Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
EXHIBIT 10(b.2)
TERMINATION AND TRANSFER AGREEMENT
THIS TERMINATION AND TRANSFER AGREEMENT dated as of February 24, 2004 (the
"Effective Date"), is made by and between DUSA PHARMACEUTICALS, INC., a
corporation organized and existing under the laws of the State of New Jersey,
having offices at 25 Upton Drive, Wilmington, Massachusetts 01887 U.S.A.
("DUSA") and DRAXIS HEALTH INC., a corporation organized and existing under the
laws of Canada, having offices at 6870 Goreway Drive, Suite 200, Mississauga,
Ontario L4V 1P1 Canada ("Draxis").
PRELIMINARY STATEMENTS
WHEREAS, DUSA, Draxis, and PARTEQ RESEARCH AND DEVELOPMENT INNOVATIONS, a
non-profit corporation without share capital organized and existing under the
laws of the Province of Ontario, having offices at Queens University at
Kingston, Kingston, Ontario Canada KL7 3N6 ("PARTEQ") are parties to that
certain Amended and Restated Assignment Agreement dated April 16, 1999 (the
"Assignment") pursuant to which DUSA assigned to Draxis all of DUSA's rights and
obligations under that certain the Amended and Restated License Agreement
between DUSA and PARTEQ effective as of March 11, 1998 (the "License"), insofar
as such rights and obligations relate to the Territory (defined below); and
WHEREAS, in connection with the execution of the Assignment, DUSA and
Draxis also entered into that certain Confidential Disclosure Agreement dated
April 16, 1999 (the "CDA"); and
WHEREAS, in May 2001, Draxis obtained Registration (defined below) of the
DUSA Product (defined below) in the Territory; and
WHEREAS, each of the Parties (defined below) believe that it is in its
best interest for Draxis to: (a) return to DUSA all rights granted to Draxis
under the Assignment and terminate the Assignment; and (b) transfer to DUSA all
right, title and interest in and to the Registration together with all relevant
know-how, pre-clinical and clinical study data and results, reports, records,
market research and materials including, without limitation, any CTAs,
Registration Applications (as each is defined below) and other regulatory
filings in Draxis' name relating to the DUSA Product, all subject to the terms
and conditions set forth herein.
NOW THEREFORE, in consideration of the foregoing preliminary statements
and the mutual agreements and covenants set forth herein, the Parties hereby
agree as follows:
1. DEFINITIONS.
As used in this Agreement, the following terms shall have the meanings set
forth in this Section 1 unless context clearly and unambiguously dictates
otherwise. References to the singular include the plural and vice versa, and
references to Sections, Exhibits and Schedules are references to the sections,
exhibits and schedules of this Agreement.
1.1 "Affiliate" shall mean, with respect to a Party, any entity
controlling, controlled by, or under common control with, such Party, for only
so long as such control exists. For these purposes, "control" shall refer to:
(i) the possession, directly or indirectly, of the power to direct the
management or policies of an entity, whether through the ownership of voting
securities, by contract or otherwise; or (ii) the ownership, directly or
indirectly, of more than fifty percent (50%) of the voting securities or other
ownership interest of an entity.
Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
1.2 "Agreement" shall mean this termination and transfer agreement
together with the preliminary statements and all exhibits, schedules and
attachments hereto and thereto.
1.3 "Assignment" shall have the meaning assigned to such term in the
preliminary statements of this Agreement.
1.4 "CDA" shall have the meaning assigned to such term in the preliminary
statements of this Agreement.
1.5 "CTA" shall mean a clinical trial application filed with the TPD as
required prior to the commencement of any clinical trial of Products, the Method
or the DUSA Product in humans in the Territory.
1.6 "Confidential Information" shall have the meaning assigned to such
term in the CDA.
1.7 "Draxis Know-How" shall mean any and all improvements, discoveries,
claims, formulae, processes, trade secrets, technologies and know-how (including
confidential data and information), whether patentable or unpatentable,
generated, owned or controlled by Draxis or its Affiliates during the term of
the Assignment: (i) useful or necessary for the development, use or sale of: (1)
Products and/or the Method in the Territory; or (2) the DUSA Product in the
Territory; or (ii) relating to the Invention; including, without limitation,
synthesis, preparation, recovery and purification processes and techniques,
control methods and assays, chemical data, toxicological and pharmacological
data and techniques, clinical data, medical uses, product forms and product
formulations and specifications.
