMA has not granted any right to any third party
relating to the Activities which would violate the terms of or conflict with the
rights granted to [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] pursuant to this
Agreement.
7.4 Technology Rights. The CIMA Technology, to the best of CIMA's
knowledge, when combined with the [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]
Technology, includes all the technology, patents, know-how, trade secrets and
other intellectual property necessary to manufacture the Products.
7.5 Litigation. There are no pending or, to the best of CIMA's
knowledge, threatened judicial, administrative or arbitral actions, claims,
suits or proceedings pending as of the date hereof against CIMA relating to the
Activities, the Licensed Assets or the CIMA Trademarks which, either
individually or together with any other, would have a material adverse effect on
the Activities, the Licensed Assets, the CIMA Trademarks or the ability of CIMA
to perform its obligations under this Agreement or any agreement or instrument
contemplated hereby. There are no pending, and CIMA does not presently
contemplate bringing, any actions or suits relating to the Activities, the
Licensed Assets or the CIMA Trademarks against others.
7.6 Governmental Approval. No consent, approval, waiver, order or
authorization of, or registration, declaration or filing with, any governmental
authority is required in connection with the execution, delivery and performance
of this Agreement, or any agreement or instrument contemplated by this
Agreement, by CIMA or the performance by CIMA of its obligations contemplated
hereby and thereby.
7.7 Brokerage. No broker, finder or similar agent has been employed by
or on behalf of CIMA, and no Person with which CIMA has had any dealings or
communications of any kind is entitled to any brokerage commission, finder's fee
or any similar compensation, in connection with this Agreement or the
transactions contemplated hereby.
7.8 Supply. All finished Products supplied by CIMA under Section 5
shall (i) have been manufactured by a process which complies with cGMP and the
Quality Assurance Addendum set forth on Schedule 5.4(d) and (ii) be of a quality
which is in accordance with criteria established by the specifications
established by the Specifications and all FDA requirements.
-23-
SECTION 8
REPRESENTATIONS AND WARRANTIES OF [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***]
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] represents and warrants to CIMA
that:
8.1 Organization, Power and Authority. [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware. [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] has all necessary corporate power and authority to enter into,
and be bound by the terms and conditions of, this Agreement, to license the
Licensed Assets, the Patents and the CIMA Technology from CIMA, and to license
the [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.***] Technology to CIMA pursuant hereto.
8.2 Due Authority; No Breach. The execution, delivery and performance
by [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.***] of this Agreement, and each
agreement or instrument contemplated by this Agreement, and the performance of
the transactions contemplated hereby and thereby, have been duly authorized by
all necessary corporate action by [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]. This
Agreement is, and each agreement or instrument contemplated by this Agreement,
when executed and delivered by [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] in
accordance with the provisions hereof, will be (assuming due execution and
delivery hereof and thereof by CIMA) the legal, valid and binding obligation of
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***], in each case enforceable against
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] in accordance with its terms, except as
such enforceability may be limited by applicable bankruptcy, insolvency,
moratorium, reorganization, or similar laws from time to time in effect which
affect the enforcement of creditors' rights generally and by legal and equitable
limitations on the availability of specific performance and other equitable
remedies against [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]. All persons who
have executed this Agreement on behalf of [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***], or who will execute on behalf of [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
-24-
SECURITIES AND EXCHANGE COMMISSION.***] any agreement or instrument contemplated
by this Agreement, have been duly authorized to do so by all necessary corporate
action. Neither the execution and delivery of this Agreement by [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***], or any such other agreement or instrument by
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***], nor the performance of the obligations
contemplated hereby and thereby, will (i) conflict with or result in any
violation of or constitute a breach of any of the terms or provisions of, or
result in the acceleration of any obligation under, or constitute a default
under any provision of its articles of incorporation or by-laws or any material
contract or any other material obligation to which [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] is a party or to which it is subject or bound, or (ii) violate
any judgment, order, injunction, decree or award of any court, administrative
agency, arbitrator or government body against, or affecting or binding upon,
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] or upon the securities, property or
business of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], or (iii) constitute
a violation by [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] of any applicable
law or regulation of any jurisdiction as such law or regulation relates to
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] or to the property or business of
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***], except for such conflict, acceleration,
default, breach or violation that is not reasonably likely to have a material
adverse effect on [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]'s ability to perform
its obligations under this Agreement or any agreement or instrument contemplated
hereby.
8.3 Brokerage. No broker, finder or similar agent has been employed by
or on behalf of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] and no Person with
which [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] has had any dealings or
communications of any kind is entitled to any brokerage commission, finder's fee
or any similar compensation, in connection with this Agreement or the
transactions contemplated hereby.
8.4 Litigation. There are no pending or, to the best of
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***]'s knowledge, threatened judicial,
administrative or arbitral actions, claims, suits or proceedings pending as of
the date hereof against [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED
-25-
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] which, either
individually or together with any other, will have a material adverse effect on
the ability of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] to perform its
obligations under this Agreement or any agreement or instrument contemplated
hereby or affect adversely the grant to CIMA of the non-exclusive license of the
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] Technology pursuant to Section 3.3.
8.5 Governmental Approval. No consent, approval, waiver, order or
authorization of, or registration, declaration or filing with, any governmental
authority is required in connection with the execution, delivery and performance
of this Agreement, or any agreement or instrument contemplated by this
Agreement, by [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] or the performance
by [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.***] of its obligations contemplated
hereby and thereby.
