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[EXECUTION COPY]
LICENSE AND SUPPLY AGREEMENT
by and between
NASTECH PHARMACEUTICAL COMPANY INC.
and
XXXXXXX PHARMA, INC.
dated as of July 15, 1997
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LICENSE AND SUPPLY AGREEMENT
This LICENSE AND SUPPLY AGREEMENT ("Agreement"), dated as of July 15,
1997, is by and between NASTECH PHARMACEUTICAL COMPANY INC., a Delaware
corporation ,("Nastech"), and XXXXXXX PHARMA, INC., a Delaware corporation
("Xxxxxxx").
WITNESSETH
WHEREAS, Nastech is engaged, among other things, in the business of
research, development, manufacturing and commercialization of nasally
administered forms of pharmaceutical products;
WHEREAS, Xxxxxxx is engaged, among other things, in the business of
marketing and selling of pharmaceutical products; and
WHEREAS, subject to the terms and conditions set forth in this
Agreement, Nastech wishes to license to Xxxxxxx and Xxxxxxx wishes to license
from Nastech certain rights under certain of the assets which Nastech uses in
the conduct of its intranasal pharmaceutical business;
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 manufacturing, promoting, marketing,
selling and distributing of Nascobal 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; provided, however, that the aggregate amounts calculated pursuant to
clauses (a), (b) and (c) of the definition of "Net Sales" for any of Years
1997, 1998 and 1999 shall not exceed 10% of the gross amount invoiced to
unrelated third parties for Nascobal in the Territory during such Year.
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"Closing Date" shall have the meaning given in Section 4.3 hereof.
"Copyrights" shall mean all of Nastech's copyright rights in the
Territory that are used or exercised by Nastech solely in connection with the
Activities, including, without limitation, Nastech's copyright rights in the
Marketing and Pricing Data and the Marketing Materials.
"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).
"Defective" shall mean, as to any Nascobal Unit, the failure of such
Nascobal Unit to strictly conform to the Specifications, the NDA, this
Agreement and all applicable law, including, without limitation, PDMA.
"FDA" shall mean the United States Food and Drug Administration.
"GMP" shall mean Good Manufacturing Practices, as determined by the
FDA.
"Improved Nascobal Unit" shall mean an improved version of the
Nascobal Unit that is approved for marketing by the FDA.
"Indemnified Party" shall have the meaning given in Section 9.2
hereof.
"Indemnifying Party" shall have the meaning given in Section 9.2
hereof.
"Intellectual Property" shall mean, collectively, (i) the Copyrights,
(ii) the Trademarks, and (iii) the Marketing Materials.
"Licensed Assets" shall have the meaning set forth in Section 2.1
hereof.
"Marketing and Research Data" shall mean, with respect to Nascobal,
all Nastech customer lists, price lists and, subject to confidentiality
obligations to third parties, all other pricing information in the possession
or control of Nastech relating solely to sales of Nascobal occurring in the
most recent 12-month period prior to the date of this Agreement for which such
information is available, together with all studies, research data and reports
with respect to Nascobal.
"Marketing Materials" shall mean all labeling, marketing and
promotional materials and inserts currently used by Nastech solely in
connection with the Activities.
"Nascobal" shall mean an intranasal form of cyanocobalamin/vitamin
B-12 in all dosage strengths and sizes that may, pursuant to applicable laws
and regulations, be manufactured, marketed and sold in the Territory under the
approved NDA, together with all expansions and
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improvements to Nascobal which may be included in any supplement, modification
or addition to the NDA.
"Nascobal Unit" shall mean a ready for sale packaged unit containing
(i) a sealed prescription vial containing a metered dose actuator and a dust
cover, (ii) a 5 xx xxxxx bottle containing Nascobal gel solution, (iii) a
patient instruction sheet and (iv) a product package insert. The actuator,
following priming, will deliver 0.1 ml of the Nascobal gel solution. One
bottle will deliver eight 500 mcg doses.
"Nastech" shall have the meaning given in the preamble and shall
include its Affiliates.
"NDA" shall have the meaning set forth in Section 2.1(a).
"Net Average Sales Price" shall, for any period, mean (i) Net Sales
for such period, divided by (ii) the number of Nascobal Units sold during such
period.
"Net Sales" shall mean, with respect to Nascobal, the gross amount
invoiced to unrelated third parties for Nascobal 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; and
(c) returns, credits and allowances.
Such amounts shall be determined from books and records maintained in
accordance with GAAP, consistently applied.
"Patents" shall mean those United States patent applications pending
or filed by Nastech or its Affiliates (or the rights to which have been
assigned to Nastech) as of the date hereof relating to Nascobal and those
patents set forth on Schedule 6.4 hereto including any patent application or
patent which constitutes an extension, registration, confirmation, reissue,
renewal, reexamination or continuation-in-part of such patent application or
patent.
"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.
"Promotional Materials" shall mean any tangible advertising and
promotional labeling bearing a name (trade name or generic name) used in the
promotion of Nascobal, including, without limitation, promotional materials
produced by Xxxxxxx (examples include, but are not
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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 Xxxxxxx. The definition of Promotional Materials
shall also include press releases and other releases of information to the
media regarding Nascobal.
"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.
"Regulatory Problem" shall have the meaning given in Section 8.2(b).
"Xxxxxxx" shall have the meaning given in the preamble and shall
include its Affiliates.
"Shelf Life Extension" shall have the meaning given in Section 4.1(b).
"Technology" shall mean all of Nastech's Patents, technology, know-how
and all other information necessary to the manufacture of Nascobal.
"Territory" shall mean the fifty (50) states, the District of Columbia
and the territories and possessions comprising the United States of America,
including Puerto Rico.
"Trademarks" shall mean all of Nastech's right, title and interest in
and to:
(a) the United States trademark NASCOBAL; and
(b) all registrations thereof, all variations thereof and
logos used in connection therewith, and all goodwill
associated therewith.
"Year" shall mean a calendar year during the term of this Agreement.
