Attached files
EXHIBIT
10.27
AGREEMENT
THIS
AGREEMENT, made this 10th day of July, 2009 (the "Effective Date"), by and
between CARACO PHARMACEUTICAL LABORATORIES, LTD., a Michigan corporation
(“CARACO”), with an address of 1150 Elijah McCoy Drive, Detroit, MI 48202,
USA,
AND
ALKALOIDA
CHEMICAL COMPANY ZRT, a Hungarian corporation (“ALKALOIDA”) having its
Registered office at H-4440, Tiszavasvari, Kabay János u. 29,
Hungary.
R E C I T
A L S
A.
ALKALOIDA has, or may develop or may obtain, proprietary
rights to know-how, data and other Intellectual Property rights (defined below)
to various generic pharmaceutical products and wishes to exploit the
same.
B.
CARACO is interested in the filing of ANDA’s, (defined below),
manufacturing, distribution and sale of the generic pharmaceutical products and
is therefore interested in obtaining the technologies for the filing of ANDA’s,
manufacturing of such products in the US Territory including Puerto
Rico.
C.
ALKALOIDA and CARACO each wish to enter into an agreement pursuant
to which ALKALOIDA shall license the product technology to CARACO for use in the
Territory and provide or cause to be provided certain support to CARACO in
pursuance of the said license.
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1.
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Definitions.
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For the
purposes of this Agreement:
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1.1
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“Affiliate”
means any person or entity that directly or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control
with a party. As used in this definition “control” (including,
with correlative meanings, “controlled by” and “under common control
with”) shall mean possession, directly or indirectly, of power to direct
or cause the direction of management or policies (whether through
ownership of securities or other ownership interest, by contract or
otherwise).
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1.2
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“ANDA”
means an Abbreviated New Drug Application which contains data when
submitted to U.S. FDA’s center for Drug evaluation and Research, office of
Generic Drugs, and provides for the review and ultimate approval of a
generic drug product.
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1.3
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“Bioequivalence”
shall have the meaning provided in the regulations of the U.S. Food and
Drug Administration, as set forth in 21 C.F.R.
§320.1.
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1
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1.4
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“First
Commercial Sale” shall mean, in the Territory, the first sale by CARACO,
its Affiliates or permitted subcontractor or sub licensee of a Product to
a third party after the required regulatory approval to sell such Product
in that country has been granted. A First Commercial Sale shall be deemed
to occur on the earlier of (a) the date the Product is shipped, or (b) the
date of the invoice to the purchaser of the
Product.
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1.5
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“Improvement”
means any alteration, modification or enhancement to, and embodying, the
Product and / or the Product Technology which changes or
improves the effectiveness, efficiency, performance or other attribute of,
or related to, the Products, or any element thereof. Unless
otherwise expressly set forth in this Agreement, the defined term “Product
Technology” includes any and all Improvements, whether made by CARACO, its
sub contractor, its sub licensee, ALKALOIDA and/or the parties
jointly.
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1.6
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“Intellectual
Property” means all know-how, technical information, methods and processes
belonging to either party, including without limitation Intellectual
Property rights and other proprietary rights in any jurisdiction
throughout the world including, without limitation, (a) patents and patent
applications and any divisions, continuations, continuations-in-part,
reissues, renewals, extensions, or reexaminations thereof, (b) inventions,
trade secrets, know-how and other confidential or proprietary information,
(c) copyrights and copyright applications, copyrightable works and mask
works, (d) trademarks and trademark applications, and (e) any additions,
advances, changes, derivatives, improvements, enhancements, refinements or
modifications made to any of the foregoing. The term defined,
as used in this Agreement, shall include any rights analogous to those set
forth in this definition such as moral rights, rights of paternity or
integrity and any other proprietary rights relating to intangible
property.
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1.7
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“Net
Sales” means gross sales to a third party (other than an Affiliate) less
returns, allowances, service level fees, chargebacks, cash discounts, free
goods, shelf stock adjustments, credits for damaged Products or expired
Products, and customary discounts given In addition, all costs incurred as
a result of any recall, field correction, market withdrawal, stock
recovery, or similar action with respect to a Product will be deducted in
the calculation of Net Sales for that Product. However, to the extent such
costs are recovered by CARACO, they will be added back to Net Sales for
such Product upon receipt by CARACO. In case of sales to Affiliates by
CARACO for the purpose of resale to a non affiliate, the net sales as
above shall be computed by such Affiliate and such net sales by such
Affiliate to a non affiliate shall be considered & treated as Net
Sales for all the intents and purposes under this
Agreement.
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1.8
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“Product”
means one or more generic pharmaceutical products, as specified in
Schedule A and to which further products may be added or deleted from time
to time, that may be identified and mutually agreed by the parties hereto
in pursuance of this Agreement and which require the filing and approval
as an ANDA from the United States Food and Drug Administration (US-FDA) of
the United States of America for the purpose of marketing the same in the
Territory.
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2
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1.9
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“Product
Technology” means, for each Product, all properties, specifications,
research, technology and formulations relating to Product, including
know-how, stability data analytical methods, manufacturing processes and
other relevant information. “Product Technology” also includes
such advice and counseling regarding information provided by ALKALOIDA
and/or its nominee as may be reasonably required by
CARACO.
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1.10
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“Territory”
means, the United States, its territories and possessions, including
Puerto Rico.
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NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto, intending to be legally bound,
hereby agree as follows:
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2.
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PROVIDING
OF TECHNOLOGY BY ALKALOIDA TO
CARACO
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2.1
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License.
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(a)
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Subject
to the terms of this Agreement, ALKALOIDA hereby grants to
CARACO:
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(i)
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a
non-exclusive, non-transferable (except as provided herein) license (with
the right to sublicense as provided herein) to the Product Technology for
a period of 5 (five) years from the date of commencement of the marketing
of the Product Technology by ALKALOIDA to CARACO to create Improvements to
the Product; and
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(ii)
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an
exclusive, non-transferable (except as provided herein) license (with the
right to sublicense as provided herein) for the product for a period of 5
(five) years from the date of commencement of the marketing of the Product
Technology by ALKALOIDA to CARACO
to:
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(A)
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manufacture
the Products, and have the Products manufactured, in the Territory using
the Product Technology;
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(B)
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market,
advertise, promote, distribute, sell, offer to sell, license and otherwise
exploit the Products in the Territory using the Product Technology;
and
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(C)
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further
develop, make, use, license and otherwise exploit in the Territory, the
formulations, technology, manufacturing process, know-how, stability data
and other relevant information with respect to the
Products.
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(b)
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The
license rights set forth in Section 2.1(a) include, without limitation,
the exclusive rights to use all Intellectual Property embodied in or
relating to the Products, or any Product Technology for a Product, within
the Territory for a period of 5 (five) years from the date of transfer
of the Product Technology by ALKALOIDA to
CARACO.
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(c)
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CARACO
is permitted to grant a sublicense to any third party manufacturers,
resellers, distributors and/or subcontractors (collectively,
“Subcontractors”) to perform its obligations and/or exercise its rights
under this Agreement; provided that: (i) no use of any Subcontractor shall
relieve CARACO of any of its obligations under this Agreement; and (ii)
CARACO shall remain fully responsible for each such Subcontractor’s
compliance with, and/or breach of, this
Agreement.
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(d)
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The
license period as set forth in Sections 2.1(a) and (b) herein above, if
required by CARACO, shall be extended for further period /block of 5 years
from the end of block of each such 5 years on the terms and conditions of
this Agreement or on such terms as may be mutually agreed upon by
CARACO and ALKALOIDA.
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2.2
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Timing
of Providing Product Technology.
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(a)
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ALKALOIDA
will deliver the Product Technology as soon as it is developed or
available with ALKALOIDA or as agreed to by both the parties or otherwise
deemed fit by the parties, to CARACO for the Products set forth in
Schedule A, which CARACO covenants to use, either alone or with others,
directly or indirectly, solely to exercise its rights and/or perform its
obligations under this Agreement.
