[ ] Brackets indicate information omitted from this exhibit pursuant to a
confidential treatment request and filed separately with the SEC.
LICENSE AGREEMENT
by and between
UNIGENE LABORATORIES, INC.
and
▇▇▇▇▇▇-▇▇▇▇▇▇▇ COMPANY
Dated as of July 15, 1997
TABLE OF CONTENTS
Page
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SECTION 1
DEFINITIONS........................................................ 2
SECTION 2
PRODUCT DEVELOPMENT................................................ 14
2.1 General.......................................... 14
2.2 Performance...................................... 19
2.3 Product Claims, Composition, Dose and Dosage
Form............................................. 20
2.4 Reference Documentation.......................... 20
2.5 Reports.......................................... 20
2.6 Filings and Other Communications with
Regulatory Authorities........................... 21
2.7 Regulatory Records............................... 22
2.8 Development Expenses............................. 22
SECTION 3
SUPPLY OF THE RAW MATERIAL......................................... 23
3.1 Supply and Purchase Obligations.................. 23
3.2 Development Forecasts............................ 23
3.3 Commercial Supply Forecasts...................... 24
3.4 Purchase Orders.................................. 25
3.5 Delivery......................................... 26
3.6 Inability to Supply.............................. 27
3.7 Warranty......................................... 28
3.8 Price............................................ 29
3.9 Specifications Amendments........................ 32
3.10 Records.......................................... 33
3.11 Third Party Raw Material Supply.................. 33
3.12 Quality Assurance................................ 33
SECTION 4
MARKETING AND SALE OF THE PRODUCT.................................. 34
4.1 ▇-▇ Obligation................................... 34
4.2 Finishing Product................................ 36
4.3 Compliance....................................... 37
4.4 Marketing Plans, Marketing Reports and Launch
Meetings......................................... 37
4.5 Marketing Materials.............................. 38
4.6 Development and Use of Trademarks................ 38
4.7 Liability Insurance.............................. 39
4.8 Competition...................................... 39
4.9 Export........................................... 40
SECTION 5
LICENSE GRANT...................................................... 41
5.1 Grant of License................................. 41
5.2 Sublicenses...................................... 41
i
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SECTION 6
LICENSE FEES; ROYALTIES; EQUITY INVESTMENT......................... 42
6.1 Consideration for License........................ 42
6.2 Withholding Taxes................................ 47
6.3 Equity Investment................................ 48
SECTION 7
DEVELOPMENT TEAM................................................... 48
7.1 Formation of the Development Team................ 48
7.2 Authority of the Development Team................ 48
7.3 Procedural Rules of the Development Team......... 49
SECTION 8
REPORTING.......................................................... 50
8.1 Reporting by Parties............................. 50
8.2 Financial Records................................ 50
8.3 Audit of Records................................. 51
SECTION 9
ADVERSE EVENT AND OTHER INFORMATION EXCHANGE....................... 51
9.1 Notification..................................... 51
9.2 Regulatory Action................................ 53
9.3 Material Communications.......................... 54
SECTION 10
PRODUCT RECALL..................................................... 54
10.1 Notification and Recall......................... 54
10.2 Recall Expenses................................. 55
SECTION 11
INTELLECTUAL PROPERTY RIGHTS....................................... 56
11.1 Ownership and Prosecution of Intellectual
Property........................................ 56
11.2 Ownership of and Validity of Trademarks......... 58
11.3 Ownership of Regulatory Documentation and
Approvals....................................... 58
11.4 Ownership of Project Information and
Inventions...................................... 59
11.5 Enforcement of Intellectual Property Rights..... 60
11.6 Infringement of Third Party Rights.............. 62
ii
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SECTION 12
CONFIDENTIALITY.................................................... 66
12.1 Confidential Information........................ 66
12.2 Authorized Disclosure........................... 67
12.3 Unigene Disclosure.............................. 69
12.4 Notification.................................... 69
12.5 Remedies........................................ 69
12.6 Return of Information........................... 70
12.7 Survival........................................ 70
12.8 Use of Names.................................... 70
12.9 Publication..................................... 70
SECTION 13
WARRANTIES; INDEMNITIES............................................ 72
13.1 Representations, Warranties and Covenants........... 72
13.2 Warranties of Unigene; Limitations.................. 73
13.3 Indemnification of ▇-▇.............................. 74
13.4 Indemnification of Unigene.......................... 75
13.5 Indemnification Procedure........................... 75
13.6 Limitation on Damages............................... 77
SECTION 14
TERM AND TERMINATION............................................... 78
14.1 Term................................................ 78
14.2 Termination of Agreement with Respect to a
Secondary Market or Region.......................... 78
14.3 Termination for Material Breach..................... 81
14.4 Unilateral Termination.............................. 81
14.5 Termination for Other Events........................ 83
14.6 Effect of Termination............................... 83
SECTION 15
GENERAL PROVISIONS................................................. 85
15.1 Force Majeure....................................... 85
15.2 Payments............................................ 86
15.3 Notice.............................................. 86
15.4 Further Assurances.................................. 88
15.5 Successors and Assigns.............................. 88
15.6 Governing Law....................................... 89
15.7 Arbitration......................................... 89
15.8 Waiver.............................................. 89
15.9 Severability........................................ 90
15.10 Counterparts........................................ 90
15.11 Construction........................................ 91
15.12 Independent Contractors............................. 91
15.13 Nasal Product....................................... 91
15.14 Publicity........................................... 92
15.15 Entire Agreement.................................... 92
iii
Page
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ANNEX A............................................................ 94
ANNEX B............................................................ 96
ANNEX C............................................................ 97
ANNEX D............................................................104
ANNEX E............................................................105
iv
THIS LICENSE AGREEMENT (this "Agreement"), is made as of July
15, 1997, by and between Unigene Laboratories, Inc., a corporation organized
under the laws of the State of Delaware ("Unigene"), and ▇▇▇▇▇▇-▇▇▇▇▇▇▇ Company,
a corporation organized under the laws of the State of Delaware
("▇-▇"),
WITNESSETH:
WHEREAS, Unigene has developed certain proprietary technology,
know-how and data, and owns certain patents, with respect to the manufacture of
pharmaceutical-grade recombinant salmon calcitonin;
WHEREAS, Unigene has developed certain leading proprietary
technology, know-how and data with respect to the oral administration of salmon
calcitonin;
WHEREAS, Unigene desires for its proprietary oral calcitonin
product to be developed, marketed and sold worldwide;
WHEREAS, ▇-▇, through its ▇▇▇▇▇-▇▇▇▇▇ unit, has considerable
expertise in the development, marketing and sale of prescription pharmaceutical
products, and has in place a large and experienced development and marketing
staff needed to develop and distribute such products effectively and
expeditiously; and
WHEREAS, ▇-▇ desires to obtain a license from Unigene to
develop, promote, market and sell the oral
2
calcitonin product, and Unigene desires to grant such a license, on the terms
set forth herein;
NOW, THEREFORE, the parties agree as follows:
SECTION 1
DEFINITIONS
1.1 "Affiliate" of a Person shall mean any other Person that
directly, or indirectly through one or more intermediaries, controls, is
controlled by or is under common control with such Person. "Control" and, with
correlative meanings, the terms "controlled by" and "under common control with"
shall mean the power to direct or cause the direction of the management or
policies of a Person, whether through the ownership of voting securities, by
contract, resolution, regulation or otherwise.