SECTION 2
GRANT OF LICENSES; LICENSE OPTION
2.1 Grant of Marketing and Sales Licenses. Nastech hereby grants
to Xxxxxxx an exclusive, even as to Nastech (except as set forth in Section
2.4), license under the following assets solely for the purpose of promoting,
marketing, selling and distributing Nascobal in the Territory (such assets are
referred to herein collectively as the "Licensed Assets"):
(a) all of Nastech's rights under the approved New Drug
Applications filed by Nastech with the FDA for Nascobal, and all
subsequent submissions thereto (collectively, the "NDA"), which NDA is
described in Schedule 2.1(a);
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(b) the Intellectual Property; and
(c) the Marketing and Research Data.
2.2 Grant of Technology Licenses. Nastech hereby grants to
Xxxxxxx an exclusive, even as to Nastech (except as set forth in Section 2.4 of
this Agreement), license to the Patents and Technology solely for the purposes
of promoting, marketing, selling and distributing Nascobal within the
Territory, and, subject to Section 4.8, for the purposes of manufacturing and
having manufactured Nascobal for sale within the Territory.
2.3 Sublicenses. The licenses granted herein shall not be
sublicensed by Xxxxxxx without the prior written consent of Nastech, which
consent shall not be unreasonably withheld.
2.4 Nastech Retained Rights. Anything herein contained to the
contrary notwithstanding, Nastech shall retain at all times during the term of
this Agreement, and shall bear all costs associated with, all rights necessary:
(a) to manufacture, or to have manufactured, Nascobal for Xxxxxxx hereunder and
otherwise fulfill its obligations under this Agreement, (b) to manufacture or
have Nascobal manufactured in the Territory, (c) subject to Section 2.6, to
manufacture, have manufactured, use or sell Nascobal outside of the Territory,
and (d) subject to Section 8.3, to make such changes as Nastech may deem
reasonably appropriate in connection with any differing approach to
manufacturing it may adopt in a facility(ies) in which any of the components of
Nascobal are produced.
2.5 Marketing. Xxxxxxx agrees to the marketing plan set forth on
Schedule 2.5.
2.6 Option. Nastech grants Xxxxxxx the exclusive option (the
"Option") (i) to license the Licensed Asset, the Patents and the Technology and
(ii) to be supplied with its requirements for Nascobal Units by Nastech, in
each case in any or all countries outside the Territory (other than England and
Ireland) where Xxxxxxx, in its sole discretion, determines it is commercially
reasonable to pursue such licenses and supply arrangements, with the terms and
conditions of such licenses and supply arrangements to be mutually agreed. The
Option shall terminate on August 1, 1997.
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SECTION 3
ROYALTY PAYMENTS
3.1 Royalty Payments. Xxxxxxx shall make the royalty payments
set forth on Schedule 3.1.
3.2 Records and Audit.
(a) Xxxxxxx 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 Nastech
hereunder. Such books of account shall be kept at Xxxxxxx'x principal
place of business or the principal place of business of the
appropriate Affiliate of Xxxxxxx 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 of a firm of
certified public accountants selected by Nastech and reasonably
acceptable to Xxxxxxx, for the limited purpose of verifying Xxxxxxx'x
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 Nastech. In the event
that any such inspection reveals a deficiency in excess of 5% of the
reported royalty for the period covered by the inspection, Xxxxxxx
shall promptly pay Nastech the deficiency, plus interest, and shall
reimburse Nastech for the fees and expenses paid to such accountants
in connection with their inspection. 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) Nastech 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 cost of manufacturing the
Nascobal samples supplied hereunder. Such books of account shall be
kept at Nastech's principal place of business or the principal place
of business of the appropriate Affiliate of Nastech 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 of a firm of certified public accountants selected by
Xxxxxxx and reasonably acceptable to Nastech, for the limited purpose
of verifying the cost of manufacturing the Nascobal samples supplied
hereunder; 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 Schwarz. In the event that any
such inspection reveals that the amount charged for Nascobal samples
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exceeds the cost of manufacturing the Nascobal samples by more than 5%
during the period covered by the inspection, Nastech shall promptly
pay Xxxxxxx the excess, plus interest, and shall reimburse Xxxxxxx for
the fees and expenses paid to such accountants in connection with
their inspection. 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.
3.3 Quarterly Reports of Royalties. In any Year, Xxxxxxx shall,
within 30 days after the end of each Quarter, deliver to Nastech true and
accurate reports, certified by an authorized official of Xxxxxxx, setting forth
the estimated or actual Annual Net Sales and total royalties due under Section
3.1(a) for such Year. If no royalties shall be due, Xxxxxxx shall so report.
3.4 Late Payments. Any amounts not paid by Xxxxxxx when due under
this Agreement shall be subject to interest from and including the date payment
is due through and including the date upon which Nastech has collected
immediately available funds in an account designated by Nastech at a rate equal
to the sum of one and one half percent (1 1/2%) per month plus the prime rate
of interest quoted in the Money Rates section of The Wall Street Journal,
calculated daily on the basis of a 365-day year, or similar reputable data
source.
SECTION 4
SUPPLY OF NASCOBAL UNITS
4.1 Supply of Nascobal Units.
(a) During the term of this Agreement, Xxxxxxx agrees to
purchase from Nastech and Nastech agrees to supply Xxxxxxx with all of
its requirements for Nascobal Units and Nascobal samples for their
subsequent use, sale, lease or transfer by Xxxxxxx. In case Nastech
develops Improved Nascobal Units, Nastech may, with Xxxxxxx'x consent,
to be given or withheld in Xxxxxxx'x sole discretion, supply Improved
Nascobal Units instead of Nascobal Units under this Agreement.
(b) Xxxxxxx agrees to initiate purchases of Nascobal
Units and Nascobal samples hereunder by issuing Nastech purchase
orders not less than 60 days prior to the required delivery date set
forth therein. Nastech agrees to accept any order issued in
accordance with this Section 4.1(b) which specifies quantities
reasonably consistent with those set forth in the purchase forecasts
for such Quarter and to meet the delivery dates specified thereon.
