Exhibit 10.31
NON EXCLUSIVE DISTRIBUTION AGREEMENT
EXCLUSIVE SUPPLY AGREEMENT
This Agreement, entered into as of the 13th day of September, 1994, by
and between MOVA PHARMACEUTICAL CORPORATION ("MOVA"), a Puerto Rico corporation,
having offices in Caguas, Puerto Rico, and PAR PHARMACEUTICAL, INC., a New York
corporation, having offices in One Ram Ridge Road, Spring Valley, New York 10977
("PAR").
WITNESSETH:
WHEREAS, MOVA manufactures and sells pharmaceutical products and has
represented that it has developed a generic version of _____________
(defined hereinafter as the "Product"); and
WHEREAS, PAR distributes a line of generic versions of branded
pharmaceutical products such as the Product; and
WHEREAS, PAR would like to distribute the Product as manufactured by
MOVA and MOVA is willing to supply the Product to PAR for such purpose, all
upon the terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the foregoing premises, which are
hereby incorporated as substantive part of this Agreement, and in
consideration of the performance of the mutual covenants and promises
herein contained, MOVA and PAR have agreed as follows:
ARTICLE 1 - DEFINITIONS
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1.1 The Product. The "Product" shall mean ______________(300mg., 400mg.,
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and 800mg.) and any future dosage strength for which the FDA approves an
Abbreviated New Drug Application with an AB rating when compared with the
corresponding strength of _______________.
1.2 The ANDA. The "ANDA" shall mean the Abbreviated New Drug Application
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for the Product which has been submitted to the FDA by MOVA, including any
amendments or supplements thereto.
1.3 The FDA. The "FDA" shall mean the United States Food and Drug
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Administration.
1.4 Patents. The "Patents" shall mean any issued patents or patent rights
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held by third parties which would be infringed by the manufacture, use or
sale of the Product to be sold by MOVA to PAR pursuant to the terms of this
Agreement.
1.5 Patents Expiration Day. The "Patents Expiration Day" shall mean the
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day on which all of the Patents have expired or are no longer in effect.
1.6 Availability Date. The "Availability Date" shall mean the date on
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which MOVA is first legally permitted and able to ship commercial
quantities of the Product in the interstate commerce of the USA.
1.7 Approval Date. The "Approval Date" shall mean the date on which MOVA
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is in receipt of all required regulatory approvals for the manufacture and
sale of the Product.
1.8 Purchase Term. The "Purchase Term" shall mean the five (5) year
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period that begins on the date the first order for Product is shipped after
the Approval Date.
1.9 Average Selling Price. The "Average Selling Price" shall mean the
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actual Net Sales of Product by shelf keeping unit sold by PAR to unrelated
third parties per calendar quarter divided by the total number of units
of each shelf keeping unit of Product sold in the said calendar quarter.
1.10 Net Sales. "Net Sales" shall mean the gross sales for each shelf
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keeping unit of Product less the following:
(i) trade, quantity or cash discounts, if any, allowed
or paid;
(ii) chargebacks, shelf stock adjustments, returns,
credits or allowances, if any, given or made on
account of Products previously delivered; and
(iii) Federal, State or local government rebates whether
in effect now or enacted at any time during the
term of this Agreement.
1.11 Net Profit. "Net Profit" shall mean the Net Sales for each shelf
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keeping unit of Product less the Base Price as specified in Exhibit A
hereof.
1.12 Purchase Price. The "Purchase Price" shall mean the base price as
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specified in Exhibit A hereof, plus a percent of Actual Net Profits per
shelf keeping unit to be determined as follows:
(i) __% in the event the Availability Date occurs by
Patents Expiration Day;
(ii) __% in the event the Availability Date occurs
within the first sixty (60) days following the
Patents Expiration Day;
(iii) __% in the event the Availability Date occurs
during the second sixty (60) days following the
Patents Expiration Day; or
(iv) __% in the event the Availability Date occurs
more than one hundred twenty (120) days
following the Patents Expiration Day.