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(b)
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Thereafter,
so long as CARACO is promptly performing its obligations pursuant hereto,
ALKALOIDA shall promptly give to CARACO, any updates to the Product
Technology in respect of any Products in Schedule A, and any Products
added to Schedule A during the term of this
Agreement.
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2.3
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Selection
of the Products.
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The
Products shall be selected from time to time by the mutual agreement of
ALKALOIDA and CARACO’s management. The Products so identified shall
be registered by CARACO with US-FDA. The Products so identified and
developed shall be added to the Schedule A from time to time. The ownership of
ANDAs for use in the Territory shall lie with CARACO. It is expressly
agreed and acknowledged that the parties have not, as of the date hereof, agreed
on what Products shall be added, and ALKALOIDA shall not, as of the date hereof,
have any obligation to deliver Product Technology in respect of any specific
Product in the future during the term of this Agreement, but solely to deliver
the Product Technology in respect of the Products, which are to be hereafter
identified as set forth in this Section 2.3.
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2.4
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Right
of First Refusal
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If at any
time before the termination of this agreement, CARACO wishes to sell the ANDAs
for any Product registered in its name under this agreement to any person, it
shall be subject to a Right of First Refusal by ALKALOIDA. The Right of First
Refusal shall be exercised in the following manner:
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(a)
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CARACO
shall provide written notice (the “Offer Notice”) to ALKALOIDA expressing
its desire sell any of the ANDAs for the Products. The Offer Notice shall
indicate the details of the ANDAs being sold and the price at which CARACO
desires to sell the Offered ANDAs (the “Offer Price”) and all other
material terms and conditions of the
offer.
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(b)
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ALKALOIDA
may agree to acquire, by itself or through its nominee, the Offered ANDAs
at the Offer Price by providing CARACO a written notice within 30 days
from the date of receipt by ALKALOIDA of the Offer Notice (the “Reply
Notice”).
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(c)
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If
ALKALOIDA refuses to acquire the Offered ANDAs and states the same in the
Reply Notice or fails to provide the Reply Notice within the period
specified hereinabove, CARACO shall be entitled to sell the Offered ANDAs
to any bona fide third party, at a price not less than the Offer Price and
at the terms and conditions not more favourable than those offered to
ALKALOIDA under this Article, within 30 days from the date of such refusal
or failure to provide Reply Notice by
ALKALOIDA.
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(d)
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If
CARACO is not able to sell the Offered ANDAs to any third party as
prescribed in this Article, then the Offered ANDAs shall again be subject
to the Right of First Refusal by
ALKALOIDA.
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(e)
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Any
third party purchasing such Offered ANDAs in compliance with this Clause
shall not be entitled to take title or beneficial ownership of any Offered
ANDAs until such time as the third party has agreed in writing to be bound
by the terms of this Agreement or as may be mutually agreed by and between
the said Purchaser and ALKALOIDA.
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2.5
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Continuing
Rights of ALKALOIDA.
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Notwithstanding
the providing of Product Technology for any Product hereunder by ALKALOIDA to
CARACO, nothing herein shall in any way limit the right of ALKALOIDA to develop,
produce, market or take any other action for exploiting the Product Technology
with respect to any Product outside of the Territory. CARACO shall
have the exclusive right to develop, produce, market or take any other action
with respect to any Product inside the Territory.
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3.
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OBLIGATIONS
OF CARACO WITH RESPECT TO PRODUCTS.
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3.1
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Delivery
of Protocol.
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To the
extent that the United States Food and Drug Administration (“US-FDA”) has a
required protocol for the studies designed to demonstrate the Bioequivalency of
a Product, (an “FDA Protocol”), then within sixty (60) days of signing of this
Agreement and subsequently within sixty (60) days of selection of the Product by
the parties, CARACO shall deliver, in writing, to ALKALOIDA, a proposed
protocol, which is believed in good faith by CARACO to be acceptable to the
US-FDA (or, if applicable, a waiver of evidence of in vivo
bioavailability). To the extent that no US-FDA Protocol exists with
respect to any Product, CARACO will, in consultation with the US-FDA and
ALKALOIDA, develop such a protocol within one hundred fifty (150) days of the
selection of the Product by the parties; and will promptly deliver such protocol
to ALKALOIDA after it has been developed.
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3.2
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Conduct
of Tests and Studies.
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CARACO
shall, at its own expense, conduct all tests, including a Bioequivalency study
(or studies) and/or pilot studies designed to provide clinical information to
assist in the development of clinical bioequivalence protocols and bioanalytic
methods, and any clinical trials which ALKALOIDA and/or CARACO deem to be
reasonably necessary to enable CARACO to prepare and to file with the FDA an
application for an ANDA for each Product. CARACO shall select
suitable clinical research organizations to conduct any such studies and
trials.
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(a)
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CARACO
shall, at its own expense, produce quantities of any Product as necessary
for use in such studies and trials. Such Products shall be
produced in accordance with those current good manufacturing regulations
established in 21 CFR Parts 210 and 211, as such sections, from time to
time, may be amended or supplemented, or any successor provisions
(“Current Good Manufacturing Practices” or
“CGMP”).
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(b)
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CARACO
shall, in connection with its clinical studies, develop manufacturing
procedures, batch records, packaging and labeling instructions, release
specifications, and quality assurance procedures and put the procedures
into an US-FDA accepted format.
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(c)
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ALKALOIDA
shall have the right, but not the obligation, to monitor all
Bioequivalency studies and clinical trials, and discuss the methodologies
and results of such studies and clinical trials with the persons
responsible for the design and conduct of such studies and/or trial by or
on behalf of CARACO. At the request of ALKALOIDA, CARACO shall
submit relevant production records, including the product formulation,
master batch record, specifications, analytical results, copies and
details of Bioequivalency study and related supporting
documentation. ALKALOIDA reserves the right to use, outside the
Territory, as and when it may elect to do so, any information, data,
studies and formulations which it may be furnished hereunder, without any
royalty, premium or other payment to CARACO notwithstanding that this
Agreement is terminated or this Agreement is terminated for any
Product. CARACO shall have no liability or responsibility
whatsoever in connection with ALKALOIDA’s use outside the Territory of any
information, data, studies and formulations which it may be furnished
hereunder.
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(d)
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The
expense on conducting all tests including Bioequivalency study and on
producing quantities of any product necessary for use in such studies and
trials shall be paid by CARACO
itself.
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3.3
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Preparation
and Submission of ANDAs.
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CARACO
shall complete and submit the ANDA for each Product to the US-FDA as promptly as
commercially practicable after the mutual selection of such Product by the
parties, shall promptly respond to inquiries by the US-FDA in connection with
the Product, and shall monitor and support the ANDA. CARACO shall pay
all expenses in connection with such submission and monitoring for each
submitted Product ANDA, including the filing fee and all legal and consulting
fees and expenses. In any ANDA, CARACO shall:
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(a)
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identify
itself as the manufacturer, and identify the packagers, labelers, and
contract laboratories whose components or services are used in production
of the Product;
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(b)
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submit
methods, process and cleaning
validations;
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(c)
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submit
a signed certificate evidencing its compliance with
CGMP;
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(d)
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submit
executed master formula and batch production and control
records;
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(e)
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adequately
describe the precautions taken to ensure proper
labeling;
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(f)
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submit
specifications and test methods for testing the Product during the
manufacturing process;
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(g)
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submit
the appropriate packaging
information;
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(h)
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submit
the appropriate stability information;
and
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(i)
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submit
such other information, documentation or other matters as (i) required by
applicable FDA rules or regulations, (ii) reasonably determined by
ALKALOIDA or CARACO to be necessary or advisable to permit the expeditious
approval of such ANDA or (iii) requested by the
FDA.