All purchase orders hereunder shall be on Xxxxxxx'x standard purchase
order form (a copy of which has been delivered to Nastech) and shall
be directed to Nastech 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 Nastech, provided, however, that in the event
any terms
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thereof are in conflict, or are inconsistent with any terms of this
Agreement, the terms and conditions hereof shall prevail. Nastech
agrees that, in order to maximize the remaining shelf life of all
reagents supplied under this Agreement, it shall not produce Nascobal
Units for delivery to Xxxxxxx until a purchase order therefor has been
received from Xxxxxxx. In addition, Nastech further agrees to use its
best efforts to maximize the shelf life of Nascobal Units transferred
to Xxxxxxx pursuant to this Agreement, the goal being a 34 month shelf
life upon delivery to Xxxxxxx; provided, however, that during the
initial 6 month period following the Closing Date, such Nascobal Units
shall have at least a 21 month shelf life upon delivery to Xxxxxxx
and, after the initial 6 month period following the Closing Date, such
Nascobal Units shall have at least a 22 month shelf life upon delivery
to Xxxxxxx; and provided further that, if Nastech receives FDA
approval to extend the shelf life for Nascobal (the "Shelf Life
Extension"), such Nascobal Units shall have at least a 24 month shelf
life upon delivery to Xxxxxxx.
(c) Xxxxxxx may increase, without payment of any penalty
or premium, the quantities of Nascobal specified on any purchase order
by up to thirty-five percent (35%) from the forecasts provided under
Section 4.5, provided, however, that notice of such increase is
received by Nastech on a supplemental purchase order not less than 45
days prior to the requested delivery date for such increased quantity
of Nascobal. Subject to conformity with the manufacturing lead times
for Nascobal ordered on such supplemental purchase order, Nastech
agrees to accept supplemental purchase orders for increased quantities
issued in accordance with this Section 4.1(c).
4.2 Minimum Annual Net Sales.
(a) Xxxxxxx shall guarantee minimum Annual Net Sales
equal to 50% of the sales forecast set forth on Schedule 4.2(a).
(b) In the event that (i) the Net Average Sales Price
falls below $50.00, (ii) any Patent is unenforceable, (iii) a generic
drug competitor with an intranasal vitamin B-12 product emerges, (iv)
there is an interruption in the supply of the Nascobal Units for a
period of either 20 days if prior to the Shelf Life Extension or 30
days thereafter, or (v) any circumstance that has a materially adverse
effect on Nascobal which is beyond the control of Xxxxxxx, then, in
each case, the minimum Annual Net Sales requirements under Section
4.2(a) shall terminate and be deemed waived by Nastech and shall be
promptly renegotiated in good faith by Xxxxxxx and Nastech.
4.3 Identification. Xxxxxxx may market Nascobal under its name,
with its packaging and logo; Xxxxxxx will, however, identify Nastech as the
supplier in a fair manner, reasonably acceptable to Nastech. Nastech will
retain title to its own product names, which will be displayed in an
appropriate manner on Nascobal. Nastech will bear all the costs of labeling
Nascobal so as to appropriately display the Xxxxxxx name provided Xxxxxxx
supplies all the appropriate graphics, designs, logos and related and
appropriate artwork, provided that such labeling costs will reasonably
approximate Nastech's existing labeling costs. Xxxxxxx may use
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Nastech's name and derivations thereof in promoting, marketing and selling
Nascobal in the Territory; provided, however, that the particular formulation
of any reference to Nastech's name in any promotional material shall be subject
to Nastech's review and consent; and provided, further, that once the
formulation of any such reference has been reviewed and consented to by
Nastech, any subsequent reference to Nastech's name using such formulation or a
substantially similar formulation shall not be subject to the review or consent
of Nastech. All samples shall be clearly marked "for sample use only".
4.4 Price, Nastech shall supply Nascobal Units to Xxxxxxx at the
fixed price of $6.00 per Nascobal Unit. Nastech shall supply Nascobal samples
to Xxxxxxx at the fixed price of $4.00 during Years 1997, 1998 and 1999 and,
thereafter, at Nastech's cost for such samples, provided that such cost shall
not exceed $6.00 per sample.
4.5 Forecasts, Delivery and Quality.
(a) Xxxxxxx shall provide Nastech with non-binding
forecasts a minimum of two Quarters prior to anticipated delivery
dates: These forecasts will be revised and extended in each succeeding
Quarter.
(b) Delivery of Nascobal Units shall be in accordance
with the destination and dates set forth in Xxxxxxx'x purchase order.
Delivery shall be F.O.B. point of shipment, and identification and
delivery of Nascobal shall be deemed to have occurred when they have
been packed for shipment and delivered to a common or contract
carrier, at which time title and risk of loss shall pass to Xxxxxxx.
(c) All deliveries of Nascobal Units hereunder shall
include a certificate of analysis provided by the quality control
manager of Nastech attesting to the fact that such Nascobal Units (i)
have been manufactured by a process which complies with GMP and has as
its goal compliance with ISO 9002 standards and (ii) are of quality
which is in accordance with criteria established in the
specifications set forth on Schedule 4.5(c) (the "Specifications"),
the NDA and all FDA requirements.
(d) The Nascobal Units supplied hereunder shall have been
manufactured by a process which complies with the quality assurance
addendum set forth on Schedule 4.5(d).
4.6 Rejection and Replacement.
(a) In the event Xxxxxxx determines that any Nascobal
Units as manufactured are Defective, then, within 60 days after
delivery of such Nascobal Units to Xxxxxxx, Xxxxxxx shall provide to
Nastech a written notice of rejection, specifying in reasonable detail
the manner in which Nascobal are Defective (the "Notice of
Rejection"). If no written Notice of Rejection is given to Nastech by
Xxxxxxx within such 60 day period, such Nascobal Units shall be deemed
to have been accepted by Xxxxxxx, provided,
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however, that nothing contained in this Section 4.6(a) shall be deemed
to relieve Nastech of its obligations under the warranties set forth
in Section 6 below.
