Exhibit 10.14
MANUFACTURE AND SUPPLY AGREEMENT
Agreement made this 11th day of April, 2005, between Seller with
Manufacturer and Buyer, each as identified below.
Manufacturer shall manufacture and Seller shall sell and deliver to Buyer,
and Buyer shall purchase from Seller, the Product identified below, upon the
terms set forth below, in the attached Terms and Conditions of Sale ("Terms"),
and in each Rider, if any, all attached hereto and made a part hereof.
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A. BUYER Ceptor Corporation
200 International Circle
Suite 5100
Hunt Valley, Maryland 21030
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B. SELLER Peninsula Laboratories
305 Old Country Road
San Carlos, California 94070
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C. MANUFACTURER Bachem AG
Hauptstrasse 144
4416 Bubendorf, Switzerland
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D. PRODUCT C-101 active pharmaceutical ingredient, in
accordance with agreed upon and approved
specifications.
Buyer shall purchase separately from a third
party, and provide to Seller to incorporate
into the Product, L-aminocarnitine of a
quality reasonably acceptable to the
parties.
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E. TERRITORY Worldwide
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F. TERM OF AGREEMENT Commencement Date: April 11, 2005
Termination Date: April 11, 2015, but at
least five years after market authorization
in the U.S. and/or EU
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G. CURRENT AGREED UPON Buyer agrees to purchase the following
QUANTITIES AND DELIVERY quantities (which are not cumulative)from
DATES Seller:
NON-GMP:
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90g - already delivered
600g - by April 15, 2005
975g - by July 31, 2005
GMP:
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300g - by September 15, 2005
1600g - by November 30, 2005
1600g - by December 31, 2005
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1
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H. PRICING First 1.2kg (non-GMP) @ $1750/g
Next 465g (non-GMP) @$750/g
Next 3.5kg (GMP) @$750/g
All other developmental GMP @$500/g All
commercial material: target price $250/g to
be confirmed after successful process
validation, but if more than $250/g, will be
subject to royalty renegotiations. These
prices do not include L-aminocarnitine as
mentioned under D.
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I. PAYMENT TERMS 1st year - the lesser of 5% of Net Sales or
$10 million;
2nd year - the lesser of 5% of Net Sales or
$15 million;
3rd year and beyond - the lesser of 5% of
Net Sales or $25 million.
"Net Sales" shall mean Buyer's gross sales
(the gross invoice amount billed customers)
of Product, less (i) all discounts and
allowances actually given and (ii) any bona
fide returns. The royalty shall be
calculated on a [quarterly] basis and shall
be payable no later than [30] days after the
termination of such royalty period.]
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2
CEPTOR CORPORATION BACHEM AG
By: /s/ William H. Pursley By: /s/ Thomas Fruh
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Name: William H. Pursley Name: Thomas Fruh
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Title: Chairman & CEO Title: Executive Vice President & COO
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Date: April 18, 2005 Date: April 8, 2005
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PENINSULA LABORATORIES, INC. BACHEM AMERICAS
By: /s/ Damir Vidovic By: /s/ Joe Dechastonay
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Name: Damir Vidovic Name: Joe Dechastonay
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Title: President & COO Title: President
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Date: April 14, 2005 Date: April 14, 2005
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3
TERMS AND CONDITIONS OF SALE
1. GENERAL. These Terms and Buyer, with all freight and insurance
Conditions of Sale ("Terms") are made prepaid by Seller [and added as a
part of the Manufacture and Supply separate item to the invoice delivered
Agreement (the "Supply Agreement"), by Seller].
between Ceptor Corporation, a Delaware
Corporation, with offices located at 11. TITLE AND RISK OF LOSS. Title to
200 International Circle, Suite 5100, the Product shall vest in Buyer upon
Hunt Valley, Maryland ("Buyer") and delivery to the location specified by
Peninsula Laboratories, Inc., 305 Old Buyer. Seller shall assume the risk of
County Road, San Carlos, California in-transit loss or damage for all
("Seller") with Bachem AG Hauptstrasse Product hereunder until delivery to
144, 4416 Bubendorf, Switzerland Buyer. Buyer shall notify Seller
("Manufacturer"). promptly of any claim and shall
cooperate with Seller in every
2. DEFINITIONS. Unless otherwise set reasonable way to facilitate
forth in these Terms, the capitalized disposition of any such claim.
terms contained herein shall have the
meaning ascribed thereto in the Supply 12. SPECIFICATIONS. Manufacturer and
Agreement. Buyer agree that Product
specifications and any changes in
3. QUANTITY AND PRICE. Manuafacturer specifications must be mutually agreed
agrees to manufacture and Seller upon.
