[CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTIONS OF THIS DOCUMENT
HAVE BEEN REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE COMMISSION]
BOVINE VACCINE DISTRIBUTION AGREEMENT
This Agreement is entered as of the 13th day of February, 1998 (the
"Effective Date"), by and between DIAMOND ANIMAL HEALTH, INC., an Iowa
corporation with offices at 2538 S.E. 43rd Street, Des Moines, Iowa, 50317,
("Diamond") and AGRI LABORATORIES, LTD., a Delaware corporation, with offices at
20927 State Route K, St. Joseph, Missouri, 64505 ("Distributor").
WHEREAS, Diamond has the right to certain bovine antigens described on
Exhibit A attached hereto and certain USDA and other licenses (and applications
therefor) for the manufacture of such antigens and the right to enter into this
distribution agreement as to them; and
WHEREAS, Distributor desires to purchase Products from Diamond, to be
marketed under private label brand names as Distributor deems appropriate
pursuant to the terms of this Agreement.
NOW, THEREFORE, the parties agree as follows:
SECTION 1. PRODUCTION, SALE AND DISTRIBUTION
1.01 Manufacture and Sale. Diamond agrees to manufacture and sell to
Distributor, and Distributor agrees to purchase from Diamond, Products
and additional products as referenced herein for distribution in the
Territory pursuant to and in accordance with the terms and conditions of
this Agreement.
1.02 Exclusivity. Distributor's distribution rights under this Agreement
shall be exclusive worldwide for all Products identified on Exhibit A
attached hereto and additional Products added pursuant to Section 2,
except as set forth in this paragraph. Notwithstanding the foregoing,
(i) Distributor's rights under this Agreement shall be non-exclusive for
distribution in Canada for all Products; (ii) Distributor shall have no
distribution rights outside the United States for any Products
containing Biostar antigens listed on Exhibit C, without the prior
written consent and agreement of Biostar (it being understood that
Diamond does not have rights to such Biostar antigens outside the United
States); (iii) Distributor shall not have any right to distribute
Products consisting of the Biostar antigens listed on Exhibit C in
combination with any antigens other than the viral antigens listed on
Exhibit A, without the prior written consent and agreement of Biostar;
(iv) Distributor acknowledges that Biostar has exclusive rights to
distribute in Canada the product combinations (and lesser fallout
products containing Biostar antigens) described in Exhibit C; (v)
Diamond and its Affiliates may sell, have sold and otherwise distribute
to Biostar without restriction the individual Biostar antigens listed in
Exhibit C; (vi) Diamond and its Affiliates may sell, have sold and
otherwise distribute to Boehringer Ingelheim without restriction the
individual antigens and monovalent vaccines (i.e., a vaccine containing
a single bovine antigen) listed on Exhibit B; and (vii) Diamond and its
Affiliates may sell, have sold and otherwise distribute to BTI without
any restriction biological veterinary products containing antigens
specified in Exhibit D to be used in solid dose configurations or using
[ *** ] technologies. From the beginning date of the second Contract
Year, Distributor shall have twenty-four (24) months to submit an
application to any foreign jurisdiction for the registration of any one
or more Products or future products and twenty-four (24) months after
obtaining approval of the registration to begin marketing the registered
Product. If Distributor fails to submit a timely application for the
registration of any one or more Products or additional Products, or if
Distributor submits a timely application and obtains an approved
registration but fails to timely market the Product, then Distributor
shall forfeit its Exclusive License rights to foreign markets but shall
maintain its Exclusive License rights in the United States.
It is furthermore recognized by the parties hereto that parties will make
good faith efforts to hereafter negotiate fair and equitable agreements as
between them for the sale of bulk antigens to other vaccine companies which
sales should be included in the Qualified Revenue requirements as set forth
in Section 1.04(ii). If the parties hereto cannot agree for the sale of
Bulk Antigens to other vaccine companies, then Diamond shall be prohibited
from making any Bulk Sales, except as set forth in Section 1.02.
1.03 Territory. Distributor is authorized to sell, have sold and otherwise
distribute Products and additional products added pursuant to Section 2
hereafter collectively referred to as "All Products" worldwide limited only
as provided in Section 1.02.
1.04 Purchase of Requirements; Minimum Purchases.
(i) Requirements. Distributor agrees to purchase its total
requirements of Products from Diamond for bovine veterinary
biologic products of the type described on Exhibit A but only to
the extent Diamond has the Products reasonably available for
Distributor's delivery directions that conform to Section 4 hereof.
Distributor may purchase any additional requirement from any
source, but only during such period that Diamond is unable to meet
such requirements and the reasonable costs thereof shall be
included in Minimum Qualified Revenues for purposes of Section
1.04(ii).
*** Confidentail Treatment Requested
(ii) Minimums. During the term of this Agreement Distributor shall cause
the Qualified Revenues for each Contract Year to equal or exceed the
following amounts (the "Minimum Qualified Revenue").
Minimum
Contract Year Qualified
as defined in 13.06 Revenues
-------------------- -------------------
1st [ *** ]
2nd $[ *** ]
3rd $[ *** ]
4th $[ *** ]
5th and thereafter $[ *** ]
provided, however, that Distributor may permit the Qualified
Revenues to be less than the Minimum Qualified Revenue in any
Contract Year and in lieu thereof pay to Diamond an amount equal to
the difference between such Minimum Qualified Revenue and the actual
Qualified Revenues for such Contract Year (the "Additional
Payment"). If an Additional Payment is due hereunder for any
Contract Year, which payment shall be due and payable thirty (30)
days after the end of such Contract Year, Distributor may elect by
written notice to Diamond within thirty (30) days after the end of
such Contract Year, in lieu of paying such Additional Payment, to
terminate Distributor's exclusivity rights under Section 1.02 of
this Agreement. Distributor's distribution rights shall continue on
a nonexclusive basis subject to all the remaining terms of this
Agreement not inconsistent therewith, which shall remain in full
force and effect.
1.05 Responsibilities of Distributor; Diamond Technical Support. Distributor
shall use reasonable efforts to market and sell Products in the
*** Confidential Treatment Requested
Territory and shall adhere to reasonable industry practice in connection
therewith. Distributor shall be responsible, at its sole expense, for
advertising and promotion, technical support and customer service. At
Distributor's request, Diamond shall provide reasonable technical
support for Distributor's marketing, sales and customer service efforts,
and shall pay the support costs thereof.
1.06 Registration and Licensing. Diamond shall use reasonable efforts to obtain
Licenses in the United States with respect to all Products and will pay all
Registration Costs associated with obtaining and maintaining such Licenses,
except as set forth in Section 2.02. Diamond will use reasonable efforts to
assist Distributor in the registration of Products (bulk or packed form)
outside the United States at Distributor's expense. Distributor shall pay
all Registration Costs associated with obtaining and maintaining any
Licenses required in the Territory outside the United States and said cost
shall be included in the Qualified Revenue requirements as set forth in
Section 1.04(ii).
1.07 Specifications. Diamond and Distributor agree that all Products will be
manufactured in accordance with the Specifications and applicable USDA
regulations. The Specifications may be changed at any time by mutual
agreement of the parties, subject to applicable regulatory requirements,
notices and approvals. Any disagreement concerning revisions to the
Specifications shall be first addressed by mutual discussion and
negotiation. Except to the extent the parties may otherwise agree in
writing, any increases in costs resulting from Specification changes
(including, but not limited to, those relating to packaging and raw
materials) may be reflected in a direct cost increase to the Purchase.