1.13 Base Price. "The Base Price" shall mean the base price per shelf
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keeping unit as specified in Exhibit A hereof. The Base Price set forth in
Exhibit A shall remain firm through December 31, 1994. The Base Price will
be adjusted on January 1st. every year, commencing on January 1, 1995 for
the annual change in the CPI for the previous year.
1.14 USA. The "USA" shall mean the United States of America and the
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District of Columbia, its territories and possessions, excluding the
Commonwealth of Puerto Rico and the U.S. Virgin Islands.
1.16 Affiliate. "Affiliate" shall mean, with respect to either party, all
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corporations or other business entities
which, directly or indirectly, are controlled by, control or are under the
common control with that party. For this purpose, the meaning of the word
"control" shall include, but not be limited to, ownership of more than
fifty percent (50%) of the voting shares or interest of such corporation or
other business entity.
1.17 CPI. "CPI" shall mean the Consumer Price Index published by the
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Puerto Rico Department of Labor.
1.18 Competitive Product. "Competitive Product" shall mean versions of the
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Product which are manufactured by other pharmaceutical companies for which
the FDA approves an Abbreviated New Drug Application with an AB rating when
compared with the corresponding strength of ________________ tablets.
1.19 Active Ingredient. "Active Ingredient" shall mean __________ as defined
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in the USP.
ARTICLE 2 - SUPPLY
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2.1 Purchase and Sale. Subject to the terms and conditions of this
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Agreement, MOVA shall supply and PAR shall purchase from MOVA substantially
all of PAR's requirements for the Product in the USA from the Approval Date
and throughout the Purchase Term. PAR shall not purchase the Product or
any product having the same active ingredient, strength and indication as
the Product, from any party other than MOVA after the Approval Date and
throughout the Purchase Term except that PAR may purchase the Product or
any such product from any party pursuant to Paragraph 2.4 and Article 14
hereunder. It is understood and agreed that PAR may purchase the Product
from third parties before the Approval Date, including accepting shipments
of the Product made after the Approval Date pursuant to orders submitted
by PAR before the Approval Date. PAR shall have the non-exclusive right
to sell, market and distribute the Product in the USA. It is understood
and agreed further that PAR may, but is not obligated to, purchase the
Product for sale in countries outside of the USA. Notwithstanding the
foregoing purchase obligations, if as a result of a merger, acquisition or
other similar extraordinary corporate transaction PAR becomes an Affiliate
of a corporate entity (a "Merger Party") who at the time of such
transaction either manufactures or has filed an ANDA for the manufacture of
a Competitive Product, then PAR may purchase such Competitive Product from
the Merger Party one (1) year after giving MOVA written notice of such
intent, and provided further that, within ninety (90) days from the date of
the merger, acquisition or other similar extraordinary transaction, PAR
notifies MOVA of the occurrence of such transaction and of its intent of
purchasing the Competitive Product from the Merger Party. At the time of
such notice, the restrictions contained in Paragraph 2.7 hereof, with
respect to sales by MOVA to certain parties, shall no longer be applicable.
2.2 Forecasts. As early as reasonably possible (but no later than thirty
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(30) days prior to the date which MOVA notifies PAR should be the
Availability Date) and thirty (30) days prior to every calendar quarter
thereafter, PAR shall give to MOVA a written forecast of the quantities of
the Product, including quantities for each strength and unit size of the
Product, and delivery dates that PAR anticipates it will order from MOVA
during the two (2) calendar quarters following the date of the written
forecast. Such forecast shall not create a binding obligation on the part
of either MOVA or PAR, except as provided in Paragraph 2.3 hereof.
However, PAR shall use all reasonable efforts to make each forecast as
accurate as possible. PAR shall promptly advise MOVA of any significant
changes in its estimated forecast of Product.