1.8 "Draxis Patent Rights" shall mean all patents (including, without
limitation, all reissues, extensions, substitutions, re-registrations,
re-examinations, re-validations, supplementary protection certificates and
patents of addition) and patent applications (including, without limitation, all
provisional applications, continuations, continuations-in-part and divisions)
which: (i) are useful or necessary for the development, use or sale of: (1)
Products and/or the Method in the Territory; or (2) the DUSA Product in the
Territory; or (ii) relate to the Invention; and in each case are owned by or
licensed to Draxis or its Affiliates as of the Effective Date as set forth on
Schedule 1.8.
1.9 "Draxis Intellectual Property" shall mean, collectively, the Draxis
Know-How and Draxis Patent Rights.
1.10 "DUSA Product" shall mean collectively: (i) Levulan(R) 20% topical
solution; and (ii) DUSA's proprietary, disposable applicator being
commercialized under the trademark Kerastick(R), for the application of
Levulan(R) 20% topical solution.
1.11 "Effective Date" shall have the meaning assigned to such term in the
introductory paragraph of this Agreement.
1.12 "First Commercial Sale" shall mean the first sale for use or
consumption of the DUSA Product in the Territory.
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Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
1.13 "GAAP" shall mean generally accepted accounting principles in the
United States, consistently applied by the party at issue.
1.14 "Gross Sales" shall mean the gross invoiced sales price received by
DUSA or its Affiliates and sublicensees, if any, with respect to the sale of the
DUSA Product for the Territory, it being agreed by the Parties that only a
customary number of samples of the DUSA Product shall be provided to the market
for promotional purposes, as determined by DUSA in its reasonable sole
discretion.
1.15 "Improvements" shall have the meaning assigned to such term in the
License and incorporated by reference in to the Assignment.
1.16 "Indemnitee" shall have the meaning assigned to such term in Section
8.3.
1.17 "Invention" shall have the meaning assigned to such term in the
License and incorporated by reference in to the Assignment.
1.18 "Levulan(R)" shall mean DUSA's brand of the chemical compound 5 -
aminolevulinic acid HCl.
1.19 "License" shall have the meaning assigned to such term in the
preliminary statements of this Agreement.
1.20 "Materials" shall have the meaning assigned to such term in Section
3.2.1.
1.21 "Method" shall have the meaning assigned to such term in the License
and incorporated by reference in to the Assignment.
1.22 "Party" shall mean DUSA or Draxis and, when used in the plural, shall
mean DUSA and Draxis.
1.23 "Products" shall have the meaning assigned to such term in the
License and incorporated by reference in to the Assignment.
1.24 "Proprietary Information" shall have the meaning assigned to such
term in Section 7.2.
1.25 "Registration" shall mean approval by the Regulatory Authorities in
the Territory of any Registration Application including, but not limited to,
pricing and reimbursement approvals, for Products, the Method or the DUSA
Product.
1.26 "Registration Application" shall mean any filing(s) made with the
Regulatory Authorities including, without limitation, a new drug submission
filed with the TPD, for regulatory approval of the marketing, manufacture and
sale (and pricing, as applicable) of the Products, the Method or the DUSA
Product in the Territory.
1.27 "Regulatory Authority" shall mean the TPD together with the Health
Products and Food Branch of Health Canada, or any successors thereto, as well as
any state or local health regulatory authorities having jurisdiction over any
activities contemplated by the Parties including, without limitation, the
marketing, manufacture, and sale of Products, the Method or the DUSA Product in
the Territory.
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Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
1.28 "Royalty Payment Period" shall mean the period commencing as of the
First Commercial Sale and terminating upon the expiration of five (5) years. For
these purposes, a "year" shall refer a calendar year beginning on the Effective
Date and ending of 365 days (or 366 days in a leap year) thereafter.
1.29 "Territory" shall mean Canada.
1.30 "TPD" shall mean the Therapeutic Products Directorate of Health
Canada, or any successor thereto.
1.31 "Transfer Fees" shall have the meaning assigned to such term in
Section 3.3
1.32 "United States," "U.S." or "U.S.A." shall mean The United States of
America.