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3.4
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Intellectual
Property Analysis.
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CARACO
shall perform, at its own cost, an Intellectual Property analysis before the
development / license hereunder of the Product Technology for a Product by
ALKALOIDA to determine whether the Product will infringe on the Intellectual
Property of any third party in the Territory based upon the Intellectual
Property strategy made available by ALKALOIDA. In the event that
CARACO, initially and/or at any time after selection of the Product Technology
but before the commencement of any development by ALKALOIDA, determines that a
Product, as formulated in the Product Technology, will infringe the Intellectual
Property of any third party in the Territory, CARACO shall provide written
notice of its conclusions to ALKALOIDA, and shall make its counsel available to
discuss such analysis with ALKALOIDA’s counsel; provided that CARACO and/or
ALKALOIDA shall have no obligation to disclose any written materials that would
result in the waiver of any attorney-client or other legal
privilege. CARACO may require that ALKALOIDA reformulate the Product
and ALKALOIDA shall use its commercially reasonable efforts to do so within a
reasonable time. In the event that ALKALOIDA is unable or is not
willing to reformulate the Product Technology to avoid possible infringement
within a mutually agreed upon reasonable time (not to exceed nine (9) months,
unless otherwise mutually agreed upon), then CARACO or ALKALOIDA may terminate
this Agreement as to the applicable Product upon written notice to the other
party. However, if CARACO and ALKALOIDA mutually decide that the
innovator's patent is challengeable as invalid or unenforceable under the
relevant law, both ALKALOIDA and CARACO may mutually decide, prior to
development of the Product Technology, to launch the Product at risk whether or
not the Product Technology for the Product may be infringing.
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3.5
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Manufacture
of Products.
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CARACO
shall manufacture each Product in accordance with CGMP as defined under 21
C.F.R. 210 and 211, whether such Products are being manufactured in connection
with the submission and seeking of approval of an ANDA or for sale to the public
following approval of an ANDA with respect thereto.
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3.6
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Marketing
of Products.
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Subject
to any limitations imposed as a result of its financial condition, CARACO shall
use its best efforts, consistent with CARACO’s usual customary practices to
market each Product in the Territory, and provide marketing personnel and such
other capabilities as are reasonably appropriate. If CARACO does not start
marketing within one (1) year from the date of approval of ANDA, CARACO shall be
liable to pay to ALKALOIDA for the 1st year of delay at the rate of
US $300,000 and at the rate of US $100,000 for each succeeding year of delay
till the time this Agreement is terminated for the relevant Product, provided
that the reason for the delay is not due to the product not being marketable
and/or profitable, not due to any ongoing analysis or discussion as to whether
the Product would infringe on the Intellectual Property of any third party, or
CARACO has determined that there is no return on investment based on the current
market conditions at time of launch, however, further subject to the condition
that CARACO shall have reimbursed to ALKALOIDA its proportionate share of the
cost of the development of the Product Technology for the Product by ALKALOIDA,
which amount will not exceed an amount to be mutually determined prior to the
selection of any such Product for inclusion in this Agreement. To this extent,
CARACO shall not, at any time after delivery of any Product, enter into any
agreement or otherwise obligate itself to restrict or limit its manufacture of
such Product, except with the consent of ALKALOIDA. Notwithstanding
anything else herein to the contrary (a) CARACO shall not be required to
manufacture the Products in quantities or to sell the Products at prices other
than those which are commercially reasonable; and (b) CARACO shall have full
authority to determine the methods of marketing and selling the Products and the
discounts and terms of sale to its customers provided however that CARACO shall
provide ALKALOIDA prior written notice of any special bundling of Products which
CARACO may offer its customers which may affect the sales of the
Products. In the event that any special bundling would result in a
materially adverse price impact on the Products, then CARACO shall obtain
ALKALOIDA's prior written consent.
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3.7
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No
Activities Outside of the
Territory.
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CARACO
shall not make, use or sell, or grant rights to others to make, use or sell a
Product outside the Territory, but only to ALKALOIDA without the written consent
of ALKALOIDA which may be granted with or without consideration or be withheld
in its sole discretion.
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3.8
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Exclusivity,
IP Ownership and Enforcement.
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(a)
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Subject
to the licenses granted above, ALKALOIDA shall own and retain all right,
title and interest, including all Intellectual Property rights, in and to
the Products, all Product Technology, and all Improvements to the Products
created by a party in connection with, or pursuant to, this Agreement
(“Proprietary Materials”). CARACO shall, at no additional cost
to ALKALOIDA, provide reasonable assistance to ALKALOIDA, including
executing all documents provided by ALKALOIDA, as reasonably necessary for
ALKALOIDA to register, record, protect or otherwise enforce its rights in
the Territory in the Proprietary
Materials.
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(b)
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In
the event ALKALOIDA and/or CARACO becomes aware of any actual or
threatened misappropriation, violation and/or infringement by a third
party of any Intellectual Property related to or embodied in any of the
Products and / or the Product Technology in the Territory, that party
shall promptly notify the other party. In the absence of an
agreement to the contrary at that time, CARACO shall have the sole right
to determine what, if any, action is to be taken against any such third
party and the sole right to take, or not take, any action against such
third party. If CARACO elects to take action against the third
party, CARACO shall bear all costs, expenses and fees, including
attorneys’ fees, associated with the action, provided, however, that, in
the event that such action is unsuccessful, ALKALOIDA shall reimburse
CARACO in the amount of 25% of the costs, expenses and fees, including
attorneys' fees, of any such action. After the payment of all
legal costs and expenses (including, without limitation, attorneys' fees)
CARACO shall be entitled to retain all amounts of any award or settlement
resulting from the action less a payment of consideration as further
described in Section 5.1 hereof (i.e., 25% of the net amount of such award
or settlement) considering such award or settlement as the part of
consideration under this Agreement. CARACO shall obtain the
prior written approval from ALKALOIDA for such award or settlement before
agreeing for any such award or settlement. In connection with
any such action, ALKALOIDA will reasonably cooperate in any such action,
at CARACO’s expense, and will grant CARACO all rights and authorizations
reasonably necessary in association with each
action.
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(c)
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It
is agreed and understood between ALKALOIDA and CARACO that all ANDAs for
the Products shall be owned by and shall belong exclusively to CARACO
however subject to ALKALOIDA's right to use, outside the Territory, as and
when ALKALOIDA may elect to do so, any information, data, studies and
formulations which it may be furnished hereunder, without any royalty,
premium or other payment to CARACO as per the Section 3.2(c)
hereinabove. It is agreed and understood between ALKALOIDA and
CARACO that CARACO may market or sell the Products outside the Territory
using the Product Technology covered by this Agreement only with the prior
written consent of ALKALOIDA, which consent may be withheld in its sole
discretion, and pursuant to the same terms and conditions of this
Agreement, including the payment of consideration as provided by this
Agreement.
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4.
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SUPPORT
TO AND FOR CARACO.
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4.1
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Provision
of Technical Personnel.
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ALKALOIDA
agrees to use its best efforts to provide to CARACO with qualified technical
professional personnel, if required by CARACO for its operations during the term
of this Agreement at the cost of CARACO unless the cost is associated with the
transfer of the technology itself prior to or at the time of completion of the
transfer of the technology.
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4.2
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Assistance
with Raw Materials.
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ALKALOIDA
agrees to use its best efforts to assist CARACO in obtaining quantities of raw
materials, if required by CARACO in its operations at competitive
prices.
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4.3
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Regulatory
Approvals; ANDA Submittals.
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(a)
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ALKALOIDA
will use commercially reasonable efforts to support CARACO in gaining
regulatory approval (ANDAs, etc.) for the Products in the
Territory. ALKALOIDA will timely supply copies of all existing
information and/or Product Technology necessary for each Product to
CARACO.
