EXHIBIT 10.37
CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTIONS
OF THIS DOCUMENT MARKED [****] HAVE BEEN REDACTED AND HAVE BEEN FILED
SEPARATELY WITH THE U.S. SECURITIES AND EXCHANGE
COMMISSION.
TRANSITION SERVICES AGREEMENT
BY AND BETWEEN
IPR PHARMACEUTICALS, INC.
AND
ATHEROGENICS, INC.
DATE: DECEMBER 22, 2005
TABLE OF CONTENTS
1 Definitions................................................. 1
2 Construction................................................ 6
3 Amendment................................................... 6
4 Transition Assistance....................................... 6
5 Fees........................................................ 8
6 Invoicing, Payment, Recordkeeping and Audits................ 11
7 Representations and Warranties.............................. 12
8 Indemnification............................................. 13
9 Force Majeure............................................... 17
10 Term and Termination........................................ 17
11 Confidentiality............................................. 19
12 Use of Name................................................. 21
13 Notices..................................................... 21
14 Relationship of the Parties................................. 22
15 Rights Of Third Parties..................................... 23
16 Assignment.................................................. 23
17 Entire Agreement............................................ 23
18 Expenses.................................................... 23
19 Waiver and Non-Exclusion of Remedies........................ 24
20 Severability................................................ 24
21 Governing Law and Disputes.................................. 24
22 Equitable Relief............................................ 24
23 Environmental Provisions.................................... 25
24 Counterparts................................................ 25
EXHIBITS
Exhibit 1 -- Process Improvements
Exhibit 2 -- Estimated Spray Drying Capital Expenditure
Exhibit 3 -- Estimated Manufacturing Start-Up and Other Costs
Exhibit 4 -- Existing Agreements
Exhibit 5 -- Dow Consent to Assignment
(i)
TRANSITION SERVICES AGREEMENT
This Transition Services Agreement (the "AGREEMENT") is made as of
December 22, 2005 and shall be effective as of the Effective Date (as defined
herein) by and between
(1) IPR Pharmaceuticals, Inc., a company organized and existing under the laws
of Puerto Rico with an address at CARR 188 LOTE 17 SAN ISIDRO INDUSTRIAL
PARK, CANOVANAS, PR 00729 ("ASTRAZENECA"); and
(2) AtheroGenics, Inc., a Georgia corporation with principal executive offices
at 8995 Westside Parkway, Alpharetta, Georgia 30004 (the "AGIX").
RECITALS
(A) WHEREAS, AstraZeneca desires to receive certain transition services from
AGIX to facilitate AstraZeneca's exercise of the manufacturing rights
granted pursuant to the License Agreement; and
(B) WHEREAS, AGIX is willing to provide such transition services on the terms
and conditions set forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants contained in this
Agreement, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties, intending to be
legally bound, agree as follows:
1 DEFINITIONS
Unless otherwise specifically provided in this Agreement, the following terms
shall have the following meanings:
1.1 "AFFILIATE" means any Person that directly (or indirectly through one or
more intermediaries) controls, is controlled by, or is under common
control with a Party. For purposes of this definition only, the terms
"controls," "controlled," and "control" means (i) the direct or indirect
ability or power to direct or cause the direction of the management and
policies of an entity or otherwise direct the affairs of such entity,
whether through ownership of equity, voting securities, or beneficial
interest, by contract, or otherwise, or (ii) the ownership, directly or
indirectly, of at least 50% of the voting securities (or other comparable
ownership interest for an entity other than a corporation) of a Party.
1.2 "AGIX INDEMNITEES" has the meaning set forth in Section 8.2.
1
1.3 "AGIX INFORMATION" means all data and information related to or comprised
in Intellectual Property Rights and Know-How, as well as other information
in relation to AGIX's general business operations, SDD, a SDD
Manufacturing Process, the Final Commercial Products, a Manufacturing
Process, an SDD Process Improvement, or a Process Improvement, which is
owned by AGIX.
1.4 "APPLICABLE LAWS AND REGULATIONS" mean all applicable statutes,
ordinances, regulations, rules, or orders of any kind whatsoever of any
Governmental Authority, including, without limitation, the Food, Drug and
Cosmetic Act, Prescription Drug Marketing Act, Generic Drug Enforcement
Act of 1992 (21 U.S.C. Section 335a et seq.), and Anti-Kickback Statute
(42 U.S.C. Section 1320a-7b et seq.), all as amended from time to time.
1.5 "ASTRAZENECA INFORMATION" means all data and information related to or
comprised in Intellectual Property Rights and Know-How, as well as other
information in relation to AstraZeneca's general business operations, SDD,
a SDD Manufacturing Process, the Final Commercial Products, a
Manufacturing Process, or a Process Improvement, which data and
information is owned by AstraZeneca.
1.6 "CAPACITY RESERVE FEE" shall have the meaning set forth in the Dow
Agreement.
1.7 "COMBINATION PRODUCT" means a Product in final form that includes one or
more pharmaceutically active ingredients other than the Compound, in
combination with the Compound, that are sold as a fixed dose or separate
doses in a single package and priced as one item. All references to
Product in this Agreement shall be deemed to include Combination
Product(s).
1.8 "COMPOUND" means AGI-1067, which is chemically defined as [****],
including its pharmacologically acceptable salts, solvates, hydrates,
hemihydrates, polymorphs, metabolites, free base forms, pro-drugs, esters,
tautomers, and if applicable, any isomers, stereoisomers, racemates,
enantiomers and all optically active forms thereof.
1.9 "CONFIDENTIAL INFORMATION" has the meaning set forth in Section 11.1.1
hereof.
1.10 "CONTROL" or "CONTROLLED" means with respect to any Intellectual Property
Right, that the Party owns or has a license to such Intellectual Property
Right or Information and has the ability to grant access, a license, or a
sublicense to such Intellectual Property Right to the other Party as
provided for in this Agreement without violating an agreement with, or
infringing any rights of, a Third Person as of the time such person would
be first required under this Agreement to grant the other person such
access, license or sublicense.
1.11 "DISCLOSING PARTY" means the Party disclosing Confidential Information.
1.12 "DOW AGREEMENT" means that "Commercial Supply Agreement for Production of
AGI-1067 and Probucol between The Dow Chemical Company ("DOW") and
- -------
[****] indicates that certain confidential information contained in this
document has been omitted pursuant to a request for confidential treatment and
filed separately with the Securities and Exchange Commission.
2
AtheroGenics, Inc." dated as of October 6, 2005, excluding any amendments
thereto entered into after the Effective Date.
1.13 "EFFECTIVE DATE" means the Effective Date of the License Agreement.
1.14 "EXISTING AGREEMENTS" means the Dow Agreement and the other agreements set
forth on Exhibit 4.
1.15 "FDA" means the United States Food and Drug Administration, or any
successor federal agency having responsibility over United States
Regulatory Approvals.
1.16 "FINAL COMMERCIAL PRODUCT" means a pharmaceutical product in
ready-for-sale form, packaged and labeled dosage form marketed by or on
behalf of AstraZeneca, its Affiliates or Sublicensees, now or in the
future, that comprises or utilizes SDD or the Compound in its manufacture.
1.17 "FORCE MAJEURE" has the meaning set forth in Section 9.1.
1.18 "GOVERNMENTAL AUTHORITY" means any court, tribunal, arbitrator, agency,
commission, official or other instrumentality of any federal, state, or
other political subdivision, or supranational body, domestic or foreign.