1.08 Labeling; Trademarks. Diamond shall affix labeling to all Products, such
labeling to bear one or more Distributor trademarks, as specified in
writing by Distributor. Nothing contained herein shall give Diamond any
right to use any Distributor trademark except on all Products manufactured
and delivered for Distributor. Diamond shall not obtain any right; title
or interest in any Distributor trademark by virtue of this Agreement
Distributor shall not use, nor shall Distributor obtain any right, title or
interest in, any Diamond trademark or any [ *** ] trademark, including
without limitation "Pneumo-Star," "Somnu-Star" and "Somnu-Star PH." All
Product labeling shall in addition to the Distributor trademark, contain
the notation "Manufactured by Diamond Animal Health, Inc." with its address
or such similar notation as may be necessary or advisable under applicable
law, and shall contain the notation "Distributed by Agri Laboratories,
Inc.," with its address. Distributor shall cause All Product labeling to
contain only such claims as are permitted under applicable Licenses for
such Products and to otherwise comply with applicable law. All labeling
and packaging of All Products shall be subject to the prior written
approval of both parties, which shall not be unreasonably withheld.
Diamond will order quantities of labeling and packaging sufficient to
perform its obligations hereunder in its reasonable discretion. Distributor
shall be responsible for the costs of developing and changing packaging for
All Products, including costs of obsolete labeling and packaging due to
changes requested by Distributor but only those occurring after initial
License for the same. Furthermore, Diamond shall be responsible for the
cost occasioned by any changes required by a government agency.
1.09 Location of Manufacture. All Products shall be manufactured by Diamond
at its plant located in Des Moines, Iowa.
SECTION 2. ADDITIONAL PRODUCTS
2.01 Additional Products. At Distributor's request, additional Products may
be added to Exhibit A to this Agreement, providing for additional
combinations of the antigens listed in Exhibit A and/or combinations of
such antigens and new antigens specified by Distributor. Diamond shall
have the right, in its discretion, to approve or disapprove any such
additional Products and if approved, to establish reasonable Purchase
Prices therefor. Any such approved additional Products and the Purchase
Prices therefor shall be set forth in an amended Exhibit A signed by
both parties to be collectively known as "All Products". Any such
approved additional product shall be included in the requirements of
Section 1.04(ii).
2.02 Registration Costs; Ownership. Distributor shall advance to Diamond the
Registration Costs for any additional Products approved pursuant to Section
2.01, which are added at Distributor's request. Each of Distributor and
Diamond shall retain ownership of any antigens it supplies for any such
additional Products and the addition of additional Products to Exhibit A
shall not be deemed to transfer any right, title, interest or license in or
to the antigens supplied by either party to the other party for such
Products, except as necessary to manufacture and sell Products under this
Agreement. Each of Distributor and Diamond shall retain joint ownership of
any jointly produced antigens developed by the parties hereto, and the
addition of said Products to Exhibit A shall not be deemed to transfer any
right, title, interest or license in or to the jointly developed antigens
or Products, except as necessary to manufacture and sell Products under
this Agreement. It is contemplated that a separate agreement would be
entered into for the joint development of antigens or Products between the
parties hereto.
SECTION 3. PRICE; PAYMENT
3.01 Purchase Prices. Distributor agrees to purchase the Products at prices
shown in Exhibit A hereto, subject to adjustment from time to time as
specified below (the "Purchase Price"). All prices are F.O.B. Diamond's
manufacturing plant and are exclusive of taxes, freight and insurance, if
any, which shall be invoiced to and paid by Distributor.
3.02 Annual Price Adjustment. Purchase Prices for each Product set forth in
Exhibit A shall be in effect for Products having specified delivery
dates during the first Contract Year. Purchase Prices to be in effect
for Products to be delivered in each subsequent Contract year shall be
negotiated by the parties in good faith, taking into account factors
including, but not limited to, cost changes, volume changes and plant
utilization. In the event that Purchase Price changes are not agreed
upon as a result of such good faith negotiations, then the Purchase
Prices in effect for the preceding Contract Year shall remain in effect.
3.03 Cost Increases. Diamond may also notify Distributor in writing during
any Contract Year of any cost increases for raw materials and packaging
components for All Products to the extent such increases, individually
or in the aggregate, would cause total finished cost of goods of such
Product to increase by more than 2%. Upon Distributor's request,
Diamond will furnish reasonable supporting documentation therefor. Upon
such notification, the parties shall negotiate in good faith to adjust
the applicable Purchase Prices to account for such increases. In the
event that Purchase Price changes are not agreed upon as a result of
such good faith negotiations, then the Purchase Prices then in effect
shall remain in effect.
3.04 Payment Terms. Diamond shall notify Distributor of the date when Products
are ready for shipment. Diamond shall invoice the Distributor for Products
on the later of (i) the date Diamond notifies Distributor that the Products
are ready for shipment or (ii) the delivery date specified in Distributor's
purchase order accepted by Diamond. Diamond shall invoice Distributor for
the Additional Payment, if any, within thirty (30) days after the end of
any Contract Year for which it is due. Diamond shall invoice Distributor
for Registration Costs, Support Costs and other amounts payable by
Distributor under this Agreement, if applicable, monthly as incurred.
Payment terms shall be net 30 days from the date of each such invoice. An
interest charge of one and one-half percent (1 1/2 %) per month or portion
of a month shall be charged for late payments. Diamond shall be entitled
to place Distributor on shipment hold and otherwise suspend performance
under this Agreement if Distributor shall be materially late or in default
of its payment obligations.
3.05 Packaging. Purchase Prices include packaging for bulk palletized shipment
for Distributor by common carrier for next-day delivery. Distributor shall
pay to Diamond the additional charges for labor and materials costs for
special or additional packaging or shipping requested by Distributor.
SECTION 4. FORECASTS; ORDER PROCEDURES; DELIVERIES
4.01 Firm Orders. Except to the extent that the parties otherwise agree in
writing with regard to a particular order, Distributor shall submit to
Diamond a firm written purchase order or orders specifying the types,
quantities and delivery dates and instructions of Products that it
desires to purchase at least five (5) months prior to the requested
delivery date(s). Diamond will review each purchase order within five
(5) business days of receipt and either issue in writing its
confirmation or its proposal for changes and modifications for delivery
to accommodate, to the extent reasonable, Diamond's scheduling
requirements. Diamond will use reasonable commercial efforts to
accommodate and to minimize changes and modifications to the delivery
dates requested by Distributor. Each purchase order shall be binding on
Distributor upon written confirmation by Diamond or, if Diamond has made
a proposal for changes or modifications to delivery, upon Distributor's
written acceptance of such changes or modifications; provided, that no
material modification or change will become effective after confirmation
without the written approval of both parties. Diamond agrees that with
respect to Products covered by a purchase order confirmed by it in
writing, the Products shall be available for shipment on the specified
delivery dates, except to the extent it is prevented from doing so due
to conditions beyond its reasonable control as provided in Section 8.
The applicable delivery schedules shall be suspended during any period
that Products have been selected for testing by a regulatory authority.
4.02 Standard Batch Size. Distributor will order Products in standard batch
sizes as shown on Exhibit A. If specified order amounts for Distributor
would result in a batch which is thirty percent (30 %) or more below the
applicable standard batch size set forth in Exhibit A, Diamond will so
notify Distributor and at Distributor's option (i) the parties will
mutually agree to an increased Purchase Price for such Products; (ii)
Distributor will agree to accept and pay for the entire standard batch
size of the ordered Products or (iii) Distributor may submit a revised
purchase order for a quantity of Products within the permitted
parameters.
4.03 Forecasts. Within 15 days after the date hereof Distributor will furnish
Diamond a written forecast of the quantities and types of Products that the
Distributor anticipates it will order from Diamond during each of the
anticipated first twelve (12) months of this Agreement. Thereafter, within
fifteen (15) days after the first day of each calendar quarter during the
term of this Agreement, Distributor will also furnish to Diamond revised
written estimates of the quantities it anticipates it will order during
each month of the succeeding twelve (12) month period. Such forecasts will
not be deemed binding commitments, but are for the purpose of enabling
Diamond to more effectively schedule the use of its facilities.