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(b)
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ALKALOIDA
will use commercially reasonable efforts to correct any problems or issues
regarding the information needed for submittal of the ANDA for Product by
CARACO. Should CARACO be unable to submit the ANDA for approval for the
Product for any reason, including without limitation due to the failure of
either the pilot or pivotal biostudy, directly attributable to the Product
Technology and/or information and technology transferred by ALKALOIDA,
then CARACO or ALKALOIDA may terminate this Product upon advance written
notice to the other party; provided, however, that, to the extent that any
problems or issues precluding regulatory approval are the result of
CARACO's willful misconduct or negligence, CARACO shall reimburse the cost
borne by ALKALOIDA for the development of the Product Technology for
Product.
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4.4
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Sales
Support.
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In
connection with the sale of a Product, ALKALOIDA will provide to CARACO the
requisite analytical procedures (which, without limitation, include stability
indicia and cleaning methods), stability data, pilot biostudy data, a
development report and development data customarily prepared by
ALKALOIDA.
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4.5
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Subcontractors.
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ALKALOIDA
is permitted to use subcontractors to develop the Product Technology under this
Agreement; provided that: (a) no use of any subcontractor shall relieve
ALKALOIDA of any of its obligations under this Agreement, and (b) ALKALOIDA
shall remain fully responsible for each such Subcontractor’s compliance with,
and/or breach of, this Agreement.
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5.
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CONSIDERATION.
|
|
5.1
|
CONSIDERATION.
|
In
consideration of the licenses granted herein and the performance by ALKALOIDA of
its obligations under this Agreement, for each Product, ALKALOIDA shall receive
a royalty of ten percent (10%) of the Net Sales effected by CARACO of the
applicable Products or shall receive such percentage of the net selling price of
the applicable Products as may be mutually agreed upon in writing for any
Product by and between the parties to this Agreement, as the case may
be. The consideration will become due with respect to each Product at
such time as such Product is sold by CARACO to any third party within the
Territory. CARACO shall notify ALKALOIDA when the First Commercial
Sale of the Products has been effectuated. CARACO will pay consideration on a
quarterly basis no later than forty-five (45) days after the end of the quarter
and will provide necessary workings etc. to support the computation of the
royalty payment, as described below. ALKALOIDA shall then notify
CARACO as to where and in whose name (ALKALOIDA's or an Affiliate's) ALKALOIDA
wishes the consideration to be received. Within fifteen (15) business
days of CARACO's receipt of such notice from ALKALOIDA, it shall, as applicable,
either directly remit such consideration to ALKALOIDA and/or its Affiliates
promptly.
It is
hereby agreed and understood by the parties that all the marketing, selling and
distribution expenses for the sale of the Product shall be paid and borne by
Caraco.
Provided
that the royalty of 10% of the Net Sales may be increased or reduced
as mutually agreed from time to time to comply with the provisions of Transfer
Pricing or similar other regulations applicable to either of the
parties.
|
5.2
|
TERMS
OF PAYMENT
|
|
|
(a)
|
Sales
Reports. CARACO shall provide a quarterly sales report
for the Products. The report shall generally include sales
details by customer and Product (e.g. sales value during the period, sales
quantity, average sales price of the Products, average credit period
allowed, charge backs or any other pricing calculations, special bundling
of Products' offers which CARACO may have with customers which may affect
the sales of the Products, realization of Products). CARACO further agrees
to provide such other reports and/or details as may be reasonably
requested by ALKALOIDA and agreed to by
CARACO.
|
|
|
(b)
|
Manner of
Payment. All payments hereunder shall be payable in
United States dollars, by wire transfer to a bank account designated by
ALKALOIDA unless otherwise specified in writing by
ALKALOIDA.
|
11
|
|
(c)
|
Late
Payments. In the event that any payment due hereunder is
not made when due, the payment shall accrue interest from that date due at
an annual interest rate that is equal to 1% over the prevailing 90 Libor
rate as published on the date the payment was due; provided, however, that
in no event shall such range exceed the maximum legal annual interest
rate. The payment of such interest shall not limit ALKALOIDA
from exercising any other rights it may have as a consequence of the delay
of any payment.
|
|
|
(d)
|
Records. During
the term of this Agreement, and for a period of a minimum of five (5)
years after its expiration or termination (or whatever is required by
applicable law or any regulatory authority), CARACO and ALKALOIDA shall
keep complete and accurate records in sufficient detail to permit
ALKALOIDA or CARACO, as the case may be, to confirm the accuracy of all
payments due and paid hereunder.
|
|
|
(e)
|
Taxes. The
parties agree that each is responsible for its own taxes attributable to
this Agreement.
|
|
6.
|
ADVANCED
DRUG DELIVERY SYSTEMS.
|
If
ALKALOIDA desires to transfer the Technology in respect an advanced drug
delivery system (such as a time-release formulation or any other complex
formulation), the terms and conditions of such transfer may be discussed and
negotiated independently, and mutually agreed to, between ALKALOIDA and the
management of CARACO.
|
7.
|
REPRESENTATIONS
AND WARRANTIES OF ALKALOIDA.
|
ALKALOIDA,
as an inducement to CARACO to enter into this Agreement, represents, warrants
and covenants to CARACO as follows:
|
7.1
|
Rights
to Product Technology Information.
|
ALKALOIDA
has or will have at the time the Product Technology of a Product is delivered to
CARACO, the full right, power and authority to grant the licenses set forth
herein relating to each Product in the Territory pursuant to the terms of this
Agreement to permit CARACO to perform pursuant to this Agreement and develop,
market and sell each Product free and clear of any mortgage, lien, encumbrance
or any other third-party interest of any kind. ALKALOIDA is not aware
of any facts or circumstances that a Product is subject to any restriction,
covenant, license (other than this Agreement) or judicial or administrative
order of any kind which detract in any material respect from the value of the
Product's Technology, or which could interfere with the use thereof by CARACO in
the Territory as contemplated by this Agreement unless anything contrary is
specified/indicated in writing to CARACO.
12
|
7.2
|
Knowledge
of no FDA Approval.
|
ALKALOIDA
is not aware of any facts that would reasonably lead it to conclude that any
Product will be unable to receive the contemplated approval from the US-FDA or
approval from any other regulatory authority upon satisfactory completion of
clinical trials, and ALKALOIDA has no knowledge of any facts which would
reasonably lead it to conclude that satisfactory completion of clinical trials
is not likely.
|
7.3
|
Rights
to Products.
|
ALKALOIDA
has not received any notice and has no knowledge that (a) the rights to develop,
market and sell any of the Products have been challenged in any judicial or
administrative proceeding, or (b) any person, entity or product has infringed or
will infringe any patent or other rights with respect to any Product, or (c) any
Intellectual Property rights have been infringed by ALKALOIDA or will be
infringed by CARACO by virtue of performing the activities contemplated by this
Agreement.
|
7.4
|
Right
to Execute and Perform.
|
ALKALOIDA
has full right, power and authority to execute and deliver this Agreement, and
to perform its obligations under it, and has taken all necessary action to
authorize such execution, delivery and performance. This Agreement
constitutes a legal, valid and binding obligation of ALKALOIDA, enforceable
against it in accordance with its terms.
|
7.5
|
Compliance
with Laws.
|
ALKALOIDA
will comply with all applicable laws in connection with performance of its
obligations under this Agreement. The execution, delivery and
performance of this Agreement by ALKALOIDA does not violate any provision of
applicable law or of any regulation, order decree of any court, arbitration or
governmental authority, or any other agreement to which ALKALOIDA is a
party. No consents, approvals or authorizations, registrations or
filings are required in connection with the execution, delivery, performance,
validity or enforceability of this Agreement, except as have been obtained or
set forth in this Agreement.
|
7.6
|
Survivability.