1.19 "INDIRECT TAXES" means value added taxes, sales taxes, consumption taxes
and other similar taxes.
1.20 "INFORMATION" means any information Controlled by either Party, including,
but not limited to: (a) any and all inventions (whether or not
patentable), Know-How, developments, materials, data, analyses, and the
like, regardless of whether the information is stored or transmitted in
oral, documentary, or electronic form; (b) information relating to
research and development plans, experiments, results, compounds,
therapeutic leads, candidates and products, clinical and preclinical data,
trade secrets and manufacturing, marketing, financial, regulatory,
personnel and other business information and plans, and all scientific,
clinical, regulatory, marketing, financial and commercial information or
data; (c) AstraZeneca Information; and (d) AGIX Information.
1.21 "INTELLECTUAL PROPERTY RIGHTS" means trade secrets, patent rights,
trademarks, service marks, trade names, design rights, copyrights
(including rights in computer software) and any rights or property similar
to any of the foregoing in any part of the world, whether registered or
not, together with the right to apply for the registration of any such
rights, and all rights or forms of protection having equivalent or similar
effect, in any part of the world.
1.22 "INVOICE CURRENCY" means United States dollars.
1.23 "KNOW-HOW" means all technical information or data relating to SDD,
whether protected by Intellectual Property Rights or not, including, but
not limited to technology, processes, specifications, formulas,
procedures, techniques, SHE
3
Information, practices and instructions of, and scientific, analytical and
technical data regarding the synthesis, manufacturing and pharmaceutical
processing of SDD or the Compound.
1.24 "LICENSE AGREEMENT" means the License and Collaboration Agreement between
AstraZeneca and AGIX, dated as of December 22, 2005, as the same shall be
amended from time to time.
1.25 "LOSSES" means any and all liabilities, claims, demands, causes of action,
damages, loss and expenses incurred directly in connection with this
Agreement, including interest, penalties, and reasonable lawyers' fees and
disbursements.
1.26 "MANUFACTURING PROCESS" means any process (or any step in or portion of
any process) used or developed by AGIX, Third Party Suppliers, or
AstraZeneca (or any of their Affiliates) as of the Effective Date or at
any time thereafter, in manufacturing SDD or Final Commercial Product.
1.27 "MANUFACTURING START-UP AND OTHER COSTS" shall mean such expenditures
estimated by AGIX as all reasonably necessary expenditures for the start
up and launch of manufacture of SDD (other than those expenditures
described as Spray Dried Capital Expenditures) as set forth in Exhibit 3.
1.28 "PARTIES" means AstraZeneca and AGIX and "PARTY" means either AstraZeneca
or AGIX.
1.29 "PERSON" means a natural person, a corporation, a partnership, a trust, a
joint venture, a limited liability company, any Governmental Authority or
any other entity or organization.
1.30 "PROCESS IMPROVEMENT" has the meaning set forth in Section 5.3.1.
1.31 "PRODUCT" means a pharmaceutical product that contains or incorporates the
Compound, whether in development or approved by any Regulatory Authority,
including all formulations, line extensions and modes of administration
(including, without limitation, all delivery devices, dosage forms or
other peripherals and consumables), including, without limitation,
Combination Products.
1.32 "RECEIVING PARTY" means the Party to whom Confidential Information is
disclosed.
1.33 "REGULATORY APPROVAL" means any and all approvals (including pricing
approvals to the extent necessary), licenses, registrations or
authorizations of any Regulatory Authority, necessary for the development,
manufacture and commercialization of a Final Commercial Product.
1.34 "REGULATORY AUTHORITY" means, in a particular country or jurisdiction, any
applicable government regulatory authorities involved in granting
Regulatory
4
Approval and/or, to the extent required in such country or jurisdiction,
pricing approval of Final Commercial Product in such country or
jurisdiction, including without limitation, (a) in the United States, the
FDA, and any other applicable governmental or regulatory authority in the
United States having jurisdiction over Final Commercial Product, and any
successor government authority having substantially the same function, and
(b) any foreign equivalent thereof.
1.35 "SAVINGS" has the meaning set forth in Sections 5.3.5 and 5.3.6,
respectively.
1.36 "SAVINGS TRIGGER DATE" has the meaning set forth in Section 5.3.3.
1.37 "SHE INFORMATION" means to the extent applicable and available, and as
agreed to by the Parties, safety, health and environmental information as
it relates to SDD and SDD Manufacturing Process including, without
limitation: safety data sheets, chemical hazard assessments, operational
hazard test results and environmental assessments.
1.38 "SPRAY DRIED DISPERSION" or "SDD" means the Compound in spray-dried form.
1.39 "SDD MANUFACTURING PROCESS" means any process (or any step in or portion
of any process) used or developed by a Party (or any of its Affiliates or
Third Party Suppliers) as of the Effective Date or at any time thereafter,
in manufacturing SDD.
1.40 "SPRAY DRYING CAPITAL EXPENDITURE" shall mean such capital expenditures
estimated by AGIX as being all reasonably necessary capital expenditures
relating directly to the spray drying process to manufacture SDD, which
expenditures are estimated in Exhibit 2.
1.41 "SUBLICENSEE" means any Third Person (including, without limitation, a
distributor) to which AstraZeneca or any of its Affiliates grants any
right to make, use, market, or import and sell a Final Commercial Product
in accordance with the License Agreement. A Third Person who is granted
only the right to distribute or promote a Final Commercial Product (such
as a contract sales organization) shall not be considered a Sublicensee.
1.42 "TERM" means the period beginning on the Effective Date and continuing
until the date upon which this Agreement is terminated in accordance with
Article 10.
1.43 "THIRD PARTY" or "THIRD PERSON" means any Person other than AGIX or
AstraZeneca and their respective Affiliates.
1.44 "THIRD PARTY SUPPLIER" means a Person engaged by a Party, including,
without limitation, Dow, for the supply of SDD or any aspect of the
supply, manufacture or warehousing of SDD, its constituents or raw
materials (such as Probucol), including the performance of a SDD
Manufacturing Process.
5
1.45 "TRANSITION PERIOD" means the period commencing on the Effective Date and
continuing until the receipt of the first Regulatory Approval for the
Product.
2 CONSTRUCTION
2.1 Except where the context requires otherwise, whenever used the singular
includes the plural, the plural includes the singular, the use of any
gender is applicable to all genders and the word "or" has the inclusive
meaning represented by the phrase "and/or." Whenever this Agreement refers
to a number of days, unless otherwise specified, such number refers to
calendar days. The headings of this Agreement are for convenience of
reference only and do not define, describe, extend or limit the scope or
intent of this Agreement or the scope or intent of any provision contained
in this Agreement. The term "including" or "includes" as used in this
Agreement means including, without limiting the generality of any
description preceding such term. The wording of this Agreement shall be
deemed to be the wording mutually chosen by the Parties and no rule of
strict construction shall be applied against any Party.
2.2 References to Articles, Sections, Exhibits and Schedules refer to the
Articles, Sections, Exhibits and Schedules of and to this Agreement.
2.3 The Exhibits and the Schedules (as amended from time to time by agreement
of the Parties in writing) form part of this Agreement and have the same
force and effect as if expressly set out in the body of the Agreement. Any
reference to the Agreement includes the Exhibits and the Schedules. Any
breach of the Exhibits or Schedules shall be deemed as a breach of this
Agreement.
3 AMENDMENT
Any amendment or modification of this Agreement (including any amendment
of any Exhibit or Schedule hereto) must be in writing and signed by
authorized representatives of both Parties.