2. REPRESENTATIONS AND WARRANTIES.
2.1 Representations and Warranties of Both Parties. Each Party represents
and warrants to the other Party, as of the Effective Date, that:
2.1.1 such Party: (1) is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction in which it is
incorporated; (2) has the corporate power and authority and the legal right to
own and operate its property and assets, to lease the property and assets it
operates under lease, and to carry on its business as it is now being conducted;
and (3) is in compliance with all requirements of applicable law, except to the
extent that any noncompliance would not have a material adverse effect on the
properties, business, financial or other condition of such Party and would not
materially adversely affect such Party's ability to perform its obligations
under this Agreement;
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Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
2.1.2 such Party: (1) has the corporate power and authority and the
legal right to enter into this Agreement and to perform its obligations
hereunder; and (2) has taken all necessary corporate action on its part to
authorize the execution and delivery of this Agreement and the performance of
its obligations hereunder. The Agreement has been duly executed and delivered on
behalf of such Party, and constitutes a legal, valid, binding obligation,
enforceable against such Party in accordance with its terms;
2.1.3 such Party has obtained all necessary consents, approvals and
authorizations of all governmental authorities and third parties required to be
obtained by such Party in connection with this Agreement; and
2.1.4 the execution and delivery of this Agreement and the
performance of such Party's obligations hereunder: (1) do not, to the best of
such Party's knowledge, conflict with or violate any requirement of applicable
laws or regulations; and (2) do not conflict with, or constitute a default
under, any contractual obligation of such Party.
2.2 Representations and Warranties of Draxis. Draxis hereby represents and
warrants to DUSA, as of the Effective Date, that:
2.2.1 Draxis is the owner of a Registration for the DUSA Product and
such Registration is in full force and effect and has been maintained to date;
2.2.2 to the best of Draxis' knowledge: (1) Draxis has disclosed to
DUSA all Draxis Know-How in its or its Affiliates possession; and (2) Draxis and
its Affiliates have exclusive rights to all of the Draxis Know-How in existence
on the Effective Date and the exclusive right to grant licenses with respect
thereto;
2.2.3 Draxis is the owner of, or has exclusive rights to, all of the
Draxis Patent Rights set forth on Schedule 1.8, and has the exclusive right to
grant to DUSA the rights granted under this Agreement. Schedule 1.8 sets forth a
complete and accurate list of all Draxis Patent Rights;
2.2.4 Draxis has not entered into any agreement with any third party
that is in conflict with the return of rights to DUSA pursuant to this
Agreement; and
2.2.5 Draxis is in full compliance with the terms and conditions of
the Assignment and no payments or other financial obligations are due from
Draxis to any third party (including, without limitation, PARTEQ) thereunder.
2.3 Representations and Warranties of DUSA. DUSA hereby represents and
warrants to Draxis, as of the Effective Date, that DUSA is in full compliance
with the terms and conditions of the Assignment.
3. TERMINATION; TECHNOLOGY TRANSFER.
3.1 Termination of Assignment. Effective as of the Effective Date, the
Parties agree to terminate the Assignment and all obligations of each Party to
the other under the Assignment, except for those set forth in Sections 6.1, 6.2,
and 14.1 (solely with respect to claims arising prior to the Effective Date) of
the License which are incorporated by reference into the Assignment, which shall
survive such termination. Thereafter, DUSA shall be free to develop and
commercialize Products and the Method in the Territory without compensation or
other obligation to Draxis, subject to payment of the termination payment set
forth in Section 4.1.
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Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
3.2 Technology Transfer; Grant of Rights.
3.2.1 Within thirty (30) days of the Effective Date, Draxis will
return or transfer to DUSA all data, information and materials including,
without limitation, all pre-clinical and clinical study data and results,
reports, records, market research, Confidential Information and all regulatory
filings (e.g., all CTAs, Registration Applications and Registrations)
(collectively, the "Materials"), together with all know-how, including Draxis
Know-How, pertaining to the development and commercialization of Products and
the Method as well as the DUSA Product, received by Draxis or its Affiliates
from DUSA or developed by Draxis, its Affiliates and/or their third party
contractors or collaboration partners during the term of the Assignment.
Schedule 3.2.1 sets forth an initial list of Materials for transfer. In
addition, the Parties shall work together to identify any additional Materials
and know-how, including Draxis Know-How, that should be transferred. In the
event that, after the Effective Date, Draxis or DUSA identifies any such
Materials or know-how, including Draxis Know-How, received by Draxis or its
Affiliates from DUSA or developed by Draxis, its Affiliates and/or its third
party contractors or collaboration partners during the term of the Assignment,
the identifying Party shall promptly notify the other and the Parties agree to
promptly make arrangements for the return or transfer to DUSA of such Materials
or know-how, including Draxis Know-How, as applicable. Notwithstanding the
foregoing, Draxis shall be entitled to retain archival copies of all Materials
and know-how, including Draxis Know-How, in electronic or hardcopy form for
purposes of its ongoing confidentiality obligations pursuant to Section 7.