agrees to sell to Buyer, and Buyer
hereby agrees to purchase from Seller, 13. TESTING. Manufacturer will, at its
subject to the terms of the Supply sole cost and expense, undertake and
Agreement, the amount of Product and conduct such tests as shall reasonably
at the prices set forth in the Supply be appropriate to ensure that the
Agreement. Product meets its specifications and
will provide the results of such tests
4. ROYALTIES. In consideration for to Buyer.
the manufacture and sale of the
Product, Buyer agrees to pay 14. COMPLIANCE. All parties shall
Manufacturer, pursuant to the terms of comply with all applicable
the Supply Agreement, a royalty in the international, national, regional and
amount set forth in the Supply local laws and regulations governing
Agreement. their respective performances
hereunder, and the manufacture, use,
5. PURCHASE ORDERS. For all Product handling, sale and disposal of
orders, Buyer agrees to submit a firm Product, as well as the importation
purchase order to Seller. and exporting of Product.
6. PAYMENT TERMS. The payment terms 15. WARRANTIES. Manufacturer
shall be as set forth in the Supply represents and warrants to Buyer that
Agreement. at the time of delivery of the Product
to Buyer, (i) the Product conforms to
7. SHIPMENT TERMS. All parties agree the agreed upon specifications, and
that the shipment terms are to be (ii) the Product has been manufactured
mutually agreed upon with each according to GMP guidelines and
purchase order. applicable laws. This section shall
survive the termination or expiration
8. EXCLUSIVITY. It is expressly of the Agreement.
understood that the Supply Agreement
requires Manufacturer to manufacture 16. REPORTING. Each party shall
and Seller to sell the Product promptly report to the other any
exclusively for and to Buyer and that customer complaints, recalls,
Buyer shall purchase the Product regulatory and customer inquiries, or
exclusively from Seller. Manufacturer other adverse events arising from or
shall not manufacture and Seller shall relating to the manufacture, supply,
not sell or deliver Product to any import, export, sale and use of the
other person, directly or indirectly, Product.
nor use the Product for itself,
without the prior written consent of 17. PRODUCT LIABILITY INSURANCE.
Buyer. Buyer shall be relieved of its During the term of this Agreement,
obligations during any time that Manufacturer agrees that the Product
Seller is unable to satisfy Seller's and Buyer (as it relates to the
obligations hereunder. Product) shall be covered under its
worldwide insurance policy, which
9. CONFIDENTIALITY. Manufacturer and policy shall not be for less than $2
Seller acknowledge that the Product million.
contains and/or embodies various
valuable proprietary information of 18. BUYER INDEMNIFICATION. Except to
Buyer. Any proprietary information of the extent any cost, claim, suit,
Buyer shall be kept confidential by expense or damage arises out of or
Manufacturer and Seller and shall be results from Manufacturer's gross
used only in connection with negligence or willful misconduct,
Manufacturer and Seller's performance Buyer shall indemnify, defend and hold
hereunder, or for such other purposes Manufacturer and each of its officers,
and upon such terms as may be agreed directors, employees, agents and
upon between the parties in writing. consultants (each a "Manufacturer
This section shall survive the Indemnitee") harmless from and against
termination or expiration of this all third party costs, claims, suits,
relationship. expenses (including reasonable
attorney's fees) and damages arising
10. DELIVERY. Product will ultimately out of or resulting from any
be shipped to the location specified allegation that the Product infringes
by Buyer, using a carrier agreeable to the patent rights of any third party,
Ceptor _____ Bachem _____
provided that the Manufacturer non-defaulting party by law or in
Indemnitee gives reasonable notice to equity. Notwithstanding anything to
Buyer of any such claim or action, the contrary contained in this
tenders the defense of such claim or Agreement, in the event Manufacturer
action to Buyer and assists Buyer at fails to supply development phase
Buyer's expense in defending such Product in the agreed upon quantities
claim or action and does not by the agreed upon delivery dates,
compromise or settle such claim or then in addition to all other rights
action without Buyer's prior written and remedies at law or equity or
consent. otherwise, Buyer and Manufacturer
shall have the right to extend such
19. SELLER INDEMNIFICATION. Except to delivery date to a mutually agreed
the extent any cost, claim, suit, upon later date through good faith
expense or damage arises out of or negotiations (subject to the right to
results from Buyer's gross negligence terminate if not delivered by such
or willful misconduct, Manufacturer extended date). In the event
shall indemnify, defend and hold Buyer Manufacturer fails to supply
and each of its officers, directors, commercial Product in the agreed upon
employees, agents and consultants quantities by the agreed upon delivery
(each a "Buyer Indemnitee") harmless dates, then in addition to all other
from and against all third party rights and remedies at law or equity
costs, claims, suits, expenses or otherwise, Buyer shall have the
(including reasonable attorney's fees) right to (i) terminate such purchase
and damages to the extent arising out order, (ii) extend such delivery date
of or resulting from an allegation to a mutually agreed upon later date
that the process to produce Product as (subject to the right to terminate if
sold to Buyer infringe a third party not delivered by such extended date),
patent, provided that such Buyer or (iii) order such amount of said
Indemnitee gives reasonable notice to purchase order from a backup supplier.