|
The
foregoing representations, warranties and covenants shall survive the
termination of this Agreement and shall be deemed to be made anew each time that
the Product Technology of a Product is delivered by ALKALOIDA to CARACO in
pursuance hereof and shall not be affected by any examination made by or on
behalf of CARACO, the knowledge of its officers, directors, stockholders,
employees or agents or the acceptance of any certificate or
opinion.
|
8.
|
REPRESENTATIONS
AND WARRANTIES OF CARACO.
|
As an
inducement to ALKALOIDA to enter into this Agreement, CARACO represents and
warrants to ALKALOIDA as follows:
13
|
8.1
|
Right
to Execute and Perform.
|
CARACO
has full right, power and authority to execute and deliver this Agreement, and
to perform its obligations under it, and has taken all necessary action to
authorize such execution, delivery and performance. This Agreement
constitutes the legal, valid and binding obligation of CARACO, enforceable
against it in accordance with its terms.
|
8.2
|
COMPETING
PRODUCTS.
|
During
the term of this Agreement, CARACO shall not, directly or indirectly,
manufacture, sell, distribute or market products with the same formulae and
dosage strengths as the Products which are subject to this Agreement, from other
suppliers in Territory. ALKALOIDA shall not offer the same technology
to partners outside the Territory to be used for manufacture and sales within
the Territory during the term of validity of the license to CARACO under this
Agreement.
|
8.3
|
Compliance
with Law.
|
CARACO
will comply with all applicable laws in connection with performance of its
obligations under this Agreement. The execution, delivery and
performance of this Agreement by CARACO does not and will not violate any
provision of applicable law or of any regulation, order decree of any court,
arbitration or governmental authority or any other agreement to which CARACO is
a party. No consents, approvals or authorizations, registrations or
filings are required in connection with the execution, delivery, performance,
validity or enforceability of this Agreement, except as had been obtained or set
forth in this Agreement.
|
8.4
|
Survivability.
|
The
foregoing representations, warranties and covenants, shall survive the
termination of this Agreement, shall be deemed to be made anew each time that a
Product is selected by the parties, and shall not be affected by any examination
made by or on behalf of ALKALOIDA, the knowledge of its officers, directors,
stockholders, employees or agents or the acceptance of any certificate or
opinion.
|
9.
|
INDEMNIFICATION.
|
|
9.1
|
Indemnification
by ALKALOIDA.
|
ALKALOIDA
shall defend, at its sole expense, any third party claim, demand or suit
(“Claim”) against CARACO and/or its Affiliates (“CARACO Indemnitees”) alleging
and/or arising out of the following in connection with this Agreement, and shall
indemnify and hold CARACO Indemnitees harmless from and against any and all
losses, liabilities, damages, fines, penalties, costs, expenses and/or fees
(including reasonable attorneys’ fees) incurred by, or awarded or assessed
against, CARACO Indemnitees in connection with a Claim, or reached through a
negotiated settlement of a Claim:
|
|
(a)
|
that
ALKALOIDA, its employees, or subcontractors were negligent or committed an
intentional act that caused injury to a person or damage to property, or
failed to comply with any applicable law, statute, regulation or
ordinance;
|
14
|
|
(b)
|
product
liability arising from the development of the Product;
and/or
|
|
|
(c)
|
ALKALOIDA’s
breach of this Agreement, including, without limitation, any
representation or warranty set forth in this
Agreement.
|
|
9.2
|
Indemnification
by CARACO.
|
Except
for those Claims that are ALKALOIDA’s responsibility under Section 9.1 above,
CARACO shall defend, at its sole expense, any third party Claim against
ALKALOIDA and/or its Affiliates (“ALKALOIDA Indemnitees”) alleging and/or
arising out of the following in connection with this Agreement, and shall
indemnify and hold ALKALOIDA Indemnitees harmless from and against any and all
losses, liabilities, damages, fines, penalties, costs, expenses and/or fees
(including reasonable attorneys’ fees) awarded or assessed against ALKALOIDA
Indemnitees in connection with a Claim, or reached through a negotiated
settlement of a Claim:
|
|
(a)
|
that
the Products infringe a third party’s Intellectual Property rights under
U.S. law;
|
|
|
(b)
|
that
CARACO, its employees, or Subcontractors were negligent or committed an
intentional act that caused injury to a person or damage to property, or
failed to comply with any applicable law, statute, regulation or
ordinance; and/or
|
|
|
(c)
|
CARACO’s
breach of this Agreement including, without limitation, any representation
or warranty set forth in this
Agreement.
|
|
9.3
|
Procedures.
|
In order
to receive indemnification under this Section, the party seeking indemnification
must provide the other party with prompt written notice of the assertion of the
Claim; permit the other party to retain sole control over the defense and/or
settlement of the Claim; and cooperate with the other party, at the other
party’s expense, in the defense and/or settlement of the Claim. No
Claim described in this Section may be settled without the written consent of
both parties, which shall not be unreasonably withheld. This Section
sets forth the parties’ exclusive indemnification obligations and remedies in
connection with the Claims described in this Section.
|
10.
|
TERM
AND TERMINATION.
|
|
10.1
|
Term.
|
This
Agreement shall be effective on the date first written above and shall expire
sixty (60) months from the date of the first approval of an 1st ANDA under this
Agreement. However, the licenses granted with respect to any Product
as to which CARACO and ALKALOIDA have fulfilled their obligations thereunder,
shall continue for a period of 5 years pursuant to the Clause 2.1 of this
Agreement and CARACO shall pay the consideration as agreed to in terms of this
Agreement for so long as CARACO continues to sell the Product/s during the
period of the agreement. This Agreement may be renewed or extended
for consecutive periods of one (1) year each, if agreed to by parties in
writing; however, the licence granted under this Agreement shall remain valid
pursuant to its terms under this Agreement.
15
|
10.2
|
Termination.
|
At any
time, this Agreement may be terminated in its entirety or with respect to one or
more Products, as provided below, by giving 180 days
written notice unless denoted otherwise as follows:
|
|
(a)
|
by
either party, if the other party is in material default or in material
breach of any term or provision hereof or material breach of any
representation or warranty in this Agreement, and such material default or
material breach continues and is not remedied with thirty (30) days of the
breaching party’s receipt of written notice of such default or
breach. As noted above, termination of the Agreement will not
affect the licenses with respect to any Product pursuant to which
ALKALOIDA and CARACO have fulfilled their obligations with respect to such
Product under this Agreement.
|
|
|
(b)
|
by
CARACO for any given Product in case of material technical, scientific or
regulatory problems or, if the results in data achieved and generated
during the development of any given Product, in CARACO’s reasonable
determination, shows that approval for such Product will be unlikely to be
granted, again with respect to the specific Product only. In
the event of termination by CARACO pursuant to this sub-paragraph, no
obligation shall stand for consideration of any kind other than its
proportionate share of the cost of development of the Product Technology
for the Product by ALKALOIDA or its subcontractor (as further described in
Section 3.6 Marketing of Products) until the time when CARACO terminated
under this Section however that CARACO shall make available, at no cost to
ALKALOIDA, all relevant production records, including the product
formulation, master batch record, specifications, analytical results,
copies and details of Bioequivalency study and related supporting
documentation for use by ALKALOIDA within or outside
Terittory. CARACO shall have no liability or responsibility
whatsoever in connection with ALKALOIDA’s use outside the Territory of any
such production records, including the product formulation, master batch
record, specifications, analytical results, copies and details of
Bioequivalency study and related supporting
documentation.