1.2 "Approvals" shall mean any approval granted by the
Regulatory Authorities for the manufacture, Marketing, sale and use of the
Product in each country in the Territory.
1.3 "Calendar Quarter" shall mean a period of three
consecutive calendar months ending on March 31, June 30, September 30 or
December 31.
1.4 "Calendar Year" shall mean each successive period of
twelve (12) consecutive calendar months commencing on January 1 and ending on
December 31.
1.5 "CMC Data" shall mean any and all information contained
in, as well as data supporting, the Chemistry,
3
Manufacturing and Control section of the NDA, including, without limitation, any
Drug Master Files referenced therein.
1.6 "Combination Product" shall have the meaning set forth in
Section 1.34.
1.7 "Compound" shall mean salmon calcitonin.
1.8 "Development Activities" shall have the meaning set forth
in Section 2.1.
1.9 "Development Plan" shall mean the program to develop the
Product, as set forth in that certain side letter of even date herewith by and
between the parties, as amended by the Development Team from time to time
pursuant to Section 7.2.
1.10 "Development Team" shall mean the team established to
monitor and manage the Development Activities pursuant to Section 7.
1.11 "Disclosing Party" shall have the meaning set forth in
Section 12.1.
1.12 "Europe" shall mean the European Union (Austria, Belgium,
Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,
Netherlands, Portugal, Spain, Sweden, and the United Kingdom).
1.13 "FDA" shall mean the United States Food and Drug
Administration and any successor agency having substantially the same function.
4
1.14 "Finish" or "Finishing" shall mean all activities
relating to the formulation of Raw Material into finished Product in packaged
form for sale to the consumer.
1.15 "Improvement" shall mean any modification to a product,
discovery, technology, device or formulation, whether or not patentable,
including, without limitation, any enhancement in the formulation, ingredients,
preparation, presentation, means of delivery, dosage or packaging of the
Product.
1.16 "IND" shall mean an Investigational New Drug Application
made in accordance with applicable regulations and requirements of the FDA as in
effect from time to time.
1.17 "Japanese Sublicensee" shall have the meaning set forth
in Section 2.1(c).
1.18 "Joint Improvement" shall mean any Improvement jointly
conceived by employees or representatives of both of the parties. For purpose of
this Paragraph, parties include their respective Affiliates and Sublicensees.
1.19 "Launch" shall mean, with respect to each country in the
Territory, the date on which the Product is first shipped from ▇-▇'s
distribution centers (or such other ▇-▇ or third party facilities as ▇-▇ may use
for such purpose) for commercial sale to unaffiliated third parties in such
country.
1.20 "Licensed Technology" shall mean all information,
materials, products, devices, apparatus,
5
technical knowledge, expertise, skill, practice, inventions, procedures,
formulae, trade secrets, analytical methodology, processes, preclinical,
clinical, stability and other data, toxicological information, market studies
and all other experience and know-how in tangible or intangible form, whether
patented, patentable or otherwise, including, without limitation, the Unigene
Patent Rights and any Project Information and Inventions owned or controlled by
or licensed (other than pursuant to Section 11.4(b)) to Unigene or its
Affiliates, which during the term of this Agreement (i) are in the possession or
under the control of Unigene and in which Unigene has an ownership or licensable
interest, and (ii) are not generally known (other than in the case of patented
inventions), and (iii) are necessary or useful in connection with the Finishing,
developing, Marketing, or sale of the Product in the Territory for use in humans
for pharmaceutical purposes.
1.21 "Losses" shall have the meaning set forth in Section
13.3.
1.22 "Market" or "Marketing" shall mean all programs and
activities relating to the promotion and sale of the Product in the Territory,
including but not limited to advertising, studies, seminars, symposia, training
and education, as well as detailing, selling, contracting for sale of, and
distributing the Product.
6
1.23 "Marketing Plans" shall mean the plans for Marketing the
Product developed by ▇-▇ from time to time pursuant to Section 4.4.
1.24 "Minimum Royalty Amount" for each of the United States,
Europe and Japan shall be in the amount and for the annual periods set forth on
Annex A hereto.
1.25 "NDA" shall mean a New Drug Application made in
accordance with applicable regulations and requirements of the FDA in effect
from time to time.