Manufacturer of any such claims or If the Manufacturer repeatedly is
action, tenders the defense of such unable to supply to Buyer the required
claim or action to Manufacturer and amount of Product, the Buyer shall
assists Manufacturer at Manufacturer's have the right to terminate the Supply
expense in defending such claim or Agreement with three months written
action and does not compromise or notice.
settle such claim or action without
Manufacturer's prior written consent. 23. FORCE MAJEURE. No party shall be
held liable for any delay or failure
20. INDEPENDENT CONTRACTOR. It is in performance of any part of this
understood and agreed that Agreement caused by fires, strikes,
Manufacturer and Seller are embargoes, explosions, power
independent contractors and are not blackouts, computer malfunctions,
agents or representatives of Buyer. earthquakes, volcanic action, floods,
Manufacturer and Seller shall not have wars, water, the elements, labor
any right or authority to act for, disputes, civil disturbances,
incur, assume or create any obligation government requirements, civil or
or liability on behalf of Buyer or to military authorities, acts of God or
bind Buyer in any way whatsoever. the public enemy, inability to secure
Additionally, all personnel employed raw materials, inability to secure
or retained by Manufacturer to perform product of outside vendors, terrorist
the services hereunder shall at all acts, transportation facilities, acts
times be deemed the agents, servants or omissions of carriers or other
and employees of Manufacturer and causes beyond its control, whether or
Seller, and Buyer shall incur no not similar to the foregoing
obligation or liability other than as conditions (collectively "Force
specified in the Supply Agreement, Majeure Event"), provided that the
express or implied, by virtue of or hindered party (i) notifies the other
with respect to the conduct of any of parties of such cause, (ii) exercises
Manufacturer's and Seller's personnel reasonable efforts to cure such delay
in carrying out their obligations and or failure and resume performance.
duties for or on behalf of
Manufacturer and Seller. 24. NOTICES. All notices given
pursuant to the Supply Agreement shall
21. PUBLICITY. Each party agrees to be in writing, referencing the Supply
submit to the other party all Agreement, and shall be sent by hand
advertising, sales promotion, press delivery with a signed receipt,
releases and other publicity matters certified mail, return receipt
relating to the Product or the requested, or by a reputable overnight
services performed under the Supply courier, and directed as set forth in
Agreement. Such materials may not be the Supply Agreement. Such notices
publicized, used or distributed shall be deemed to have been given or
without the prior written consent of made when delivered (if sent by had
the other party, which consent may not delivery), 10 business days after
be unreasonably withheld. deposited in the mail, or 3 business
days after deposited with an overnight
22. TERMINATION. Any party may cancel courier. Such addresses may be changed
or terminate the Supply Agreement in at any time by giving 10 days' prior
the event any other party fails to written notice as provided above.
comply with any of its material
obligations contained in these Terms 25. ASSIGNMENTS. Neither the Supply
or in the Supply Agreement and fails Agreement nor any rights or interests
to correct the default within ninety thereunder shall be assignable by
(90) days of being notified thereof by either party by operation of law or
the non-defaulting party, or upon the otherwise, without the prior written
bankruptcy of the other party. consent of the other party; provided,
Manufacturer and Seller shall have the however, either party may assign the
right to terminate the Supply Supply Agreement to any affiliate or
Agreement upon 18 months prior written to any successor by merger or sale of
notice. Termination or cancellation all or substantially all of its
shall be without prejudice to any assets. The Supply Agreement shall be
other rights and in addition to any binding upon the successors and
other remedies available to the permitted assigns of the parties.
2 Ceptor _____ Bachem _____
26. ENTIRE AGREEMENT; AMENDMENTS.
These Terms and the Supply Agreement,
and its riders, if any, constitute and
contain the entire understanding and
agreement of the parties respecting
the subject matter hereof. No waiver,
modification or amendment of these
Terms or the Supply Agreement can be
made except by way of written
agreement, signed by both parties
hereto.
27. MISCELLANEOUS. This agreement
shall be governed by, construed under
and interpreted in accordance with the
laws of the State of Maryland. In the
event that any provision contained
herein shall be determined to be
unenforceable, all other provisions
shall remain in full force and effect
and the affected provision shall be
construed as to be enforceable to the
maximum extent permissible by
applicable law. Any actions to be
brought in relation to this Agreement
shall be filed in the appropriate
courts in Maryland.
3 Ceptor _____ Bachem _____