4 TRANSITION ASSISTANCE
4.1 Transition Assistance. Following the Effective Date and continuing
throughout the Transition Period, AGIX shall cooperate with AstraZeneca
and provide AstraZeneca with all reasonable assistance as reasonably
requested by AstraZeneca to facilitate manufacturing of the Final
Commercial Product and Compound, including, without limitation, assistance
regarding the Process Improvements. Such technical assistance shall
include, without limitation, (i) transitioning to AstraZeneca
relationships with Third Party Suppliers, vendors and contractors relating
to the manufacture of raw materials, Compound and Spray Dried Dispersion
and (ii) transferring to AstraZeneca financial, business, regulatory,
technical and all other necessary or useful information relating to the
manufacture and supply of raw materials, Compound and Spray Dried
Dispersion.
4.2 Manufacturing Timelines. [****]
- -------
[****] indicates that certain confidential information contained in this
document has been omitted pursuant to a request for confidential treatment and
filed separately with the Securities and Exchange Commission.
6
4.3 Assignment of Contracts and Other Rights. AGIX shall use commercially
reasonable efforts to assign to AstraZeneca and, upon such assignment,
AstraZeneca shall assume all rights and obligations of AGIX under the Dow
Agreement and the other Existing Agreements, provided, however that
AstraZeneca will, at AGIX's option, use commercially reasonable efforts to
assign to AGIX such agreements, to the extent then still in effect, and
any new agreements entered into by AstraZeneca relating to the manufacture
of raw materials, Compound and Spray Dried Dispersion together with any
equipment funded under Section 5.2 and used in connection with the
manufacture thereof, and the right to the use thereof in the event that
AstraZeneca terminates the License Agreement pursuant to Sections 13.3(a),
13.3(b), 13.3(c) or 13.3(d) of the License Agreement or AGIX terminates
the License Agreement pursuant to Section 13.4 thereof, provided, however,
that in the event that AGIX elects to have an agreement, equipment or the
use thereof assigned to AGIX pursuant to this Section 4.3, AstraZeneca
shall be relieved of its obligation pursuant to Section 13.5(b)(vi) of the
License Agreement to supply Products and/or Compounds to AGIX. AGIX and
AstraZeneca shall use commercially reasonable efforts to obtain any third
party consents that may be necessary to effect the assignments required by
this Section 4.3. Immediately following the execution of this Agreement,
AGIX shall contact Niro to obtain Niro's consent to the assignment of
PO#B24579 set forth on Exhibit 4 to AstraZeneca. In the event AGIX is
unable to obtain Niro's consent, AGIX shall lease or, at AstraZeneca's
option, assign the equipment purchased thereunder to AstraZeneca, for no
addition consideration beyond that set forth herein, and shall pass
through to AstraZeneca all warranties set forth in such purchase order.
4.4 Assistance Following Transition Period. Following the Transition Period,
AGIX shall continue to provide such reasonable additional technical and
regulatory assistance as reasonably requested by AstraZeneca, at
AstraZeneca's expense. Such assistance may be provided by telephone, video
conference or in-person at AstraZeneca's facility or at any third party's
facility, as mutually agreed; provided that, the Parties reasonably agree
to the scheduling of any such assistance.
4.5 Certain Additional Covenants. Following the date hereof, AGIX (i) will not
enter into any contracts related to the manufacture or supply of Spray
Dried Dispersion without the prior written consent of AstraZeneca, except
that AGIX may take any of the foregoing actions in the ordinary course
prior to the Effective Date without AstraZeneca's consent; (ii) will not
terminate, take any action likely to result in a breach of or prepay any
contract or obligation related to the manufacture or supply of Spray Dried
Dispersion without the prior written consent of AstraZeneca; and (iii)
will cause each of its Affiliates to comply with this Section 4.5.
4.6 Meetings. During the Transition Period, AstraZeneca shall notify AGIX
promptly of any material developments with respect to, and shall keep AGIX
informed on an ongoing basis regarding, the manufacture and supply of the
SDD, the Compound and materials, and regulatory matters. During the
Transition Period,
7
the Parties shall meet no less than monthly regarding the manufacturing,
supply and regulatory filings related to the SDD, the Compound and
materials.
5 FEES
5.1 Costs of Transitional Assistance. AstraZeneca shall reimburse AGIX for all
costs and expenses reasonably incurred by AGIX in providing transition
assistance hereunder. Promptly following the Effective Date, the Parties
will agree on a process and rates for determining such costs and expenses.
5.2 Reimbursement for Capital and Other Expenses.
5.2.1 AstraZeneca shall reimburse AGIX for [****] of the capital and other
expenses set forth on Exhibits 2 and 3 incurred by AGIX prior to the
Effective Date.
5.2.2 After the Effective Date, AGIX shall reimburse AstraZeneca for
[****] of the capital and other expenses set forth on Exhibits 2 and
3 incurred by AstraZeneca, up to the maximum AGIX payment levels
specified on such Exhibits.
5.2.3 AstraZeneca shall pay to AGIX, within thirty (30) days following the
last date that AstraZeneca is no longer entitled to elect to
terminate the License Agreement pursuant to Sections 13.3(a),
13.3(b) or 13.3(c) (and has not exercised any such election to
terminate the License Agreement), or prior to such last date, AGIX
terminates the License Agreement pursuant to Section 13.4 thereof,
an amount equal to (a) the capital and other expenses set forth on
Exhibits 2 and 3 incurred by AGIX prior to the Effective Date and
not previously reimbursed by AstraZeneca pursuant to Section 5.2.1
plus (b) any amounts paid by AGIX pursuant to Section 5.2.2 above.
5.2.4 All amounts payable pursuant to this Section 5.2 shall be made
within thirty (30) days after receipt of an invoice therefor,
accompanied by evidence of payment of such expenses.
5.3 Process Improvements.
5.3.1 As of the Effective Date, AGIX has proposed the following
improvements to the manufacturing process, as more fully described
in Exhibit 1 (the "PROCESS IMPROVEMENTS"):
(a) [****] (Part A, Exhibit 1);
(b) [****] (Part B, Exhibit 1);
(c) [****] (Part C, Exhibit 1); and
(d) [****] (Part D, Exhibit 1).
- -------
[****] indicates that certain confidential information contained in this
document has been omitted pursuant to a request for confidential treatment and
filed separately with the Securities and Exchange Commission.
8
5.3.2 AstraZeneca shall have the right to determine which of the Process
Improvements to implement and shall pay all costs associated with
implementing any such Process Improvements. The Process Improvements
described in Sections 5.3.1(a)-(c) shall be considered to have been
implemented on the date that the price paid by AstraZeneca to any
Third Party Supplier for SDD or the Compound is reduced to reflect
such implementation (the "PROCESS IMPLEMENTATION DATE").
5.3.3 AGIX shall not be entitled to receive Savings, if any, from any
Process Improvement until the earlier of: (a) the date on which
[****] of the Final Commercial Product sold by AstraZeneca, its
Affiliates and Sublicensees in two consecutive calendar quarters is
in the form of a 300mg tablet or (b) [****] from the First
Commercial Sale (as defined in the License Agreement) of the
Product. The earlier of such dates is referred to herein as the
"SAVINGS TRIGGER DATE."