4.04 Delivery; Title. Diamond shall ship the Products at the Distributor's
expense and in accordance with Distributor's written instructions. Written
shipping instructions shall be provided by Distributor in each purchase
order or not later than two (2) days prior to the specified delivery date.
Title and risk of loss of the Products shall pass to the Distributor upon
receipt of the Products at the location directed by Distributor.
4.05 Warehousing . Diamond agrees to store the Products as required by the
Distributor for a period of not to exceed thirty (30) days from the later
of (i) the date Diamond notifies Distributor the Products are ready for
shipment or (ii) the delivery date specified in Distributor's purchase
order accepted by Diamond. With respect to Products that are not picked up
by the common carrier designated by Distributor's shipping instructions
within thirty (30) days from the date Diamond notifies Distributor the
Products are ready for shipment, Diamond shall charge a warehousing fee of
one and one-half percent (1 1/2%) of the invoice amount per month or
portion thereof until such Products are shipped.
4.06 Order of Precedence. In the event of conflict between the typewritten
terms of Distributor's purchase orders and the terms and conditions of
this Agreement, the order of precedence shall be first, the typewritten
terms of Distributor's accepted purchase orders and then this Agreement.
All other terms and conditions contained in Distributor's and Diamond's
standard form purchasing and selling documents shall be disregarded.
SECTION 5. LABEL CODES: QUALITY ASSURANCE; DATING
5.01 Label Codes. Diamond shall code all labels affixed to each unit of the
packaged Products to identify the Product batch. Distributor shall not
remove or obliterate label codes or patent marking on any Products.
5.02 Product Analysis . Prior to shipping any Product for the Distributor,
Diamond shall analyze the Product for the purpose of determining whether
it conforms with the Specifications.
5.03 Audit. Once during each Contract Year, Diamond shall provide to
Distributor reasonable access, during normal business hours, upon
reasonable notice to Diamond's manufacturing facilities to permit
Distributor to examine, audit and copy Diamond's records with respect to
manufacture, quality control and regulatory compliance of the Products,
at Distributor's sole expense. Such audit rights shall not extend to
financial and other records of Diamond not pertinent hereto.
5.04 Dating. Unless otherwise approved by Distributor prior to shipment,
Products will have a dating at time of shipment as follows; provided,
that in the event that retesting is required for a Product, the minimum
dating otherwise required shall be reduced by a period of sixty (60)
days:
(i) Products released for sale with twenty-four (24) months dating will
be shipped for Distributor with a minimum of twenty (20) months
dating remaining.
(ii) Products released for sale with eighteen (18) months dating will be
shipped for Distributor with a minimum of fourteen (14) months
dating remaining.
(iii) Products released for sale with twelve (12) months dating will be
shipped for Distributor with a minimum of eight (8) months dating
remaining.
5.05 Outdates. Should Product remain undistributed beyond the date permitted
by regulation or other government agency requirement, Diamond will
accept redelivery to it at Distributor's shipping costs, with
Distributor to receive credit for same at the price paid to Diamond up
to a maximum cumulative credit of 1 % of the aggregate Purchase Prices
of the products ordered for shipment within a Contract Year, to be
included in the calculation of the Qualified Revenue Requirement in
Section 1.04 (ii). Diamond agrees to destroy said returned Product at
its cost and in compliance with all regulatory requirements.
SECTION 6. TERM; TERMINATION
6.01 Term. The initial term of this Agreement shall be for a period
commencing on the Effective Date and ending on the fifth (5th)
anniversary of the end of the first Contract Year. This Agreement shall
automatically renew thereafter for additional renewal terms of one year
each, unless either party gives at least twelve (12) months prior
written notice to the other that it does not wish to renew this
Agreement.
6.02 Termination for Breach. Subject to the provisions of Section 8, if
either party shall breach any material obligation required under this
Agreement the other party may give written notice of its intention to
terminate this Agreement describing in reasonable detail the breach. If
the breaching party fails to remedy such material breach within thirty
(30) days (ninety (90) days in the case of any failure by Diamond to
deliver any Product) following such written notice, or if such breach is
not reasonably capable of cure within such thirty (30)-day or ninety
(90)-day period, as the case may be, and the breaching party fails to
commence cure procedures within such thirty (30)-day or ninety (90)-day
period and diligently prosecute such procedures until the breach is
cured, then the non-breaching party may, in addition to all other
remedies available at law or in equity, terminate this Agreement
forthwith upon written notice.
6.03 Performance on Termination. Upon termination of this Agreement, (i)
Products manufactured pursuant to confirmed purchase orders shall be
delivered no later than the requested delivery dates in the approved
purchase order and Distributor shall pay Diamond therefor as provided in
Section 3.04 (provided, that prepayment shall be required upon
termination due to Distributor's payment default); (ii) all raw
materials furnished by Distributor shall be returned at Distributor's
expense; and (iii) all reasonable costs of unused raw materials,
containers, labeling and packaging previously ordered by Diamond in its
reasonable discretion and not reusable for other purposes by Diamond
shall be paid by Distributor.
SECTION 7. REPRESENTATIONS AND WARRANTIES; NOTIFICATIONS
7.01 Of Diamond. Diamond represents and warrants to Distributor that:
(i) the Products delivered to Distributor hereunder shall conform to
the Specifications and all other requirements and shall be free
from material defects in workmanship and materials through their
respective expiration dates;
(ii) the execution and delivery of this Agreement by Diamond, and the
performance of its obligations hereunder, do not require the
consent of any third party and will not violate, with or without
notice, the lapse of time or both, any agreement, contract, license
or permit to which Diamond is a party or its organizational
documents; and
(iii)prior to delivery of any Product hereunder it will have, and
will thereafter maintain, all required manufacturing establishment
designations, permits and Licenses required to perform its
obligations with respect to such Product under this Agreement.
7.02 Of Distributor. Distributor represents and warrants to Diamond that:
(i) the execution and delivery of this Agreement by Distributor, and the
performance of its obligations hereunder, do not require the consent
of any third party and will not violate, with or without notice, the
lapse of time or both, any agreement, contract, license or permit to
which Distributor is a party or its organizational documents; and
(ii) it has, and will maintain, all permits and licenses required to
perform its obligations under this Agreement and Products
distributed hereunder will bear labels conforming to the
requirements of this Agreement.
7.03 Non-Conforming Products. The Distributor shall have 30 days after
receipt of the Product to inspect the Product for gross visual defects
and reject the same. If the Product is rejected, written notice must be
given to Diamond no later than 30 days after receipt by the Distributor.
The parties within 30 days after rejection will endeavor in good faith
negotiations to determine whether or not the Product conforms to
Diamond's warranties. If the parties conclude it does conform, it will
be treated as conforming in all respects under this Agreement with time
requirements to be adjusted to cover the time required by this process.
If the parties conclude it does not conform with Diamonds warranties in
Section 7.01 (i), at the Distributor's option, (i) Diamond shall be
relieved of any obligation to deliver any Product with respect to the
non-conforming shipment and in such case Diamond shall credit against
future purchases by Distributor the purchase price of such
non-conforming Product paid by Distributor together with any shipping
costs paid by the Distributor for delivery of such non-conforming
Product, or (ii) Diamond shall replace the non-conforming Product with
substitute Product which conforms with said warranties, within the time
agreed to by both parties, in which case the Distributor shall pay to
Diamond amounts in accordance with Section 3 hereof based on the
substitute shipment, net of the purchase price and shipping costs, if
any, previously paid by Distributor for such non-conforming Products.
The nonconforming Product shall become the property of and be returned
to Diamond at Diamond's expense. Diamond shall dispose of such Product
at its own expense according to all appropriate regulations. The
Purchase Price of nonconforming product shall be treated as Minimum
Qualified Revenue in the Contract Year the product is ordered for
shipment.