3.2.2 To the extent required for DUSA to access Materials in the
possession of third party contractors and collaboration partners engaged by
Draxis or its Affiliates to perform services on its or their behalf including,
without limitation, to conduct: (1) preclinical or clinical studies on Products
and the Method as well as the DUSA Product; or (2) market research on the DUSA
Product, Draxis agrees to grant permission under any applicable agreement for
such third parties to give access to DUSA such Materials and any other data and
documentation relating to Products, the Method or the DUSA Product in their
possession. In addition, Draxis shall assign, or have its Affiliate assign, its
rights to DUSA as needed under applicable agreements to permit such access by
DUSA and, subject to the prior written approval of DUSA, Draxis may assign to
DUSA obligations of confidentiality, if any, that are required for purposes of
such access. As of the Effective Date, Draxis has identified the third party
contractors and collaboration partners set forth on Schedule 3.2.2.
3.2.3 To enable DUSA to fully exploit its rights under the License,
Draxis and its Affiliates hereby grant to DUSA an exclusive, irrevocable, fully
paid-up, royalty-free, right and license under the Draxis Intellectual Property
to develop, make, have made, use, offer to sell, sell and have sold Products,
the Method and the DUSA Product for all indications worldwide. The foregoing
license shall include the right to grant sublicenses.
3.3 Fees and Expenses. Each party shall bear its own fees and expenses
incurred in connection with the transactions contemplated by this Agreement;
provided, that, the Parties agree that any fees, charges, transfer taxes, bulk
sales taxes or other payments ("Transfer Fees") required to be made to any
governmental entity in connection with the transfer of Materials shall be borne
by DUSA. Draxis and DUSA shall cooperate in timely making and filing all filings
including, but not limited to, tax returns, reports and forms as may be required
with respect to any Transfer Fees payable in connection with the transactions
contemplated by this Agreement.
4. CONSIDERATION.
4.1 Termination Payment to Draxis. As consideration to Draxis for the
return to DUSA of the licenses and other rights granted to Draxis under the
Assignment, DUSA shall pay to Draxis a non-refundable, non-creditable
termination payment of [c.i.] within two (2) business days of the execution of
this Agreement by both Parties.
4.2 Royalties. In recognition of the value-added contributions made by
Draxis in obtaining Registration of the DUSA Product in the Territory,
including, without limitation, the data, information, Materials and Draxis
Intellectual Property developed by Draxis during the term of the Assignment all
of which are being transferred or licensed to DUSA pursuant to Section 3.2, DUSA
shall pay to Draxis during the Royalty Payment Period a royalty [c.i.] of Gross
Sales by DUSA and its Affiliates and sublicensees, if any, in the Territory.
5. PAYMENTS AND REPORTS.
5.1 Payments.
5.1.1 Beginning with the Calendar Quarter in which the First
Commercial Sale of a DUSA Product is made in the Territory by DUSA or its
designee, and for each Calendar Quarter during the Royalty Payment Period
thereafter, royalty payments pursuant to Section 4.2 shall be made to Draxis
within forty-five (45) days following the end of each such Calendar Quarter.
Each royalty payment shall be accompanied by a report, summarizing the total
Gross Sales during the relevant Calendar Quarter and the calculation of
royalties, if any, due thereon. In the event that no royalties are payable in
respect of a given Calendar Quarter, DUSA shall submit a royalty report so
indicating.
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Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
5.1.2 All other payments to be made under this Agreement shall be
made in accordance with the terms set forth in the applicable Section(s)
regarding such payments
5.2 Mode of Payment. All payments under this Agreement shall be made in
Canadian Dollars, via wire transfer of immediately available funds as directed
by Draxis from time to time. For sales of DUSA Product in the Territory made in
a currency other than Canadian Dollars, royalties hereunder shall be calculated
in the currency of such sale or payment and converted into Canadian Dollars at
the rate published by the Bank of Canada on the last business day of the
Calendar Quarter in which such sale is made.
5.3 Late Charges. Amounts not paid when due as set forth in Section 5.1
shall be subject to a late charge at a rate of interest equal to the prime rate
plus three percent (3%) as reported on the date such payment is due by the East
Coast Edition of The Wall Street Journal, with daily compounding of interest.
Payment by DUSA of such late charges shall be Draxis' sole and exclusive remedy
for any failure of DUSA to pay any amounts under this Agreement when due.
5.4 Records Retention. DUSA and its Affiliates shall keep complete and
accurate records pertaining to the sale of the DUSA Product in the Territory
during the Royalty Payment Period, for a period of three (3) calendar years
after the year in which such sales occurred, and in sufficient detail to permit
Draxis to confirm the accuracy of the aggregate royalties paid by DUSA
hereunder.