|
|
|
(c)
|
by
CARACO, for any given Product, if prior to a Product passing the
applicable Bioequivalency study or studies, CARACO in its reasonable
discretion determines that it would not be viable to develop and market
the Product in the Territory a 30 day written notice will be
provided. In the event of termination by CARACO pursuant to
this sub-paragraph, no consideration other than its proportionate share of
the cost of development of the Product Technology for the Product to
ALKALOIDA (as further described in Section 3.6 Marketing of Products)
shall be paid with respect to such Product to ALKALOIDA and/or its
affiliates and, if such consideration has already been paid, ALKALOIDA
agrees to refund such consideration in excess of its proportionate share
of the cost of development of the Product Technology for the Product by
ALKALOIDA (as further described in Section 3.6 Marketing of Products) to
CARACO however that CARACO shall make available, at no cost to ALKALOIDA,
all relevant production records, including the product formulation, master
batch record, specifications, analytical results, copies and details of
Bioequivalency study and related supporting documentation for use by
ALKALOIDA within or outside Terittory. CARACO shall have no
liability or responsibility whatsoever in connection with ALKALOIDA’s use
outside the Territory of any such production records, including the
product formulation, master batch record, specifications, analytical
results, copies and details of Bioequivalency study and related supporting
documentation.
|
16
|
|
(d)
|
by
ALKALOIDA, for any given Product, if prior to a Product passing the
applicable Bioequivalency study or studies, ALKALOIDA in its reasonable
discretion and concurrence of Caraco determines that it would not be
viable to develop and market the Product in the Territory a 30 day written
notice will be provided. In the event of termination by
ALKALOIDA pursuant to this sub-paragraph, ALKALOIDA shall reimburse to
CARACO all reasonable expenses incurred by CARACO for this Agreement for
the relevant Product and CARACO shall make available all relevant
production records, including the product formulation, master batch
record, specifications, analytical results, copies and details of
Bioequivalency study and related supporting documentation to
ALKALOIDA. CARACO shall have no liability or
responsibility whatsoever in connection with ALKALOIDA’s use outside the
Territory of any such production records, including the product
formulation, master batch record, specifications, analytical results,
copies and details of Bioequivalency study and related supporting
documentation.
|
|
|
(e)
|
by
ALKALOIDA, for any given Product, if CARACO does not start marketing
within reasonable time without any reasonable cause from the date of
approval of ANDA, ALKALOIDA in its reasonable discretion
determines without prejudice to the right of other recovery by ALKALOIDA
under this Agreement. In the event of termination by ALKALOIDA
pursuant to this sub-paragraph, CARACO shall make available all relevant
production records, including the product formulation, master batch
record, specifications, analytical results, copies and details of
Bioequivalency study and related supporting documentation to
ALKALOIDA. CARACO shall have no liability or responsibility
whatsoever in connection with ALKALOIDA’s use outside the Territory of any
such production records, including the product formulation, master batch
record, specifications, analytical results, copies and details of
Bioequivalency study and related supporting
documentation.
|
|
|
(f)
|
by
ALKALOIDA, for any given Product, in the event CARACO materially fails to
perform its material obligations with respect to the Product, and fails to
cure such failure within thirty (30) days of notice of such failure from
ALKALOIDA (or if a cure is not reasonably possible within thirty (30)
days, such longer period as is necessary to cure such failure so long as
at all relevant times after such thirty (30) days, CARACO is using its
best efforts to effect such cure). In such event, ALKALOIDA may
elect to have the rights sold in such Product to revert back to
ALKALOIDA. Also, in addition to any other rights it may have
hereunder or under law, ALKALOIDA shall have the right to qualify an
alternative company for the manufacture and sale of the Product in the
Territory and the right to submit an ANDA for the manufacture and sale of
the Product at an alternative company in the Territory. In such
situation, no obligation shall stand for consideration of any kind. Upon
reversion of the Product to ALKALOIDA, CARACO shall retain no rights to
develop, produce, market or otherwise exploit or deal in any manner with
the Product in the Territory and CARACO shall immediately return to
ALKALOIDA the original versions and all copies of all Product Technology
Information (but not including any Bioequivalency studies, any other
information CARACO is obligated to retain under applicable law, and one
copy of all Proprietary Technical Information for CARACO’s record keeping
purposes).
|
17
|
10.3
|
No
Prejudice to Rights.
|
The
termination of this Agreement or of any given Product shall be without prejudice
to any rights and obligations of either party accrued prior to the effective
date of such termination, unless explicitly otherwise agreed or otherwise
provided in this Agreement.
|
11.
|
ARBITRATION.
|
Any
dispute between the parties regarding any provision of this Agreement shall be
resolved by binding arbitration in the State of Michigan pursuant to the
commercial arbitration rules then prevailing of the American Arbitration
Association. The parties shall use good faith to cause the
arbitration proceeding to be completed as soon as practicable, preferably within
ninety (90) days after the date the arbitrator accepts his or her
appointment. Any decision or award of the arbitrator shall be based
solely on the terms of this Agreement and the substantive governing law
applicable to this Agreement and such other information as the arbitrator
determines is appropriate in ascertaining an appropriate remedy. The
decision of the arbitrator shall be in writing stating the reasons therefor,
shall be final and conclusive, and shall be binding on the
parties. Judgment upon the award rendered in the arbitration may be
entered and enforced by any court of competent jurisdiction. The
parties agree to exclude, to the fullest extent permitted by law, any right of
application or appeal to any court in connection with any questions of law
arising in the course of the arbitration proceedings or out of any decision or
award by the arbitrator. The parties hereby expressly agree that the
arbitrator shall have the authority to award specific performance or any
injunction to the prevailing party or to make an award of damages but that the
arbitrator shall not have the power to award punitive or exemplary
damages.
|
12.
|
NO
THIRD-PARTY BENEFICIARIES.
|
This
Agreement shall not confer any rights or remedies upon any person other than the
parties and their respective officers, directors, heirs, executors,
administrators, successors, affiliates and associates and permitted
assigns.
18
|
13.
|
FURTHER
ASSURANCES.
|
The
parties hereto hereby agree to execute and deliver to one another such further
instruments and other documentation as may be requested by any other party
hereto at any time and from time to time to carry out the terms of this
Agreement.
|
14.
|
ENTIRE
AGREEMENT.
|
This
Agreement, all Schedules, and any amendments thereto, contain the entire
understanding of the parties with respect to the subject matter addressed herein
and supersede, replace and merge all prior understandings, promises,
representations and agreements, whether written or oral, relating
thereto. The provisions of the various Agreement documents shall, to
the extent possible, be interpreted so as supplement each other and avoid any
conflict between them. However, in the event of a conflict or
inconsistency between the Agreement documents, such conflict or inconsistency
shall be resolved in accordance with the following order of precedence: (a) any
amendments to this Agreement and/or any Schedule; (b) the applicable Schedule;
and (c) this Agreement.
|
15.
|
BINDING
EFFECT, ASSIGNMENT.
|
Neither
party may assign this Agreement, in whole or in part, without the other party’s
prior express written consent, which shall not be unreasonably withheld or
delayed. Any attempted assignment without such written consent shall
be void. Notwithstanding the foregoing, each party may assign this
Agreement without the other party’s consent, in whole, but not in part: (a) to
one or more Affiliates, provided that each such Affiliate agrees to be bound by
this Agreement and the assigning party remains liable and responsible for such
Affiliates’ compliance with and/or breach of this Agreement; and (b) as
reasonably necessary in connection with any merger, acquisition, sale of assets
or other corporate restructuring. In addition, ALKALOIDA may assign,
transfer and/or convey all or a portion of its rights in and to the Products,
without CARACO’s consent, provided that any such assignment, transfer and/or
conveyance is made expressly subject to the terms of this Agreement, and the
rights and remedies granted to CARACO. Subject to the provisions of
this Section, this Agreement will be binding upon and will inure to the benefit
of the parties and their respective successors and assigns.
|
16.
|
AFFILIATES.
|
ALKALOIDA
and CARACO agree and understand that ALKALOIDA may perform some of its
obligations through its affiliates. However, ALKALOIDA is ultimately legally
responsible for the actions of its affiliates. Any action of an
affiliate of ALKALOIDA under this Agreement which would constitute breach of
this Agreement if performed directly by ALKALOIDA constitutes a breach of this
Agreement by ALKALOIDA. In addition, CARACO in taking any actions
under this Agreement with affiliates of ALKALOIDA shall thereby satisfy its
obligations to ALKALOIDA. This provision does not limit or restrict
the rights of CARACO to pursue any right or remedy against any affiliate of
ALKALOIDA in connection with such affiliate’s performance of the obligations of
ALKALOIDA under this Agreement.