1.26 "Net Sales" shall mean, for any period, the gross amount
invoiced for the Product by ▇-▇, its Affiliates, and its Sublicensees to third
parties, less deductions for: (i) normal and customary quantity and/or cash
discounts and sales returns and allowances, including, without limitation, those
granted on account of price adjustments, billing errors, rejected goods, damaged
goods, returns, rebates, administrative or other fees or reimbursements or
similar payments to wholesalers or other distributors, buying groups, pharmacy
benefit management organizations, health care insurance carriers or other
institutions, allowances, rebates, fees paid to distributors and chargebacks
actually allowed or given; (ii) freight, postage, shipping, and insurance
expenses (if separately identified in such invoice); (iii) customs or excise
duties or other duties related to the sales making up the gross invoice amount;
(iv) any rebates or similar payments made with respect to sales paid for by any
governmental or
7
regulatory authority such as, by way of illustration and not in limitation of
the parties' rights hereunder, Federal or state Medicaid, Medicare or similar
state program or equivalent foreign governmental program; and (v) sales and
other taxes and duties directly related to the sale, to the extent that such
items are included in the gross invoice price (but not including taxes assessed
against the income derived from such sale). Any of the deductions listed above
which involves a payment by ▇-▇ shall not be taken as a deduction prior to the
date (i) accrued in accordance with Generally Accepted Accounting Principles as
consistently applied in ▇-▇'s audited financial statements or (ii) paid by ▇-▇.
For purposes of calculating Net Sales, sales between or among
a party, its Sublicensees and/or Affiliates shall be excluded from the
computation of Net Sales (which exclusion shall include sales to Sublicensees or
Affiliates of samples pursuant to this Agreement), but sales by such party, its
Sublicensees and its Affiliates to their customers shall be included in the
computation of Net Sales.
With respect to sales of Combination Products, Net Sales shall
be calculated on the basis of the invoice price of Product containing the same
weight of Compound sold without other active ingredients.
1.27 "Notice" shall have the meaning set forth in Section
15.3.
8
1.28 "Patents" shall mean any and all patents and patent
applications (which for purposes of this Agreement shall be deemed to include
certificates of invention, applications for certificates of invention,
registered designs, registered design applications, industrial designs, and
industrial design applications and registrations) and any divisions,
continuations, continuations-in-part, substitutes, reissues, reexaminations,
renewals, extensions, supplementary protection certificates or the like of any
of the aforesaid items.
1.29 "Person" shall mean an individual, sole proprietorship,
partnership, limited partnership, limited liability partnership, corporation,
limited liability company, business trust, joint stock company, trust,
unincorporated association, joint venture or other similar entity or
organization, including, without limitation, a government or political
subdivision, department or agency of a government.
1.30 "Phase I Clinical Trials" shall mean, with respect to any
product, all tests and studies in patients that are required by the FDA from
time to time, pursuant to regulations, guidelines or otherwise, to obtain
sufficient data of product safety to permit initiation of Phase II Clinical
Trials for such product.
1.31 "Phase II Clinical Trials" shall mean, with respect to
any product, all tests and studies in patients that are required by the FDA from
time to time, pursuant to
9
regulations, guidelines or otherwise, in addition to Phase I Clinical Trials, to
obtain sufficient data to permit initiation of Phase III Clinical Trials for
such product.
1.32 "Phase III Clinical Trials" shall mean, with respect to
any product, all tests and studies using an extensive patient base (other than
Phase I Clinical Trials and Phase II Clinical Trials) that are intended to
provide substantial evidence of efficacy and safety in support of an NDA for
such product, including, without limitation, all tests and studies that are
required by the FDA from time to time, pursuant to regulations, guidelines or
otherwise, as Phase III tests and studies for such product.
1.33 "Priority Markets" shall mean, collectively, the United
States and its territories and possessions (including Puerto Rico), Canada,
Europe and Japan. If any Secondary Market that is not currently part of the
European Union is admitted to the European Union following the date hereof, then
such country shall automatically become a Priority Market effective as of the
date of its admission to the European Union. Each of France, Germany, Italy,
Spain and the United Kingdom shall remain Priority Markets, regardless of
whether such country remains a member of the European Union.
1.34 "Product" shall mean a pharmaceutical product in finished
form containing the Compound, alone or in combination with such other active
ingredient(s) as the
10
Development Team may approve (a "Combination Product"), for administration
orally; provided, however, that the term "Product" shall not include any product
administered by any other method, including, without limitation, nasally or by
injection.
1.35 "Product Specifications" shall mean the specifications
(including without limitation the claims, composition, active ingredients, dose
and dosage forms) and quality control testing procedures for the Product as
determined from time to time, pursuant to Section 3.9.
1.36 "Product Trademark" shall mean any Trademark selected by
and used by ▇-▇ exclusively for the Product at any time during the term of this
Agreement.
1.37 "Project Activities" shall mean any and all activities
undertaken or performed in the course of, as a result of or in connection with
the research, development, manufacture, Marketing, sale or use of the Product,
or otherwise in connection with this Agreement, including, without limitation,
the Development Activities; provided, however, that Project Activities shall not
include any activity that is funded by Unigene other than pursuant to Section
2.8.
1.38 "Project Information and Inventions" shall mean all
discoveries, Improvements, processes, formulae, data, inventions, know-how and
trade secrets, procedures, devices, marketing studies and intellectual property
(other than the
11
Regulatory Documentation), patentable or otherwise, created, developed, or
arising in the course of, as a result of or in connection with the Project
Activities.
1.39 "Raw Material" shall mean bulk Compound in unfinished
form.
1.40 "Receiving Party" shall have the meaning set forth in
Section 12.1.
1.41 "Region" shall have the meaning set forth in Section
14.2(b).
1.42 "Regulatory Authorities" shall mean the FDA and the
corresponding authorities in each country in the Territory with responsibility
for granting regulatory approval for the importation, Finishing, Marketing, sale
and use of the Product in such country.