5.5 Audits. During the Royalty Payment Period and for a period of three
(3) years thereafter, at the request and expense of Draxis, DUSA and its
Affiliates, if any, shall permit an independent, certified public accountant
appointed by Draxis and reasonably acceptable to DUSA, at reasonable times and
upon reasonable notice (but in no case no more than once per calendar year), to
examine such records as may be necessary for the sole purpose of verifying the
calculation and reporting of Gross Sales in the Territory and the correctness of
any royalty payment made under this Agreement. The independent, certified public
accountant shall disclose to Draxis only the royalty amounts which the
independent auditor believes to be due and payable hereunder to Draxis and shall
disclose no other information revealed in such audit. Any and all records
examined by such independent accountant shall be deemed DUSA's Confidential
Information which may not be disclosed by said independent, certified public
accountant to any third party. If, as a result of any inspection of the books
and records of DUSA, it is shown that any royalty payments under this Agreement
were less than the amount which should have been paid, then DUSA shall make all
payments required to be made to eliminate any discrepancy revealed by said
inspection within forty-five (45) days of Draxis' demand therefor. Draxis shall
pay for such audits, except that in the event that the royalty payments made by
DUSA were less than ninety percent (90%) of the undisputed amounts that should
have been paid during the period in question, DUSA shall pay the reasonable
costs of the audit.
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Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
5.6 Taxes. The Parties understand that, under applicable law as of the
Effective Date, there are no withholding requirements for the payments set forth
in this Agreement. In the event that DUSA is required to withhold any tax to the
tax or revenue authorities in the Territory regarding any payment to Draxis due
to the laws of the Territory, such amount shall be deducted from the payment to
be made by DUSA, and DUSA shall promptly notify Draxis of such withholding and,
within a reasonable amount of time after making such deduction, furnish Draxis
with copies of any tax certificate or other documentation evidencing such
withholding. Each Party agrees to cooperate with the other Party in claiming
exemptions from such deductions or withholdings under any agreement or treaty
from time to time in effect.
6. COVENANTS.
6.1 Joint Covenants. Promptly after the Effective Date, and in no case
more than sixty (60) days thereafter, the Parties shall file with any applicable
Regulatory Authorities any and all information required by such Regulatory
Authorities to transfer all regulatory filings (e.g., all CTAs, Registration
Applications and Registrations) filed with such Regulatory Authority from Draxis
or any Affiliate, to DUSA. The Parties also agree to use all reasonable
commercial efforts to take any and all other actions required by any Regulatory
Authority, or other governmental entity in the Territory, if any, to effect the
transfer of all such regulatory filings, along with the drug identification
number(s) assigned to the DUSA Product in the Territory from Draxis or any
Affiliate, as applicable, to DUSA.
6.2 Covenants of Draxis. Draxis covenants with DUSA as follows:
6.2.1 Draxis has returned or transferred, or will return or transfer
as required pursuant to Section 3.2, to DUSA all Materials and know-how,
including Draxis Know-How, pertaining to the development and commercialization
of Products and the Method as well as the DUSA Product, received by Draxis or
its Affiliates from DUSA, or developed by Draxis, its Affiliates and/or its
third party contractors or collaboration partners, during the term of the
Assignment (subject to Draxis' right to retain an archival copy as set forth in
Section 3.2.1);
6.2.2 Draxis shall comply with all applicable state, provincial,
federal and international laws, rules and regulations (including, without
limitation, those applicable to the transfer of regulatory records and filings
relating to Products, the Method and the DUSA Product) in connection with the
performance of its obligations under this Agreement;
6.2.3 Draxis and its Affiliates shall report to DUSA any product
complaints and/or safety information (e.g., adverse drug experiences) regarding
the DUSA Product in the Territory promptly after being made aware of same, in
order to permit DUSA to make timely reports to the Regulatory Authorities as may
be required; and
6.2.4 Draxis and its Affiliates agree, on their own behalf and for
the benefit of DUSA, that, during the Royalty Payment Period, neither Draxis nor
any of its Affiliates shall develop, manufacture for itself or its Affiliates,
market, distribute or sell a product, either for prescription or
over-the-counter sale, which competes with the Invention and all Improvements,
if any, in the Territory.
7. CONFIDENTIALITY.
7.1 DUSA's Confidential Information. Draxis acknowledges that the
Materials and know-how received by Draxis or its Affiliates from DUSA during the
term of the Assignment are Confidential Information and subject to terms of the
CDA, which are incorporated in this Agreement by reference.