19
|
17.
|
COUNTERPARTS.
|
This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original but all of which together shall constitute one and the same
instruments.
|
18.
|
HEADINGS.
|
The
headings of this Agreement are for ease of reference only and shall not affect
its construction or interpretation. The captions contained in this
Agreement are not a part of this Agreement, but are merely guides or labels to
assist in locating and reading the several articles hereof.
|
19.
|
NOTICES.
|
Any
notices or consents required or permitted by this Agreement shall be in writing
and shall be deemed delivered if sent by certified mail, postage prepaid, return
receipt requested, or overnight delivery service (receipt confirmed), or
facsimile (receipt confirmed), as follows, unless such address is changed by
written notice hereunder.
|
If
to CARACO:
|
CARACO
Pharmaceutical Laboratories, Ltd.,
|
|
1150
Elijah McCoy Drive,
|
|
|
Detroit,
MI 48202, USA.
|
|
|
Attn:
Mr. Daniel Movens
|
|
|
If
to ALKALOIDA:
|
ALKALOIDA
Chemical Company ZRT
|
|
H-4440,
Tiszavasvari,
|
|
|
Kabay
János u. 29,
|
|
|
Hungary
|
|
|
Attn:
Mr. Harin Mehta
|
Any
notice sent by mail shall be deemed to have been delivered within 12 working
days after dispatch and any notice sent by telex or telecopy shall be deemed to
have been delivered within 96 hours of the time of the
dispatch. Notice of change of address shall be effective upon
receipt.
|
20.
|
GOVERNING
LAW.
|
This
Agreement shall be governed by and construed in accordance with the laws of the
State of Michigan (exclusive of its choice of law rules), and the federal laws
of the U.S. The parties agree to bring any suit, claim or proceeding against
each other arising from this Agreement in Michigan and, solely for any such
suit, claim or proceeding, they consent to the personal jurisdiction of such
court and waive any objections to venue in such court.
20
|
21.
|
AMENDMENTS
AND WAIVERS.
|
This
Agreement may be amended and any provision hereof waived only in a writing
signed by the party against whom an amendment or waiver is sought to be
enforced. The parties hereto shall have the right at all times to
enforce the provisions of this Agreement in strict accordance with the terms
hereof, notwithstanding any conduct or custom on the part of such party in
refraining from so doing at any time or times. The failure of any
party at any time to enforce its rights under such provisions strictly in
accordance with the same shall not be construed as having created a custom in
any way or manner contrary to specific provisions of this Agreement or as having
in any way or manner modified or waived the same.
|
22.
|
SEVERABILITY.
|
If any
provision of this Agreement shall be held invalid under any applicable law, such
invalidity shall not affect any other provisions of this Agreement that can be
given effect without the invalid provision, and, to this end, the provisions
hereof are severable.
|
23.
|
EXPENSES.
|
Except as
otherwise expressly provided in this Agreement, the parties will bear their
respective costs and expenses (including legal fees and expenses) incurred in
connection with this Agreement and the transactions contemplated
hereby.
|
24.
|
CONSTRUCTION.
|
The
parties have participated jointly in the negotiation and drafting of this
Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any of the provisions of
this Agreement. Any reference to any federal, state or local statute
or law shall be deemed also to refer to all rules and regulations promulgated
thereunder, unless the context requires otherwise. The word
“including” shall mean including without limitation. Words used
herein, regardless of the number and gender specifically used, shall be deemed
and construed to include any other number, singular or plural, and any other
gender, masculine, feminine or neuter, as the context requires.
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25.
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MISCELLANEOUS
PROVISIONS.
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25.1
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Secrecy.
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(a)
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Prior
to and during the term of this Agreement, each party may disclose, and may
have disclosed, to the other party (orally, in writing, or
electronically), or a party may obtain, observe, or otherwise be granted
access to, information and materials considered confidential by the other
party. Confidential information includes, but is not limited
to, information relating to Product Technology, the Products,
compensation, research, services, developments, inventions, processes,
protocols, methods of operation, techniques, strategies, programs (both
software and firmware), designs, systems, proposed business arrangements,
results of testing, distribution, engineering, marketing, financial,
merchandising and/or sales information, individual customer profiles,
customer lists and/or aggregated customer data (“Confidential
Information”). Confidential Information must be marked or
identified as “confidential” by the disclosing party, unless the
information should reasonably be understood by the receiving party to be
confidential or proprietary under the circumstances. However, information
shall not be subject to the restrictions and prohibitions set forth herein
to the extent that such
information:
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21
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(i)
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is
available to the public in public literature or otherwise, or after
disclosure by one party to the other becomes public knowledge through no
fault of the party receiving such information;
or
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(ii)
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was
known to the party receiving such information prior to the receipt of such
information by such party as established by relevant documentary evidence,
whether received before or after the date of this Agreement;
or
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(iii)
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is
obtained by the party receiving such information from a third party not
subject to a requirement of confidentiality with respect to such
information as established by relevant documentary evidence;
or
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(iv)
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is
independently developed by employees of the party receiving such
information who did not have access to or use of the other party’s
Confidential Information as established by relevant documentary evidence;
or
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(v)
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is
required to be disclosed pursuant to (i) any order of a court having
jurisdiction and power to order such information to be released
or made public; or (ii) any lawful action of a governmental or regulatory
agency provided that each party shall notify the other in writing of any
disclosure of information required hereunder prior to such disclosure;
provided that the party provides reasonable prior notice of such required
disclosure to the other party and, if requested by such other party, uses
all reasonable efforts to secure confidential protection of such
Confidential Information.
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(b)
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Each
party shall use the other party’s Confidential Information only for the
purposes of this Agreement, and not for its own or any third party’s
benefit except as otherwise expressly provided in this
Agreement. Each party shall maintain the confidentiality of the
other party’s Confidential Information in the same manner in which it
protects its own Confidential Information of like kind, but in no event
shall either party take less than reasonable precautions to prevent the
unauthorized disclosure or use of the other party's Confidential
Information.
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(c)
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Each
party is permitted to disclose the other party’s Confidential Information
to its employees, contractors and other third parties on a need to know
basis only, provided that such employees, contractors and/or third parties
have written or legal confidentiality obligations to that party no less
stringent than those contained in this Agreement. Each party
shall be and remain fully liable and responsible for its recipients’
unauthorized disclosure or use of the other party’s Confidential
Information.
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22
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(d)
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Each
party acknowledges and agrees that its unauthorized disclosure or use of
the other party’s Confidential Information will cause damage to the other
party that may not be adequately compensated through money
damages. As such, each party expressly consents to the entry of
an order for equitable remedies, including, but not limited to, temporary,
preliminary and permanent injunctions to remedy any actual or threatened
breach of its obligations under this Agreement. These remedies
are cumulative and in addition to all other remedies available at law or
in equity.
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(e)
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At
the disclosing party’s request, each party shall return the other party’s
Confidential Information. Neither party shall use the other
party’s Confidential Information for its own, or any third party’s,
benefit. However, each party shall be permitted to retain and
use a copy of the other party’s Confidential Information as reasonably
necessary to exercise its rights that survive termination of this
Agreement, for regulatory purposes and/or as otherwise necessary to
protect such party’s interests; provided that party continues to comply
with its confidentiality obligations set forth herein. The
provisions of this Section shall survive termination of this Agreement for
so long as the Confidential Information remains
confidential.