5.3.4 With respect to each of the Process Improvements set forth in
Section 5.3.1(a)-(c), beginning on the Savings Trigger Date and
continuing throughout the term of the License Agreement, AstraZeneca
shall pay to AGIX on a quarterly basis, [****] of any Savings from
such Process Improvement (as calculated in accordance with Sections
5.3.5 and 5.3.6 below) times the number of kilograms of Compound
purchased by AstraZeneca, its Affiliates and Sublicensees (other
than Third Party Suppliers) during such calendar quarter.
5.3.5 With respect to the Process Improvements set forth in Section
5.3.1(b) and (c) the term "SAVINGS" shall mean the difference
between the per kilogram price of the Compound to AstraZeneca and
its Affiliates and Sublicensees prior to the Process Implementation
Date and the per kilogram price of the Compound to AstraZeneca and
its Affiliates and Sublicensees immediately after the Process
Implementation Date for such Process Improvement to the extent that
any such reduction in price is attributable to the implementation of
such Process Improvement.
5.3.6 With respect to the Process Improvement set forth in Section
5.3.1(a), the term "SAVINGS" shall mean (i) for the number of
kilograms of Compound actually purchased by AstraZeneca, its
Affiliates and Sublicensees, the difference between the per kilogram
price of Compound prior to the Process Implementation Date and the
per kilogram price of Compound to AstraZeneca, its Affiliates and
Sublicensees, after the Process Implementation Date for such Process
Improvement (both such prices as set forth specifically in the Dow
Agreement) plus, (ii) for the number of kilograms of Probucol
actually purchased by AstraZeneca, its Affiliates and Sublicensees,
the cost reduction per kilogram as a result of reduced Probucol
consumption, which cost reduction shall equal the average per
kilogram price of Probucol during a calendar year times the
fraction, where the numerator is the difference between the number
of Probucol
- -------
[****] indicates that certain confidential information contained in this
document has been omitted pursuant to a request for confidential treatment and
filed separately with the Securities and Exchange Commission.
9
kilograms required per kilogram of Compound prior to the
Implementation Date and the number of Probucol kilograms required
per kilo of Compound after the Process Implementation Date and the
denominator is the number of Probucol kilograms required per
kilogram of Compound after the Process Implementation Date.
5.3.7 The Parties acknowledge and agree that the calculations of Savings
are based on the financial structure currently set forth in the Dow
Agreement as of the Effective Date and that AstraZeneca may at any
time seek to amend the Dow Agreement. In the event that AstraZeneca
amends the Dow Agreement or structures its relationships with Third
Party Suppliers in a manner that reduces the amounts that would be
otherwise paid to AGIX pursuant to this Section 5.3.6 had the Dow
Agreement remained in effect and unamended, AGIX shall be entitled
to the amounts that would have been due under the Dow Agreement,
unless such change was agreed to in advance by AGIX.
5.3.8 For the avoidance of doubt, all decreases in the price of Compound
or SDD attributable to the Process Improvement described in Section
5.3.1(d) shall be retained by AstraZeneca. Furthermore, sales from
AstraZeneca or any of its Affiliates to a Sublicensee or Affiliate
shall be disregarded for purposes of the calculations set forth in
this Section 5.3.
5.4 Capacity Reserve Fee.
5.4.1 If Regulatory Approval has not been obtained prior to [****], any
Capacity Reserve Fees due to Dow under the Dow Agreement relating to
any period prior to [****] shall be paid by AstraZeneca and,
provided that AstraZeneca performs the validation run of the
Compound for 2006 as specified in the Dow Agreement, reimbursed by
AGIX. Thereafter, AstraZeneca shall pay any Capacity Reserve Fees
due under Section 6.1(c) of the Dow Agreement, however, AGIX shall
reimburse AstraZeneca for [****] of any Capacity Reserve Fees paid
by AstraZeneca pursuant to Section 6.1(c) of the Dow Agreement for
periods prior to receipt of the first Regulatory Approval. Any
Capacity Reserve Fees that are due under the Dow Agreement for
periods after receipt of the first Regulatory Approval shall be paid
solely by AstraZeneca. Any Capacity Reserve Fees for the year in
which Regulatory Approval is first obtained shall be prorated.
5.4.2 In the event that AGIX has reimbursed AstraZeneca for a Capacity
Reserve Fee or a portion thereof and AstraZeneca's, its Affiliates'
and Sublicensees' orders for that year exceed the minimum quantity
specified in Section 6.1(b) of the Dow Agreement, AstraZeneca shall
refund any reimbursement by AGIX for any Capacity Reserve Fee
reimbursed by AGIX for such year.
- -------
[****] indicates that certain confidential information contained in this
document has been omitted pursuant to a request for confidential treatment and
filed separately with the Securities and Exchange Commission.
10
5.4.3 In the event the Dow Agreement is amended after the Effective Date
hereof, for the purpose of this Section 5.4, AGIX shall receive the
benefit of any reduction in the Capacity Reserve Fees or minimum
quantities agreed to in any amendment, but shall not be subject to
any increases with respect thereto.
5.4.4 Notwithstanding the provisions of the Dow Agreement, no Capacity
Reserve Fees or portion thereof shall be payable by AGIX for any
year in which the total cumulative quantity of Compound ordered by
AstraZeneca from all of its Third Party Suppliers exceeds the
minimum quantity specified in Section 6.1(b) of the Dow Agreement.
6 INVOICING, PAYMENT, RECORDKEEPING AND AUDITS
6.1 Except as otherwise provided herein, each Party shall pay all amounts due
hereunder within thirty (30) days after receipt of an invoice therefor,
accompanied by evidence of payment of such expenses.
6.2 All past due amounts owed by one Party to the other Party under this
Agreement shall bear simple interest at the U.S. Prime Rate, as reported
by the Wall Street Journal, Eastern Edition, on the due date (or the next
business day if the due date is not a business day), calculated based on
the number of days between the actual date the payment is made and the
date the payment was due; provided, however, that in no event shall such
rate exceed the maximum legal annual interest rate. The payment of such
interest shall not limit a Party from exercising any other rights it may
have as a consequence of the lateness of any payment.
6.3 All amounts payable hereunder are:
6.3.1 exclusive of Indirect Taxes, which, if payable, shall be borne and
paid by each Party against the provision by the other Party of an
appropriate Indirect Tax invoice; and
6.3.2 payable in the Invoice Currency.
6.4 Each Party shall maintain for at least five (5) years, complete and
accurate books and records in connection with the fees payable hereunder
as necessary to allow the accurate calculation of the amounts due to the
other Party hereunder.
6.5 Audits
6.5.1 Each Party shall permit upon written notice to the other Party, at
its own expense, a certified public accountant or a person
possessing similar professional status and associated with an
independent accounting firm acceptable to the Parties to inspect,
during normal business hours, and not more than once in any calendar
year, to audit the other Party's books and records as may be
reasonably necessary to verify the accuracy of the financial reports
furnished by the other Party pursuant to this Agreement
11
or of any charges, reimbursements or payments made by the other
Party pursuant to this Agreement, in respect of any Calendar Year
ending not more than three (3) years prior to the date of such
notice.
6.5.2 Each Party recognizes that the Third Party performing any audit for
a Party may perform accounting services for a Party, and each Party
hereby waives any conflict of interest relating to the use of such
accounting firm.
6.5.3 Upon the expiration of the three (3) years following the end of any
Calendar Year, the calculation of amounts payable with respect to
such fiscal year shall be binding and conclusive upon the Parties,
and the Parties shall be released from any liability or
accountability with respect to payments for such year.