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Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
7.2 Protection of Proprietary Information. In addition to the foregoing,
any Materials and know-how, including Draxis Know-How, pertaining to the
development and commercialization of Products, the Method and DUSA Product,
developed by Draxis, its Affiliates and/or their third party contractors or
collaboration partners during the term of the Assignment (collectively,
"Proprietary Information") shall be deemed to be the confidential and
proprietary information of DUSA as the disclosing party. Draxis shall keep
confidential and shall not publish or otherwise disclose or use for any purpose
other than as provided for in this Agreement any such Proprietary Information;
except to the extent that it can be established by Draxis that such Proprietary
Information:
7.2.1 becomes published or otherwise part of the public domain
through no fault or omission on the part of Draxis or its Affiliates;
7.2.2 is received by Draxis, without restriction as to
confidentiality or use, from a third party legally entitled to possession of
such Proprietary Information and having a right of further disclosure; or
7.2.3 is required to be disclosed under applicable laws or
regulations or an order by a court or other regulatory body having competent
jurisdiction; PROVIDED, HOWEVER, that except where impracticable, Draxis shall
give DUSA reasonable advance notice of such disclosure requirement (which shall
include a copy of any applicable subpoena or order) and shall cooperate with
DUSA to oppose, limit or secure confidential treatment for such required
disclosure. In the event of any such required disclosure, Draxis shall disclose
only that portion of the Proprietary Information that Draxis is legally required
to disclose.
7.3 Term of Obligation. The obligations Draxis under Section 7.2 shall
continue for a period of ten (10) years from the Effective Date.
7.4 Remedies. DUSA shall be entitled, in addition to any other right or
remedy it may have, at law or in equity, to an injunction, without the posting
of any bond or other security, enjoining or restraining Draxis from any
violation or threatened violation of this Section 7.
8. INDEMNIFICATION.
8.1 By Draxis. Draxis shall indemnify, defend and hold harmless DUSA, its
Affiliates, and their respective directors, officers, employees and agents, from
and against any and all liabilities, damages, losses, costs and expenses
(including the reasonable fees of attorneys and other professionals) for claims
of any Third Party to the extent arising from or in connection with or otherwise
with respect to:
8.1.1 a breach of any representation, warranty or covenant of Draxis
contained in this Agreement; or
8.1.2 a breach of any representation, warranty or covenant of Draxis
contained in the Assignment; or
8.1.3 any negligence, recklessness or wrongful intentional acts or
omissions of Draxis, or its Affiliates, and their respective directors,
officers, employees and agents, in connection with Draxis' performance of its
obligations under this Agreement; or
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that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
8.1.4 any liabilities, obligations or commitments of whatever kind
and nature, primary or secondary, direct or indirect, absolute or contingent,
known or unknown, whether or not accrued, arising out of or relating to,
directly or indirectly, to the development or commercialization of Products, the
Method or DUSA Product to the extent related to any period on or before the
Effective Date.
8.2 By DUSA. DUSA shall indemnify, defend and hold harmless Draxis, its
Affiliates, and their respective directors, officers, employees and agents, from
and against any and all liabilities, damages, losses, costs and expenses
(including the reasonable fees of attorneys and other professionals) for claims
of any Third Party to the extent arising from or in connection with or otherwise
with respect to:
8.2.1 a breach of any representation, warranty or covenant of DUSA
contained in this Agreement;
8.2.2 DUSA's failure to pay to PARTEQ royalties on sales of the DUSA
Product in the Territory pursuant to the License; or
8.2.3 any liabilities, obligations or commitments of whatever kind
and nature, primary or secondary, direct or indirect, absolute or contingent,
known or unknown, whether or not accrued, arising out of or relating to,
directly or indirectly, to the development or commercialization of Products, the
Method or DUSA Product to the extent related to any period after the Effective
Date.
8.3 Notice. In the event that any person (an "Indemnitee") entitled to
indemnification under Section 8.1 or 8.2 is seeking such indemnification, such
Indemnitee shall: (i) inform, in writing, the indemnifying Party of the claim as
soon as reasonably practicable after such Indemnitee receives notice of such
claim; (ii) permit the indemnifying Party to assume direction and control of the
defense of the claim (including the sole right to settle it at the sole
discretion of the indemnifying Party; provided, that such settlement does not
impose any obligation on, or otherwise adversely affect, the Indemnitee or the
other Party); (iii) cooperate as requested (at the expense of the indemnifying
Party) in the defense of the claim; and (iv) undertake all reasonable steps to
mitigate any loss, damage or expense with respect to the claim(s).
8.4 Complete Indemnification. As the Parties intend complete
indemnification, all costs and expenses, including without limitation, legal
fees and expenses, actually incurred by an Indemnitee in connection with
enforcement of Sections 8.1 or 8.2 shall also be reimbursed by the indemnifying
Party.
