Common use of Purchase Commitment Clause in Contracts

Purchase Commitment. (a) During the Term and upon the terms and subject to the conditions of this Agreement, and as long as SAFC can demonstrate to Company’s reasonable satisfaction that SAFC: (i) provides conforming Product in accordance with the terms of this Agreement and (ii) can meet the Commercial Assurance (as defined below in Sec. 3.1) production levels, Company undertakes to purchase from SAFC not less than [***] of API (“Minimum Percentage Requirement”). The Parties acknowledge that Company placed and SAFC manufactured API for the Work Order dated October 17, 2017 under purchase order 80319 dated November 6, 2017 and Proposal dated March 7, 2018 under purchase order 80767 dated March 16, 2018. The Parties agree that the terms of this Agreement shall apply to the Manufacture of API pursuant only to Purchase Order 80767, however both Purchase Orders 80319 and 80767 shall apply towards the Minimum Percentage Requirement. [***]. Company agrees to cooperate in a prompt and timely manner with SAFC in any investigation and resolution of any quality issues with the API to enable SAFC to remedy any such issue. [***]. For clarity, API that is to be used for clinical purposes shall not be included when calculating Total Commercial Volume Requirements. (b) At any time and from time to time during the Term, if SAFC believes that Company is not purchasing the Minimum Percentage Requirement, it will provide Company with written notice requesting that Company provide sufficient documentation demonstrating such purchases. Company shall have [***] after such notice to provide this documentation. If Company does not provide such documentation within this [***] period or if such documentation does not demonstrate, to SAFC’s reasonable satisfaction, that Company purchased the Minimum Percentage Requirement based on Company’s demand forecast, the Parties will engage in good faith discussions for a period of an additional [***] in an effort to resolve the disagreement. If the Parties do not reach a mutually acceptable agreement within the foregoing [***] discussion period, then either Party may refer the matter to be resolved by binding arbitration. The arbitration shall be conducted in accordance with the Commercial Arbitration Rules of the American Arbitration Association in effect at the time of the arbitration to the extent that both Parties are domestic United States companies or in accordance with the International Arbitration Rules of the American Arbitration Association in effect at the time of the arbitration to the extent that one of the Parties is not a domestic United States company, except, in each instance, as such rules may be modified herein or by mutual agreement of the Parties. The seat of the arbitration shall be New York City, New York, USA, and it shall be conducted in the English language.

Purchase Commitment. (a) During the Term and upon the terms and subject to the conditions of this Agreement, Agreement and as long as SAFC *** can demonstrate to Company’s reasonable satisfaction satisfaction, based on capacity availability, Batch size and other commercially reasonable requirements, that SAFC: (i) provides conforming Product *** has in accordance place an acceptable alternate Manufacturing facility at which *** is capable of manufacturing the Excipient and/or necessary Raw Materials for the Manufacture of the Excipient in compliance with the terms of this Agreement and the Quality Agreement (ii) can meet the Commercial Assurance (as defined below in Sec. 3.1) production levels“Qualified Alternate Facility”), Company undertakes agrees to purchase from SAFC ***, its and its Affiliate’s annual worldwide requirements of the Excipient for use in SUSTOL. If *** does not have a Qualified Alternate Facility, then during the Term and upon the terms and subject to the conditions of this Agreement, Company agrees to purchase from ***, not less than [***] * of API (“Minimum Percentage Requirement”its and its Affiliate’s annual worldwide requirements of the Excipient for use in SUSTOL unless there is a Failure to Supply pursuant to Section 2.12(a). The Parties acknowledge that Company placed and SAFC manufactured API for the Work Order dated October 17, 2017 under purchase order 80319 dated November 6, 2017 and Proposal dated March 7, 2018 under purchase order 80767 dated March 16, 2018. The Parties agree that the terms of this Agreement shall apply to the Manufacture of API pursuant only to Purchase Order 80767, however both Purchase Orders 80319 and 80767 shall apply towards the Minimum Percentage Requirement. [***]. Company agrees to cooperate in a prompt and timely manner