2.3 Orders. PAR shall submit written purchase orders to MOVA for the
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quantities of the Product, including the quantity of each strength and unit
size and delivery dates, which PAR desires to purchase under this
Agreement. For the first three (3) month period of each forecast given by
PAR pursuant to Paragraph 2.2 hereof, PAR shall submit purchase orders to
MOVA for at least the greater of: seventy-five percent (75%) of the
forecasted quantities for that period on the then current forecast or fifty
percent (50%) of the forecasted quantities for that period as shown on the
immediately preceding forecast. If applicable, each purchase order shall
specify the country in which the Product is to be resold by PAR.
Regardless of the quantities ordered, MOVA shall use all reasonable efforts
to deliver the full quantities of the Product (each strength and unit size)
ordered by PAR. Deliveries of the Product ordered by PAR to the
destination designated by PAR will be made within sixty (60) days following
the date on which PAR submitted the purchase order unless a later delivery
date has been specified by PAR.
2.4 Inability to Supply. Within thirty (30) days following its receipt of
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each forecast according to Paragraph 2.2 hereof, MOVA shall advise PAR in
writing if it is unable to supply the entire quantity forecasted. PAR
shall have the right to purchase from third parties such quantities of the
Product for which MOVA shall have advised that it will be unable to supply,
for as long as MOVA's inability to supply continues.
2.5 Shipments. Delivery shall be f.o.b. Caguas, Puerto Rico, freight and
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insurance prepaid by MOVA. Product shall be shipped by MOVA according to
PAR's instructions, to PAR's facility at One Ram Ridge Road, Spring Valley,
NY 10977; provided, however, that should PAR instruct MOVA to ship to
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another location, MOVA shall do so and PAR shall reimburse for any
incremental costs involved.
2.6 Purchase Price and Payment. MOVA shall invoice PAR the Base Price for
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all shelf keeping units in each shipment of Product delivered to PAR. Such
amount shall be payable sixty (60) days from receipt of the invoice
therefor. At the end of each calendar quarter, PAR shall determine and
advise MOVA of the Actual Net Profits obtained from the sale of the Product
by PAR during such calendar quarter. Within twenty (20) days after the end
of each such quarter, PAR shall pay to MOVA, the difference between the
Base Price and the Purchase Price times the actual number of shelf keeping
units actually sold during said calendar quarter. Payment will be made
only with respect to Product actually shipped by PAR during such calendar
quarter. In addition, within thirty (30) days after the end of each
calendar quarter, PAR shall provide MOVA with a report of the number of
units of Product shipped and returned, gross sales of Product and Net Sales
of Product during such calendar quarter and the number of units of Product
inventory remaining under PAR's control at the end of such calendar
quarter.
2.7 Sales to certain customers. Throughout the term of this Agreement,
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MOVA agrees not to knowingly sell the Product to the customers listed in
Exhibit B hereof. MOVA shall not knowingly sell the Product to any third
party to whom PAR shall have sold the Product under PAR's label within the
sixty (60) day period immediately following the Availability Date, provided
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however, that such restriction shall end one (1) year after the end of the
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aforementioned sixty (60) day period.
2.8 Conflicting Terms. In ordering and delivering the Product, PAR and
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MOVA may use their standard forms, but nothing in such forms shall be
construed to amend or modify the terms of this Agreement and in case of
conflict herewith, the terms of this Agreement shall control.
ARTICLE 3 - QUALITY
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3.1 Quality Control. Prior to each shipment of the Product, MOVA shall
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perform such quality control procedures to verify that each shipment of the
Product made under this Agreement conforms to the specifications for the
Product contained in the approved ANDA and otherwise complies with the
representations and warranties given by MOVA in Article 4 hereof. Each
shipment of the Product shall be accompanied by a quality assurance
analytical data sheet (the "Q.A. Certificate of Analysis").