6.5.4 The report prepared by any Third Party, if used by a Party, shall
contain the conclusions of such Third Party regarding the audit and
shall specify that the amounts paid pursuant thereto were correct
or, if incorrect, the amount of any underpayment or overpayment.
6.5.5 In the case of any payments hereunder, if such report shows any
underpayment by a Party, such Party shall remit to the other Party
within thirty (30) days after receipt of such report, (A) the amount
of such underpayment; and (B) if such underpayment exceeds five
percent (5%) of the total amount owed for the Calendar Year then
being audited, the reasonable and necessary fees and expenses of
such Third Party to perform the audit, subject to reasonable
substantiation thereof. If such report shows any overpayment by a
Party, then at the audited Party's option, such overpayment shall
either be refunded to such Party by the other Party within thirty
(30) days of receipt of the audit report, or be creditable against
amounts payable by such Party in subsequent payment periods.
6.5.6 The Parties agree that all information subject to review under this
Article 6 is Confidential Information and that each Party shall
retain and cause any Third Party used for any audit to retain all
such information in confidence.
7 REPRESENTATIONS AND WARRANTIES
7.1 AGIX represents and warrants to AstraZeneca that:
7.1.1 To the best of AGIX's knowledge as of the Effective Date, the
performance by AGIX of its obligations to AstraZeneca under this
Agreement will not breach or be in conflict with any covenant or
obligation of AGIX to any third party, and, to the best of AGIX's
knowledge as of the Effective Date, will not infringe the
Intellectual Property Rights of any Third Party;
12
7.1.2 There are no material contracts or other legally binding commitments
of AGIX relating to the manufacturing, start-up or launch of supply
of SDD other than the Existing Agreements, and (ii) there are no
material contracts or other legally binding commitments of AGIX
relating to the supply of raw materials or services in connection
with supply of SDD other than the Existing Agreements;
7.1.3 AGIX represents and warrants to AstraZeneca that
(a) the Existing Agreements are in full force and effect and have
not been modified or amended other than as shown therein;
(b) neither AGIX nor, to the knowledge of AGIX, any other party to
an Existing Agreement is in default with respect to a material
obligation under, and neither such party has claimed or has
grounds upon which to claim that the other party is in default
with respect to a material obligation under, an Existing
Agreement; and
(c) AGIX has not waived or allowed to lapse any of its rights
under any Existing Agreement, and no such rights have lapsed
or otherwise expired or been terminated. and
7.1.4 The estimates of Spray Drying Capital Expenditures and the
Manufacturing Start-Up and Other Costs set forth on Exhibits 2 and 3
represent AGIX's good faith estimates as of the Effective Date of
these expenses. For the avoidance of doubt, AGIX makes no
representation or warranty that actual costs will equal these
estimated costs.
7.2 EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT OR THE RELATED AGREEMENTS,
NEITHER PARTY MAKES ANY OTHER REPRESENTATION OR WARRANTY, EXPRESS OR
IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND
EACH PARTY SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY
WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY, OF FITNESS FOR A
PARTICULAR PURPOSE, AND OF NON-INFRINGEMENT.
7.3 NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR INDIRECT, INCIDENTAL,
CONSEQUENTIAL, OR SPECIAL DAMAGES INCLUDING, BUT NOT LIMITED TO, LOST
PROFITS ARISING FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT,
REGARDLESS OF ANY NOTICE OF THE POSSIBILITY OF SUCH DAMAGES. HOWEVER,
NOTHING IN THIS SECTION IS INTENDED TO LIMIT OR RESTRICT THE
INDEMNIFICATION RIGHTS OR OBLIGATIONS OF EITHER PARTY UNDER ARTICLE 8.
8 INDEMNIFICATION
13
8.1 AGIX shall defend AstraZeneca, its Affiliates and their respective
officers, directors, partners, shareholders, employees and agents and
licensees (the "AZ INDEMNITEES"), at AGIX's cost and expense, and will
indemnify and hold harmless the AZ Indemnitees from and against any and
all Losses incurred by or awarded against an AZ Indemnitee only to the
extent relating to or in connection with any and all claims or actions
brought by an unaffiliated Third Party against any AZ Indemnitee arising
out of a breach of a representation, warranty, covenant or obligation set
forth herein, except to the extent that such Losses are (i) attributable
to the gross negligence or willful misconduct of the AZ Indemnitees or
(ii) otherwise subject to an obligation by AstraZeneca to indemnify AGIX
Indemnitees under Section 8.2.
8.2 Except with respect to Losses required to be indemnified by AGIX pursuant
to Section 8.1 above, AstraZeneca shall defend AGIX, its Affiliates and
their respective officers, directors, partners, shareholders, employees
and agents and licensees (the "AGIX INDEMNITEES"), at AstraZeneca's
expense, and will indemnify and hold harmless the AGIX Indemnitees from
and against any and all Losses incurred by or awarded against an AGIX
Indemnitee relating to or in connection with any and all claims or actions
brought by an unaffiliated Third Party against a AGIX Indemnitee arising
out of a breach of a representation, warranty, covenant or obligation set
forth herein, except to the extent that such Losses are (i) attributable
to the gross negligence or willful misconduct of the AGIX Indemnitees or
(ii) otherwise subject to an obligation by AGIX to indemnify AstraZeneca
Indemnitees under Section 8.1.
8.3 Indemnification Procedures
8.3.1 Notice. Promptly after an Indemnitee receives notice of a pending or
threatened claim, demand, suit, action or proceeding brought or
initiated by a Third Party (an "ACTION"), such Indemnitee shall give
written notice of the Action to the Indemnifying Party to whom the
Indemnitee is entitled to look for indemnification pursuant to this
Article 8. However, an Indemnitee's delay in providing or failure to
provide such notice shall not relieve the Indemnifying Party of its
indemnification obligations, except to the extent it can demonstrate
prejudice due to the delay or lack of notice.
8.3.2 Defense. Upon receipt of notice under Section 8.3.1 from the
Indemnitee, the Indemnifying Party shall have the duty to either
compromise or defend, at its own expense and by counsel (reasonably
satisfactory to Indemnitee, such Action. The Indemnifying Party
shall promptly and in any event not more than twenty (20) days after
receipt of the Indemnitee's original notice) notify the Indemnitee
in writing that it wishes to assume control of the Action pursuant
to this Article 8 and of its intention to either compromise or
defend such Action. The assumption of the defense of an Action by
the Indemnifying Party shall not be construed as an acknowledgement
that the Indemnifying Party is liable to indemnify the Indemnitee in
respect of the Action, nor shall it constitute a waiver by the
14
Indemnifying Party of any defenses it may assert against any
Indemnified Party's claim for indemnification. Once the Indemnifying
Party gives such notice to the Indemnitee, the Indemnifying Party is
not liable to the Indemnitee for the fees of other counsel or any
other expenses subsequently incurred by the Indemnitee in connection
with such defense, other than the Indemnitee's reasonable costs of
investigation and cooperation. However, the Indemnitee shall have
the right to employ separate counsel and to control the defense of
an Action (and the Indemnifying Party shall bear the reasonable
fees, costs, and expenses of such counsel) if:
(a) the use of the counsel chosen by the Indemnifying Party would
present such counsel with a conflict of interest;
(b) the actual or potential defendants in, or targets of, such
Action include both the Indemnifying Party and the Indemnitee,
and the Indemnitee reasonably concludes that there may be
legal defenses available to it that are different from or
additional to those available to the Indemnifying Party (in
which case the Indemnifying Party shall not have the right to
assume the defense of such Action on the Indemnitee's behalf);
(c) the Indemnifying Party does not employ counsel reasonably
satisfactory to the Indemnitee to represent the Indemnitee
within a reasonable time after the Indemnitee's notice of such
Action; or
(d) in the reasonable opinion of counsel to the Indemnitee, the
claim could result in the Indemnitee becoming subject to
injunctive relief or relief other than the payment of Losses
that could have a materially adverse effect on the ongoing
business of the Indemnitee; provided, however, that in no
event shall the Indemnifying Party be obligated to bear the
fees, costs and expenses of more than one (1) separate counsel
for all of the other Party's Indemnitees in such Action.