with SAFC in any investigation and resolution of any quality issues with the API to enable SAFC to remedy any such issue. [***]. For clarity, API that is to be used for clinical purposes shall not be included when calculating Total Commercial Volume Requirements. (b) At any time and from time to time If during the Term, if SAFC Term *** reasonably believes that Company is not purchasing Excipient at the Minimum Percentage Requirementlevel required by this Section 2.11 (the “Compliance Level”), it will provide Company with written notice requesting that Company provide sufficient documentation demonstrating such purchasescompliance with the Compliance Level. Company shall have [***] sixty (60) days after such notice to provide this documentationdocumentation responsive to the request, and which illustrates solely the Company’s annual requirements for Excipient, and that amount purchased from ***. If Company does not provide provides such documentation within this [***] period or if and such documentation does not demonstrate, to SAFC*** reasonable satisfaction Company’s reasonable satisfactioncompliance with the Compliance Level, then, in the event that Company purchased the Minimum Percentage Requirement based does not agree with *** findings, Company and *** shall mutually agree on an acceptable independent third party auditor to review Company’s demand forecastbooks and records solely to determine whether Company met the Compliance Level. Such third-party auditor will be required to sign a standard form of confidentiality agreement for the benefit of Company. The cost of the independent third party shall be borne by Company if the independent third party determines reasonably that Company was out of compliance with the Compliance Level, the Parties will engage in good faith discussions for a period of an additional [otherwise by ***] in an effort to resolve the disagreement. If pursuant to this Section 2.11(b) Company is deemed or determined to be out of compliance with the Parties do not reach a mutually acceptable agreement within the foregoing [Compliance Level, then ***] discussion period, then either Party * may refer adjust pricing by not more than the matter to be resolved per cent (%) shortfall in the Compliance Level as determined by binding arbitrationthe independent third party. The arbitration shall be conducted Any adjusted pricing hereunder would remain in accordance effect until such time as Company demonstrates compliance with the Commercial Arbitration Rules of the American Arbitration Association in effect at the time of the arbitration to the extent that both Parties are domestic United States companies or in accordance with the International Arbitration Rules of the American Arbitration Association in effect at the time of the arbitration to the extent that one of the Parties is not a domestic United States company, except, in each instance, as such rules may be modified herein or by mutual agreement of the Parties. The seat of the arbitration shall be New York City, New York, USA, and it shall be conducted in the English languageCompliance Level.

Purchase Commitment. (a) During Omnicare will meet and maintain the Term and upon the terms and subject to the conditions of this Agreement, and as long as SAFC can demonstrate to Company’s reasonable satisfaction that SAFC: (i) provides conforming Product in accordance with the terms of this Agreement and (ii) can meet the Commercial Assurance (as defined below in Sec. 3.1) production levels, Company undertakes to following purchase commitments: 2.2.1 purchase from SAFC Vendor not less than [***] of API its Net dollar volume of overall requirements for Branded Rx Products of Omnicare and the Omnicare Facilities, net of Permitted Purchases (“Minimum Brand Volume Net Purchase Percentage Requirement”). The Parties acknowledge that Company placed . 2.2.2 purchase from Vendor, through Vendor’s OneStop Program, not less than [***] of its Net dollar volume of overall requirements for Generic Products of Omnicare and SAFC manufactured API for the Work Order dated October 17Omnicare Facilities, 2017 under purchase order 80319 dated November 6, 2017 and Proposal dated March 7, 2018 under purchase order 80767 dated March 16, 2018. The Parties agree that the terms net of this Agreement shall apply to the Manufacture of API pursuant only to Permitted Purchases (“Generic Volume Net Purchase Order 80767, however both Purchase Orders 80319 and 80767 shall apply towards the Minimum Percentage Requirement”). [***]. 