3.2 Rejection. PAR shall have thirty (30) days following the day on which
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it receives a shipment to reject same because all or part of the shipment
fails to conform to the applicable specifications or otherwise fails to
conform to the representations and warranties given by MOVA herein, by
giving written notice to MOVA specifying the manner in which all or part of
such shipment fails to meet the foregoing requirements. If PAR rejects a
shipment before the date on which payment therefor is due according to
Paragraph 2.6 hereof, it may withhold payment for that shipment or the
rejected portion thereof. All shipments or portions thereof not rejected
by PAR before such date shall be paid for in accordance with Paragraph 2.6
hereof. All shipments or portions thereof which PAR rejected but, as
determined pursuant to Paragraph 3.4 hereof, did not have the right to
reject, shall be paid within fifteen (15) days following the day on which
such determination was made, unless PAR had paid earlier. In the event PAR
rejects a shipment or portion thereof within such thirty (30) day period in
accordance with the terms hereof but after payment therefor had been made,
PAR shall be entitled to recoup the payment amount by, at PAR's election,
MOVA's issuing a prompt refund or by PAR's offsetting such amount against
the payment of future invoices or other payments that may become due
hereunder. The representations and warranties given by MOVA hereunder
shall survive any failure to reject by PAR under this
Paragraph.
3.3 Recalls. If the Product is recalled pursuant to FDA regulation or
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other applicable laws and returned as a result of any such recall and such
recall is due to MOVA's negligence or willful misconduct or a breach of
any representation or warranty of MOVA hereunder, then MOVA shall bear all
incremental out-of-pocket direct costs in connection with the recall,
including, but not limited to, all notification letters and all shipping
expenses. In no event shall MOVA be responsible for any indirect expenses
incurred by PAR. If the recalled Product is to be destroyed, MOVA, at
PAR's request, shall replace free of charge said Product or issue a credit
to PAR's account or refund payment to PAR. If the recalled Product is to
be reworked, MOVA shall bear all costs of reworking said product. If the
Product is recalled and such recall is due to PAR's negligence or willful
misconduct or a breach of any representation or warranty of PAR hereunder,
then PAR shall bear all incremental out-of-pocket direct costs in
connection with the recall, including, but not limited to, all notification
letters and all shipping expenses. In no event shall PAR be responsible
for any indirect expenses incurred by MOVA.
3.4 Disputes. If MOVA disputes PAR's right to reject all or part of any
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shipment of the Product as set forth in Paragraph 3.2 or 3.3 hereof, such
dispute shall be resolved by an independent approved FDA testing
organization or consultant of recognized repute within the U.S.
pharmaceutical industry mutually agreed upon by the parties, the
appointment of which shall not be unreasonable withheld or delayed by
either party. The determination of such entity with respect to all or part
of any shipment of the Product shall be final and binding upon the parties,
but only as to the reasons given by PAR in rejecting the shipment or
portion thereof and shall have no effect on any matter for which said
entity did not render a determination. The fees and expenses of the third
party making the determination shall be paid by the party against which the
determination is made.
3.5 Obligation to Inform the Other. Parties agree to keep each other
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regularly and fully informed of any notification or other information,
whether received directly or indirectly, which might in any way affect the
marketability, safety or effectiveness of the Product, or which might
result in potential liability for either party, or which might necessitate
action on the part of either party, or which might result in recall of the
Product, or which might otherwise in any way affect either of the parties'
interest with respect to the distribution or use of the Product. Nothing
contained in this Paragraph shall obligate either party to provide the
other with any information other than information regarding the quality of
the Product.
3.6 Inspections. Upon reasonable notice given to MOVA, PAR shall have the
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right to have a reasonable number of its employees inspect any facility at
which the Product to be sold to PAR hereunder is manufactured, packaged,
stored or shipped.
3.7 Packaging. MOVA shall supply the Product to PAR in bulk and in
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finished bottles bearing the PAR label as specified by PAR and approved by
the FDA or such other labeling specified by PAR for the Product to be sold
outside of the USA.