1.43 "Regulatory Documentation" shall mean all regulatory
submissions, including the NDA and submissions to the European Medicines
Evaluation Agency, clinical studies and tests relating to the Product and any
Improvements thereto or the Compound, including, without limitation, all
investigational new drug applications, new drug applications, abbreviated new
drug applications, drug master files, correspondence with regulatory agencies
(registrations and licenses, regulatory drug lists, advertising and promotion
documents), adverse event files, complaint files and manufacturing records.
12
1.44 "Remedies" shall have the meaning set forth in Section
11.5.
1.45 "Royalty Transition Date" shall have the meaning set
forth in Section 6.1(b)(i)(A).
1.46 "Secondary Markets" shall mean all the countries in the
world other than the Priority Markets; provided, however, that if Unigene
terminates this Agreement with respect to a country in accordance with Section
14.2, such country shall immediately cease to be a Secondary Market.
1.47 "Semi-Exclusive Territory" shall have the meaning set
forth in Section 5.1(a).
1.48 "Sole Improvement" shall mean any Improvement conceived
by any employee or representative of only one (1) of the parties. For purposes
of this Paragraph, parties include their respective Affiliates and Sublicensees.
1.49 "Sublicensee" shall have the meaning set forth in Section
5.2.
1.50 "Territory" shall mean the Priority Markets and the
Secondary Markets.
1.51 "Trademark" shall mean any trademark, trade dress, brand
▇▇▇▇, trade name, brand name, logo, slogans, service marks, including, without
limitation, all trademark registrations and applications for registrations and
all good will associated therewith.
1.52 "Unigene" shall have the meaning set forth in the
preamble.
13
1.53 "Unigene Patent Rights" shall mean any rights under (a)
the Patent applications listed on Annex B, any other Patent applications for the
Product in the Territory that may be filed pursuant hereto, and any Patents that
may issue thereon, and (b) any Patent applications filed by or on behalf of
Unigene relating to Sole Improvements of Unigene or Joint Improvements, and any
Patents that may issue thereon.
1.54 "Unigene Regulatory Documentation" shall mean the
Regulatory Documentation relating to the Raw Material, including without
limitation the CMC Data, that is prepared and filed by Unigene or any of its
Affiliates.
1.55 "Unigene Trademarks" shall mean any Trademarks that are
owned or used by Unigene, any registrations thereof and any unregistered rights
of Unigene that may exist through use, as well as any modifications of the
foregoing.
1.56 "Valid Claim" shall mean a claim contained within the
Unigene Patent Rights or any Patents owned by Unigene relating to the
manufacture of the Raw Material, which would be infringed by the manufacture,
Finishing, having Finished, using or selling of Product by a third party.
1.57 "▇-▇" shall have the meaning set forth in the preamble.
1.58 "▇-▇ Regulatory Documentation" shall mean the Regulatory
Documentation relating to the Finishing and clinical testing of the Product that
is prepared and filed by ▇-▇ or any of its Affiliates or Sublicensees.
14
1.59 "▇-▇ Patent Rights" shall mean any Patent applications
filed by or on behalf of ▇-▇ relating to Sole Improvements of ▇-▇ or Joint
Improvements, and any Patents that may issue thereon.
SECTION 2
PRODUCT DEVELOPMENT
2.1 General. ▇-▇ shall (i) perform all tests, studies and
other activities necessary to obtain and maintain Approvals of the Product in
each of the countries in the Territory, except as provided in (w), (x), (y) and
(z) below, and (ii) obtain and maintain such Approvals, and Unigene shall (w)
establish the manufacturing process by which Unigene will produce commercial
quantities of the Raw Material, not later than one year prior to the filing of
the NDA (or such later date as will allow for stability data and such other data
as may be required in support of the NDA submission to be timely obtained), (x)
complete the construction or expansion of commercial scale manufacturing
facilities for the Raw Material as necessary to meet its commercial supply
obligations hereunder, in a timely manner so as not to delay the preapproval
inspection of such facilities by the FDA in connection with its review of the
NDA for the Product (or such earlier date as may be required by applicable law),
but in any event not later than six (6) months prior to the Launch of the
Product in any Priority Market, provided that ▇-▇ shall have provided Notice to
Unigene of the projected date of such
15
inspection or Launch, as the case may be, not less than thirty (30) months prior
thereto, (y) perform, or cause to be performed, all tests, studies and other
activities necessary to support the relevant Approvals as they relate to the
manufacturing of Raw Material and such other activities, approved by the
Development Team, as Unigene may agree, and (z) perform analytic testing in
connection with the formulation of the Product; all as required by this Section
2 and the Development Plan, and in accordance with Section 7 (collectively, the
"Development Activities").
(a) ▇-▇ shall conduct and complete, with respect to
the Product, (i) all tests, studies and other development activities designated
for ▇-▇ in the Development Plan, or required in order to obtain the information
designated to be obtained by ▇-▇ in the Development Plan, all in accordance with
the time frames set forth therein, and (ii) such other tests, studies and other
development activities as may be required from time to time by the Development
Team or the Regulatory Authorities. Notwithstanding anything to the contrary
contained herein or in the Development Plan, ▇-▇ shall (i) with respect to the
United States, Europe and Japan commence Phase I Clinical Trials or their local
equivalents, as applicable, promptly following the development and selection of
a formulation and completion of all other activities allowing the start of Phase
I Clinical Trials or their local equivalents, as applicable, including
acceptance
16
of the IND and clinical protocols or their local equivalents, as applicable, and
commence Phase III Clinical Trials or their local equivalents, as applicable,
promptly following the development and selection of a final formulation and the
completion of all other activities allowing the start of Phase III Clinical
Trials or their foreign equivalents, as applicable; (ii) with respect to each of
the Priority Markets other than the United States, Europe and Japan, and each of
the Secondary Markets in which clinical trials in addition to those performed in
one or more of the Priority Markets are required for Approval, initiate as
necessary for the relevant Approval, the treatment phase of clinical trials
analogous to the United States pivotal Phase III Clinical Trials, including any
required comparator studies, within the later to occur of (1) six months after
the start of the treatment phase of such United States clinical trials, and (2)
three months after the completion of such additional pre-clinical or clinical
trials as may be required by the relevant Regulatory Authorities in such country
prior to the commencement of such trials; provided, however, that if ▇-▇ fails
to initiate within such period, or by such later date as the parties may agree,
the treatment phase of such trials for the Product in any such Secondary Market
Unigene shall have the right to terminate this Agreement with respect to such
Secondary Market pursuant to Section 14.2.