2.2.3 Omnicare represents and warrants that its actual net generics spend for 2014 (annualized based upon the actual amounts from January 1, 2014 to November 30, 2014) shall have been an amount not less than [***] (the “2014 Generic Spend Target”). Company agrees If Omnicare does not achieve the Brand Volume Net Purchase Percentage Requirement, the Generic Volume Net Purchase Percentage Requirement or the 2014 Generic Spend Target, [***] by giving written notice to cooperate in a prompt and timely manner with SAFC in any investigation and resolution such effect to Omnicare. Following the giving of any quality issues such notice, the Parties shall negotiate in good faith with the API respect to enable SAFC to remedy any such issue. [***]. For clarity, API that is If the Parties come to be used for clinical purposes shall not be included when calculating Total Commercial Volume Requirements. (b) At any time and from time to time during the Term, if SAFC believes that Company is not purchasing the Minimum Percentage Requirement, it will provide Company with written notice requesting that Company provide sufficient documentation demonstrating such purchases. Company shall have agreement [***] after such notice to provide this documentation]. If Company does not provide such documentation within this [***] period or if such documentation does not demonstrate, to SAFC’s reasonable satisfaction, that Company purchased To the Minimum Percentage Requirement based on Company’s demand forecast, extent the Parties will engage in good faith discussions for a period of an additional [***] in an effort to resolve the disagreement. If the Parties do cannot reach a mutually acceptable agreement within the foregoing [***] discussion periodagreement, then either Party may refer may, at its election and as its sole remedy, submit the matter dispute for binding mediation subject to be resolved by binding arbitration. The arbitration the provisions of Section 13.19 of the Agreement. 2.2.4 Omnicare shall be conducted not purchase Pharmaceutical Products from another vendor (including any wholesaler or manufacturer), except for (i) purchases that are Permitted Purchases, (ii) purchases in accordance with the Commercial Arbitration Rules operational transition plan contemplated by Schedule 2.2 (the “Transition Plan”) and (iii) purchases in amounts that would not cause Omnicare not to satisfy the requirement in this Section 2.2. For purposes of determining Omnicare’s compliance with the American Arbitration Association in effect at the time Brand Volume Net Purchase Percentage Requirement and Generic Volume Net Purchase Percentage Requirement, all purchases of the arbitration to the extent that both Parties are domestic United States companies or Pharmaceutical Products from other vendors (including wholesalers and manufacturers) in accordance with the International Arbitration Rules of the American Arbitration Association in effect at the time of the arbitration to the extent that one of the Parties is not a domestic United States company, except, in each instance, as such rules may be modified herein or by mutual agreement of the Parties. The seat of the arbitration Transition Plan shall be New York City, New York, USA, and it shall be conducted in the English languageincluded as if they were purchased from Vendor and/or Vendor’s One Stop Program (as applicable).

Purchase Commitment. (a) During the Term and upon Subject to the terms and subject to the conditions of this Agreement, Agreement and as long as SAFC can demonstrate to Company’s reasonable satisfaction that SAFC: SAFC (i) provides conforming and timely delivered Product in accordance with commercial Batches resulting from a production yield of not less than the terms minimum yield achieved in the prior [***] validation runs but in no case shall such production be less than a [***] yield of this Agreement and Product based on starting iron material (“Yield”); and, (ii) can meet the Commercial Assurance (as defined below in Sec. 3.1) production levels, Company undertakes agrees to purchase from SAFC not less than an annual minimum amount of Product equal to the greater of [***]Batches or [***] of API Product for use in the production and distribution of Finished Product for [***] (the “Minimum Percentage RequirementPurchase Commitment”) as measured [***], as the case may be, during the Term (the “Purchase Year”). The Parties acknowledge that Company placed and SAFC manufactured API for the Work Order dated October 17, 2017 under purchase order 80319 dated November 6, 2017 and Proposal dated March 7, 2018 under purchase order 80767 dated March 16, 2018. The Parties agree that the terms of this Agreement shall apply to the Manufacture of API pursuant only to Purchase Order 80767, however both Purchase Orders 80319 and 80767 shall apply towards In calculating the