SECTION 9
ADDITIONAL COVENANTS AND AGREEMENTS OF THE PARTIES
9.1 Governmental Filings. CIMA and [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] each agree to prepare and file whatever filings, listings,
requests or applications are required to be filed with any governmental
authority in connection with this Agreement or the Products and to cooperate
with one another as reasonably necessary to accomplish the foregoing.
9.2 Compliance with Law. [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] and
CIMA shall each comply with all federal, state and local laws and regulations
applicable to developing, approving, manufacturing, marketing and selling the
Products in the Territory, the Licensed Assets, the Patents and the Technology
or the performance of their respective obligations hereunder. CIMA and
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] each shall keep all records and reports
required to be kept by applicable laws and regulations, and each shall make its
facilities available at reasonable times during business hours for inspection by
representatives of governmental agencies. CIMA and [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] each shall notify the other within forty-eight (48) hours of
receipt of any notice or any other indication whatsoever of any FDA or other
governmental agency inspection, investigation or other inquiry, or other
material notice or communication of any type, involving any Product.
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
-26-
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] and CIMA shall
cooperate with each other during any such inspection, investigation or other
inquiry including, but not limited to, allowing upon request a representative of
the other to be present during the applicable portions of any such inspection,
investigation or other inquiry and providing copies of all relevant documents.
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] and CIMA shall discuss any written
response to observations or notifications received in connection with any such
inspection, investigation or other inquiry and each shall give the other an
opportunity to comment upon any proposed response before it is made. In the
event of disagreement concerning the form or content of such response, however,
CIMA shall be responsible for deciding the appropriate form and content of any
response with respect to any of its cited activities and [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] shall be responsible for deciding the appropriate form
and content of any response with respect to any of its cited activities.
9.3 Recall. [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] and CIMA shall
consult with one another as to all decisions concerning recall or withdrawal of
any Product from the market, including, but not limited to, determining whether
or not to make any such recall or withdrawal, the timing and scope thereof, and
the means of conducting any recall or withdrawal. The party requesting any
recall or withdrawal must receive the prior written consent of the other party,
such consent not to be unreasonably withheld, prior to initiating such recall or
withdrawal. No consent shall be necessary if the recall or withdrawal is
requested by the FDA or other governmental authority. CIMA shall bear the costs
(including but not limited to, shipping and product credits) for any recall or
withdrawal primarily due to CIMA's failure to comply with this Agreement. The
costs for any other recall or withdrawal shall be the responsibility of
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***].
9.4 Confidentiality. [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall
treat as confidential the Licensed Assets, the Patents, the CIMA Technology, and
all other information of CIMA of which [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] becomes aware in connection with this Agreement (collectively,
"CIMA Proprietary Information"). [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall
neither disclose CIMA Proprietary Information to any third party nor use CIMA
Proprietary Information for any purpose other than as set forth in this
Agreement. CIMA shall treat as confidential the [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] Technology and all other information of [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] of which CIMA becomes aware in connection with this
Agreement (collectively, "[***CONFIDENTIAL
-27-
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] Proprietary Information"). CIMA shall neither disclose
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] Proprietary Information to any third
party nor use [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] Proprietary
Information for any purpose other than as set forth in this Agreement.
Nothing contained herein will in any way restrict or impair either
party's (the "Using Party's") right to use, disclose or otherwise deal with any
Proprietary Information of the other party which:
(a) at the time of disclosure is known to the public or
thereafter becomes known to the public by publication or otherwise
through no fault of the Using Party;
(b) the Using Party can establish was in its possession prior
to the time of the disclosure and was not obtained directly or
indirectly from the other party;
(c) is independently made available as a matter of right to
the Using Party by a third party who is not thereby in violation of a
confidential relationship with the other party;
(d) is developed by the Using Party independently of the
Proprietary Information received from the other party and the Using
Party can establish such development; or
(e) is information required to be disclosed by legal or
regulatory process; provided, in each case the Using Party timely
informs the other party and uses reasonable efforts to limit the
disclosure and maintain confidentiality to the extent possible and
permits the other party to intervene and contest or attempt to limit
the disclosure.
Nothing in the foregoing, however, shall prohibit a party from making such
disclosures to the extent deemed necessary under applicable federal or state
securities laws or any applicable rule or regulation of any nationally
recognized securities exchange including, without limitation, NASDAQ. In such
event, however, the disclosing party shall use good faith efforts to consult
with the other party prior to such disclosure and, where applicable, shall
request confidential treatment to the extent available. [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] shall obtain no right or license of any kind under the
CIMA Proprietary Information except as set forth in this Agreement. CIMA shall
obtain no right or license of any kind under the [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] Proprietary Information except as set forth in this Agreement.
9.5 Expenses. CIMA and [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
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COMMISSION.***] shall each bear their own direct and indirect expenses incurred
in connection with the negotiation and preparation of this Agreement and, except
as set forth in this Agreement, the performance of the obligations contemplated
hereby.
9.6 Reasonable Efforts. CIMA and [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] each hereby agrees to use all reasonable efforts to take, or
cause to be taken, all actions and to do, or cause to be done all things
necessary or proper to make effective the transactions contemplated by this
Agreement, including such actions as may be reasonably necessary to obtain
approvals and consents of governmental Persons and other Persons.
9.7 Publicity. Each of the parties agrees that no publicity release or
announcement concerning the transactions contemplated hereby shall be issued
without the advance written consent of the other, except as such release or
announcement may be required by law, in which case the party making the release
or announcement shall, before making any such release or announcement, afford
the other party a reasonable opportunity to review and comment upon such release
or announcement.