ARTICLE 4 - REPRESENTATIONS AND WARRANTIES
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MOVA hereby covenants, represents and warrants to PAR that:
(a) on the date of shipment, all of the Product sold by MOVA to PAR
hereunder will comply with the specifications for the Product contained in
the approved ANDA, conform with the information shown on the Q.A. Data
Sheet and, when applicable, the sample provided for the particular shipment
according to Paragraph 3.1 hereof;
(b) all of the Product sold by MOVA to PAR hereunder shall have been
manufactured, packaged and stored and shipped in conformance with all
applicable current Good Manufacturing Practices which are in force or
hereinafter adopted by the FDA or any successor agency thereto;
(c) on the date of shipment, all of the Product shipped by MOVA to PAR
hereunder will not be
adulterated or misbranded within the meaning of the Federal Food, Drug
and Cosmetic Act, as amended and in effect at the time of shipment
(the "Act"), or within the meaning of any applicable state or
municipal laws in the USA under which such terms have the same meaning
as set forth under the Act;
(d) on the date of shipment, all of the Product sold by MOVA to PAR
hereunder may be legally distributed or sold in the USA;
(e) title to all the Product sold by MOVA to PAR hereunder shall pass
to PAR as provided herein free and clear of any security interest,
lien or other encumbrance;
(f) the Product sold hereunder shall have been manufactured, packaged
and stored in facilities which are approved by the FDA at the time of
such manufacture, packaging and storage, to the extent such approval
is required by law;
(g) to the best of MOVA's knowledge and belief, the manufacture, use
or sale of the Product sold by MOVA to PAR hereunder shall not
constitute an infringement of any Patents; and
(h) to the best of MOVA's knowledge and belief, MOVA and its
employees, affiliates and agents have never been (i) debarred or (ii)
convicted of a crime for which a person can be debarred, under Section
306(a) of the U.S. Federal Generic Drug Enforcement Act of 1992
("Section 306(a) or (b)") and, to the best of MOVA's knowledge and
belief, MOVA and its employees, affiliates and agents has ever been
threatened to be (i) debarred or (ii) indicted for a crime or
otherwise engaged in conduct for which a person can be debarred under
Section 306(a) or (b), and it will promptly notify PAR in the event of
any such debarment, conviction, threat or indictment.
ARTICLE 5 - APPROVALS
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5.1 ANDA. MOVA shall be responsible for obtaining the approval of the
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ANDA by the FDA and in so doing shall exercise what it in good faith
believes to be reasonable commercial effort to obtain such approval at the
earliest possible date.
5.2 Inspections by Government Agencies. Without limiting the generality
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of Paragraph 5.1 hereof, MOVA shall permit the FDA to conduct whatever
inspections of the facilities at which the Product is to be manufactured,
packaged and/or stored and shall cooperate with the FDA during any such
inspections.
5.3 Administration of the ANDA and other Approvals. MOVA shall be
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responsible for maintaining the ANDA and any other approvals current and in
effect. In so doing, MOVA shall comply with all applicable requirements of
the FDA and counterpart governmental agencies outside of the USA.
5.4 Product Complaints. Each party shall immediately inform the other of
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product quality, health or safety related concerns or inquiries that raise
potentially serious and unexpected quality, health or safety concerns. All
such other information not involving the above described situation shall be
transmitted to the other party within three (3) business days following
receipt.
ARTICLE 6 - ADJUSTMENTS
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6.1 Price Protection. Notwithstanding any provision herein to the
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contrary, if at any time MOVA makes sales of the Product to any other party
within the USA or for resale in the USA, except sales to federal, state and
local government agencies, at a price lower than one hundred twenty-five
percent (125%) of the Base Price to PAR then in effect under this
Agreement, the Base Price to PAR then in effect under this Agreement shall
be reduced to eighty percent (80%) of such lower price given to the other
party for so long as MOVA continues to make such sales to such other party
at such lower price, unless sale to PAR at such lower price would violate
the provisions of any pertinent law, order or regulation.
6.2 Adjustment. In the event that PAR's average selling price for the
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Product to any other party becomes less than ______ per bottle of 100
tablets for 300 mg tablets adjusted on January 1st. every year, commencing
on January 1, 1995 for the annual change in the CPI (with comparable limits
for other strengths as set forth in Exhibit A), the parties shall
negotiate such modification to this Agreement as may be necessary to enable
each to perform thereunder on terms fair and reasonable under the
circumstances and if no agreement thereon can be reached within a
reasonable time, either party may terminate this agreement by giving ninety
(90) days prior notice.