8.3.3 Cooperation. The Indemnitee shall cooperate fully with the
Indemnifying Party and its legal representatives in the
investigation and defense of an Action. The Indemnifying Party shall
keep the Indemnitee informed on a reasonable and timely basis as to
the status of such Action (to the extent the Indemnitee is not
participating in the defense of such Action) and conduct the defense
of such Action in a prudent manner.
8.3.4 Settlement. If an Indemnifying Party assumes the defense of an
Action, no compromise or settlement of such Action may be effected
by the Indemnifying Party without the Indemnitee's written consent
(which consent shall not be unreasonably withheld or delayed),
unless (i) there is no finding or admission of any violation of law
or any violation of the rights of any person and no effect on any
other claims that may be made
15
against the Indemnitee, (ii) the sole relief provided is monetary
damages that are paid in full by the Indemnifying Party, and (iii)
the Indemnitee's rights under this Agreement are not adversely
affected. If the Indemnifying Party fails to assume defense of an
Action within a reasonable time, the Indemnitee may settle such
Action on such terms as it deems appropriate with the consent of the
Indemnifying Party (which consent shall not be unreasonably
withheld), and Indemnifying Party shall be obligated to indemnify
the Indemnitee for such settlement as provided in this Article 8.
8.4 Indemnification Payment Adjustments
8.4.1 Insurance Proceeds Or Other Recovery. The amount of any Losses for
which indemnification is provided under this Article 8 shall be
reduced by the insurance proceeds received and any other amount
recovered, if any, by the Indemnitee with respect to any Losses. An
Indemnitee shall mitigate, to the extent such mitigation does not
otherwise harm such Indemnitee or is otherwise inconsistent with
this Article 8, any Losses for which indemnification is sought
hereunder and, to the extent such Losses are covered by Indemnitee's
insurance, shall pursue an insurance claim relating to such Losses.
8.4.2 Refund. If an Indemnitee receives a payment pursuant to this Article
8 and subsequently receives insurance proceeds or other amounts with
respect to the same Losses, the Indemnitee shall pay to the
Indemnifying Party an amount equal to the difference (if any)
between: (i) the sum of the insurance proceeds received, other
amounts received, and the indemnification amount received from the
Indemnifying Party pursuant to this Article 8 and (ii) the amount
necessary to fully and completely indemnify and hold harmless the
Indemnitee from and against such Losses. However, in no event shall
such refund ever exceed the Indemnifying Party's payment to the
Indemnitee under this Article 8.
8.5 Indemnification Payment. Any amount owed by an Indemnitee to a Third
Person, for which the Indemnifying Party has an obligation under this
Article 8 to indemnify, shall be due from the Indemnifying Party to the
Third Person, whether upon entry of judgment, upon settlement, or
otherwise.
8.6 Survival. The provisions of this Article 8 shall survive any termination
or expiration of this Agreement. Each Indemnitee's rights under this
Article 8 shall not be deemed to have been waived or otherwise affected by
such Indemnitee's waiver of the breach of any obligation, agreement,
condition, covenant, representation, or warranty contained in, or made
pursuant to, this Agreement, unless such waiver expressly (and in writing)
also waives any or all of the Indemnitee's rights under this Article 8.
16
9 FORCE MAJEURE
9.1 Subject to Section 9.3, a Party's obligations under this Agreement will be
suspended to the extent and for the duration that its performance is
delayed, hindered or prevented by circumstances which are not within its
reasonable control ("FORCE MAJEURE").
9.2 For the purposes of this Section, Force Majeure includes acts or
restraints of governments or public authorities, war, revolution, riot or
civil commotion, strikes, lock-outs (except relating to a Party's own
employees), blockage or embargo, explosion, fire, flood or natural
disaster and any other events that are beyond the reasonable control of
the affected Party.
9.3 A Party affected by any event of Force Majeure shall:
9.3.1 promptly in writing notify the other Party, explaining the nature,
details and expected duration of such event. Such Party shall also
notify the other Party from time to time as to when the affected
Party reasonably expects to resume performance in whole or in part
of its obligations hereunder, and notify the other Party of the
cessation of any such event;
9.3.2 use diligent efforts to resume full performance of its obligations
under this Agreement as soon as reasonably practical; and
9.3.3 pending such resumption, use commercially reasonable efforts to
facilitate any efforts that the other Party may make to procure an
alternative method by which its obligations under this Agreement may
be performed.
9.4 If a Party anticipates that an event of Force Majeure may occur, such
Party shall notify the other Party of the nature, details and expected
duration of such event.
10 TERM AND TERMINATION
10.1 Term. This Agreement shall be effective during the Term.
10.2 Termination by Either Party. In addition to any other provision of this
Agreement expressly providing for termination of this Agreement, this
Agreement may be terminated immediately by either Party upon notice to the
other Party in the following circumstances:
10.2.1 in the event of a material breach of this Agreement by the other
Party, which breach remains uncured for sixty (60) days.
10.2.2 if the other Party shall file in any court or agency, pursuant to
any statute or regulation of any state or country, a petition in
bankruptcy or insolvency or for reorganization or for an the
appointment of a receiver or trustee of such other Party or of its
assets, or if the other Party proposes a written agreement of
composition or extension of its debts, or
17
if the other Party shall be served with an involuntary petition
against it, filed in any insolvency proceeding, or if the other
Party shall propose or be a party to any dissolution or
liquidation, or if the other Party shall make an assignment for the
benefit of its creditors;
10.2.3 if any encumbrancer takes possession of any material part of the
assets of the other Party;
10.2.4 if any distress, execution or other such process is levied or
enforced upon or against any of the material assets of the other
Party;
10.2.5 if the other Party ceases or threatens to cease to carry on the
whole or substantially the whole of its business or that part of
its business to which this Agreement relates; or
10.2.6 if the License Agreement is terminated pursuant to Sections
13.3(a), 13.3(b), 13.3(c) or 13.3(d) of the License Agreement or
AGIX terminates the License Agreement pursuant to Section 13.4
thereof.
10.3 Effect of Termination. Without prejudice to any other rights or remedies
which either Party may have, upon the termination of this Agreement,
howsoever the same occurs, each Party shall:
10.3.1 immediately pay to the other Party all undisputed sums which at the
date of termination are due and payable to the other Party under
this Agreement, and
10.3.2 within thirty (30) days of such termination, at its own expense,
return to the other Party any property of the other Party in its
possession, custody or control, including all Confidential
Information of that Party and copies of it; provided, however, that
a Party may retain one (1) copy of the other Party's Confidential
Information in order to ensure compliance with its obligations set
forth in this Agreement.
10.4 Articles 1, 2, 8, 11-22 and Section 6.4, 6.5, 7.2, 7.3, 10.3, 10.4 and
with respect to the effects of termination of the License Agreement,
Sections 4.3 and 5.2.3 will survive expiration or termination of this
Agreement, howsoever the same occurs.