Minimum Percentage RequirementPurchase Commitment during each Purchase Year, Company shall be credited with all Product ordered, including amounts [***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. used for samples and testing provided such amounts are authorized by applicable law for release and use by AMAG or its licensee [***]. Company In the event a Batch is produced with a Yield that is less than minimum criteria stated above, the Parties will negotiate in good faith to provide a price adjustment on such Batch. Further, SAFC agrees to cooperate notify Company promptly in a prompt and timely manner writing of when the percentage of manufacturing capacity consumed at the facility designated in Section 12.6 (c) with SAFC in any investigation and resolution the inclusion of any quality issues with the API to enable SAFC to remedy any such issue. amount of Product ordered by Company (“Capacity Notification”) equals or exceeds [***]] of such facility’s manufacturing capacity. For clarity, API that is to be used for clinical purposes shall not be included when calculating Total Commercial Volume Requirements. (b) At any time and Company may at its discretion request Capacity Notification from SAFC from time to time during the Term, if SAFC believes term of this Agreement. To the extent that Company is the provisions in (i) or (ii) above are not purchasing maintained or the Minimum Percentage Requirement, it will provide Company with written notice requesting that Company provide sufficient documentation demonstrating such purchases. Company shall have Capacity Notification exceeds [***] after such notice of the applicable facility’s manufacturing capacity, Company shall have the right to provide this documentation. If Company does not provide such documentation within this reduce the Company’s Minimum Purchase Commitment hereunder by up to [***] period or if until such documentation does not demonstrate, time that that SAFC can demonstrate to SAFCCompany’s reasonable satisfaction, satisfaction that Company purchased SAFC can maintain the Minimum Percentage Requirement based on CompanyYield and Commercial Assurance production levels described in (i) and (ii) above and/or that the applicable facility’s demand forecast, the Parties will engage in good faith discussions for a period of an additional manufacturing capacity is less than [***] in an effort to resolve the disagreement. If the Parties do not reach a mutually acceptable agreement within the foregoing [***] discussion period, then either Party may refer the matter to be resolved by binding arbitration. The arbitration shall be conducted in accordance with the Commercial Arbitration Rules of the American Arbitration Association in effect at the time of the arbitration to the extent that both Parties are domestic United States companies or in accordance with the International Arbitration Rules of the American Arbitration Association in effect at the time of the arbitration to the extent that one of the Parties is not a domestic United States company, except, in each instance], as such rules the case may be modified herein or by mutual agreement of the Parties. The seat of the arbitration shall be New York City, New York, USA, and it shall be conducted in the English languagebe.

Purchase Commitment. (a) 1.1 During the Term and upon the terms and subject to the conditions of this Agreement, and as long as SAFC can demonstrate to Company’s reasonable satisfaction that SAFC: (i) provides conforming Product in accordance with the terms of this Agreement and (ii) can meet the Commercial Assurance DVA shall purchase NEEDLE PRODUCTS (as identified and defined below in Sec. 3.1on Schedule A) production levels, Company undertakes from DVA’s chosen MDS CONTRACT DISTRIBUTOR sufficient to purchase from SAFC not less than fulfill at least [**] percent ([**]%) of DVA’s total requirements (in each equivalents) for AVF needles and safety or buttonhole needles (and excluding any requirements for Medic-type safety needles) in DVA-owned facilities, including inventory needs, but not including [**] unless and until DVA elects by [**] days written notification to MDS, which notification shall be given by DVA upon the earlier of API (X) [**] or (Y) [**] (the “Minimum Percentage RequirementNEEDLE COMMITMENT”). The Parties acknowledge that Company placed foregoing NEEDLE COMMITMENT shall go into effect commencing upon the Effective Date of this Agreement. If during each [**] period during the Term of this Agreement DVA [**], DVA shall [**] not so purchased during [**] period, and, except for this provision and SAFC manufactured API for the Work Order dated October 17, 2017 under purchase order 80319 dated November 6, 2017 and Proposal dated March 7, 2018 under purchase order 80767 dated March 16, 2018. The Parties agree that the terms of this Agreement sections 1.4 and 1.5 below, MDS shall apply not be entitled to the Manufacture of API pursuant only any other damages or remedy whatsoever. Any such payment by DVA to Purchase Order 80767, however both Purchase Orders 80319 and 80767 MDS shall apply towards the Minimum Percentage Requirement. be made within [***]. Company ] days of each anniversary of this Agreement. 