6.3 Independent Prices. Each of the parties shall establish the prices at
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which it sells the Product to its customers independently of the other
party.
6.4 Active Ingredient Cost Fluctuations. In the event that the cost of
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the Active Ingredient purchased from third parties by MOVA, as defined in
Exhibit A, increases or decreases by more than 10% at any time, such change
shall be added or deducted to the Base Prices paid by PAR to MOVA according
to Paragraph 2.6 hereof. MOVA shall provide PAR with the necessary
information to verify the changes in the cost of the Active Ingredient.
ARTICLE 7 - INDEMNIFICATION
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7.1 MOVA's Obligation to Indemnify. MOVA agrees to indemnify, defend, and
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hold harmless PAR, its affiliates and subsidiaries and their respective
employees against any and all claims, losses, damages and liabilities,
including reasonable attorneys' fees and costs associated with a recall of
the Product as defined in Paragraph 3.3 hereof, incurred by any of them
arising out of any breach of any obligation hereunder or any representation
or warranty by MOVA hereunder or any act or omission of MOVA in connection
with its obligations hereunder.
7.2 PAR's Obligation to Indemnify. PAR agrees to indemnify, defend and
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hold harmless MOVA, its affiliates and subsidiaries and their respective
employees against any and all claims, losses, damages and liabilities,
including reasonable attorneys' fees and costs associated with a recall of
the Product as defined in Paragraph 3.3 hereof, incurred by any of them
arising out of any breach of any obligation hereunder or any representation
or warranty by PAR hereunder or any act or omission of PAR in connection
with its obligations hereunder.
7.3 Obligations of the Party Seeking to be Indemnified. If PAR or any of
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its affiliates or subsidiaries or MOVA or any of its affiliates or
subsidiaries (in each case an "Indemnified Party") receive any written
claims which it believes is the subject of indemnity hereunder by MOVA or
PAR, as the case may be (in each case an "Indemnifying Party"), the
Indemnified Party shall, as soon as reasonably practicable after forming
such belief, give notice thereof to the Indemnifying Party, including full
particulars of such claim to the extent known to the Indemnified Party;
provided, that the failure to give timely notice to the Indemnifying Party
as contemplated hereby shall not release the Indemnifying Party from any
liability to the Indemnified Party except to the extent that the
Indemnifying Party is injured by such delay. The Indemnifying Party shall
have the right, by prompt notice to the Indemnified Party, to assume the
defense of such claim with counsel reasonably satisfactory to the
Indemnified Party, and at the cost of the Indemnifying Party. If the
Indemnifying Party does not assume the defense of such claim, or, having
done so, does not diligently pursue such defense, the Indemnified Party may
assume such defense, with counsel of its choice, but for the account of the
Indemnifying Party. If the Indemnifying Party so assumes such defense, the
Indemnified Party may participate therein through counsel of its choice,
but the cost of such counsel shall be for the account of the Indemnified
Party. The party not assuming the defense of any such claim shall render
all reasonable assistance to the party assuming such defense, and all out-
of-pocket costs of such assistance shall be for the account of the
Indemnifying Party. No such claim shall be settled other than by the party
defending the same, and then only with the consent of the other party,
which shall not be unreasonably withheld; provided, that the Indemnified
Party shall have no obligation to consent to any settlement of any such
claim which imposes on the Indemnified Party and liability or obligation
which cannot be assumed and performed in full by the Indemnifying Party.
7.4 Insurance. Each party and its Affiliates shall carry products
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liability insurance in an amount at least equal to _______ with an
insurance carrier reasonably acceptable to the other party. Such insurance
shall cover the indemnifications set forth in Article 7 hereof. Each party
shall name the other party as additional insured under such policy. A copy
of such policy or policies shall be delivered to the other party within ten
(10) days prior to the date any such Product is first commercially sold by
such party, and shall provide among other things, that such insurance shall
not be canceled or modified without giving the other party at least thirty
(30) days prior written notice.