7.04 Recall. Diamond shall replace Product at no cost to the Distributor to
complete any Product recall or stop-sale required by a subsequent
determination that the Product (i) was not produced in accordance with
Specifications when released to the Distributor, (ii) failed to remain
in compliance with Specifications through the dating period of such
Product, (iii) contained any material defect in workmanship and
materials not detectable by Distributor's inspection testing, or (iv)
was not produced in compliance with applicable USDA regulations. The
reasonable costs of any such recall or stop-sale shall be borne by
Diamond. Any such recall or stop-sale shall be conducted in accordance
with USDA Veterinary Services Memorandum No. 800.57 or any successor
regulations. The Distributor shall be responsible for all other recalls
related to marketing, handling or storage of Product by Distributor or
its agents, including voluntary recalls made by Distributor. Minimum
Qualified Revenue for any Contract Year shall include the Purchase Price
for product recalled under the first sentence of this Section 7.04.
7.05 Exclusive Remedy. THE REMEDIES DESCRIBED IN THIS AGREEMENT ARE
EXCLUSIVE AND IN LIEU OF ANY 0THER REMEDY DISTRIBUTOR WOULD OTHERWISE
HAVE AGAINST DIAMOND WITH RESPECT TO DEFECTIVE PRODUCTS OR ANY BREACH OF
DIAMOND'S LIMITED WARRANTY UNDER SECTION 7.01 (i) OF THIS AGREEMENT;
PROVIDED, THAT THIS SECTION SHALL NOT LIMIT DIAMOND'S INDEMNITY
OBLIGATION SET FORTH IN SECTION 11 WITH RESPECT TO THIRD PARTY CLAIMS.
7.06 Limitations.
(i) EXCEPT AS EXPRESSLY SET FORTH IN THIS SECTION 7, DIAMOND MAKES NO
WARRANTIES, EXPRESSED OR IMPLIED, CONCERNING TECHNOLOGY, GOODS,
SERVICES, RIGHTS OR THE MANUFACTURE AND SALE OF PRODUCTS, AND HEREBY
DISCLAIMS ALL WARRANTIES, INCLUDING WITHOUT LIMITATION ANY WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR USE OR PURPOSE OR
NONINFRINGEMENT WITH RESPECT TO ANY AND ALL OF THE FOREGOING.
(ii) IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR ANY
THIRD PARTY FOR LOST PROFITS, LOSS OF GOODWILL, OR ANY SPECIAL,
INDIRECT, CONSEQUENTIAL OR INCIDENTAL DAMAGES, HOWEVER CAUSED, ARISING
UNDER ANY THEORY OF LIABILITY. THIS LIMITATION SHALL APPLY EVEN IF A
PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND
NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED
REMEDY.
(iii) THE WARRANTY IN SECTION 7. 01 (i) WILL NOT APPLY TO THE EXTENT
OF ANY DEFECTS CAUSED BY IMPROPER OR INADEQUATE HANDLING OR STORAGE
OF PRODUCTS AFTER SHIPMENT BY DIAMOND OR FAILURE OF ANY RAW
MATERIALS SUPPLIED BY DISTRIBUTOR.
7.07 Notifications.
(i) Of Diamond. Diamond agrees that it will promptly notify the
Distributor in writing of any contact, claim or other communication
by any entity or agency that relates to, or may relate to,
Diamond's ability to perform its responsibilities herein. Any
communication (other than routine regulatory filings, notices and
reports and other non-adverse communications), either initiated by
Diamond or by the USDA, that references a Product in this Agreement
or the submission of any such Product will immediately be brought
in writing to the attention of the Distributor.
(ii) Of Distributor. Distributor agrees that it will promptly notify
Diamond in writing of any contact, claim or other communication by
any entity or agency that relates to, or may relate to,
Distributor's ability to perform its responsibilities herein. Any
communication (other than routine regulatory filings, notices and
reports and other non-adverse communications), either initiated by
Distributor or by the USDA, that references a Product in this
Agreement or the submission of any such Product will immediately be
brought in writing to the attention of Diamond.
SECTION 8. FORCE MAJEURE
8.01 Force Majeure. No party shall be held liable or responsible for failure
or delay in fulfilling or performing any obligation of this Agreement in
case such failure or delay is due to Acts of God, strikes or other labor
disputes, governmental regulations or actions (not otherwise the
responsibility of the parties), inability to obtain material, labor,
equipment or transportation, or any other condition beyond the
reasonable control of the affected party, provided such party has taken
reasonable steps to avert such causes or conditions. Each party agrees
to give the other party prompt written notice of the occurrence and the
nature of any such condition or act,, and the extent to which the
affected party will be unable to fully perform its obligation hereunder.
Each party further agrees to use all reasonable efforts to correct the
condition as quickly as possible.
8.02 Right to Terminate. If, as a result of causes or conditions described
in this Section, either party is unable to perform substantially all of
its material obligations hereunder for any consecutive period of three
(3) months, the other party shall have the right to terminate this
Agreement upon at least thirty (30) days prior written notice.
SECTION 9. CONFIDENTIAL INFORMATION
9.01 Non-Disclosure. All Confidential Information disclosed hereunder shall
remain the property of the disclosing party and shall be maintained in
confidence and not disclosed by the receiving party to any person except
to officers, employees, and consultants to whom it is necessary to
disclose the information for the purpose of performing and enforcing
this Agreement. Each party shall take all steps it would normally take
to protect its own Confidential Information to ensure that the received
Confidential Information shall be maintained in confidence and not
disclosed, but in no event less than reasonable care.
9.02 Use. Unless otherwise agreed in writing, all Confidential Information
disclosed hereunder shall be used by the parties only pursuant to and in
accordance with this Agreement.
9.03 Exceptions. The obligations of Diamond and Distributor under this
paragraph shall not apply to:
(i) Information which, at the time of disclosure, is in the public
domain or thereafter comes within the public domain other than as a
result of breach of this Agreement; or
(ii) Information which either party can establish was in its possession
at the time of disclosure; or
(iii) Information which was received from a third party not under an
obligation of confidentiality; or
(iv) Information which either party can establish was independently
developed without reference to the information received hereunder.
9.04 Termination; Survival. Upon termination of this Agreement, Diamond and
Distributor agree upon written request to return to the other all
written or other physical embodiments of the other's Confidential
Information, except for one record copy. The obligations under this
paragraph shall be binding on any affiliate, parent, subsidiary,
successor or assign of Diamond or Distributor as if a party to the
Agreement. The obligations of confidentiality and non-use of the
Confidential Information under this Agreement shall, continue throughout
the term of this Agreement and for a period of two (2) years following
the termination or expiration of this Agreement.
9.05 Confidentially of Agreement. Except to the extent required by law,
neither party shall disclose to third parties the terms of this Agreement
or the negotiations giving rise to this Agreement.
SECTION 10. OWNERSHIP OF INTELLECTUAL PROPERTY
Any and all design, patent, copyright and other relevant ownership and other
rights in and to the intellectual property aspects of the Products which are
the subject of this Agreement and all modifications, adjustments, changes and
derivatives thereto and thereof (collectively, the "Rights") shall belong
exclusively to Diamond, except as otherwise agreed in writing with respect to
additional Products added to this Agreement pursuant to Section 2.
Distributor agrees that it does not have, and will not claim, any Rights in
any Product delivered pursuant to this Agreement or aspect thereof, except as
so agreed in writing. Diamond. shall own the raw materials and Products,
subject to any security interest, until title passes pursuant to Section
4.04.