(b) Upon receipt of a Notice of Rejection from Xxxxxxx
and in order to minimize any hardship to Xxxxxxx'x customers, Nastech
shall use its best efforts to promptly supply to Xxxxxxx a quantity of
replacement Nascobal Units meeting the Specifications equal to the
size of the lot which Xxxxxxx claims was Defective so that such
replacement Nascobal Units shall be received by Xxxxxxx within 60 days
following Nastech's receipt of Xxxxxxx'x Notice of Rejection. All
costs and expenses relating to any rejection and replacement pursuant
to this Section 4.6 shall be paid by Nastech.
4.7 Invoice and Payment. Upon delivery of any Nascobal shipment,
Nastech shall be entitled to submit invoices therefor to Xxxxxxx, and Xxxxxxx
agrees to remit payment within 30 days from receipt of the invoice.
4.8 Supply Disruption; Alternate Manufacturing Site. (a) Nastech
shall use its best efforts to supply Xxxxxxx with Nascobal Units in a timely
manner in accordance with the orders and forecasts received by Nastech pursuant
to Sections 4.1(b) and 4.5(a), respectively, such efforts to include the
maintenance of (i) if after the Shelf Life Extension, a stock of Nascobal Units
equal to 50% of the quantity shipped to Xxxxxxx during the immediately
preceding Quarter and (ii ) at all times, a stock of the glass bottles and
pumps from NDA approved vendors sufficient to produce 100% of the quantity of
Nascobal Units shipped to Xxxxxxx during the immediately preceding Quarter. In
any Quarter, should Nastech fail to supply Xxxxxxx with the greater of (x) 90%
of the quantity of Nascobal Units forecasted for such Quarter pursuant to
Section 4.5(a) and (y) 90% of the quantity of Nascobal Units shipped to Xxxxxxx
during the immediately preceding Quarter (if at least so many are ordered for
such Quarter pursuant to Section 4.1(b)), Xxxxxxx shall have the right to
manufacture Nascobal Units and Xxxxxxx and Nastech shall transfer the
manufacture of the Nascobal Units to Xxxxxxx. Should Nastech cure its failure
to supply, Nastech shall have the right to resume the manufacture of Nascobal
Units and Xxxxxxx and Nastech shall transfer the manufacture of the Nascobal
Units back to Nastech within a commercially reasonable amount of time.
(b) Nastech and Xxxxxxx shall, as soon as practicable following
the Closing Date, qualify a manufacturing plant designated by Xxxxxxx as an
alternate FDA approved manufacturing and packaging site for the Nascobal Units.
The costs of obtaining such approval shall be borne equally by Nastech and
Xxxxxxx.
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SECTION 5
CONDITIONS PRECEDENT TO THE CLOSING;
CLOSING DATE; TERM OF AGREEMENT
5.1 Conditions Precedent to Xxxxxxx'x Obligations. Subject to
waiver as set forth in Section 11.3, all obligations of Xxxxxxx 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 Nastech contained in this
Agreement or in any schedule, certificate or document delivered by
Nastech to Xxxxxxx 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. Nastech 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. Xxxxxxx shall have received a
certificate from Nastech, executed by an officer of Nastech,
certifying in such detail as Xxxxxxx may reasonably request that the
conditions specified in Sections 5.1(a) and 5.1(b), above, have been
fulfilled and certifying that Nastech 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 Nastech'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
Nastech's knowledge, threatened.
5.2 Conditions Precedent to Nastech's Obligations. Subject to
waiver as set forth in Section 11.3, all obligations of Nastech 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 Xxxxxxx contained in this
Agreement or in any schedule, certificate or document delivered by
Xxxxxxx to Nastech pursuant to the
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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. Xxxxxxx 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. Nastech shall have received a
certificate from Xxxxxxx, executed by an officer of Xxxxxxx,
certifying in such detail as Nastech may reasonably request that the
conditions specified in Sections 5.2(a) and 5.2(b), above, have been
fulfilled and certifying that Xxxxxxx 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 Xxxxxxx'x 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
Xxxxxxx'x knowledge, threatened.
5.3 Closing Date.
(a) Subject to Section 5.3(b), below, the closing of the
transactions contemplated by this Agreement shall take place at 3:00
p.m., local time, on July 15, 1997, or on such other date as may be
mutually agreed upon in writing by the parties (the "Closing Date"),
at the offices of Xxxxx, Xxxxx & Xxxxx, 0000 Xxxxxxxx, Xxx Xxxx, Xxx
Xxxx 00000.
(b) Each party hereby agrees to use its best efforts to
consummate the transactions contemplated herein, as modified, on or
before July 15, 1997; provided, however, that if the parties are
unable to close the transactions contemplated hereby by July 15, 1997,
or such later date as shall be mutually agreed to in writing by
Nastech and Xxxxxxx, then all of the rights and obligations of the
parties under this Agreement shall terminate without liability.
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SECTION 6
REPRESENTATIONS AND WARRANTIES OF NASTECH
Nastech hereby represents and warrants to Xxxxxxx that:
6.1 Organization, Power and Authority. Nastech is a corporation
duly organized and validly existing under the laws of the State of Delaware.
Nastech 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, the Patents and the Technology to Xxxxxxx pursuant hereto.
6.2 Due Authority; No Breach. The execution, delivery and
performance by Nastech 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 Nastech. This Agreement is, and each agreement or
instrument contemplated by this Agreement, when executed and delivered by
Nastech in accordance with the provisions hereof, will be (assuming the due
execution and delivery hereof and thereof by Xxxxxxx) the legal, valid and
binding obligation of Nastech, in each case enforceable against Nastech 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 Nastech. All persons
who have executed this Agreement on behalf of Nastech, or who will execute on
behalf of Nastech 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 Nastech, 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 the Articles of Incorporation or By-laws of Nastech or any
material contract or any other material obligation to which Nastech 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, Nastech or upon the
securities, property or business of Nastech, or (iii) constitute a violation by
Nastech of any applicable law or regulation of any jurisdiction as such law or
regulation relates to Nastech, or to the property or business of Nastech except
for such conflict, acceleration, default, breach or violation that is not
reasonably likely to have a material adverse effect on Nastech's ability to
perform its obligations under this Agreement or under any agreement or
instrument contemplated hereby.