17
(b) ▇-▇ shall file with the relevant Regulatory
Authorities, in the name of ▇-▇ or one of its Affiliates except as otherwise
required by applicable law, an IND and an NDA, or the local equivalents thereof,
as applicable, and any necessary or appropriate amendments thereto, for the
Product in each country in the Territory; provided, however, that ▇-▇ shall (i)
complete and submit an NDA in the United States following completion of Phase
III Clinical Trials and assembly of the preclinical and clinical information
into an appropriate format for filing with the appropriate Regulatory Authority,
and (ii) complete and submit the local equivalent of the NDA (A) in Europe
following completion of any local equivalent of Phase III Clinical Trials that
may be required by the appropriate Regulatory Authority in connection with such
submission and assembly of the preclinical and clinical information into an
appropriate format for filing with such Regulatory Authority, (B) in each
Priority Market other than the United States, Europe and Japan, and in each
Secondary Market in which clinical trials in addition to those performed in one
or more of the Priority Markets are required for Approval, following completion
of any local equivalent of Phase III Clinical Trials that may be required by the
appropriate Regulatory Authority in connection with such submission and assembly
of the preclinical and clinical information into an appropriate format for
filing with such Regulatory Authority, and (C) in each Secondary Market in
18
which no such additional clinical trials are required for Approval, within three
months of the grant of a referenceable Approval or, where permitted by
applicable law, within three months of the submission of a referenceable NDA or
equivalent, or such later date as ▇-▇ and Unigene may agree; and provided,
further, that if ▇-▇ fails to file the local equivalent of an NDA for the
Product in a Secondary Market within the time frames set forth in this Section
2.1(b), or within such longer periods as the parties may agree, Unigene shall
have the right to terminate such Secondary Market pursuant to Section 14.2.
(c) ▇-▇ shall use its best efforts to enter into an
agreement with a Japanese pharmaceutical company that has demonstrated expertise
in the field of osteoporosis and/or women's health care prescription products
(the "Japanese Sublicensee") to develop, commercialize and co-promote or
co-Market the Product in Japan. ▇-▇ shall identify one or more suitable
potential Japanese Sublicensees as soon as possible, but in any event no later
than six months, after the execution of this Agreement. Unigene shall have the
right to approve the Japanese Sublicensee, which approval shall not be
unreasonably withheld.
(d) After the completion of all tests, studies and
other Development Activities for the Product in a particular country in the
Territory, and the preparation of all data and other information necessary or
appropriate for obtaining Approval of the Product in such country, ▇-▇ shall
19
use its best efforts to obtain and maintain such Approval in such country.
(e) ▇-▇ shall take whatever steps are lawfully
available to qualify for and obtain (i) exclusivity against Abbreviated New Drug
Applications for the Product in the United States, and (ii) equivalent status
for the Product in each of the other countries in the Territory.
2.2 Performance. ▇-▇ and Unigene each shall perform, or cause
to be performed, its respective Development Activities in good scientific
manner, and in compliance in all material respects with all requirements of
applicable laws, rules and regulations, and shall endeavor to achieve the
related objectives of the Development Plan efficiently and expeditiously.
Moreover, ▇-▇ and Unigene each shall proceed diligently with its respective
Development Activities by allocating sufficient time, effort, equipment, and
skilled personnel to complete such activities successfully and promptly. ▇-▇ and
Unigene agree to use their best efforts to aggressively pursue Approval for the
Product, as applicable, in each of the countries in the Territory in accordance
with the Development Plan and their respective obligations hereunder, which
efforts shall in no event be less than ▇-▇'s commitment, financial and
otherwise, to those of its own products with similar commercial potential that
it actively and aggressively develops.
20
2.3 Product Claims, Composition, Dose and Dosage Form. Subject
to Section 3.9, the Development Team shall determine the claims, composition,
including, without limitation, active ingredients, dose and dosage forms of the
Product in the Territory.
2.4 Reference Documentation. Unigene shall provide the
Regulatory Authorities in each country in the Territory with any Unigene
Regulatory Documentation in its possession or under its control, that the
Regulatory Authorities may require in order to grant and maintain Approval.
Unigene shall have no obligation to furnish such Unigene Regulatory
Documentation to ▇-▇; provided, however, that Unigene shall notify ▇-▇, in
writing as soon as practicable, prior to making any changes to any of Unigene's
Drug Master Files included in the CMC Data, without disclosing the substance
thereof. If ▇-▇ determines that it must make a submission to a Regulatory
Authority as a result of such changes by Unigene, then the parties will meet to
discuss the appropriate timing for the submission by Unigene of such changes.
2.5 Reports. No less often than every four months, each party
shall provide to the Development Team a written progress report which shall
describe the Development Activities it has performed, or caused to be performed,
to date, and evaluate the work performed in relation to the goals of the
Development Plan (a "Status Report").
21
2.6 Filings and Other Communications with Regulatory
Authorities. ▇-▇ shall be responsible for all communications with the Regulatory
Authorities relating to the Approvals for the Product. The parties agree to
discuss, in good faith, the benefits of Unigene's participation in the review of
draft filings prepared by ▇-▇ relating to the Product for submission to
Regulatory Authorities and in meetings and other significant communications with
Regulatory Authorities relating to the Product, with the objective of expediting
the grant of Approvals; provided, however, that in any event ▇-▇ shall (i)
notify Unigene as early as reasonably practicable in advance of all meetings and
significant communications with representatives of the Regulatory Authorities
concerning the Product, (ii) promptly forward to Unigene copies of all meeting
minutes and summaries of all such meetings with the Regulatory Authorities, as
well as any significant written communications received from representatives of
the Regulatory Authorities relating to the Product, and (iii) provide Unigene
with copies of the Chemistry, Manufacturing, and Control sections of the draft
submissions to Regulatory Authorities in the United States and Europe prepared
by ▇-▇ relating to the Product, not less than fourteen days prior to the
intended date of submission thereof (as to which Unigene shall provide its
comments within seven days after receipt thereof). Notwithstanding the
foregoing, Unigene may communicate with the Regulatory Authorities with
22
respect to the Raw Material, the CMC Data and the Compound (other than with
respect to the Product) generally.