1.2 MDS acknowledges and agrees that DVA has not promised or committed to cooperate in a prompt and timely manner with SAFC in purchase any investigation and resolution particular quantity of any quality issues of the Medic Needle Products (as defined in Schedule A) or any particular percentage of its requirements for items such as the Medic Needle Products, and that DVA may purchase other products performing some or all of the same functions as the Medic Needle Products. MDS has no obligation hereunder to supply, or any liability associated with the API a failure to enable SAFC supply, Medic Needle Products, except with respect to remedy orders made by DVA that are consistent with any such issue. [***]. For clarity, API then-current forecast for Medic Needle Products made pursuant to Section 1.4 that is accepted by MDS. The protections afforded to be used for clinical purposes DVA and the obligations of MDS under Sections 7 and 14 shall not be included when calculating Total Commercial Volume Requirementsapply to Medic Needle Products. (b) 1.3 At any time and from time to time the end of each calendar year during the Term, if SAFC believes upon at least [**] business days notice to DVA, MDS shall have the right to audit DVA’s compliance with the NEEDLE COMMITMENT, at its sole cost and expense during normal business hours and so as not to interfere with the business of DVA. In the event that Company is not purchasing MDS’ audit demonstrates that DVA failed to comply with the Minimum Percentage RequirementNEEDLE COMMITMENT during such calendar year, it will provide Company with MDS shall deliver a written notice requesting (an “Objection Notice”) to DVA setting forth, in reasonable detail, any and all items of disagreement related to DVA’s compliance with the NEEDLE COMMITMENT. MDS and DVA will use commercially reasonable efforts to resolve any disagreements relating to DVA’s compliance with the NEEDLE COMMITMENT, but if they do not obtain a final resolution within [**] days after DVA has received the Objection Notice, then either MDS or DVA may refer the items in dispute to a nationally recognized firm of independent public accountants as to which MDS and DVA mutually agree (the “Firm”), to resolve any remaining disagreements. MDS and DVA will direct the Firm to render a determination within [**] days of its retention, and MDS and DVA and their respective agents will cooperate with the Firm during its engagement. The determination of the Firm will be conclusive and binding upon MDS and DVA. The Firm shall enter into a confidentiality agreement acceptable to DVA. The fees and expenses of the Firm shall be paid by the non-prevailing party. If the determination of the Firm indicates that Company DVA has not met its NEEDLE COMMITMENT, DVA shall pay MDS liquidated damages as set forth in Section 1.1. 1.4 At least [**] days prior to the beginning of each [**], DVA shall provide sufficient documentation demonstrating MDS with a forecast on a code by code basis of its anticipated NEEDLE PRODUCTS requirements for such purchases[**] (the “[**] Forecast”). Company DVA will use its best commercially reasonable efforts to make the [**] Forecast as accurate as possible and MDS shall use its best commercially reasonable efforts to fulfill the NEEDLE PRODUCT requirements in such [**] Forecast. Upon receipt of the [**] Forecast, MDS shall have [***] after such notice business days to provide this documentation. If Company does not provide such documentation within this determine if it can fulfill DVA’s forecast of its anticipated NEEDLE PRODUCTS requirements for the applicable [***] period or if and in the event MDS determines that it shall not be able to satisfy the requirements set forth in such documentation does not demonstrate, to SAFC’s reasonable satisfaction, that Company purchased the Minimum Percentage Requirement based on Company’s demand forecast, the Parties will engage in good faith discussions for a period of an additional [***] Forecast, it shall notify DVA in an effort to resolve the disagreement. If the Parties do not reach a mutually acceptable agreement writing within the foregoing [**] days of such