9.8 Cooperation. If either party shall become engaged in or participate
in any investigation, claim, litigation or other proceeding with any third
party, including the FDA, relating in any way to the Products or any of the
Licensed Assets, the Patents or the Technology, the other party shall cooperate
in all reasonable respects with such party in connection therewith, including,
without limitation, using its reasonable efforts to make available to the other
such employees who may be helpful with respect to such investigation, claim,
litigation or other proceeding, provided that, for purposes of this provision,
reasonable efforts to make available any employee shall be deemed to mean
providing a party with reasonable access to any such employee at no cost for a
period of time not to exceed 24 hours (e.g., three 8-hour business days).
Thereafter, any such employee shall be made available for such time and upon
such terms and conditions (including, but not limited to, compensation) as the
parties may mutually agree.
9.9 Competition; No Sale for Resale.
(a) CIMA agrees that, commencing on the Closing Date and continuing for
the period ending [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] after the term of
this Agreement, it shall not directly or indirectly, develop or manufacture for
sale within the Territory any Product described on Schedule 3.1 on the date
hereof or engage in the marketing, selling or distributing of any such Product
in the Territory except as contemplated by this Agreement. It is further
understood that the remedies at law are inadequate in the case of any breach of
this covenant and that [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall be
entitled to equitable relief, including the remedy of specific performance, with
respect to any breach of such covenant.
-29-
(b) Neither [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] nor any sublicensee
of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.***] shall knowingly directly or
indirectly sell any Product to anyone in the Territory for subsequent
distribution or resale outside the Territory and each shall take all reasonable
precautions to prevent such distribution or resale outside the Territory.
Neither CIMA nor any of its Affiliates shall knowingly directly or indirectly
sell any Product to anyone in the Territory or outside the Territory for
subsequent distribution or resale in the Territory and each shall take all
reasonable precautions to prevent such distribution or resale in the Territory.
9.10 Conflicting Rights. CIMA shall not grant any right to any third
party relating to the Activities which would violate the terms of or conflict
with the rights granted to [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] pursuant to
this Agreement.
9.11 Patent and Trademark Maintenance.
(a) CIMA shall be solely responsible for filing, prosecuting, and
maintaining all of the CIMA Patents, and CIMA shall pay the costs associated
therewith. CIMA shall file, prosecute, and maintain all CIMA Patents so as to
fully continue the benefits under the licenses granted to [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] hereunder. CIMA may, however, discontinue prosecuting
and maintaining any CIMA Patent if (i) CIMA has a valid business reason to do
so, and (ii) obtains the prior written approval of [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***], such approval not to be unreasonably withheld or delayed.
(b) CIMA shall be solely responsible for filing, prosecuting, and
maintaining all CIMA Trademarks, and CIMA shall pay the costs associated
therewith. All registrations, variations, logos, goodwill and other rights under
or acquired through use of the CIMA Trademarks shall accrue and belong to CIMA.
Except as provided herein, [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall have no
rights to use the CIMA Trademarks. [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] will
not use in its business, in or outside of the Territory, any other xxxx or name
which is similar to or nearly resembles any of the CIMA Trademarks in use by
CIMA to indicate the source and origin of the CIMA Technology as to be likely to
cause deception or confusion. [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]
recognizes that CIMA is the owner of all CIMA Trademarks used in commerce to
-30-
indicate the source of the CIMA Technology and agrees that the CIMA Trademarks
shall remain vested in CIMA both during the term of this Agreement and
thereafter. [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall not contest
the validity of the CIMA Trademarks or CIMA's ownership of the CIMA Trademarks.
Use of the CIMA Trademarks by [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] in
conjunction with the manufacture, use, and sale of the Product and all goodwill
related thereto shall inure to the benefit of CIMA for purposes of building the
longevity and extent of use of the CIMA Trademarks.
(c) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall be solely
responsible for filing, prosecuting, and maintaining all trademarks it develops
or owns for the Products (the "[***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]
Trademarks"), and [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall pay the costs
associated therewith. All registrations, variations, logos, goodwill and other
rights under or acquired through use of the [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] Trademarks shall accrue and belong to [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] CIMA shall have no rights to use the [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] Trademarks, including, without limitation, in connection with
any product subsequently developed by CIMA. CIMA will not use in its business,
in or outside of the Territory, any other xxxx or name which is similar to or
nearly resembles the [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] Trademarks in use by
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] in a manner that is likely to cause
deception or confusion. CIMA recognizes that [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] is the owner of all of the [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] Trademarks used in commerce to indicate the source of the
Product and agrees that the [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]
Trademarks shall remain vested in [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] both
during the term of this
-31-
Agreement and thereafter. CIMA shall not contest the validity of the
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] Trademarks or [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***]'s ownership of the [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]
Trademarks. Use of the [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] Trademarks by
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] in conjunction with the manufacture,
use, and sale of the Product and all goodwill related thereto shall inure to the
benefit of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] for purposes of
building the longevity and extent of use of the [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] Trademarks.
(d) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] and CIMA agree that,
where applicable, all packaging of the Products shall identify (i) the number of
the CIMA Patents and CIMA as the owner thereof and (ii) [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] as the owner of the [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] Trademarks.
(e) Any improvements to the CIMA Technology (whether or not patentable)
shall be owned solely by CIMA.
(f) Any improvements to the [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] Technology (whether or not patentable) shall be owned solely by
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***].