18
11 CONFIDENTIALITY
11.1 Nondisclosure Obligation
11.1.1 Confidential Information. All Information disclosed by one Party to
the other Party pursuant to this Agreement, including the terms of
this Agreement ("CONFIDENTIAL INFORMATION"), shall be maintained in
confidence by the Receiving Party and shall not be disclosed to any
non-Party or used for any purpose except to exercise its rights and
perform its obligations under this Agreement without the prior
written consent of the Disclosing Party, except to the extent that
the Receiving Party can demonstrate by competent written evidence
that such Information:
(a) is known by the Receiving Party at the time of its receipt
and, not through a prior disclosure by the disclosing Party,
as documented by the receiving Party's business records;
(b) is in the public domain other than as a result of any
breach of this Agreement by the Receiving Party;
(c) is subsequently disclosed to the Receiving Party on a
non-confidential basis by a Third Party who may lawfully do
so; or
(d) is independently discovered or developed by the Receiving
Party without the use of Confidential Information provided by
the Disclosing Party, as documented by the Receiving Party's
business records.
11.1.2 Return of Confidential Information Upon Expiration or Termination
of Agreement. Within thirty (30) days after any expiration or
termination of this Agreement, each Party shall destroy (and
certify to the other Party such destruction) or return such
Confidential Information provided by the other Party as the other
Party reasonably requests be destroyed or returned; provided,
however, that (i) the foregoing obligation shall not apply to any
matter of Confidential Information otherwise provided for in this
Agreement; and (ii) each Party may retain a single copy of the
Confidential Information in its confidential legal files for the
sole purpose of ascertaining its ongoing rights and
responsibilities regarding the Confidential Information.
11.2 Permitted Disclosures
11.2.1 Certain Permitted Disclosures. Each Party may disclose Confidential
Information provided by the other Party without such other Party's
written consent to the extent such disclosure is reasonably
necessary in the following instances:
19
(a) disclosure to governmental or other regulatory agencies in
order to obtain or maintain patents and to obtain, maintain or
amend any regulatory materials regarding SDD or satisfy any
other regulatory obligation regarding SDD, but such disclosure
may be only to the extent reasonably necessary to obtain
patents or obtain, maintain or amend such regulatory
materials;
(b) complying with applicable court orders or governmental
regulations, including without limitation rules or regulations
of the Securities and Exchange Commission, or by rules of the
National Association of Securities Dealers, any securities
exchange or NASDAQ; provided, however, that the receiving
Party shall first have given notice to the other Party hereto
in order to allow such Party the opportunity to seek
confidential treatment of the Confidential Information;
(c) disclosure to consultants, agents or other Third Parties
(including Third Party Suppliers) solely to the extent
required to accomplish the purposes of this Agreement or in
connection with due diligence or similar investigations by
such Third Parties; provided, however, that such Third Parties
agree to be bound by confidentiality and non-use obligations
at least equivalent in scope to those contained in this
Agreement.
11.2.2 Written Agreements. Each Party shall obtain written agreements from
each of its employees and consultants who perform work pursuant to
this Agreement, which agreements shall obligate such persons to
similar obligations of confidentiality and to assign to such Party
all inventions made by such persons during the course of performing
such work. Each Party will notify the other Party promptly upon
discovery of any unauthorized use or disclosure of the Confidential
Information of the other Party.
11.2.3 Required Disclosure. If a Party is required by judicial or
administrative process to disclose Confidential Information that is
subject to the non-disclosure provisions of Section 11.1.1, such
Party shall promptly inform the other Party of the disclosure that
is being sought in order to provide the other Party an opportunity
to challenge or limit the disclosure obligations, provided that
such Party's obligations to comply with Applicable Laws and
Regulations shall not be affected by such obligations. Confidential
Information that is disclosed by judicial or administrative process
shall remain otherwise subject to the confidentiality and non-use
provisions of this Article 11, and the Party disclosing
Confidential Information pursuant to law or court order shall take
all reasonable steps necessary, including without limitation
obtaining an order of confidentiality, to ensure the continued
confidential treatment of such Confidential Information.
20
11.3 Except as otherwise provided in this Agreement or the License Agreement,
any Confidential Information which is disclosed by or on behalf of a
Disclosing Party to the Receiving Party will remain the property of the
Disclosing Party, and AstraZeneca at all times shall own the AstraZeneca
Information, and AGIX at all times shall own the AGIX Information.
11.4 The obligations of each Party in this Article 11 will survive for a period
of ten (10) years after the date of expiration or termination of this
Agreement.
12 USE OF NAME
12.1 Except as provided under Section 12.2, neither Party may make any
announcement about the transactions contemplated by this Agreement without
the prior written consent of the other Party.
12.2 Except as set forth in the License Agreement, each Party shall not mention
or otherwise use the name, insignia, symbol, trademark, trade name or
logotype of the other Party or its Affiliates in any publication, press
release, promotional material or other form of publicity without the prior
written consent of the other Party in each instance, except for those
disclosures for which consent has previously been obtained. The
restrictions imposed by this Article 12 shall not prohibit either Party
from making any disclosure identifying the other Party that is required by
applicable law, rule or regulation or the requirements of a national
securities exchange or another similar regulatory body; provided that any
such disclosure shall be governed by Article 12. Further, the restrictions
imposed on each Party under this Article 12 are not intended, and shall
not be construed, to prohibit a Party from identifying the other Party in
its internal business communications; provided that any confidential
information in such communications remains subject to Article 12.
13 NOTICES
13.1 Notice Requirements
Any notice, request, demand, waiver, consent, approval or other
communication permitted or required under this Agreement shall be in
writing and shall be deemed given only if delivered by hand or sent by
facsimile transmission (with transmission confirmed) or by internationally
recognized overnight delivery service that maintains records of delivery,
addressed to the Parties at their respective addresses specified in
Section 13.2 or to such other addresses of which notice shall have been
given. Such Notice shall be deemed to have been given as of the date
delivered by hand or transmitted by facsimile (with transmission
confirmed) or on the second delivery day after deposit with an
internationally recognized overnight delivery service. Any notice
delivered by facsimile shall be confirmed by a hard copy delivered as soon
as practicable thereafter. This Section is not intended to govern the
day-to-day business communications
21
necessary between the Parties in performing their obligations under the
terms of this Agreement.
13.2 Address for Notice
For AstraZeneca: IPR Pharmaceuticals, Inc.
CARR 188 LOTE 17
SAN ISIDRO INDUSTRIAL PARK,
CANOVANAS, PR 00729
Fax: (787) 750-5332
Attn: President and General Manager
With a copy to: Shiona McGillivray, Senior Legal Counsel
AstraZeneca
Alderley House
Alderley Park
Macclesfield
Post Code SK10 4TF England
For AGIX: AtheroGenics, Inc.
8995 Westside Parkway
Alpharetta, Georgia 30004
Attn: President and Chief Executive Officer
Fax: (678) 336-2504
With a copy to: Arnold & Porter LLP
Suite 900
1600 Tysons Boulevard
McLean, Virginia 22102
Attn: Steve Parker, Esq.
Fax: (703) 720-7399
14 RELATIONSHIP OF THE PARTIES
The status of a Party under this Agreement shall be that of an independent
contractor. Nothing contained in this Agreement shall be construed as
creating a partnership, joint venture or agency relationship between the
Parties or, except as otherwise expressly provided in this Agreement, as
granting either Party the authority to bind or contract any obligation in
the name of or on the account of the other Party or to make any
statements, representations, warranties or commitments on behalf of the
other Party. All persons employed by a Party shall be employees of such
Party and not of the other Party and all costs and obligations incurred by
reason of any such employment shall be for the account and expense of such
Party.