ARTICLE 8 - CONFIDENTIALITY
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8.1 Each party shall at all times maintain as confidential any know-how or
other business information received from the other party under this
Agreement during the term of this Agreement, shall only use such
information in furtherance of this Agreement shall only disclose such
information to those of its employees with a need to know in furtherance of
this Agreement, provided, however, that nothing contained herein shall
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prevent a party from submitting information to a governmental
instrumentality in connection with seeking approval to market the Product.
Said obligation of confidentiality shall not apply, however, to any
information which:
(a) was known to the receiving party, as evidenced by its written
records, prior to receipt from the other party;
(b) is in the public domain at time of receipt or subsequently enters
the public domain through no breach of this Agreement by the receiving
party;
(c) after the date of receipt from the disclosing party, is received
without cover of secrecy from a third party with a bona fide right to
disclose without violating any right of the disclosing party; or
(d) is independently developed by the receiving party without the aid,
application or use of any information for which it is obligated to
maintain as confidential according to this Paragraph.
The respective obligations of MOVA and PAR under this Paragraph shall be in
effect during the term of this Agreement and for the three (3) years
thereafter.
ARTICLE 9 - RECORDS
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9.1 PAR shall keep appropriate and complete records in sufficient detail
so that the payments due hereunder can be properly ascertained. PAR shall,
on the request of MOVA, permit a certified public accountant, selected by
MOVA and to whom PAR has no reasonable objection, to have access during
normal business hours, to such books and records as may be necessary to
determine, in respect of any accounting period ending not more than three
(3) years prior to the date of such request, the correctness of any payment
under this Agreement. Any such accountant shall not disclose any
information to MOVA except that which specifically relates to the payment
obligations hereunder.
ARTICLE 10 - TERM, TERMINATION
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10.1 Term. This Agreement shall become effective as of the date first
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written above and shall remain in full force and effect through the end of
the Purchase Term.
10.2 Termination for Cause. This Agreement may be terminated at any time
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by either party:
(a) upon breach of this Agreement by the other party, on sixty (60)
days' prior written notice to the breaching party, this notice to
become effective at the end of such sixty (60) day period unless the
breach is sooner cured by the breaching party; or
(b) upon bankruptcy or insolvency of the other party or placing of the
business of such party in receivership.
10.3 Termination Upon Merger. If PAR exercises its right under Paragraph
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2.1 to purchase a Competitive Product from a Merger Partner MOVA may
terminate this Agreement at any time after one (1) year from the time such
notice is given by PAR by giving PAR ninety (90) days' prior written
notice.
10.4 Waiver. Failure to terminate this Agreement following a breach or
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failure to comply with terms and conditions of this Agreement shall not be
deemed a waiver of the nonbreaching party's defenses, rights or causes of
action arising from such or any future breach or noncompliance.
ARTICLE 11 - TRADE NAMES AND TRADEMARKS
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11.1 PAR and MOVA hereby acknowledge that they do not have, and shall not
acquire by virtue of this Agreement, any rights to or in any goodwill,
trademark, trade name, copyright, patent or other property of the other,
nor in any of the other's trademarks or trade names appearing on the label
or packaging materials of the Product. PAR and MOVA each agrees to do
nothing by act or omission which would impair, the rights, ownership and
title to the other, including its Affiliates, in the aforementioned.
ARTICLE 12 - NOTICES
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12.1 Any notice required or permitted to be given or made under this
Agreement by either of the parties to the other shall be in writing and
delivered to the other party at its address indicated below or to such
other address as the addressee shall have theretofore furnished in writing
to the addressor by hand, courier or by registered or certified mail
(postage prepaid) or by telefax, provided all telefax notices shall be
promptly confirmed, in writing, by registered or certified mail (postage
prepaid):
If to MOVA:
MOVA Pharmaceutical Corporation
P. O. Box 8639
Caguas, Puerto Rico 00626
Telefax: (809) 258-6405
Attention: Joaquin B. Viso
President
With a Copy to:
Ledesma, Palou & Miranda
Hato Rey Tower, Suite 1103
268 Munoz Rivera Avenue
Hato Rey, Puerto Rico 00918
Telefax: (809) 754-6344
Attention: Silvestre M. Miranda
If to PAR:
Par Pharmaceutical, Inc.