(g) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall have full
ownership rights to the Products with the exception of any improvements to the
CIMA Technology as contemplated by Section 9.11(e).
(h) Any provisions in this Agreement to the contrary notwithstanding,
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
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SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] acknowledges that,
for all purposes, CIMA is the owner of the CIMA Technology and CIMA acknowledges
that, for all purposes, [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] is the owner
of the [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] Technology.
9.12 Infringement; Enforcement of Proprietary Rights.
(a) Infringement of Patent Rights. Each party shall promptly notify the
other of any alleged infringement by third parties of any CIMA Patent and
provide any information available to that party relating to such alleged
infringement. CIMA shall have the responsibility to investigate such alleged
infringement and act diligently, [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], to
end any infringement of such rights that materially affect [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***]'s rights pursuant to this Agreement, including, but not
limited to, bringing suit against such third party infringer. In the event that
CIMA does not bring suit against such third party infringer, [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] may, at its own expense, bring suit against such third
party infringer on CIMA's behalf.
(b) Procedures. No settlement, consent judgment or other voluntary
final disposition of any suit contemplated by Section 9.12(a) may be entered
into without the consent of each party, which consent shall not be unreasonably
withheld or delayed. Any recovery of damages in any such suit shall be retained
by the party bearing the costs of such suit. In the event of any infringement
suit against a third party brought by either party pursuant to this Section
9.12, the party not bringing such suit shall cooperate in all respects, execute
any documents reasonably necessary to permit the other party to prosecute such
suit, and to the extent reasonable shall make available its employees and
relevant records to provide evidence for such suit.
(c) Infringement of Third Party Rights. If, during the term of this
Agreement, [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]'s marketing or
selling of the Product hereunder infringes on a third party patent based upon
claims that dominate claims in the CIMA Patents, within [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] after notice by [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***], CIMA shall use its reasonable best efforts to procure for
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH
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THE SECURITIES AND EXCHANGE COMMISSION.***] the right to exercise all rights
licensed under this Agreement without any additional payment therefor by
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***].
9.13 Supply of Products. CIMA shall maintain sufficient capacity
throughout the term of this Agreement to meet the requirements of
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] for the supply of Products hereunder.
9.14 Liability Insurance. At and after each Launch, CIMA shall use its
best efforts to obtain and carry in full force and effect product liability
insurance in respect of the applicable Product in the amount of $1,000,000 per
occurrence and in the aggregate and policies of $10,000,000 of excess coverage
in the aggregate. At and after each Launch, [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] shall use its best efforts to obtain and carry in full force and
effect product liability insurance in respect of the applicable Product in the
amount of $1,000,000 per occurrence and in the aggregate and policies of
$10,000,000 of excess coverage in the aggregate.
9.15 Referral of Orders and Inquiries. CIMA shall refer all Persons
sending orders or making inquiries regarding the Products within the Territory
to [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION.***] and shall promptly notify
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] of the name of each such Person and the
nature of the inquiry of such Person.
9.16 Deemed Breach of Covenant. Neither CIMA nor [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] shall be deemed to be in breach of any covenant
contained in this Section 9 if such party's deemed breach is the result of any
action or inaction on the part of the other party.
SECTION 10
INDEMNIFICATION
10.1 Indemnification.
(a) CIMA shall indemnify, defend and hold [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] (and its directors, officers, employees, and Affiliates)
harmless from and against any and all Damages incurred or suffered by
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
-34-
SECURITIES AND EXCHANGE COMMISSION.***] (and its directors, officers, employees,
and Affiliates) as a consequence of:
(i) any breach of any representation or warranty made by CIMA
in this Agreement or any agreement, instrument or document delivered by
CIMA pursuant to the terms of this Agreement;
(ii) any failure to perform duly and punctually any covenant,
agreement or undertaking on the part of CIMA contained in this
Agreement;
(iii) any act or omission of CIMA with respect to the
operation of CIMA's business, or the handling, manufacturing or
development of the Products by CIMA; or
(iv) the infringement of the Licensed Assets, the Patent or
the Technology of any patent, trademark, copyright, trade secret or
other intellectual property right of any person other than CIMA or
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***].
(b) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall indemnify,
defend and hold CIMA (and its directors, officers, employees, and Affiliates)
harmless from and against any and all Damages incurred or suffered by CIMA (and
its directors, officers, employees, and Affiliates) as a consequence of:
(i) any breach of any representation or warranty made by
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] in this Agreement or
any agreement, instrument or document delivered by [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] pursuant to the terms of this
Agreement;
(ii) any failure to perform duly and punctually any covenant,
agreement or undertaking on the part of [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] contained in this Agreement; or
(iii) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] of
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] with respect to the
operation of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]'s
business or the handling, marketing or sale
-35-
of the Products by [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***], including [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***]'s supply of API hereunder.