2.7 Regulatory Records. ▇-▇ and Unigene each shall maintain,
or cause to be maintained, records of its respective Development Activities,
including, without limitation, all relevant Regulatory Documentation, in
sufficient detail and in good scientific manner appropriate for patent and
regulatory purposes, which shall be complete and accurate and shall fully and
properly reflect all work done and results achieved in the performance of its
respective Development Activities, and which shall be retained by each party for
at least five (5) years after the termination of this Agreement, or for such
longer period as may be required by applicable law. Each party shall have the
right, during normal business hours and upon reasonable notice, to inspect and
copy (if required for compliance with applicable law) any such records
maintained by or on behalf of the other party, except with respect to records
maintained by Unigene relating to the manufacture of the Raw Material other than
pursuant to Section 3.10.
2.8 Development Expenses. ▇-▇ shall bear the cost and expense
of all Development Activities; provided, however, that Unigene shall bear the
cost of conducting the activities set forth in clauses (w), (x), and (z) of
Section 2.1, and the cost of supplying ▇-▇ with Raw Material for use in
connection with the Development Activities pursuant to Section 3.8. ▇-▇ shall
reimburse Unigene for its fully-loaded costs and
23
expenses incurred in connection with any Development Activities (other than
those set forth in the proviso to the preceding sentence) performed by or on
behalf of Unigene.
SECTION 3
SUPPLY OF THE RAW MATERIAL
3.1 Supply and Purchase Obligations. Subject to the terms and
conditions of this Agreement, Unigene agrees to supply to ▇-▇, and ▇-▇ agrees to
purchase (or otherwise obtain, pursuant to this Section 3) from Unigene, all of
its requirements of clinical and commercial supplies of the Raw Material. With
respect to each country in the Territory, these supply and purchase obligations
shall continue until the earlier of (a) the termination of this Agreement with
respect to such country (as provided in Section 11.6 or 14.2) and (b) the later
of (i) the Royalty Transition Date in such country, and (ii) the second
anniversary of the day on which either party shall have given the other written
Notice of such party's intent to terminate such supply and purchase obligations
with respect to such country under Section 14.2(e).
3.2 Development Forecasts. Within thirty days of the execution
of this Agreement, ▇-▇ shall provide Unigene with a good faith forecast
estimating ▇-▇'s monthly requirements of the Raw Material (and the desired
delivery dates therefor) for the succeeding twelve (12) month period, which
report ▇-▇ shall update monthly; provided, however, that
24
with respect to each monthly update, ▇-▇ may not change the forecast for the
succeeding three (3) months by more than ten percent (10%) of the amount that
▇-▇ forecasted for such three (3) month period in its previous update.
3.3 Commercial Supply Forecasts.
(a) No later than two (2) years prior to the day on
which ▇-▇ projects it will initially Launch the Product, ▇-▇ shall provide
Unigene with a good faith forecast of ▇-▇'s annual requirements for Raw Material
for the next five (5) years, which forecast ▇-▇ shall update annually no later
than the end of the second Calendar Quarter of each Calendar Year.
(b) No later than nine (9) months prior to the
projected filing date of the NDA in the United States, ▇-▇ shall provide Unigene
with a good faith forecast estimating ▇-▇'s monthly requirements of the Raw
Material (and the desired delivery dates) for the succeeding twelve (12) month
period, which forecast ▇-▇ shall update no later than thirty (30) days prior to
each Calendar Quarter; provided, however, that with respect to each quarterly
update, ▇-▇ (a) may not change the forecast for the initial Calendar Quarter in
the updated twelve (12) month period at all from the amount that ▇-▇ forecasted
for such Calendar Quarter in its previous update, (b) may not change the
forecast for the second Calendar Quarter by more than ten percent (10%) of the
amount that ▇-▇ forecasted for such Calendar Quarter in its previous update,
25
and only to the extent that such change results in a forecast amount for such
Calendar Quarter that is between ninety percent (90%) and one-hundred and ten
percent (110%) of the amount that ▇-▇ forecasted for such Calendar Quarter in
the update that preceded its previous update, and (c) may not change the
forecast for the third Calendar Quarter in such period by more than twenty
percent (20%) of the amount that ▇-▇ forecasted for such Calendar Quarter in its
previous update. ▇-▇ shall promptly notify Unigene of any changes in the
circumstances on the basis of which the forecasts were determined and which
materially affect the amount of ▇-▇'s anticipated requirements, as reported in
the forecasts given to Unigene hereunder, and ▇-▇ and Unigene shall work with
each other to reach a mutually acceptable solution; provided, however, that ▇-▇
shall be obligated to purchase, and Unigene shall be obligated to sell, such
quantities of the Raw Material as are set forth in the firm forecast, as such
forecast may be amended from time to time pursuant to the preceding sentence.
3.4 Purchase Orders.
(a) With respect to development supplies of Raw
Material, ▇-▇ shall issue to Unigene a firm purchase order for purchases of such
Raw Material during each month not later than thirty (30) days prior to the
commencement of such month; provided, however, ▇-▇ shall be obligated to
purchase at least such quantities of Raw Material as are set forth in the most
26
recent forecast pursuant to Section 3.2 for such month; and provided further
that Unigene shall not be obligated to supply quantities of Raw Material in
excess of such quantities of Raw Material as are set forth in the most recent
forecast pursuant to Section 3.2 for such month.