22
15 RIGHTS OF THIRD PARTIES
The provisions of this Agreement are for the sole benefit of the Parties
and their successors and permitted assigns, and they shall not be
construed as conferring any rights in any other persons except as
otherwise provided in this Agreement.
16 ASSIGNMENT
This Agreement shall inure to the benefit and be binding upon each Party,
its successors and assigns. The Agreement may not be assigned or otherwise
transferred, nor, except as expressly provided hereunder, may any right or
obligation hereunder be assigned or transferred by either Party without
the prior written consent of the other Party, provided, however, that
either Party may, without such consent, assign the Agreement and its
rights and obligations hereunder (i) to an Affiliate, provided such
Affiliate has the financial resources to perform the obligations of this
Agreement in the reasonable judgment of the other Party or (ii) in
connection with the transfer or sale of all or substantially all of its
assets or business to which this Agreement relates, or in the event of its
merger or consolidation or change in control or similar transaction, or a
sale of all or substantially all the pharmaceutical business assets of the
Party; and provided further, that either Party shall be permitted to sell,
assign or transfer the right to receive any payments owed by the other
Party pursuant to this Agreement to one or more Third Parties. Any
attempted assignment not in accordance with this Article 16 shall be void.
17 ENTIRE AGREEMENT
17.1 This Agreement constitutes the entire agreement between the Parties with
respect to the subject matter of the Agreement. This Agreement supersedes
all prior agreements, whether written or oral, with respect to the subject
matter of the Agreement. Each Party confirms that it is not relying on any
representations, warranties or covenants of the other Party except as
specifically set out in this Agreement. Nothing in this Agreement is
intended to limit or exclude any liability for fraud. All Schedules and/or
Exhibits referred to in this Agreement are intended to be and are hereby
specifically incorporated into and made a part of this Agreement.
17.2 Where it is lawful to exclude them, all other conditions, representations
and warranties which would otherwise be implied (by law or otherwise) will
not form part of this Agreement.
18 EXPENSES
Except as otherwise expressly provided in this Agreement, each Party shall
pay the fees and expenses of its respective lawyers and all other expenses
and costs incurred by such Party incidental to the negotiation,
preparation, execution and delivery of this Agreement.
23
19 WAIVER AND NON-EXCLUSION OF REMEDIES
19.1 A Party's failure to enforce, at any time or for any period of time, any
provision of this Agreement, or to exercise any right or remedy shall not
constitute a waiver of that provision, right or remedy or prevent such
Party from enforcing any or all provisions of this Agreement and
exercising any rights or remedies. To be effective any waiver must be in
writing. The rights and remedies provided herein are cumulative and do not
exclude any other right or remedy provided by law or otherwise available
except as expressly set forth herein.
19.2 The payment of the invoices by a Party will not operate as any waiver by
such Party any right, power or remedy provided by law or under this
Agreement.
20 SEVERABILITY
To the fullest extent permitted by applicable law, the Parties waive any
provision of law that would render any provision in this Agreement
invalid, illegal or unenforceable in any respect. If any provision of this
Agreement is held to be invalid, illegal or unenforceable, in any respect,
then such provision will be given no effect by the Parties and shall not
form part of this Agreement. To the fullest extent permitted by applicable
law and if the rights or obligations of any Party will not be materially
and adversely affected, all other provisions of this Agreement shall
remain in full force and effect and the Parties will use their best
efforts to negotiate a provision in replacement of the provision held
invalid, illegal or unenforceable that is consistent with applicable law
and achieves, as nearly as possible, the original intention of the
Parties.
21 GOVERNING LAW AND DISPUTES
The interpretation and construction of this Agreement shall be governed by
the laws of State of New York excluding any conflicts or choice of law
rule or principle that might otherwise refer construction or
interpretation of this Agreement to the substantive law of another
jurisdiction.
22 EQUITABLE RELIEF
A breach by either Party of Article 11 may cause irreparable damage and
the non-breaching Party will not be adequately compensated by monetary
damages. In the event of a breach, or threatened breach, of Section
11.1.1, the non-breaching Party shall be entitled to seek from any court
of competent jurisdiction equitable relief, whether preliminary or
permanent, without the need to show irreparable harm or the inadequacy of
monetary damages as a remedy. Nothing in this Article 22 is intended, or
shall be construed, to limit the Parties' rights to equitable relief or
any other remedy for a breach of any provision of this Agreement.
24
23 ENVIRONMENTAL PROVISIONS
Each Party shall comply with all environmental and occupational safety and
health laws, rules, regulations and requirements relating to SDD and the
raw materials used in connection therewith.
24 COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original and all of which taken together shall be
deemed to constitute one and the same instrument. An executed signature
page of this Agreement delivered by facsimile transmission shall be as
effective as an original executed signature page.
[Signature Page Follows]
25
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
first set forth above.
IPR PHARMACEUTICALS, INC. ATHEROGENICS, INC.
By: /s/ RUBEN FREYRE By: /s/ RUSSELL M. MEDFORD
------------------ ---------------------------------
Name: Ruben Freyre Name: Russell M. Medford, M.D., Ph.D.
Title: President & General Manager Title: President & CEO
EXHIBIT 1
PROCESS IMPROVEMENTS
PART A: [****]
PART B: [****]
PART C: [****]
PART D: [****]
Exhibit 1-1
- ---------
[****] indicates that certain confidential information contained in this
document has been omitted pursuant to a request for confidential treatment and
filed separately with the Securities and Exchange Commission.
PART A: [****]
Part A-1
- -------
[****] indicates that certain confidential information contained in this
document has been omitted pursuant to a request for confidential treatment and
filed separately with the Securities and Exchange Commission.
PART B: [****]
Part B-1
- -------
[****] indicates that certain confidential information contained in this
document has been omitted pursuant to a request for confidential treatment and
filed separately with the Securities and Exchange Commission.
PART C: [****]
Part C-1
- -------
[****] indicates that certain confidential information contained in this
document has been omitted pursuant to a request for confidential treatment and
filed separately with the Securities and Exchange Commission.
PART D: [****]
Part D-1
- -------
[****] indicates that certain confidential information contained in this
document has been omitted pursuant to a request for confidential treatment and
filed separately with the Securities and Exchange Commission.
EXHIBIT 2
ESTIMATED SPRAY DRYING CAPITAL EXPENDITURES
[****]
Exhibit 3-1
- -------
[****] indicates that certain confidential information contained in this
document has been omitted pursuant to a request for confidential treatment and
filed separately with the Securities and Exchange Commission.
EXHIBIT 3
ESTIMATED MANUFACTURING START-UP AND OTHER COSTS
[****]
Exhibit 3-2
- -------
[****] indicates that certain confidential information contained in this
document has been omitted pursuant to a request for confidential treatment and
filed separately with the Securities and Exchange Commission.
EXHIBIT 4
(1) The Dow Agreement
(2) The addenda to the Research Agreement entered into by and between AGIX and
Dow, dated November 11, 2005.
(3) [****]
(4) [****]
- -------
[****] indicates that certain confidential information contained in this
document has been omitted pursuant to a request for confidential treatment and
filed separately with the Securities and Exchange Commission.
Exhibit 4-1
Exhibit 5
Dow Consent to Assignment
Exhibit 4-2