6.3 NDA. Nastech has furnished Xxxxxxx with access to a complete
copy of the NDA, including all material amendments and supplements thereto.
Nastech is the lawful holder of all rights under the NDA. Nastech has complied
in all material respects with all applicable laws and regulations in
connection with the preparation and submission to the FDA of the NDA,
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and the NDA has been approved by, and nothing has come to the attention of
Nastech which has, or reasonably should have, led Nastech to believe that the
NDA is not in good standing with, the FDA. Nastech has filed with the FDA all
required notices, supplemental applications and annual or other reports,
including adverse experience reports, with respect to the NDA which are
material to the ability of Nastech to conduct the Activities. There is no
pending or threatened action by the FDA which will have a material adverse
effect on the Activities and no future action by the FDA is required to
lawfully market Nascobal Units in the Territory. Other than pursuant to this
Agreement, Nastech has neither independently marketed, nor has it made
arrangements for others to market Nascobal or Nascobal Units in the Territory.
6.4 Intellectual Property. Set forth on Schedule 6.4 hereto is a
list of all Intellectual Property and Patents. Except as set forth on Schedule
6.4 hereto, (i) Nastech is the lawful owner of the Intellectual Property,
Patents and Technology, (ii) Nastech can license the Intellectual Property,
Patents and Technology without the consent of any third party, (iii) there is
no pending or overtly threatened claim against Nastech asserting that any of
the Intellectual Property, Patents or Technology infringes or violates the
rights of third parties or that Xxxxxxx, by practicing under the Licensed
Assets or Technology in running the Activities, would violate any of the
intellectual property rights of any third party, and (iv) nothing has come to
the attention of Nastech which has, or reasonably should have, led Nastech to
believe that any of the Intellectual Property, Patents or Technology infringes
or violates the right of third parties. Except as set forth on Schedule 6.4
hereto, Nastech has not given any notice to any third parties asserting
infringement by such third parties upon any of the Intellectual Property,
Patents or Technology. Nastech is not aware of and has not received any
communications challenging the ownership, validity or effectiveness of any of
the Intellectual Property, Patents or Technology, or any other intellectual
property rights relating to the Activities. Nastech 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 Xxxxxxx pursuant to this Agreement.
6.5 Technology Rights. The Patents and the Technology contain all
the technology, patents, know-how, trade secrets and other intellectual
property necessary to manufacture Nascobal.
6.6 Litigation. There are no pending or, to the best of Nastech's
knowledge, threatened judicial, administrative or arbitral actions, claims,
suits or proceedings pending as of the date hereof against Nastech relating to
the Activities, the Licensed Assets, Patents or the Technology which, either
individually or together with any other, would have a material adverse
effect on the Activities, the Licensed Assets, the Patents, Technology or the
ability of Nastech to perform its obligations under this Agreement or any
agreement or instrument contemplated hereby. There are no pending, and Nastech
does not presently contemplate bringing, any actions or suits relating to the
Activities, the Licensed Assets, the Patents or the Technology brought by
Nastech against others.
6.7 Governmental Approval. Other than FDA approval of Xxxxxxx'x
trade dress of the Nascobal Units, no consent, approval, waiver, order or
authorization of, or registration,
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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 Nastech or the
performance by Nastech of its obligations contemplated hereby and thereby.
6.8 Brokerage. Other than Mazier Partners LLC, no broker, finder
or similar agent has been employed by or on behalf of Nastech, and no Person
with which Nastech 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.
Nastech shall bear any brokerage commission, finder's fee or any similar
compensation owed to Mazier Partners LLC.
6.9 Implied Warranties. EXCEPT AS EXPRESSLY PROVIDED IN THIS
SECTION 6, NASTECH MAKES NO REPRESENTATION OR WARRANTY AS TO THE LICENSED
ASSETS, THE PATENTS, THE TECHNOLOGY OR THE ACTIVITIES, EITHER IN FACT OR BY
OPERATION OF LAW, AND NASTECH SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR
STATUTORY WARRANTIES.
SECTION 7
REPRESENTATIONS AND WARRANTIES OF XXXXXXX
Xxxxxxx represents and warrants to Nastech that:
7.1 Organization, Power and Authority. Xxxxxxx is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Delaware. Xxxxxxx 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, the Patents and the Technology from Nastech
pursuant hereto.
7.2 Due Authority; No Breach. The execution, delivery and
performance by Xxxxxxx 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 Xxxxxxx. This Agreement is, and each agreement or
instrument contemplated by this Agreement, when executed and delivered by
Xxxxxxx in accordance with the provisions hereof, will be (assuming due
execution and delivery hereof and thereof by Nastech) the legal, valid and
binding obligation of Xxxxxxx, in each case enforceable against Xxxxxxx 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 Xxxxxxx. All persons
who have executed this Agreement on behalf of Xxxxxxx, or who will execute on
behalf of Xxxxxxx any agreement or instrument contemplated by this Agreement,
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have been duly authorized to do so by all necessary corporate action. Neither
the execution and delivery of this Agreement by Xxxxxxx, or any such other
agreement or instrument by Xxxxxxx, 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 the Articles of Incorporation or By-laws of Xxxxxxx or
any material contract or any other material obligation to which Xxxxxxx 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, Xxxxxxx or upon the
securities, property or business of Xxxxxxx, or (iii) constitute a violation by
Xxxxxxx of any applicable law or regulation of any jurisdiction as such law or
regulation relates to Xxxxxxx or to the property or business of Xxxxxxx, except
for such conflict, acceleration, default, breach or violation that is not
reasonably likely to have a material adverse effect on Xxxxxxx'x ability to
perform its obligations under this Agreement or any agreement or instrument
contemplated hereby.
7.3 Brokerage. No broker, finder or similar agent has been
employed by or on behalf of Xxxxxxx and no Person with which Xxxxxxx 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.