SECTION 11. INDEMNIFICATION
11.01 By Diamond. Diamond hereby agrees to defend, indemnify and hold
Distributor, its directors, officers, employees, agents and Affiliates
harmless from and against any loss, claim, action, damage, expense or
liability (including defense costs and attorneys' fees) resulting from
any third party claim or suit arising out of or relating to Diamond's
failure to manufacture a Product in compliance with its Specifications;
provided, however, that the foregoing indemnity obligations shall not
apply where such claim is the result of the willful misconduct or
negligent act of Distributor or its Affiliates, and there shall be
apportionment in accordance with responsibility when such obligation
derives in part from such acts of Diamond and in part from such acts of
Distributor and its Affiliates.
11.02 By Distributor. Distributor hereby agrees to defend, indemnify and
hold Diamond, its directors, officers, employees, agents and Affiliates
harmless from and against any loss, claim, action, damage, expense or
liability (including defense costs and attorneys' fees) resulting from
any third party claim or suit arising out of or relating to the use,
sale or distribution of any of the Product manufactured in conformity
with the Specifications, including, but not limited to any warranty for
the Products extended by Distributor other than the warranties given by
Diamond in Section 7.01(i) above and any of the claims identified in
Section 7.06(i) above; provided, however, that the foregoing indemnity
obligation shall not apply where such claim is solely the result of the
willful misconduct or negligent act of Diamond or its Affiliates and
there shall be apportionment in accordance with responsibility when such
obligation derives in part from acts of Distributor and in part from
such acts of Diamond and its Affiliates.
11.03 Procedures. In the event that a third-party claim is made or
third-party suit is filed for which either party intends to seek
indemnification from the other party pursuant to this Section 11, the
party seeking indemnification (the "Indemnitee" shall promptly notify the
other party (the "Indemnitor")of said claim or suit. The Indemnitor shall
have the right to control, through counsel of its choosing, the defense of
such third-party claim or suit, but may compromise or settle the same only
with the consent of the Indemnitee, which consent shall not be unreasonably
withheld. The Indemnitee shall promptly consult in good faith with the
Indemnitor with respect to any proposed settlement. The Indemnitee shall
cooperate fully with the Indemnitor and its counsel in the defense of any
such claim or suit and shall make available to the Indemnitor any books,
records or other documents necessary or appropriate for such defense. The
Indemnitee shall have the right to participate at the Indemnitee's expense
in the defense of any such claim or suit
through counsel chosen by the Indemnitee.
11. 04 Insurance. Diamond and Distributor will each Maintain product
liability insurance covering their individual performance of their
obligations hereunder with a minimum limit of liability of Two Million
Dollars ($2,000,000) in the aggregate. Each party will maintain
insurance to protect themselves and the other from claims under any
workers compensation acts and from any other damages from personal
injury including death, which may be sustained by the said parties,
their agents, servants or employees and the general public and/or claims
of property damage which might be sustained from any one of them due to
the negligence of the parties. Each party shall furnish the other with a
certificate of insurance.
11.05 Survival. The provision of Sections 11.01 through 11.03 shall
survive the expiration or termination of this Agreement.
SECTION 12. MISCELLANEOUS
12.01 Notices. All notices or other communications provided for in this
Agreement shall be in writing and shall be considered delivered upon the
earliest of actual receipt, or personal or courier delivery, or sending
by facsimile with confirmation of receipt in good order requested and
received, or on the fourth business day after they are deposited in the
United States mail, certified first class or air mail postage prepaid,
return receipt requested, addressed to the respective parties as
follows:
(i) If to Diamond: (ii) If to Distributor:
Diamond A al Health, Inc. AGRI Laboratories, ltd.
2538 S.E. 43rd Street 20927 State Route K
Des Moines, Iowa 50317 St. Joseph, MO 64505
ATTN: President ATTN: President
Fax: (515) 263-8661 Fax: (816) 233-9546
Copy to: Copy to:
Heska Corporation Edward S. Sloan
Legal Department Niewald, Waldeck & Brown
1825 Sharp Point Drive 120 W. 12th Street
Fort Collins, CO 80525 Kansas City, MO 64105
Fax: (816) 474-0872
The parties may, at any time, change their addresses or other information in
this section by written notice under this section.
12.02 Independent Contractors. The parties are and shall always remain
independent contractors as to the other in their performances of this
Agreement. The provisions of this Agreement shall not be construed as
authorizing or reserving to either party any right to exercise any
control or direction over the operations, activities, employees, or
agents of the other in connection with this Agreement except to the
extent required by law, it being understood and agreed that the control
and direction of such operations, activities, employees, or agents
shall otherwise remain with each party. Neither party to this
Agreement shall have any authority to employ any person as an employee
or agent for or on behalf of the other party to this Agreement, nor
shall any person performing any duties or engaging in any work at the
request of such party, be deemed to be an employee or agent of the
other party to this Agreement.
12.03 Governing Law. The validity, interpretation and performance of
this Agreement shall be governed and construed in accordance with the
internal laws of the State of Iowa.
12.04 Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such a manner as to be effective and valid under
applicable law, but if any provision hereof shall be prohibited by or be
invalid under applicable law, such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating the
remainder of such provision or the remaining provisions of this
Agreement.
12.05 Modification. No modification or waiver of any provision of this
Agreement shall be effective unless the modification is made in writing and
signed by the party sought to be charged, and the same shall then be
effective only for a period and on the conditions and for the specific
instances and purposes specified in such writing. No course of dealing
between Diamond and the Distributor or delay or failure to exercise any
rights hereunder shall operate as a waiver of such rights or preclude the
exercise of any other rights hereunder.
12.06 Survival. Termination or expiration of this Agreement shall not
relieve either party from any obligation under this Agreement which may
have accrued prior thereto or which survives by its terms.
12.07 Captions. The captions set forth in this Agreement are for
convenience only and shall not be used in any way to construe or
interpret this Agreement.
12.08 Assignment. Neither party to this Agreement may assign this
Agreement or its rights or obligations hereunder without the prior
written consent of the other party; except that either party may assign
its right and delegate its obligations hereunder without prior consent
of the other party to any successor entity by way of merger,
consolidation, or reorganization or to the purchaser of all or
substantially all of its assets. Any permitted assignee shall assume
all obligations of its assignor under this Agreement. No assignment
shall relieve either party of responsibility for the performance of any
accrued obligation which it has hereunder. Any consent required shall
not be unreasonably withheld.
12.09 Entire Agreement. This Agreement (including the Exhibits hereto)
constitutes the entire understanding of the parties with respect to the
subject matter hereof and supersede all prior negotiations or
communications, however given, regarding the subject matter hereof.
There are no other understandings, representations or warranties of any
kind, express or implied.
12.10 Arbitration. Should the parties hereto be unable to amicably
resolve between themselves any disagreements relating to or arising from
any one or more of the provisions of this Agreement, which does not
involve injunctive or equitable relief, both parties shall submit such
disagreement to arbitration under the Commercial Rules of the American
Arbitration Association in Kansas City, Missouri, with any hearing to be
held in St. Joseph, Missouri. Neither party shall have the right to
further appeal or redress an arbitration award in any other court or
tribunal except solely for the purpose of obtaining execution of the
judgment rendered by the American Arbitration Association.
SECTION 13. DEFINITIONS
13.01 "Affiliate" shall mean with respect to any person or entity (i) any
other person or entity that controls, is controlled by or is under common
control with such first person or entity, with "control" meaning direct or
indirect beneficial ownership of more than fifty percent (50%) of the
equity interest of an entity or more than a fifty percent (50%) interest
in the decision making authority of an entity, and (ii) an entity in which
the maximum equity interest permitted by law to be held by another entity
is held by such other entity.
13.02 "BTI" shall mean Ballistic Technologies, Inc.
13.03 "Biostar" shall mean Biostar, Inc., a corporation organized
under the laws of Canada.