One Ram Ridge Road
Spring Valley, New York 10977
Telefax: (914) 425-7907
Attention: Ken Sawyer
President
All notices shall be effective as of the date received by the addressee.
ARTICLE 13 - NON ASSIGNABILITY
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13.1 This Agreement and the rights of the parties hereunder shall not be
assignable nor shall the obligations of either party be delegable, except
as to affiliates of PAR or MOVA, without the prior written consent of the
other party, which consent shall not be unreasonably withheld. In the
event either party seeks and obtains the other party's consent to assign or
delegate its rights or obligations to another party, or in the event of an
assignment or delegation to an affiliate, the obligations of the assignee
or transferee must be guaranteed in writing by the party who is the
assignor or transferor.
ARTICLE 14 - FORCE MAJEURE
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14.1 Force Majeure. No failure or omission by the parties in the
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performance of any obligation according to this Agreement shall be deemed a
breach of this Agreement or create any liability if the same shall arise
from any cause or causes beyond the control of the party, including, but
not limited to, strikes, riots, war, acts of God, invasion, fire,
explosion, floods, delay of carrier, shortage or failure in the supply of
materials, energy shortage and acts of government or governmental agencies
or instrumentalities.
14.2 Obligations of the Parties in case of Force Majeure. In the event
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that due to force majeure either party hereto shall be delayed or hindered
in or prevented from the performance of its duties or doing acts required
under the terms of this Agreement, the performance of such act, except for
the obligation to pay amounts due under this Agreement, shall be excused
for the period of the delay. Notwithstanding the aforementioned, the party
subject to force majeure shall take all reasonable steps to resolve the
condition(s) forming the basis of force majeure.
ARTICLE 15 - MISCELLANEOUS
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15.1 Governing Law. This Agreement shall be governed by, and construed in
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accordance with, the laws of the Commonwealth of Puerto Rico.
15.2 Independent Contractor. The parties shall be considered independent
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contractors, and neither the making of this Agreement nor the performance
of any of the provisions hereof shall be construed to make either party an
agent, employee or legal representative of the other, nor shall this
Agreement be deemed to establish a joint venture or partnership.
15.3 Public Announcements. MOVA and PAR shall consult with each other
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before issuing any press releases or otherwise making any public statements
with respect to this Agreement and neither of them shall issue any press
release or make any public statement prior to obtaining the other party's
approval, which approval shall not be unreasonably withheld, except that no
such approval shall be necessary to the extent disclosure may be required
by law.
15.4 Severability. Should any section, or portion thereof, of this
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Agreement be held invalid by reason of any law, statute or regulation
existing now or in the future in any jurisdiction by any court of competent
authority or by a legally enforceable directive of any governmental body,
then such section or portion thereof shall be validly reformed so as to
approximate the intent of the parties as nearly as possible and, if
unreformable, shall be deemed divisible and deleted with respect to such
jurisdiction; this Agreement shall not otherwise be affected.
15.5 Taxes. Each party shall be responsible for its own taxes.
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15.6 Entire Agreement. The terms and provisions contained in this
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Agreement, including the Exhibit hereto, constitute the entire agreement
between the parties and shall supersede all previous communications,
representations, agreements or understandings, either oral or written,
between the parties with respect to the subject matter hereof. No
agreement or understanding varying or extending this Agreement shall be
binding upon either party hereto, unless set forth in a writing which
specifically refers to this Agreement, signed by duly authorized officers
or representatives of the respective parties, and the provisions hereof not
specifically amended thereby shall remain in full force and effect.
IN WITNESS WHEREOF, MOVA and PAR have executed this Agreement in
duplicate as of the day and year first above written.
MOVA PHARMACEUTICAL CORPORATION PAR PHARMACEUTICAL, INC.
By:_________________________ By:_______________________
Joaquin B. Viso Ken Sawyer
President President