(b) With respect to commercial supplies of Raw
Material, ▇-▇ shall issue to Unigene a firm purchase order covering purchases of
such Raw Material during each Calendar Quarter, not later than thirty (30) days
prior to the commencement of such Calendar Quarter; provided, however, ▇-▇ shall
be obligated to purchase at least such quantities of Raw Material as are set
forth in the most recent forecast pursuant to Section 3.3(b) for such Calendar
Quarter; and provided further that Unigene shall not be obligated to supply
quantities of Raw Material in excess of such quantities of Raw Material as are
set forth in the most recent forecast pursuant to Section 3.3(b) for such
Calendar Quarter.
(c) In the event that the terms of any purchase order
issued pursuant to this Section 3.4 are not consistent with this Agreement, the
terms of this Agreement shall prevail.
3.5 Delivery. Delivery of each order of Raw Material shall be
made Ex Works (Incoterms 1990) at a facility to be designated by Unigene. Title
to and risk of loss of the Raw Material shall pass to ▇-▇ at the time of
delivery to the carrier. Unigene shall promptly invoice ▇-▇ for all Product
27
shipped. Invoices shall be accompanied by the certificate of analysis for each
invoiced lot of Raw Material.
3.6 Inability to Supply. Unigene understands and agrees that a
reliable source of Raw Material is critical to ▇-▇. Should Unigene believe, at
any time during the term of this Agreement, that it may be unable to supply
▇-▇'s forecasted requirements of Raw Material, then it shall advise ▇-▇ thereof
and of the steps it will take to help insure that it will be able to continue to
supply ▇-▇'s forecasted requirements of Raw Material. In the event that
Unigene's manufacturing facility is destroyed or otherwise compromised, or is
not adequate to produce ▇-▇'s reasonably forecasted requirements of Raw
Material, Unigene shall use its best efforts to rebuild or expand its
manufacturing facilities, as the case may be, or qualify a third party
manufacturer, whichever is likely to enable Unigene more quickly to meet its
supply obligations, taking into consideration the quantities of Raw Material
forecasted by ▇-▇ together with any obligations Unigene may have to supply third
parties with Raw Material; provided, however, that Unigene shall consult with
▇-▇ and keep ▇-▇ apprised concerning any steps that Unigene proposes to take in
order to restore or expand its capacity to produce the Raw Material, including
without limitation qualifying a third party manufacturer; and provided, further,
that ▇-▇ agrees to cooperate with and provide reasonable assistance to Unigene
in the event that Unigene seeks to
28
qualify a third party manufacturer. In the event that Unigene is unable to
produce sufficient Raw Material to meet the orders of all of its customers,
Unigene shall supply ▇-▇ on a priority basis with such quantities of Raw
Material as Unigene is able to produce, up to the amounts required to
manufacture the quantities of the Product corresponding to the sales levels set
forth for the relevant year on Annex D hereto (and, for years thereafter, up to
the amounts required to manufacture quantities of the Product corresponding to
the sales levels set forth for the final year listed on Annex D hereto);
provided, however, that in the event that such inability to supply shall result
from a force majeure, as defined in Section 15.1, then Unigene shall supply ▇-▇
with its pro rata allocation of available Raw Material calculated based on the
firm forecasts of ▇-▇ and Unigene's other customers.
3.7 Warranty. Unigene warrants that, at the time of delivery
of the Raw Material to ▇-▇: (i) the Raw Material will have been manufactured,
stored and shipped in accordance with applicable Good Manufacturing Practices
and all other applicable laws, rules, regulations or requirements of the FDA and
other Regulatory Authorities which have granted Approvals, (ii) the Raw Material
will have been manufactured in accordance with the specifications provided to
▇-▇ by Unigene for the Raw Material, and conform with the certificate of
analysis provided pursuant to Section 3.5, (iii) the Raw
29
Material will not be adulterated or misbranded under the Federal Food, Drug, and
Cosmetic Act, as amended, and similar provisions of the laws of other countries
as to which Approvals have been granted; (iv) title to all Raw Material sold
hereunder will pass to ▇-▇ as provided herein free and clear of any security
interest, lien, or other encumbrance; and (v) the Raw Material will have been
manufactured, stored and tested in facilities which are approved by the FDA and
any other applicable Regulatory Authorities at the time of such manufacture,
storage and testing, to the extent such approval is required by applicable law;
provided, however, that to the extent that Unigene reasonably determines, after
consultation with ▇-▇, that requirements imposed by a Regulatory Authority
(other than the FDA) in a country for approval of such facilities are materially
inconsistent with those required by the FDA or are otherwise onerous, Unigene
shall have the right to terminate this Agreement with respect to such country,
by Notice to ▇-▇, whereupon such country shall no longer be part of the
Territory, provided that Unigene shall not terminate this Agreement pursuant to
this Section 3.7 with respect to the United States, Canada, Europe or Japan.