10.2 Notice and Opportunity To Defend. Promptly after receipt by a
party hereto of notice of any claim which could give rise to a right to
indemnification pursuant to Section 10.1. such party (the "Indemnified Party")
shall give the other party (the "Indemnifying Party") written notice describing
the claim in reasonable detail. The failure of an Indemnified Party to give
notice in the manner provided herein shall not relieve the Indemnifying Party of
its obligations under this Section, except to the extent that such failure to
give notice materially prejudices the Indemnifying Party's ability to defend
such claim. The Indemnifying Party shall have the right, at its option, to
compromise or defend, at its own expense and by its own counsel, any such matter
involving the asserted liability of the party seeking such indemnification. If
the Indemnifying Party shall undertake to compromise or defend any such asserted
liability, it shall promptly (and in any event not less than 10 days after
receipt of the Indemnified Party's original notice) notify the Indemnified Party
in writing of its intention to do so, and the Indemnified Party agrees to
cooperate fully with the Indemnifying Party and its counsel in the compromise or
defense against any such asserted liability. All reasonable costs and expenses
incurred in connection with such cooperation shall be borne by the Indemnifying
Party. If the Indemnifying Party elects not to compromise or defend the asserted
liability, fails to notify the Indemnified Party of its election to compromise
or defend as herein provided, fails to admit its obligation to indemnify under
this Agreement with respect to the claim, or, if in the reasonable opinion of
the Indemnified Party, the claim could result in the Indemnified Party becoming
subject to injunctive relief or relief other than the payment of money damages
that could materially adversely affect the ongoing business of the Indemnified
Party in any manner, the Indemnified Party shall have the right, at its option,
to pay, compromise or defend such asserted liability by its own counsel and its
reasonable costs and expenses shall be included as part of the indemnification
obligation of the Indemnifying Party hereunder. Notwithstanding the foregoing,
neither the Indemnifying Party nor the Indemnified Party may settle or
compromise any claim over the objection of the other; provided, however, that
consent to settlement or compromise shall not be unreasonably withheld. In any
event, the Indemnified Party and the Indemnifying Party may participate, at
their own expense, in the defense of such asserted liability. If the
Indemnifying Party chooses to defend any claim, the Indemnified Party shall make
available to the Indemnifying Party any books, records or other documents within
its control that are necessary or appropriate for such defense. Notwithstanding
anything to the contrary in this Section 10.2, (i) the party conducting the
defense of a claim shall (A) keep the other party informed on a reasonable and
timely basis as to the status of the defense of such claim (but only to the
extent such other party is not participating jointly in the defense of such
claim), and (B) conduct the defense of such claim in a prudent manner, and (ii)
the Indemnifying Party shall not cease to defend, settle or otherwise dispose of
any claim without the prior written consent of the Indemnified Party (which
consent shall not be unreasonably withheld).
10.3 Indemnification Payment Obligation. No Indemnifying Party will
have any obligations under Sections 10.1(a) or 10.1(b) until the cumulative
aggregate amount of Damages
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incurred or suffered by the Indemnified Party which the Indemnifying Party is
otherwise subject to under this Agreement exceeds [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] at which time the entire cumulative aggregate amount of such
Damages shall be covered. The provisions of this Section 10.3 shall not limit or
otherwise affect the obligations of any Indemnifying Party under any other
Section of this Agreement.
10.4 Indemnification Payment Adjustments. The amount of any Damages for
which indemnification is provided under this Section 10 shall be reduced to take
account of any net tax benefit and shall be increased to take account of any net
tax detriment arising from the incurrence or payment of any such Damages or from
the receipt of any such indemnification payment and shall be reduced by the
insurance proceeds received and any other amount recovered, if any, by the
Indemnified Party with respect to any Damages; provided, however, that an
Indemnified Party shall not be subject to an obligation to pursue an insurance
claim relating to any Damages for which indemnification is sought hereunder. If
any Indemnified Party shall have received any payment pursuant to this Section
10 with respect to any Damages and shall subsequently have received insurance
proceeds or other amounts with respect to such Damages, then such Indemnified
Party shall pay to the Indemnifying Party an amount equal to the difference (if
any) between (i) the sum of the amount of those insurance proceeds or other
amounts received and the amount of the payment by such Indemnifying Party
pursuant to this Section 10 with respect to such Damages and (ii) the amount
necessary to fully and completely indemnify and hold harmless such Indemnified
Party from and against such Damages; provided, however, in no event will such
Indemnified Party have any obligation pursuant to this sentence to pay to such
Indemnifying Party an amount greater than the amount of the payment by such
Indemnifying Party pursuant to this Section 10 with respect to such Damages.
10.5 Indemnification Payment. Upon the final determination of liability
and the amount of the indemnification payment under this Section 10, the
appropriate party shall pay to the other, as the case may be, within 10 business
days after such determination, the amount of any claim for indemnification made
hereunder.
10.6 Survival. The provisions of Section 10 shall survive any
termination of this Agreement. Each Indemnified Party's rights under Section 10
shall not be deemed to have been waived or otherwise affected by such
Indemnified Party's waiver of the breach of any representation, warranty,
agreement or covenant contained in or made pursuant this Agreement, unless such
waiver expressly and in writing also waives any or all of the Indemnified
Party's right under Section 10.
SECTION 11
TERMINATION
11.1 Termination. The term of this Agreement shall begin upon the
Closing Date and, unless sooner terminated as hereinafter provided, shall end
with respect to each Product upon the expiration of the last CIMA Patent
applicable to such Product to expire or, if later, the expiration
-37-
of any other patent resulting from the development process contemplated hereby.
Notwithstanding the foregoing, this Agreement may be terminated as follows:
(a) Termination for Insolvency. If either [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] or CIMA (i) makes a general assignment for the benefit of
creditors or becomes insolvent; (ii) files an insolvency petition in bankruptcy;
(iii) petitions for or acquiesces in the appointment of any receiver, trustee or
similar officer to liquidate or conserve its business or any substantial part of
its assets; (iv) commences under the laws of any jurisdiction any proceeding
involving its insolvency, bankruptcy, reorganization, adjustment of debt,
dissolution, liquidation or any other similar proceeding for the release of
financially distressed debtors; or (v) becomes a party to any proceeding or
action of the type described above in (iii) or (iv) and such proceeding or
action remains undismissed or unstayed for a period of more than 60 days, then
the other party may by written notice terminate this Agreement in its entirety
with immediate effect.