13.04 "Boehringer Ingelheim" shall mean Boehringer Ingelheim Animal Health,
Inc., a Delaware corporation.
13.05 "Confidential Information" shall, mean all information disclosed in
writing, or by oral communication if reduced to writing and confirmed as
confidential within (30) days of disclosure, by either party to the
other relating to raw materials, product specifications, formulations
and compositions, scientific know-how, chemical compound and composition
data, manufacturing processes, analytical methodology, product
applications, including safety and efficacy data, current and future
product and marketing plans and projections, and other information of a
technical or economic nature related to the Products and/or Diamond's
manufacture of the Products.
13.06 "Contract Year" shall mean (i) for Contract Year one (1) the period
commencing on the Effective Date and ending on the date Diamond has
obtained licenses in the United States for all of the viral antigens
listed on Exhibit A, and (ii) for each Contract Year thereafter, each
succeeding twelve-month period thereafter.
13.07 "License" shall mean a veterinary biologic license issued to
Diamond by the United States Department of Agriculture or other
regulatory agency with jurisdiction in the Territory for a Product to be
manufactured by Diamond pursuant to this Agreement.
13.08 "Minimum Qualified Revenue" shall mean the minimum amounts of
Qualified Revenue per Contract Year, as specified in Section 1.04 (ii)
above.
13.09 "Product" shall mean the antigens set forth on Exhibit A attached
hereto, together with any additional antigens added to this Agreement
pursuant to Section 2 hereof, individually or in any combination
permitted by this Agreement, in bulk or packaged as set forth in Exhibit
A.
13. 10 "Qualified Revenue" shall mean, for any Contract Year, an amount
equal to (i) the Purchase Price of Products ordered for shipment in such
Contract Year by Distributor, plus (ii) any amounts paid by Distributor
to Diamond in such Contract Year for Registration Costs and Support
Costs, plus (iii) any other amounts paid or advanced by Distributor to
Diamond in such Contact Year for research and development or other
services not contemplated by this Agreement, as adjusted for (iv) all
other adjustments to Minimum Qualified Revenue expressly as provided in
this Agreement.
13.11 "Registration Costs" shall mean all costs and expenses associated
with obtaining Licenses, including without limitation clinical trial
costs, assay development and validation, development of seed stocks,
production processes scale-up, formulation development, production of
pre-licensing serials, conduct of field safety trials, application fees
and other costs and expenses reasonably incidents thereto. As between
the parties, Registration Costs shall include labor and service charges
at Diamond's standard hourly rates, as amended from time to time, direct
cost of materials, and out-of-pocket and third-party expenditures.
13.12 "Specifications" shall mean, as the context may require, either one
or both of the following, which have been mutually agreed upon by the
parties: (i) vendor-certified appropriate quantitative and qualitative
particulars for all raw materials including active and non-active
excipients that are used to prepare all components represented in and by
final Products, and (ii) a filed and approved USDA Outline of Production
describing in detail the manufacturing process applicable for each
Product and the testing and release criteria applicable to each Product.
13.13 "Support Costs" shall mean all costs and expenses of Diamond
associated with providing technical support to Distributor under this
Agreement, including without limitation labor and service charges at
Diamond's standard hourly rates, as amended from time to time, direct
cost of materials, and out-of-pocket and third-party expenditures.
13.14 " Territory" shall mean the territory specified in Section 1.03.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their duly authorized representatives as of the date first written above.
DIAMOND ANIMAL HEALTH, INC. AGRI LABORATORIES, LTD.
By: /s/ LOUIS VAN DAELE By: /s/ STEVE SCHRAM
--------------------- ---------------------
Title: President Title: President
EXHIBITS
A - Products and Prices
B - Boehringer Ingelheim Rights Rights
C - BioStar Antigens
D - Ballistic Technologies Inc.
Exhibit A (Modified Live)
Products and Pricing
Trade Name Antigens 1Ods 50ds 5ds
Titanium BRSV (BRSV) [***] [***] [***]
Titanium BRSV Vac3 (BRSV-PI3-IBR) [***] [***] [***]
Titanium 5 (BRSV-PI3-IBR-BVD1,BVD2) [***] [***] [***]
Titanium 5-L5 (BRSV-PI3-IBR-BVD1,BVD2-Lepto 5) [***] [***] [***]
Titanium 3 + BRSV LP (BRSV-IBR-BVD1,BVD2-Lepto Pomona) [***] [***] [***]
Titanium IBR (IBR) [***] [***] [***]
Titanium IBR LP (IBR-Lepto Pomona) [***] [***] [***]
Titanium 3 (IBR-BVD1,BVD2) [***] [***] [***]
Titanium 4 (IBR-PI3-BVD1,BVD2) [***] [***] [***]
Titanium 4 L5 (IBR-PI3-BVD1,BVD2-Lepto 5) [***] [***] [***]
Diamond Animal Health, Inc Agri Laboratories, LTD
By: /s/ CONNIE PHILLIPS By: /s/ STEVE SCHRAM
--------------------- ------------------
Title: V. P. Ops Title: President
Date: 11-6-00 Date: 11-3-00
Standard Batch Size Large Freeze Dryer Small Freeze Dryer
5 dose [ *** ] units [ *** ]ds [ *** ] units [ *** ] ds
10 dose [ *** ] units [ *** ]ds [ *** ] units [ *** ] ds
50 dose [ *** ] units [ *** ]ds [ *** ] units [ *** ] ds
NOTE: THESE PRICES ARE IN EFFECT FOR DELIVERIES MADE BETWEEN 1/1/2001 AND
12/31/2001
INCLUDING PURCHASE ORDERS PLACED AFTER 8/1/2000
Those products that are no longer carried are not included in this price
restructure. Should any of these
be ordered after this agreement, new pricing will be established.
Handscribed:
Note: 5ds pricing subject to reduction if forecasting/batches (larger) are
obtainable. SDS 11/3/00
*** Confidential Treatment Requested
Exhibit A
DAH World Wide Products
Single Bovine Antigens or Bovine Combinations
Modified Live Virus Antigens (Signature Line)
Infectious Bovine Rhinotracheitis (IBR)
Bovine Virus Diarrhea Virus-Type I (BVD)
Bovine Virus Diarrhea Virus-Type 11 (BVD)
Parainfluenza (P13)
Bovine Respiratory Syncytial Virus (BRSV)
Inactivated Virus Antigens (Signature Line)
Infectious Bovine Rhinotracheitis (IBR)
Bovine Virus Diarrhea - Type I (BVD)
Bovine Virus Diarrhea - Type II (BVD)
Lepto 5-way
Lepto Pomona
[ *** ] BioStar product (US Only)
[ *** ] BioStar product (US Only)
Camplylobacter (Vibrio) Bayer product
[ *** ]
[ *** ]
[ *** ]
[ *** ]
[ *** ]
[ *** ]
[ *** ]
[ *** ]
*** Confidential Treatment Requested
Exhibit B
Boehringer Ingelheim Animal Health, Inc.
[ *** ] Antigens or [ *** ] Vaccine
Infectious Bovine [ *** ]
Bovine [ *** ]
> [ *** ]
> [ *** ]
Bovine [ *** ]
[ *** ]
[ *** ]
(Master Cell Stock)
Exhibit C
BIOSTAR ANTIGENS
Generic Names Antigens
- -------------------------- -----------------------
1. [ *** ] [ *** ]
[ *** ] [ *** ]
2. [ *** ] [ *** ]
[ *** ]
3. [ *** ] [ *** ]
[ *** ] [ *** ]
[ *** ] [ *** ]
*** Confidential Treatment Requested
Exhibit C, continued
BioStar, Inc.
Exclusive BioStar Product Combinations (Canada Only)
[ *** ]
[ *** ]
[ *** ]
Any other Signature Line antigen in combination with the BioStar antigen.