7.4 Litigation. There are no pending or, to the best of Xxxxxxx'x
knowledge, threatened judicial, administrative or arbitral actions, claims,
suits or proceedings pending as of the date hereof against Xxxxxxx which,
either individually or together with any other, will have a material adverse
effect on the ability of Xxxxxxx to perform its obligations under this
Agreement or any agreement or instrument contemplated hereby.
7.5 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 Xxxxxxx or the performance by Xxxxxxx of its obligations
contemplated hereby and thereby.
SECTION 8
ADDITIONAL COVENANTS AND AGREEMENTS OF THE PARTIES
8.1 Governmental Filings. Nastech and Xxxxxxx each agree to
prepare and file whatever filings, requests or applications are required to be
filed with any governmental authority in connection with this Agreement and to
cooperate with one another as reasonably necessary to accomplish the foregoing.
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8.2 Responsibility for NDA.
(a) Nastech shall remain responsible for fulfilling all
regulatory requirements with respect to Nascobal that are imposed upon
Nastech as the owner of the NDA. Nastech shall provide Xxxxxxx, upon
request after reasonable notice from Xxxxxxx, with access to copies of
all filings submitted by Nastech to the NDA. Xxxxxxx shall, on a
timely basis, provide to Nastech all information that Xxxxxxx has that
Nastech does not have that is reasonably necessary and relevant to
Nastech's obligations hereunder to fulfill such requirements
including, but not limited to, sales distribution information
concerning Nascobal, and shall otherwise cooperate with Nastech as
reasonably necessary in connection therewith. Nastech shall have the
final decision-making authority in every case on whether and how to
supplement, amend or otherwise alter the NDA and any other issues in
connection with the NDA and on whether and how to communicate with the
FDA in connection therewith. Xxxxxxx shall submit to Nastech for
Nastech's prior review and approval any request by Xxxxxxx to pursue
approval of any new indication for Nascobal, to conduct any studies
with respect to Nascobal, and to make any submissions to the FDA with
respect to Nascobal; provided, however, that Nastech shall have the
right, in its reasonable judgment and based solely on the scientific
merit of the request, to refuse any such request. If Xxxxxxx elects
to undertake a regulatory obligation, such election shall be subject
to Nastech and Xxxxxxx mutually agreeing upon the terms and conditions
(including, but not limited to, compensation to Xxxxxxx) of any such
obligation.
(b) Anything to the contrary in Section 8.2(a)
notwithstanding, Nastech may, and in the event of any regulatory
problem that disrupts the promotion, marketing or sale of Nascobal or
Nascobal Units or has a materially adverse effect on the Activities
(each a "Regulatory Problem"), Nastech shall pay Xxxxxxx $75,000 per
annum to assume responsibility for fulfilling all regulatory
requirements with respect to Nascobal that are imposed upon Nastech as
the owner of the NDA. In any such case, Nastech shall, on a timely
basis, perform any action and provide to Xxxxxxx all information and
materials that Nastech can or has that Xxxxxxx can not or does not
have that are reasonably necessary and relevant to Xxxxxxx'x
obligations hereunder to fulfill such requirements, including
providing copies of Form 356(h) or other letter required by the FDA or
applicable law to be received from the NDA owner, and Nastech shall
otherwise cooperate with Xxxxxxx as reasonably necessary in connection
therewith. Xxxxxxx shall have the final decision-making authority in
every case on whether and how to supplement, amend or otherwise alter
the NDA and any other issues in connection with the NDA and on whether
and how to communicate with the FDA in connection therewith. Nastech
shall submit to Xxxxxxx for Xxxxxxx'x prior review and approval any
request by Nastech to pursue approval of any new indication for
Nascobal, to conduct any studies with respect to Nascobal, and to make
any submissions to the FDA with respect to Nascobal; provided,
however, that Xxxxxxx shall have the right, in its reasonable judgment
and based solely on the scientific merit of the request, to refuse any
such request.
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(c) If Nastech is forced pursuant to Section 8.2(b) to
transfer the responsibility for fulfilling regulatory requirements
with respect to Nascobal to Xxxxxxx because of a Regulatory Problem,
then Nastech shall, upon its development of procedures and/or the
capability to cure such Regulatory Problem, have the right to reassume
such responsibility and Xxxxxxx and Nastech shall transfer such
responsibility back to Nastech within a commercially reasonable amount
of time; provided, however, that Nastech shall pay all reasonable
costs and expenses of Xxxxxxx associated with such transfer,
including, without limitation, the cost of terminating any employees
of Xxxxxxx specifically hired to fulfill the regulatory requirements
with respect to Nascobal.
(d) Xxxxxxx and Nastech shall jointly develop written
procedures and define responsibilities for (i) the reporting of
adverse drug experiences, (ii) the submission by Xxxxxxx to Nastech
and by Nastech to FDA of labeling and promotional materials related to
Nascobal, (iii) the administration of and response to medical
inquiries concerning Nascobal by consumers, physicians, pharmacists
and other health care professionals, (iv) the administration and
analysis of and response to complaints concerning Nascobal, and (v)
the development of training materials related to Nascobal. Xxxxxxx
and Nastech shall each comply with the provisions of such written
procedures.
(e) Nastech shall use its best efforts to take the
regulatory steps set forth on Schedule 8.2(e).
8.3 Compliance with Law. Xxxxxxx and Nastech shall each comply
with all federal, state and local laws and regulations applicable to
manufacturing, marketing and selling Nascobal in the Territory, the Licensed
Assets, the Patents and the Technology or the performance of their respective
obligations hereunder. Nastech and Xxxxxxx 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. Nastech and Xxxxxxx
each shall notify the other within twenty-four (24) 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 Nascobal. Xxxxxxx and Nastech 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. Xxxxxxx and Nastech shall discuss any 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, Nastech shall be responsible for
deciding the appropriate form and content of any response with respect to any
of its cited activities and Xxxxxxx shall be responsible for deciding the
appropriate form and content of any response with respect to any of its cited
activities.