(b) Termination for Default. [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] and CIMA each shall have the right to terminate this Agreement
for default upon the other's failure to comply in any material respect with the
terms and conditions of this Agreement. At least ninety (90) days prior to any
such termination for default, the party seeking to so terminate shall give the
other written notice of its intention to terminate this Agreement in accordance
with the provisions of this Section 11.1(b), which notice shall set forth the
default(s) which form the basis for such termination. If the defaulting party
fails to correct such default(s) within ninety (90) days after receipt of
notification, then such party immediately may terminate this Agreement. This
Section 11.1(b) shall not be exclusive and shall not be in lieu of any other
remedies available to a party hereto for any default hereunder on the part of
the other party.
(c) Unilateral Termination by [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] Prior to Launch. Prior to the Launch of any Product,
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] will have the right to unilaterally
terminate this Agreement either in its entirety or with respect to one or more
specific Products at any time and in its sole discretion upon the delivery of
written notice to CIMA. Any provision herein notwithstanding, in the event that
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] terminates this Agreement pursuant to
this Section 11.1(c), [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]'s sole
obligation under this Agreement shall be to reimburse CIMA for the costs and
expenses actually incurred by CIMA (i) in performing the development activities
set forth on Schedule 4.1(b) hereto in respect of such
-38-
terminated Product(s) prior to CIMA's receipt of such notice of termination and
(ii) in connection with the orderly close out of such development activities;
provided, however, that [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]'s
reimbursement obligations pursuant to this Section 11.1(c) in respect of any
terminated Product(s) shall exclude the costs and expenses incurred by CIMA in
connection with any Development Phase for which [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] has made a Development Fee Payment and shall in no event exceed
the Development Fee Payment associated with the Development Phase on which CIMA
is then working, as set forth on Schedule 4.1(b).
(d) Unilateral Termination by [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] After Launch. Following the Launch of any Product,
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] will have the right to unilaterally
terminate this Agreement either in its entirety or with respect to one or more
specific Products and in its sole discretion upon the delivery of written notice
to CIMA. Termination of the Agreement either in its entirety or with respect to
one or more specific Products will be effective with respect to such Product or
Products one hundred eighty (180) days following such written notice to CIMA.
(e) Continuing Obligations. Termination of this Agreement for any
reason shall not relieve the parties of any obligation accruing prior thereto
with respect to any Product and any ongoing obligations hereunder with respect
to the remaining Products and shall be without prejudice to the rights and
remedies of either party with respect to any antecedent breach of the provisions
of this Agreement. Without limiting the generality of the foregoing, no
termination of this Agreement, whether by lapse of time or otherwise, shall
serve to terminate the obligations of the parties hereto under Sections 5.8,
9.3, 9.4, 9.5, 9.7, 9.9(a), 10, 11.1(c), 11.1(d), 11.1(e) and 12 hereof, and
such obligations shall survive any such termination.
SECTION 12
MISCELLANEOUS
12.1 Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and permitted assigns; provided, however, that neither CIMA nor [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] may assign any of its rights, duties or obligations
hereunder without the prior written consent of the other, which consent shall
not be unreasonably withheld, except that no prior written consent shall be
required in the event that a third party acquires substantially all
-39-
of the assets or outstanding shares of, or merges with, [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] or CIMA, as the case may be.
12.2 Notices. All notices or other communications required or permitted
to be given hereunder shall be in writing and shall be deemed to have been duly
given if delivered by hand or facsimile and confirmed in writing, or mailed
first class, postage prepaid, by registered or certified mail, return receipt
requested (mailed notices and notices sent by facsimile shall be deemed to have
been given on the date received) as follows:
If to CIMA, as follows:
CIMA LABS INC
00000 Xxxxxx Xxxx Xxxx
Xxxx Xxxxxxx, XX 00000
Facsimile: 000-000-0000
Attention: Chief Executive Officer
If to [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], as follows:
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] Attention: General Counsel
with a copy to:
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***]
or in any case to such other address or addresses as hereafter shall be
furnished as provided in this Section 12.2 by any party hereto to the other
party.
12.3 Waiver; Remedies. Any term or provision of this Agreement may be
waived at any time by the party entitled to the benefit thereof by a written
instrument executed by such party. No delay on the part of CIMA or
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] in exercising any right, power or
privilege hereunder shall operate as a waiver thereof, nor shall any waiver on
the part of either CIMA or [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] of any right,
power or privilege hereunder operate as a waiver of any other right, power or
privilege hereunder nor shall any single or partial exercise of any right, power
or privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or privilege hereunder. The indemnification
provided in Section 10 shall be the sole remedy available for any Damages
arising out of or in connection with this Agreement except for any rights or
remedies which the parties hereto may otherwise have in equity.
-40-
12.4 Survival of Representations. Each of the representations and
warranties made in this Agreement shall continue for the term of this Agreement
and shall thereafter be extinguished.
12.5 Independent Contractors. The parties hereto are independent
contractors and nothing contained in this Agreement shall be deemed to create
the relationship of partners, joint venturers, or of principal and agent,
franchisor and franchisee, or of any association or relationship between the
parties other than as expressly provided in this Agreement. [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] acknowledges that it does not have, and
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] shall not make representations to any
third party, either directly or indirectly, indicating that [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] has any authority to act for or on behalf of CIMA or to
obligate CIMA in any way whatsoever. CIMA acknowledges that it does not have,
and it shall not make any representations to any third party, either directly or
indirectly, indicating that it has any authority to act for or on behalf of
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] or to obligate [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] in any way whatsoever.