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(f)
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ALKALOIDA
and CARACO shall also co-operate in good faith with respect to any stock
exchange filings, public announcements, or filings with the United States
Securities and Exchange Commission which maybe necessary following
execution of this Agreement.
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25.2
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Binding
Obligation.
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As of the
EFFECTIVE DATE of this Agreement, each party hereby represents and warrants that
this Agreement is a legal and valid obligation binding upon it and is
enforceable in accordance with its terms, except that the enforcement of the
rights and remedies created hereby is subject bankruptcy, insolvency,
reorganizing and similar laws of general application affecting the rights and
remedies of creditors and that the availability of the remedy of specific
performance or of injunctive relief is subject to the discretion of the court
before which any proceeding therefore may be brought. The execution,
delivery and performance of this Agreement by such party does not conflict with
any agreement, instrument or understanding, oral or written, to which it is a
party or by which it maybe bound, nor violate any law or regulation of any
court, governmental body or administrative or other agency having authority over
it.
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25.3
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Force
Majeure.
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Neither
party shall be liable to the other for delay or failure in the performance of
the obligations on its part contained in this Agreement if and to the extent
that such failure or delay is due to circumstances beyond its control which it
could not have avoided by the exercise of reasonable diligence including but not
limited to: act of God, war or insurrection, civil commotion, destruction of
essential facilities or materials by earthquake, fire, flood or storm, labor
disturbance (whether or not any such labor disturbance is within the power of
the affected party to settle); epidemic; or other similar
event; provided, however, that the party so affected shall
notify the other party promptly should such circumstances arise, giving an
indication of the likely extent and duration thereof, and shall use all
commercially reasonable efforts to avoid, remove or alleviate such causes of
non-performance and shall resume performance of its obligations hereunder with
the utmost dispatch whenever such causes are removed. In the event of
force majeure lasting more than two (2) months, the parties agree to meet and
discuss how this Agreement can be justly and fairly implemented under the
circumstances prevailing in such country or countries and if the parties are
unable to agree upon how the Agreement can be implemented then either party may
terminate the Agreement in relation to such country or countries, or to such
Product or Products, upon thirty (30) days written notice.
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25.4
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Relationship
of the parties.
|
It is
expressly agreed that, with respect to each other and for purposes of this
Agreement, ALKALOIDA and CARACO shall be independent parties, and nothing
contained in this Agreement is intended to, or is to be construed to, constitute
ALKALOIDA and CARACO as partners or members of a joint venture or either party
as an employee of the other. Neither party hereto shall have any
express or implied right or authority to assume or create any obligations on
behalf of or in the name of the other party or to bind the other party to any
contract, agreement or undertaking with any third party.
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25.5
|
Further
Actions.
|
Upon the
terms and subject to the conditions hereof, each of the parties hereto shall use
its commercially reasonable efforts to (a) take, or cause to be taken, all
appropriate action and do, or cause to be done, all things necessary, proper or
advisable under applicable law or otherwise to consummate and make
effective the transactions contemplated by this Agreement, (b) obtain from
competent authorities any consents, licenses, permits, waivers, approvals,
authorizations or orders required to be obtained or made by the parties in
connection with the authorization, execution and delivery of this Agreement and
the consumption of the transactions contemplated by this Agreement and (c) make
all necessary filings, and thereafter make any other required submissions, with
respect to this transaction under (A) the Securities Exchange Act of 1934, as
amended and the Securities Act of 1933, as amended, and the rules and
regulations thereunder and any other applicable federal or state securities
laws, (B) the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended,
and any other antitrust regulations and (C) any other applicable
law. The parties hereto shall cooperate with each other in connection
with the making of all such filings, including by providing copies of all such
documents to the other party’s counsel (subject to appropriate confidentiality
restrictions) prior to filing and, if requested, by accepting all reasonable
additions, deletions or changes suggested in connection
therewith.
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25.6
|
Commercially
Reasonable Efforts.
|
Each
party shall use commercially reasonable efforts to perform its responsibilities
under this Agreement. As used herein, the term “commercially
reasonable efforts” means unless the parties agree otherwise, those efforts
consistent with the exercise of prudent scientific and business judgment, as
applied to other products of similar scientific and commercial potential within
the relevant product lines of the parties.
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25.7
|
Limitation
of Representation.
|
|
|
(a)
|
This
Agreement shall not be construed to appoint CARACO as the agent of
ALKALOIDA for the purpose of binding ALKALOIDA or any affiliated company
or firm as principal to any representation commitment or agreement made by
CARACO in connection with the sale or distribution of the product. CARACO
shall incur no expenses on the account of ALKALOIDA without the prior
written approval of ALKALOIDA.
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|
|
(b)
|
In
all relevant correspondence and other dealings relating to the Products,
CARACO shall clearly indicate that it is acting as principal and shall in
no circumstances expressly or impliedly do, or suffer to be done, any act
or thing which may cause it to be taken by any third party as acting as an
agent of ALKALOIDA and shall assume full responsibility for the proper
performance of orders for Products it receives and
accepts.
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|
25.8
|
Insurance.
|
CARACO
undertakes that it shall carry out within reasonable time of entering into this
Agreement and will continue to carry, with insurance companies rated A- or
better, the insurance coverages set forth in this Section, continuously during
the term of this Agreement, and thereafter as provided herein:
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|
(a)
|
Commercial
general liability insurance on an occurrence basis containing such limits
as may be mutually agreed upon by ALKALOIDA and CARACO protecting against
bodily injury, property damage and personal injury claims arising from the
exposures of: (i) product liability; and (ii) contractual liability;
and:
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|
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(i)
|
this
coverage must specifically state that the insurance provided
by CARACO shall be considered primary and non-contributory, any
of ALKALOIDA ’s insurance ,if any shall be considered excess
for the purpose of responding to
claims;
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|
|
(ii)
|
The
Parties shall add the other as an Additional Insured on the policy by
having the insurance carrier issue an Additional Insured
Endorsement(s);
|
|
|
(iii)
|
Commercial
general liability insurance coverage must be maintained for six (6) years
after the termination or expiration of this
Agreement.
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25
|
25.9
|
Limitation
of Liability.
|
Except as
expressly provided herein, in no event shall either party be liable to the other
party in connection with this Agreement and/or the Products, regardless of the
form of action or theory of recovery, for any: (a) indirect, special, exemplary,
consequential, incidental or punitive damages, even if that party has been
advised of the possibility of such damages; and/or (b) lost profits, lost
revenues, lost business expectancy and/or business interruption losses. The
limitations set forth in this Section do not apply to any liability or amounts
related to or arising from a party’s indemnification obligations under this
Agreement and/or a party’s breach of its confidentiality obligations under this
Agreement. Any claim arising out of this Agreement must be initiated
within two (2) years of the date the party knew, or reasonably should have
known, of the existence of such claim against the other party.
|
25.10
|
General.
|
If new
issues arise or a new situation emerges or changes in legislation in Hungary or
in the U.S.A is effected, which are not covered by this Agreement, CARACO or
ALKALOIDA have the right to request further negotiations with the other party to
implement amendments to this Agreement which remedy the deficiency.
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement, themselves or
by their duly authorized representatives, under seal, the day and year first
above written.
CARACO
PHARMACEUTICAL LABORATORIES, LTD,
|
/s/ Daniel H. Movens
|
||
|
By:
|
Daniel H. Movens
|
|
|
Title:
|
Chief Executive Officer
|
|
|
ALKALOIDA
CHEMICAL COMPANY ZRT
|
||
|
/s/ Harin Mehta
|
||
|
By:
|
Harin Mehta
|
|
|
Title:
|
Director
|
|
26