9. SURVIVAL OF REPRESENTATIONS.
The representations and warranties contained in this Agreement shall
survive the Effective Date and remain in full force and effect until the
expiration of the Royalty Payment Period; provided, however, that if notice of
any claim for indemnification pursuant to Section 8.1 or Section 8.2 shall have
been given prior to the expiration of the Royalty Payment Period, the relevant
representations and warranties shall survive for purposes of such claim until
such time as such claim is finally resolved.
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Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
10. MISCELLANEOUS.
10.1 Governing Law. This Agreement shall be governed by, and construed and
interpreted in accordance with, the laws of the Province of Ontario and the laws
of Canada applicable therein.
10.2 Assignment. Neither Party shall be entitled to assign its rights or
delegate its obligations hereunder without the express written consent of the
other Party hereto, except that: (i) either Party may assign its rights and
transfer its duties hereunder to an Affiliate or to any assignee of all or
substantially all of its business (or that portion thereof to which this
Agreement relates) or in the event of such Party's merger, consolidation or
involvement in a similar transaction. No assignment and transfer shall be valid
or effective unless done in accordance with this Section 10.2 and unless and
until the assignee/transferee shall agree in writing to be bound by the
provisions of this Agreement.
10.3 Dispute Resolution. Prior to the commencement of any litigation under
this Agreement, a senior executive of the Party considering commencement of such
litigation shall to notify a senior executive of the other Party that such
litigation is being contemplated. For at least twenty (20) business days
following the other Party's receipt of such notice, the Parties' senior
executives shall use good faith efforts to make themselves available to discuss
the dispute and attempt to resolve the matter. If the dispute is not resolved
within such twenty (20) business days, the Party providing the notice may
commence litigation with respect to the subject matter of the dispute and with
respect to any other claims it may have and thereafter neither Party hereto
shall have any further obligation under this Section 10.3.
10.4 Notices. Any notice or request required or permitted to be given
under or in connection with this Agreement shall be deemed to have been
sufficiently given if in writing and personally delivered or sent by certified
mail (return receipt requested), facsimile transmission (receipt verified), or
overnight express courier service (signature required), prepaid, to the Party
for which such notice is intended, at the address set forth for such Party
below:
In the case of DUSA, to:
DUSA Pharmaceuticals, Inc.
25 Upton Drive
Wilmington, Massachusetts 01887
U.S.A.
Attention: President and CEO
Facsimile No.: (978) 657-9193
Telephone No.: (978) 657-7500
In the case of Draxis, to:
Draxis Health, Inc.
6870 Goreway Drive, Suite 200
Mississauga, Ontario L4V 1P1
Canada
Attention: President
Facsimile No.: (905) 677-5494
Telephone No.: (905) 677-5500
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Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
With a copy to:
Draxis Health Inc.
16751 Trans-Canada Highway
Kirkland, Quebec H9H 4J4
Attention: General Counsel
Facsimile No.: (514) 630-7201
Telephone No.: (514) 630-7060
or to such other address for such Party as it shall have specified by like
notice to the other Party, provided that notices of a change of address shall be
effective only upon receipt thereof. If delivered personally or by facsimile
transmission, the date of delivery shall be deemed to be the date on which such
notice or request was given. If sent by overnight express courier service, the
date of delivery shall be deemed to be the next business day after such notice
or request was deposited with such service. If sent by certified mail, the date
of delivery shall be deemed to be the fifth (5th) business day after such notice
or request was deposited with the U.S. or Canadian Postal Service.
10.5 Books and Records. Any books and records to be maintained under this
Agreement by a Party shall be maintained in accordance with GAAP.
10.6 Further Actions. Each Party shall execute, acknowledge and deliver
such further instruments, and do all such other acts, as may be necessary or
appropriate in order to carry out the purposes and intent of this Agreement.
10.7 Use of Name; Publicity. Except as otherwise provided herein: (i)
neither Party shall have any right, express or implied, to use in any manner the
name or other designation of the other Party, or any other trade name, trademark
or logo of the other Party for any purpose in connection with the performance of
this Agreement; and (ii) neither Party shall make any public announcement
concerning this Agreement or the subject matter hereof without the prior written
consent of the other Party, which consent shall not be unreasonably withheld;
provided that nothing in this Section 10.7 shall prevent either Party from
issuing statements that such Party determines to be necessary to comply with
applicable law (including the disclosure requirements of the U.S. Securities and
Exchange Commission, NASDAQ or any other stock exchange on which securities
issued by such Party are traded). In the event of a required public
announcement, to the extent practicable under the circumstances, the Party
making such announcement shall provide the other Party with a copy of the
proposed text prior to such announcement and with financial terms sufficiently
in advance of the scheduled release of such announcement to afford such other
Party a reasonable opportunity to review and comment upon the proposed text.