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8.4 Recall. Xxxxxxx and Nastech shall consult with one another as
to all decisions concerning recall or withdrawal of Nascobal 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 required by the FDA
or other governmental authority. Nastech shall bear the costs (including but
not limited to, shipping and product credits) for any recall or withdrawal
primarily due to the failure of the product integrity of the Nascobal Units,
including but not limited to, Nastech's failure to comply with this Agreement,
GMP, federal regulations or the FDA approved specifications. The costs for any
other recall or withdrawal shall be the responsibility of Xxxxxxx. In the
event of any recall or withdrawal of Nascobal due to the failure of the product
integrity of the Nascobal Units, the minimum Annual Net Sales requirements
pursuant to Section 4.2 shall terminate and be deemed waived by Nastech and
shall be renegotiated in good faith by Nastech and Xxxxxxx. Each party will
cooperate fully with the other in connection with any recall or withdrawal.
8.5 Confidentiality. Xxxxxxx shall treat as confidential the
Licensed Assets, the Patents, the Technology, and all other information of
Nastech of which Xxxxxxx becomes aware in connection with this Agreement
(collectively, "Nastech Proprietary Information"). Xxxxxxx shall neither
disclose Nastech Proprietary Information to any third party nor use Nastech
Proprietary Information for any purpose other than as set forth in this
Agreement. Nastech shall treat as confidential all information of Xxxxxxx of
which Nastech becomes aware in connection with this Agreement (collectively,
"Xxxxxxx Proprietary Information"). Nastech shall neither disclose Xxxxxxx
Proprietary Information to any third party nor use Xxxxxxx 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
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(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.
Xxxxxxx shall obtain no right or license of any kind under the Nastech
Proprietary Information except as set forth in this Agreement. Nastech shall
obtain no right or license of any kind under the Xxxxxxx Proprietary
Information except as set forth in this Agreement.
8.6 Expenses. Nastech and Xxxxxxx 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.
8.7 Reasonable Efforts. Nastech and Xxxxxxx 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 (including, without limitation, all applicable drug listing
and NDA notifications to the FDA identifying Xxxxxxx as a distributor of
Nascobal).
8.8 Publicity. The parties agree that no publicity release or
announcement concerning the transactions contemplated hereby shall be issued
without the advance written consent of the other, except (i) 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 and (ii) on or promptly after the Closing Date, the
press release set forth on Schedule 8.8.
8.9 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 Nascobal 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.
8.10 Competition; No Sale for Resale.
(a) Nastech agrees that, commencing on the Closing Date
and continuing for the term of this Agreement, it shall not directly
or indirectly, engage in any
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activity in competition with the Activities in the Territory. It is
understood that Nastech may manufacture or have manufactured Nascobal
in the Territory for sale outside the Territory. It is further
understood that the remedies at law are inadequate in the case of any
breach of this covenant and that Xxxxxxx shall be entitled to
equitable relief, including the remedy of specific performance, with
respect to any breach of such covenant.
(b) Neither Xxxxxxx nor any sublicensee of Xxxxxxx shall
knowingly sell any Nascobal Units 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. Nastech shall not knowingly sell any Nascobal
Units to anyone in the Territory or outside the Territory for
subsequent distribution or resale in the Territory and Nastech shall
take all reasonable precautions to prevent such distribution or resale
in the Territory.
8.11 Product Returns. Xxxxxxx shall be responsible for all
rebates, chargebacks and returns of Nascobal Units sold on or after the date of
this Agreement and Nastech shall be responsible for all rebates, chargebacks
and returns of Nascobal Units sold prior to the date of this Agreement.
8.12 Conflicting Rights. Nastech 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 Xxxxxxx pursuant to this Agreement.
8.13 Patent and Trademark Maintenance.
(a) Nastech shall be solely responsible for filing,
prosecuting, and maintaining all of the Patents and Trademarks, and
Nastech shall pay the costs associated therewith. Nastech shall file,
prosecute, and maintain all Patents and Trademarks so as to fully
continue the benefits under the licenses granted to Xxxxxxx hereunder.
In the event that any extension, registration, confirmation, reissue,
renewal, reexamination or continuation-in-part is to be filed with
respect to a Patent or a Trademark, Nastech shall provide Xxxxxxx with
the opportunity to review such extension, registration, confirmation,
reissue, renewal, reexamination or continuation-in-part and provide
input thereto.
(b) Xxxxxxx and Nastech agree that, where applicable, all
packaging of the Nascobal Units shall identify (i) the number of the
Patents and (ii) Nastech as the owner of the Trademarks.
8.14 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 Patent and provide any information
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available to that party relating to such alleged infringement.
Nastech shall have the responsibility to investigate such alleged
infringement and act diligently to end any infringement of such
rights, including, but not limited to, bringing suit against such
third party infringer.
(b) Procedures. No settlement, consent judgment or other
voluntary final disposition of the suit 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 8.14, 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, any third party (other than an Affiliate of
Xxxxxxx) claims that Xxxxxxx'x marketing or selling of Nascobal Units
hereunder infringes on a third party patent based upon claims that
dominate claims in the Patents, within 120 days after notice by
Xxxxxxx, Nastech shall (i) initiate an action for a declaratory
judgment of invalidity and/or noninfringement of any such patents, or
(ii) procure for Xxxxxxx the right to exercise all rights licensed
under this Agreement without any additional payment therefor by
Schwarz.
8.15 Supply of Nascobal Units. Nastech shall maintain the capacity
throughout the term of this Agreement to meet the requirements of Xxxxxxx for
Nascobal Units hereunder.
8.16 Technology. Nastech shall be solely responsible for
maintaining the Technology in accordance with the terms set forth in this
Agreement.
8.17 Liability Insurance. Nastech shall obtain and carry in full
force and effect product liability insurance in respect of Nascobal in the
amount of $1,000,000 per occurrence, $3,000,000 in the aggregate. Xxxxxxx
shall obtain and carry in full force and effect product liability insurance in
respect of Nascobal in the amount of $10,000,000 per occurrence, $10,000,000
in the aggregate.
8.18 Referral of Orders and Inquiries. Nastech shall refer all
Persons sending orders or making inquiries regarding Nascobal or Nascobal Units
within the Territory to Xxxxxxx and shall promptly notify Xxxxxxx of the name
of each such Person and the nature of the inquiry of such Person.