12.6 Entire Agreement. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter hereof and supersedes all
prior agreements including, without limitation the Feasibility Agreement entered
by CIMA and [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] on November 30,
2001, or understandings of the parties relating thereto.
12.7 Amendment. This Agreement may be modified or amended only by
written agreement of the parties hereto.
12.8 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original but all of which
together shall constitute a single instrument.
12.9 Governing Law. This Agreement shall be governed and construed in
accordance with the laws of the State of New York excluding any choice of law
rules which may direct the application of the law of another state.
12.10 Arbitration. Any dispute, controversy or claim arising out of or
in connection with this Agreement shall be determined and settled by arbitration
in New York, New York, pursuant to the Rules of Arbitration then in effect of
the American Arbitration Association. Any award rendered shall be final and
conclusive upon the parties and a judgment thereon may be entered in a court
having competent jurisdiction. Any arbitration hereunder shall be
-41-
(i) submitted to an arbitration tribunal comprised of three (3) independent
members knowledgeable in the pharmaceutical industry, one of whom shall be
selected by [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***], one of whom shall
be selected by CIMA, and one of whom shall be selected by the other two
arbitrators; (ii) allow for the parties to request discovery pursuant to the
rules then in effect under the Federal Rules of Civil Procedure for a period not
to exceed 90 days; and (iii) require the award to be accompanied by findings of
fact and a statement of reasons for the decision. Each party shall bear its own
costs and expenses, including attorney's fees incurred in any dispute which is
determined and/or settled by arbitration pursuant to this Section. Except where
clearly prevented by the area in dispute, both parties agree to continue
performing their respective obligations under this Agreement while the dispute
is being resolved. Arbitration shall not prevent any party from seeking
injunctive relief where such remedy is an appropriate form of remedy under the
circumstances.
12.11 Captions. All section titles or captions contained in this
Agreement, in any Schedule referred to herein or in any Exhibit annexed hereto,
and the table of contents, if any, to this Agreement are for convenience only,
shall not be deemed a part of this Agreement and shall not affect the meaning or
interpretation of this Agreement.
12.12 No Third-Party Rights. No provision of this Agreement shall be
deemed or construed in any way to result in the creation of any rights or
obligation in any Person not a party or not affiliated with a party to this
Agreement.
12.13 Severability. If any provision of this Agreement is found or
declared to be invalid or unenforceable by any court or other competent
authority having jurisdiction, such finding or declaration shall not invalidate
any other provision hereof, and this Agreement shall thereafter continue in full
force and effect.
12.14 Attachments. All Schedules, Exhibits and other attachments to
this Agreement are by this reference incorporated herein and made a part of this
Agreement.
12.15 Force Majeure. In the event that a party is prevented from
carrying out its obligations under this Agreement by an event of Force Majeure,
then such party's performance of its obligations under this Agreement shall be
excused during the period of such event and for a subsequent reasonable period
of recovery.
12.16 Consents. Where this Agreement requires the consent of any party
and specifies that such consent is not to be unreasonably withheld, the
determination of whether such consent may be withheld shall be based upon the
facts and circumstances of the business of the party whose consent is requested,
it being understood that it is reasonable to withhold the requested consent if
granting the requested consent would have an adverse impact on such party's
business activities.
-42-
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered on the day and year first above written.
CIMA LABS INC.
By: /s/ Xxxx Xxxxx
-------------------------------------
Name: Xxxx Xxxxx
Title: Chief Operating Officer
[***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***]
By: /s/ [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE
COMMISSION.***]
Name: [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***]
Title: [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***]
Schedule 3.1 to
Master Development,
License and Supply Agreement
Master Development Schedule
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***].
Schedule 4.1(a) to
Master Development,
License and Supply Agreement
Royalty Rates
In any Year, [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall pay to
CIMA a royalty in the amount of [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] of the
Annual Net Sales, if any, actually recorded during such Year.
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall pay the royalty payment
due in respect of any Quarter (a "Quarterly Installment") by remitting a check,
together with the report required by Section 4.3, to CIMA within 60 days after
the end of each Quarter during such Year. For purposes of determining the
royalty payment pursuant to this Schedule 4.1(a) the amount of each Quarterly
Installment shall be calculated based on actual Net Sales recorded during such
Quarter.
Schedule 4.1(b) to
Master Development,
License and Supply Agreement
Development Fee And Milestone Payments
(a) Subject to paragraph (b) of this Schedule 4.1(b), [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] shall pay to CIMA any of the milestone payments set
forth below (each a "Milestone Payment") promptly after CIMA demonstrates the
Satisfactory Completion (as defined below) of the research and development
phases (each a "Development Phase") set forth opposite such Milestone Payment:
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***]
(b) Promptly after the completion of each Development Phase, CIMA shall
notify [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] of such completion and shall
provide [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] sufficient written materials (a
"Development Phase Notice") to allow [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] to evaluate whether or not such Development Phase has been
Satisfactorily Completed. [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]
(c) In addition to the Milestone Payments described above, in
connection with each Product, [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall
pay CIMA an amount equal to (i) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] in the
event the actual Completion Date for such Product precedes the target Completion
Date therefor set forth on Schedule 3.1 by at least [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] or (ii) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] in the event
the actual Completion Date for such Product precedes the target Completion Date
therefor set forth on Schedule 3.1 by at least [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***].