10.8 Waiver. A waiver by either Party of any of the terms and conditions
of this Agreement in any instance shall not be deemed or construed to be a
waiver of such term or condition for the future, or of any subsequent breach
hereof. All rights, remedies, undertakings, obligations and agreements contained
in this Agreement shall be cumulative and none of them shall be in limitation of
any other remedy, right, undertaking, obligation or agreement of either Party.
10.9 Amendment. No amendment, modification or supplement of any provisions
of this Agreement shall be valid or effective unless made in writing and signed
by a duly authorized officer of each Party.
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Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
10.10 Entire Agreement. This Agreement including the Schedules hereto,
together with the surviving sections of the Assignment, the referenced
definitions of the License and the CDA, set forth the entire agreement and
understanding between the Parties as to the subject matter hereof and merges all
prior discussions and negotiations between them, and neither of the Parties
shall be bound by any conditions, definitions, warranties, understandings or
representations with respect to such subject matter other than as expressly
provided herein or as duly set forth on or subsequent to the date hereof in
writing and signed by a proper and duly authorized officer or representative of
the Party to be bound thereby.
10.11 Parties in Interest. All of the terms and provisions of this
Agreement shall be binding upon, inure to the benefit of and be enforceable by
the Parties hereto and their respective permitted successors and assigns.
10.12 Construction of Agreement. The terms and provisions of this
Agreement represent the results of negotiations between the Parties and their
representatives, each of which has been represented by counsel of its own
choosing, and neither of which has acted under duress or compulsion, whether
legal, economic or otherwise. Accordingly, the terms and provisions of this
Agreement shall be interpreted and construed in accordance with their usual and
customary meanings, and each of the Parties hereto hereby waives the application
in connection with the interpretation and construction of this Agreement of any
rule of law to the effect that ambiguous or conflicting terms or provisions
contained in this Agreement shall be interpreted or construed against the Party
whose attorney prepared the executed draft or any earlier draft of this
Agreement.
10.13 Waiver of Jury Trial. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT. EACH PARTY HERETO (i) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THAT FOREGOING WAIVER AND (ii) ACKNOWLEDGES THAT IT HAS BEEN INDUCED
TO ENTER INTO THIS AGREEMENT AND THE RELATED INSTRUMENTS, AS APPLICABLE, BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 10.13.
10.14 Descriptive Headings. The descriptive headings of this Agreement are
for convenience only, and shall be of no force or effect in construing or
interpreting any of the provisions of this Agreement.
10.15 Counterparts. This Agreement may be signed in counterparts, each and
every one of which shall be deemed an original, notwithstanding variations in
format or file designation which may result from the electronic transmission,
storage and printing of copies of this Agreement from separate computers or
printers. Facsimile signatures shall be treated as original signatures.
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Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
representatives to execute this Agreement.
DRAXIS HEALTH INC. DUSA PHARMACEUTICALS, INC.
By: /s/ Alicia Gualtieri By: /s/ D. Geoffrey Shulman
------------------------------ -------------------------------
Name: Alicia Gualtieri D. GEOFFREY SHULMAN,
Title: General Counsel and Secretary President and CEO
PARTEQ hereby consents and agrees to the termination of the Assignment in
accordance with the terms and conditions of this Agreement.
PARTEQ RESEARCH AND DEVELOPMENT INNOVATIONS
By: /s/ John P. Malloy
---------------------------
Name: John P. Malloy Title: President & CEO
-------------- ---------------
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Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
Exhibit 10(b.2)
SCHEDULE 1.8
DRAXIS PATENT RIGHTS
NONE
Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
Exhibit 10(b.2)
SCHEDULE 3.2.1
MATERIALS
1. Complete copy of the new drug submission original application.
2. Copy of all correspondence to and from Regulatory Authorities post
application submission.
3. Copy of notice of compliance letter.
4. Copy of all correspondence to and from Regulatory Authorities post receipt of
the notice of compliance letter.
5. Final agreed upon labeling for Kerastick(R) (if different from application).
Note: Certain portions of this document have been marked "[C.I.]" to indicate
that confidential treatment has been requested for this confidential
information. The confidential portions have been omitted and filed separately
with the Sec1urities and Exchange Commission.
Exhibit 10(b.2)
SCHEDULE 3.2.2
CONTRACTORS AND PARTNERS
NONE