8.19 Deemed Breach of Covenant. Neither Nastech nor Xxxxxxx shall
be deemed to be in breach of any covenant contained in this Section 8 if such
party's deemed breach is the result of any action or inaction on the part of
the other party.
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SECTION 9
INDEMNIFICATION
9.1 Indemnification.
(a) Nastech shall indemnify, defend and hold Xxxxxxx (and
its directors, officers, employees, and Affiliates) harmless from and
against any and all Damages incurred or suffered by Schwarz (and its
directors, officers, employees, and Affiliates) as a consequence of:
(i) any breach of any representation or warranty made by
Nastech in this Agreement or any agreement,
instrument or document delivered by Nastech pursuant
to the terms of this Agreement;
(ii) any failure to perform duly and punctually any
covenant, agreement or undertaking on the part of
Nastech contained in this Agreement;
(iii) any act or omission of Nastech with respect to the
operation of Nastech's business, or the handling,
manufacturing, sale, consumption or use of Nascobal
by Nastech; 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 Nastech or
Xxxxxxx.
(b) Xxxxxxx shall indemnify, defend and hold Nastech (and
its directors, officers, employees, and Affiliates) harmless from and
against any and all Damages incurred or suffered by Nastech (and its
directors, officers, employees, and Affiliates) as a consequence of:
(i) any breach of any representation or warranty made by
Xxxxxxx in this Agreement or any agreement,
instrument or document delivered by Xxxxxxx pursuant
to the terms of this Agreement;
(ii) any failure to perform duly and punctually any
covenant, agreement or undertaking on the part of
Xxxxxxx contained in this Agreement; or
(iii) any act or omission of Xxxxxxx with respect to the
operation of Xxxxxxx'x business or the handling,
manufacturing, sale, consumption or use of Nascobal
by Xxxxxxx.
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9.2 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 9.1. 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 9.2, (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).
9.3 Indemnification Payment Obligation. No Indemnifying Party
will have any obligations under Sections 9.1(a) or 9.1(b) until the cumulative
aggregate amount of Damages incurred or suffered by the Indemnified Party which
the Indemnifying Party is otherwise subject to under this Agreement exceeds
$50,000 at which time the entire cumulative aggregate amount of such Damages
shall be covered. The provisions of this Section 9.3 shall not limit or
otherwise affect the obligations of any Indemnifying Party under any other
Section of this Agreement.
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9.4 Indemnification Payment Adjustments. The amount of any
Damages for which indemnification is provided under this Section 9 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 9 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 9 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 9 with respect to
such Damages.
9.5 Indemnification Payment. Upon the final determination of
liability and the amount of the indemnification payment under this Section 9,
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.
9.6 Survival. The provisions of Section 9 shall survive any
termination of this Agreement. Each Indemnified Party's rights under Section 9
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 9.
SECTION 10
TERMINATION
10.1 Termination. The term of this Agreement shall begin upon the
Closing Date and, unless sooner terminated as hereinafter provided, shall end
upon the later of (i) the fifteenth anniversary of the Closing Date and (ii)
the expiration of the Patents (including any continuation thereof).
Notwithstanding the foregoing, this Agreement may be terminated as follows:
(a) Termination for Insolvency. If either Xxxxxxx or Nastech
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(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.
(i) Xxxxxxx and Nastech 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 30
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 10.1(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 30 days after receipt of
notification, or if the same cannot reasonably be
corrected or remedied within 30 days, then if the
defaulting party has not commenced curing said
default(s) within said 30 days and be diligently
pursuing completion of same, then such party
immediately may terminate this Agreement.
(ii) This Section 10.1(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) Continuing Obligations. Termination of this
Agreement for any reason shall not relieve the parties of any
obligation accruing prior thereto with respect to the Nascobal and any
ongoing obligations hereunder with respect to the remaining Product
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 8.4, 8.5, 8.6, 8.8, 8.11, 8.17, 9, 10.1(c) and 11 hereof, and
such obligations shall survive any such termination.
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SECTION 11
MISCELLANEOUS
11.1 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 Nastech nor
Xxxxxxx 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 of the assets or outstanding
shares of, or merges with, Xxxxxxx or Nastech, as the case may be.
11.2 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 Nastech, as follows:
Nastech Pharmaceutical Company Inc.
00 Xxxxxx Xxxxx
Xxxxxxxx, Xxx Xxxx 00000
Facsimile: 000-000-0000
Attention: President
If to Xxxxxxx, as follows:
Xxxxxxx Pharma, Inc.
0000 Xxxxxx Xxxx Xxxx
Xxxxxx, Xxxxxxxxx 00000
Facsimile: 000-000-0000
Attention: Xxxxxx Xxxxxx
or in any case to such other address or addresses as hereafter shall be
furnished as provided in this Section 11.2 by any party hereto to the other
party.
11.3 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 Nastech or Schwarz
in exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any waiver on the part of either Nastech or Schwarz 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
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or privilege hereunder. The indemnification provided in Section 9 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.
11.4 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.
11.5 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. Xxxxxxx
acknowledges that it does not have, and Xxxxxxx shall not make representations
to any third party, either directly or indirectly, indicating that Xxxxxxx has
any authority to act for or on behalf of Nastech or to obligate Nastech in any
way whatsoever. Nastech 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 Xxxxxxx or to
obligate Xxxxxxx in any way whatsoever.
11.6 Entire Agreement. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior agreements or understandings of the parties relating
thereto.
11.7 Amendment. This Agreement may be modified or amended only by
written agreement of the parties hereto.
11.8 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.
11.9 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.
11.10 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 (i)
submitted to an arbitration tribunal comprised of three (3) independent members
knowledgeable in the pharmaceutical industry, one of whom shall be selected by
Schwarz, one of whom shall be selected by Nastech, 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
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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.
11.11 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.
11.12 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.
11.13 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.
11.14 Attachments. All Schedules, Exhibits and other attachments to
this Agreement are by this reference incorporated herein and made a part of
this Agreement.
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