(d) [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***] shall also pay to
CIMA the development fee payments set forth below (each a "Development Fee
Payment") within thirty (30) days of CIMA's invoice for development work
performed in accordance with this Agreement during the applicable Quarter.
------------------------------------------------- -------------------------
TIME PERIOD DEVELOPMENT FEE
------------------------------------------------- -------------------------
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***]
Quarter ending December 31, 2001 $500,000
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***]
---------------------------------------------------------------------------
Schedule 5.1(b) to
Master Development
License and Supply Agreement
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***] Purchase Order
[See Attached]
---------------------------------------------------- ------------------------------- ----------------------------------
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION PURCHASE ORDER NO.
OMITTED FILED SEPARATELY WITH THE SECURITIES AND PURCHASE ORDER DATE
EXCHANGE COMMISSION.***]
PAGE
------------------------------------------ -------------------------------------------
VENDOR: SHIP TO:
------------------------------------------ -------------------------------------------
ORIGINAL COPY
----------------- ------------- ------------------------------------------- -------------------------------------------
SHIP VIA TAXABLE TERMS DESCRIPTION FOB DESCRIPTION
----------------- ------------- ------------------------------------------- -------------------------------------------
RESOURCE NUMBER RESOURCE DESCRIPTION QUANTITY UM UNIT PRICE AMOUNT
--------------------------- ------------------------------- --------------- ---------- ----------------- --------------
THE TERMS AND CONDITIONS ON THE REVERSE SIDE ARE PART OF THIS PURCHASE ORDER. BY: __________________________________
TERMS AND CONDITIONS
1. Definitions. (a) Buyer means [***CONFIDENTIAL TREATMENT REQUESTED,
PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] (b) Seller means any person, firm, or corporation to
whom this Purchase Order is directed.
2. Terms: This Purchase Order constitutes any order to buy goods,
equipment, material, supplies, or services according to the description
and other terms set forth on its face and reverse side. No additional
or different terms offered by the Seller shall be or become part of
this order, nor shall this order be modified without the express
written approval of Buyer.
3. Shipping Instructions: All shipments must contain packing lists giving
descriptions of material, quantity and purchase order number. If
shipment is not made F.O.B. destination, the original xxxx of lading
must be furnished with invoices. Buyer's count will be accepted as
final on all shipments not accompanied by packing lists.
4. Risk of Loss: The risk of loss from any casualty to the goods
regardless of the cause, shall be on Seller until the goods have been
received, inspected and accepted by the company.
5. Delays in Delivery: Time is of the essence. If Seller for any reason
does not comply with the buyer's delivery schedule, Buyer in addition
to remedies provided by law, at its option may either approve and
revise delivery schedule or, may terminate the order without liability
on account thereof.
6. Warranty: Seller expressly warrants that all goods, equipment,
material, supplies or services covered by this order will conform to
the specification, drawings, samples or other description furnished or
specified by the Buyer, shall be of good material and workmanship and
free from defects.
7. Rejections: If any of the goods, equipment, material or supplies are
found within a reasonable time after delivery to the Buyer to be
defective in material or workmanship or otherwise not in conformity
with the requirements of the order, Buyer, in addition to any other
rights which it may have under warranties or otherwise, shall have the
right to reject and return such goods at Seller's expense, such goods
not to be replaced without suitable written authorization from Buyer.
8. Patent Infringements: Seller shall pay costs and damages finally
awarded in any suit against the Buyer or its vendees to the extent
based upon a finding that the design or construction of articles as
furnished infringes a United States Patent (except infringement
occurring as a result of incorporating a design or modification at the
request of Buyer); provided the Buyer promptly notifies Seller of any
charge of such infringement and the Seller is given the right at its
expense to settle such charge and to defend or control the defense of
any suit based upon such charge, this paragraph sets forth the Seller's
exclusive liability with respect to patents.
9. Compliance with Laws: Seller shall comply with all applicable State,
Federal and local laws, rules and regulations.
10a. Termination: The Buyer may terminate work on this order for its own
convenience in whole or in part by written or telegraphic notice at any
time. In the event, any claim arising out of such termination shall be
settled by negotiation on the basis of the Seller's costs and
commitments properly incurred or made, with due allowance for salvage
value.
10b. If the Seller ceases to conduct its operations in the normal course of
business including liability to meet its obligations as they mature of
if any proceeding under the bankruptcy or insolvency laws is brought by
or against the Seller, a receiver for the Seller is appointed or
applied for or an assignment for the benefit of Creditors is made by
the Seller, Buyer may terminate order without liability except for the
deliveries previously made or for goods covered by the order then
completed and subsequently delivered in accordance with the terms of
the order.
11. Nondiscrimination in Employment. Seller will not discriminate against
any employee or applicant for employment because of race, religion,
color, sex, age, or national origin.
12. Non-Waiver. Any waiver of strict compliance with the provisions of this
order shall not be deemed a waiver of the Buyer's rights to insist upon
strict compliance thereafter.
13. Subcontracting. In the event the Seller subcontracts all or any part of
this order, Seller remains completely responsible for price, delivery
and quality.
Schedule 5.3 to
Master Development,
License and Supply Agreement
[***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.***]
Schedule 5.4(d) to
Master Development
License and Supply Agreement
Quality Assurance Addendum
[To be mutually agreed by parties on
or prior to each Launch]