Note: Non-exclusive on any other Signature Line product in Canada that does
not contain the BioStar antigen.
*** Confidential Treatment Requested
Exhibit D
Ballistic Technologies, Inc.
Diamond antigens to be incorporated into the [ *** ] or Solid Dose
Technologies:
[ *** ]
[ *** ]
[ *** ]
[ *** ]
[ *** ]
Note: [ *** ] component contains both Type I and Type II
*** Confidential Treatment Requested
AMENDMENT NO. 1
TO
BOVINE VACCINE DISTRIBUTION AGREEMENT
This Amendment No. 1 ("Amendment") is entered into as of the 13th day of
July, 1998, by and between DIAMOND ANIMAL HEALTH, INC., an Iowa corporation with
offices at 2538 Southeast 43rd Street, Des Moines, Iowa 50317 ("Diamond") and
AGRI LABORATORIES, LTD., a Delaware corporation, with offices at 20927 State
Route K, St. Joseph, Missouri 64505 ("Distributor") as an amendment to that
certain Bovine Vaccine Distribution Agreement between Diamond and Distributor
dated as of February 13, 1998, (the "Distribution Agreement").
WHEREAS, Diamond and Distributor are parties to the Distribution Agreement
providing for the distribution of certain bovine antigens; and
WHEREAS, Section 2.01 of the Distribution Agreement contemplates that
additional
products may be added to the Products subject to the Distribution Agreement; and
WHEREAS, Distributor and [ *** ] are parties to a separate agreement
providing for an exclusive worldwide license of [ *** ] rights in the
Additional Product to Distributor and providing for compensation to [ *** ]
from Distributor on account of Distributor's sales of such Additional Product;
and
WHEREAS, Diamond and Distributor desire to add the Additional Product as a
Product under the Distribution Agreement in the event that the Additional
Product is successfully developed and licensed.
NOW, THEREFORE, the parties agree as follows:
1 . Definitions.
a. In General. Capitalized terms used herein shall have the
meanings ascribed to them in the Distribution Agreement, unless otherwise
defined herein.
b. "Additional Product" shall mean the Product described on
Exhibit A, attached hereto.
c. "[ *** ] Antigens" shall mean the [ *** ] and [ *** ]
antigens owned by [ *** ] and more particularly described in Exhibit A
hereto.
d. "[ *** ] Technology" means all patents, patent applications,
copyrights, trademarks, know-how, trade secrets and other intellectual
property rights relating to the [ *** ] Antigens and the Additional Product
other than the Diamond Antigens and Diamond Technology.
*** Confidential Treatment Requested
e. "Diamond Antigens" shall mean the [ *** ] and [ ***
[ *** ] antigens owned by Diamond and more particularly described in
Exhibit A hereto.
f. "Diamond Technology " shall mean all patents, patent
applications, copyrights, trademarks, know-how, trade secrets and other
intellectual property rights of Diamond relating to the Diamond Antigens and
the Additional Product.
2. Additional Product Subject to Distribution Agreement. If a
License is issued to Diamond for the Additional Product by the United States
Department of Agriculture, and effective upon the date of such issuance (the
"License Date"), the Additional Product shall be added as a "Product" under
the Distribution Agreement. All provisions of the Distribution Agreement
relating to Products shall apply to the Additional Product, except as
expressly provided in this Amendment.
3. [ *** ] Rights. The provisions of Sections 1.01 (Manufacture and
Sale), 1.02 (Exclusivity), 1.03 (Territory), 1.05 (Responsibility of
Distributor; Diamond Technical Support), and 1.06 (Registration and
Licensing) shall NOT apply with respect to the Additional Product, except to
the extent of the Diamond Antigens included therein. Distributor represents
and warrants to Diamond that Distributor has all necessary rights in and to
the [ *** ] Antigens and [ *** ] Technology for the development, manufacture
and sale of the Additional Product pursuant to the Distribution Agreement
and this Amendment ("[ *** ] Rights"). Distributor hereby grants to Diamond
exclusive manufacturing rights to Additional Product and to have sold the
Additional Product exclusively to Distributor pursuant to the Distribution
Agreement and this Amendment. Diamond shall exercise such rights only for
the purpose of performing its obligations to Distributor under the
Distribution Agreement and this Amendment.
4. Purchase Price; Batch Sizes. The Purchase Price for the
Additional Product shall be $[ *** ] per dose for and during the first three
(3) Contract Years, as defined in Paragraph 5 below, subject to a price
adjustment beginning with the fourth Contract Year and thereafter pursuant
to the terms of Sections 3.02 and 3.03 of the Distribution Agreement.
5. Term. With respect to the Additional Product (but not other
Products, with respect to which Section 6.01 of the Distribution Agreement
shall control: (i) the initial Term of this Amendment shall be for a period
commencing on the License Date and ending on the fifth (5th) anniversary of
the end of the Contract Year during which the License Date occurs and (ii)
this Amendment shall automatically renew thereafter for additional renewal
terms of one year each, unless either party gives at least twelve (12)
months prior written notice to the other that it does not wish to renew this
Amendment.
6. Registration and Licensing. Diamond will use reasonable efforts
to assist Distributor in the registration of Additional Product (bulk or
packed form) outside the United States at Distributor's expense. Distributor
shall pay all registration costs associated with obtaining and maintaining
any License required outside the United States and said costs shall be
included in Qualified Revenue requirements as set forth in Section 1.04(ii)
of the Distribution Agreement.
*** Confidential Treatment Requested
7. Effect of Amendment. This Amendment is hereby incorporated by
reference into the Distribution Agreement as if fully set forth therein, and
the Distribution Agreement as amended by this Amendment shall continue in
full force and effect following execution and delivery hereof. In the event
of any conflict between the terms and conditions of the Distribution
Agreement and this Amendment, the terms and conditions of this Amendment
shall control.
8. Indemnification. In addition to the indemnification contained in
Section 11 of the Distribution Agreement, Distributor agrees to defend,
indemnify and hold Diamond, its directors, officers, employees, agents and
affiliates harmless with respect to any third-party claim or suit arising
out of any claim that [ *** ] Antigens or [ *** ] Technology infringes the
patent, copyright or other intellectual property right of any third-party.
IN WITNESS WHEREOF, the parties have caused this Amendment No. 1 to be
executed by their duly authorized representatives as of the date first written
above.
DIAMOND ANIMAL HEALTH, INC.
By: /s/ LOUIS VAN DAELE
Its: President
AGRI LABORATORIEES, LTD.
By: /s/ STEVE SCHRAM
Its: President
*** Confidential Treatment Requested
EXHIBIT A TO AMENDMENT NO. I TO BOVINE DISTRIBUTION AGREEMENT
Additional Product, Pricing and Batch Sizes
Additional Product Purchase Price Standard Batch Size
-------------------- ---------------- --------------------
[ *** ] $[ *** ] [ *** ] units (est.)
[ *** ]
[ *** ]
[ *** ]
[ *** ]
[ *** ]
IN WITNESS WHEREOF, the parties have caused this revised Exhibit A to be
executed by their duly authorized representatives as of July 13, 1998.
DIAMOND ANIMAL HEALTH, INC.
By: /s/ LOUIS VAN DAELE
Its: President
AGRI LABORATORIES, LTD.
By: /s/ STEVE SCHRAM
Its: President
*** Confidential Treatment Requested
AMENDMENT NO. 2
TO
BOVINE VACCINE DISTRIBUTION AGREEMENT
This Amendment No. 2 ("Amendment") is entered into as of the 13th day of
December, 1999, ("Effective Date") by and between DIAMOND ANIMAL HEALTH, INC.,
an Iowa corporation with offices at 2538 Southeast 43rd Street, Des Moines, Iowa
50317 ("Diamond") and AGRI LABORATOREES, LTD., a Delaware corporation, with
offices at 20927 State Route K, St. Joseph, Missouri 64505 ("Distributor") as an
amendment to that certain Bovine Vaccine Distribution Agreement between Diamond
and Distributor dated as of February 13, 1998 (the "Distribution Agreement").