determination. DVA agrees that MDS shall have no obligation to supply, and no liability for any failure to supply hereunder, including as set forth in Section 7 herein, and DVA shall have none of the rights and protections afforded under Section 7 herein in connection with, orders for NEEDLE PRODUCTS that reflect, individually by code or in the aggregate, more than a (a) [**]% increase in quantities (measured on a [**] discussion periodbasis) over the prior [**] orders (orders prior to the Effective Date shall be considered in these calculations, then as necessary), or (b) a [**]% increase in quantities (measured on a [**] basis) over the prior [**] orders (orders prior to the Effective Date shall be considered in these calculations, as necessary). 1.5 MDS acknowledges and agrees that, commencing on the Effective Date, DVA’s NEEDLE COMMITMENT may be adjusted, according to the procedure set forth below, in the event a functionally equivalent new AVF or buttonhole needle product is introduced by a third party following the Effective Date which is superior in terms of offering [**] (a “Materially Improved Product”). In the event DVA, in good faith, believes that a Materially Improved Product has been introduced, which DVA would like to purchase as an alternative to the AVF NEEDLES or BUTTONHOLE NEEDLES purchased hereunder, DVA shall deliver written notice thereof to MDS, identifying the product alleged to be a Materially Improved Product and including an explanation of the basis for the belief that such product is a Materially Improved Product, which explanation shall include a description of the actual and documented [**] either Party (A) experienced and reported by DVA dialysis clinics using such alleged “Materially Improved Product”, or (b) published in an independent, well-respected, peer reviewed, medical, scientific, or technology journal. MDS shall have [**] days to respond to such notice, and its response (the “MDS Response”) shall indicate whether or not MDS agrees that such product is a Materially Improved Product, and articulates in reasonable detail its reasons therefore. If MDS agrees with DVA that the product is a Materially Improved Product, DVA may purchase such Materially Improved Product, MDS shall have the right to terminate this Agreement, effective upon delivering notice to DVA, and until such time as such notice is given, if any, DVA’s NEEDLE COMMITMENT hereunder shall be adjusted, such that DVA’s purchases of such Materially Improved Product shall be excluded from DVA’S NEEDLE COMMITMENT. If MDS, in good faith, disagrees with DVA that the product is a Materially Improved Product, within [**] days of receipt of written notice of MDS’ disagreement, DVA shall refer the matter to be resolved by binding arbitration. The arbitration shall be conducted in accordance with the Commercial Arbitration Rules of the American Arbitration Association in effect at the time of the arbitration to the extent that both Parties are domestic United States companies or in accordance with the International Arbitration Rules of the American Arbitration Association in effect at the time of the arbitration to the extent that one of the Parties is not a domestic United States company, except, in each instancemedical advisory board (“Medical Advisory Board”, as such rules may term is defined below) for determination of whether the alleged Materially Improved Product meets the definition of a Materially Improved Product set forth herein. The Medical Advisory Board shall be modified herein or by mutual agreement composed of [**]. Each party shall designate [**]. The Medical Advisory Board shall have [**] days from the date of the Partiesreferral, during which period each Medical Advisory Board member shall refrain from ex parte communications with each other individual member, to make a decision, which shall be by the majority of the members. The seat of the arbitration Medical Advisory Board’s determination shall be New York Cityfinal, New Yorkconclusive and binding on the parties. If the Medical Advisory Board agrees with DVA that such product is a Materially Improved Product, USAthen DVA may purchase such Materially Improved Product, MDS shall have the right to terminate this Agreement, effective upon delivering notice to DVA, and it until such time as such notice is given, if any, DVA’s NEEDLE COMMITMENT hereunder shall be conducted in adjusted, such that DVA’s purchases of such Materially Improved Product shall be excluded from DVA’S NEEDLE COMMITMENT. If the English languageMedical Advisory Board disagrees with DVA that such product is a Materially Improved Product, DVA shall continue to abide by the DVA NEEDLE COMMITMENT as set forth herein.