WHEREAS, Diamond and Distributor are parties to the Distribution Agreement
providing for the distribution of certain bovine antigens; and
WHEREAS, Diamond, Distributor and Bayer have entered into a "Bovine
Testing Agreement" for the Product Titanium 5 + Once PMH.
WHEREAS, Section 2.01 of the Distribution Agreement contemplates that
additional products may be added to the Products subject to the Distribution
Agreement; and
WHEREAS, Diamond and Distributor desire to provide for the development and
licensure of certain Additional Cattle Products (defined below) and if licensed,
to add them as Products under the Distribution Agreement.
NOW, THEREFORE, the parties agrees as follows:
1. Definitions.
(1) In General. Capitalized terms used herein shall have the
meanings ascribed to them in the Distribution Agreement, unless otherwise
defined herein,
(2) "Additional Cattle Products" shall mean the products
described in Exhibit A, attached hereto.
2. Development and Registration of Additional Cattle Products. In
consideration of Distributor's payment of the fees provided in the Bovine
Vaccine Testing Agreement, Diamond agrees to and hereby grants to
Distributor exclusive world wide marketing rights to the product identified
on Exhibit A attached hereto and incorporated herein for a period of five
(5) years from the License Date by United States Department of Agriculture
("USDA"). Diamond shall use reasonable efforts to assist Distributor in the
registration of such Additional Cattle Products (bulk or packed form)
outside the United States at Distributor's expense. Distributor shall pay
all Registration Costs associated with obtaining and maintaining any
Licenses required in the Territory outside the United States and said
Registration Costs shall be included in the Qualified Revenue requirements
as set forth in Section 1.04(ii) of the Distribution Agreement. This
Section 2 of this Amendment shall supersede any and all inconsistent
provisions of Section 1.06, and the first sentence of Section 2.02, of the
Distribution Agreement.
3. Development and Registration Fees. Amounts paid by Distributor
under the Bovine Testing Agreement to Diamond shall constitute Qualified
Revenue under the Distribution Agreement, be credited to Distributor's
Minimum Qualified Revenue obligations under the Distribution Agreement,
beginning with the Second Contract Year's Minimum Qualified Revenue, under
the Distribution Agreement.
4. Additional Product Subject to Distribution Agreement. If a
License is issued to Diamond, Bayer, Distributor or any combination of the
three (3) named parties for the Additional Cattle Product as identified in
Exhibit A by the United States Department of Agriculture, and effective upon
the date of such issuance (the "License Date"), such Additional Cattle
Products shall be added as a "Product" under the Distribution Agreement. All
provisions of the Distribution Agreement relating to Products shall apply to
the Additional Product, except as expressly provided in this Amendment.
5. Ownership. Section 2.02 of the Distribution Agreement shall not
apply to the Additional Cattle Products. Diamond shall retain ownership of
(i) the Additional Cattle Products developed pursuant to this Amendment and
(ii) any antigens it supplies for such Additional Cattle Products, and the
addition of the Additional Cattle Products as Products under the
Distribution Agreement shall not be deemed to transfer any right, title,
interest or license in or to such Additional Cattle Products and/or antigens
to Distributor, except for the distribution rights expressly granted in the
Distribution Agreement and this Amendment.
6. Purchase Price: Batch Sizes. The initial Purchase Prices and batch
sizes for the Additional Cattle Products are set forth in Exhibit A attached
hereto.
7. Term.
In General. With respect to all Additional Cattle Products (but
not other Products, with respect to which Section 6.01 of the Distribution
Agreement shall control): (i) the initial term of this Amendment shall be
for a period commencing on the License Date and ending on the fifth (5th)
anniversary of the end of the Contract Year during which the License Date
occurs and (ii) this Amendment shall automatically renew thereafter for
additional renewal terms of one year each, unless either party gives at
least twelve (12) months prior written notice to the other that it does not
wish to renew this Amendment with respect to such Additional Cattle Product.
8. Effect of Amendment. This Amendment is hereby incorporated by
reference into the Distribution Agreement as if fully set forth therein, and
the Distribution Agreement as amended by this Amendment shall continue in
full force and effect following execution and delivery hereof. In the event
of any conflict between the terms and conditions of the Distribution
Agreement and this Amendment, the terms and conditions of this Amendment
shall control.
IN WITNESS WHEREOF, the parties have caused this Amendment No. 2 to be
executed by their duly authorized representatives as of the date first written
above.
DIAMOND ANIMAL HEALTH, INC.
By: /s/ LOUIS VAN DAELE
----------------------
Its: President
AGRI LABORATORIES, INC,
By: /s/ STEVE SCHRAM
-----------------------
Its: President
EXHIBIT A
AMENDMENT NO. 2
BOVINE VACCINE DISTRIBUTION AGREEMENT
ADDITIONAL CATTLE PRODUCTS, PRICING, AND BATCH SIZES
Additional Products:
Titanium 5 + Once PMH (MLV IBR, BRSV, P13, BVD I and II + Live avirulent
P.haemolytica/multocida).
Standard Batch Size:
5 dose [ *** ] units
10 dose [ *** ] units
50 dose [ *** ] units
Purchase Price: 5 dose 10 dose 50 dose
- ------------------------- -------- --------- --------
Bayer (unlabeled) [ *** ] [ *** ] [ *** ]
AgriLabs (final packaged) [ *** ] [ *** ] [ *** ]
1) All prices include viricidal testing performed at Diamond.
2) Bactericidal testing is performed by Bayer and is incorporated into the
Once PMH cost to Agrilabs.
3) Bayer will bill Agrilabs directly for the Once PMH component and
Agilabs will provide the Once PMH component to Diamond for labeling and
final packaging at no cost to Diamond.
Diamond Animal Health Agri Laboratories, Inc.
By: /s/ LOUIS VAN DAELE By: /s/ STEVE SCHRAM
---------------------- -----------------------
Its: President Its: President
Date: 6-29-00 Date: 6-30-00
Note: Prices will be effective with the first shipment of product after
licensing and will be in effect for 12 months following the first shipment.
*** Confidential Treatment Requested
AMENDMENT NO. 3 TO
BOVINE VACCINE DISTRIBUTION AGREEMENT
This Amendment No. 3 modifies the Bovine Vaccine Distribution Agreement
dated
February 13, 1998, between Diamond Animal Health, Inc. and Agri
Laboratories, Ltd. ("Original Agreement").
1. Purchase of Requirements: Minimum Purchases: Section 1.04 (ii) of the
Original Agreement is hereby modified to delete and replace a certain
year and monetary amount under "Contract Year as defined in 13.06" and
"Minimum Qualified Revenues" as follows:
Delete in total:
----------------
5th and thereafter $[ *** ]
Replace with:
----------------
5th $[ *** ]
6th and thereafter $[ *** ]
2. No Other Changes. Except as expressly modified by this Amendment,
Amendment No. 1 dated July 13, 1998 and Amendment No. 2 dated December
13, 1999, all provisions of the Original Agreement shall remain in full
force and effect.
IN WITNESS WHEREOF, this Amendment has been executed by the duly authorized
representatives of the parties.
SIGNED:
Diamond Animal Health, Inc. Agri Laboratories
By: /s/ CAROL TALKINGTON VERSER By: /s/ STEVE SCHRAM
------------------------------ ---------------------------------
Name: Carol Talkington Verser, Ph.D. Name: Steve Schram
Title: Executive Vice President Title: CEO
Date: 7-12-01 Date: 7-05-01
*** Confidential Treatment Requested