3.8 Price. The parties agree that the purchase price for Raw
Material during the term of the parties' respective purchase and supply
obligations under Section 3.1 shall be [ ] per kilogram; provided, however, that
in the event that ▇-▇ shall lower the
30
selling price of the Product (from the selling price of the Product then in
force or, if such change is made prior to Launch, the selling price indicated in
then-current ▇-▇ marketing projections) in a country in which Approval has been
granted, in order to meet competition from one or more nasally-administered
calcitonin products sold in such country by a third party under license from
Unigene and/or using Raw Material purchased from Unigene, then the total payment
by ▇-▇ to Unigene in respect of the Product sold by ▇-▇, its Affiliates and
Sublicensees in such country, on a per unit basis (equal to the sum of the
transfer price of Raw Material used in the manufacturing thereof and the royalty
payments pursuant to Section 6.1(b) with respect to Net Sales thereof) (the
"Cost of Goods"), shall not exceed [ ], [
], or [ ], as determined pursuant to Section 6.1(b)(i)(A)(a)-(c), of the
Net Sales in such country; provided, further, that in no event shall Unigene be
obligated to supply ▇-▇ with commercial supplies of the Raw Material at a
purchase price lower than [ ] per kilogram; and provided, further, that the
parties agree to determine and settle any amounts owing by one party to the
other pursuant to the first proviso to this Section 3.8, within sixty (60) days
after the end of each Calendar Quarter; and provided, further, that Unigene
agrees to supply ▇-▇ until the third anniversary of the initial Launch of the
Product with (a) up to a maximum of 250 grams of Raw Material at [ ] and
31
reasonable quantities of Raw Material in excess of 250 grams at [ ] per
kilogram, all for use only in connection with ▇-▇'s Development Activities, and
(b) up to a maximum of 50 grams of Raw Material at [ ] and reasonable quantities
of Raw Material in excess of 50 grams at [ ] per kilogram, all for use only in
the manufacture of Product promotional samples. Terms of payment shall be net
thirty (30) days from the date of invoice.
Unigene agrees that, during the term of the parties'
respective purchase and supply obligations under Section 3.1, in the event it
supplies Raw Material to any third party (including, without limitation,
Unigene's licensee for the oral calcitonin product in the Semi-Exclusive
Territory) for use in an oral calcitonin product to be sold or used in the
Semi-Exclusive Territory for a total payment (including the transfer price
thereof and any applicable royalty payment obligation) that is lower than [ ] of
net sales (calculated on a basis similar to the calculation of Net Sales
hereunder) of such product in the Semi-Exclusive Territory by such third party
or its Affiliates, then the sum of the transfer price and royalty hereunder
shall be reduced to that paid by such third party. Unigene shall notify ▇-▇ in
writing promptly after entering into an agreement to supply Raw Material to a
third party under circumstances that would trigger a reduction in the sum of the
transfer price and
32
royalty hereunder to ▇-▇ under the preceding sentence. Further, ▇-▇ shall have
the right, upon reasonable notice to Unigene, to cause an independent certified
public accountant reasonably acceptable to Unigene to review the relevant books
and records of Unigene to verify the accuracy of the reduction granted to ▇-▇
pursuant to the first sentence of this paragraph.
In the event that ▇-▇ shall face price competition in the
Marketing and sale of the Product in one or more countries in the Territory from
nasally-administered calcitonin product(s) sold by a third party that is not a
licensee of Unigene and not using Raw Material purchased from Unigene, then the
parties agree to meet in order to discuss appropriate responses, including
without limitation ways in which to make the Product more competitive.
3.9 Specifications Amendments. Unigene reserves the right to
amend and/or supplement the Product Specifications as they relate to Raw
Material unilaterally on six (6) months' prior written notice (or such shorter
period as may be required by law) for the purpose of complying with Good
Manufacturing Practices or the rules, regulations, guidelines or requirements of
the Regulatory Authorities. Unigene may not otherwise amend and/or supplement
the Product Specifications without the prior written approval of ▇-▇, which
approval shall not be unreasonably withheld. Unigene shall provide ▇-▇ with
prior written notice of any amendments
33
or supplements that Unigene is considering and cooperate with ▇-▇ in order to
ensure that, to the extent required, such changes are submitted to and approved
by the relevant Regulatory Authorities.
3.10 Records. Unigene shall maintain, or cause to be
maintained, all records necessary to comply with all applicable laws, rules and
regulations in the United States relating to the manufacture of the Raw
Material. All such records shall be maintained for such period as may be
required by law, rule or regulation; provided, however, that all records
relating to the manufacture, stability and quality control of each batch of the
Raw Material supplied to ▇-▇ hereunder shall be retained at least until the
first anniversary of the end of the approved shelf life for the Raw Material
from such batch.
3.11 Third Party Raw Material Supply. Unigene shall use its
best efforts consistent with applicable law to ensure that any Raw Material
which Unigene may supply to a party other than ▇-▇ or any of its Affiliates or
Sublicensees shall not be used to manufacture, Finish, use or sell the Product
or any other oral calcitonin product in the Territory (other than the
Semi-Exclusive Territory) in violation of the rights licensed and/or acquired by
▇-▇ under this Agreement.
3.12 Quality Assurance. The parties agree to develop mutually
acceptable procedures for annual quality
34
assurance audits of Unigene's Raw Material manufacturing facilities by ▇-▇.
SECTION 4
MARKETING AND SALE OF THE PRODUCT
4.1 ▇-▇ Obligation.
(a) ▇-▇ shall use its best efforts to make the
Product a commercial success in each country in the Territory; provided,
however, that ▇-▇ shall be deemed to have satisfied its best efforts obligation
under this Section 4.1 to the extent that ▇-▇ actively and aggressively Markets,
distributes and sells the Product as it would (and makes a commitment thereto,
financial and otherwise, commensurate with) those of its own brands and products
with similar commercial potential that it actively and aggressively promotes. In
any event, ▇-▇ shall commence Marketing of the Product in each country in the
Territory as promptly and as expeditiously as possible after Approval has been
granted in such country, and shall promptly give Unigene written notice of the
date of Launch in each such country; provided, however, that, notwithstanding
anything to the contrary contained herein or in the Marketing Plans, ▇-▇ shall
Launch the Product (i) in each of the Priority Markets within six (6) months of
the day on which the relevant Approval and any regulatory pricing approval
required for governmental reimbursement in such country has been granted, (ii)
in each Secondary Market in which clinical trials in addition to those performed
in one or more of the Priority
35
Markets are required for Approval, within six (6) months of the day on which the
relevant Approval and any regulatory pricing approval required for governmental
reimbursement in such country has been granted, and (iii) in each Secondary
Market in which no such additional clinical trials are required for Approval,
within six (6) months of the later of (a) the day the first Approval that is
referenceable in such Secondary Market, and (b) the day any regulatory pricing
approval required for governmental reimbursement in such country, has been
granted; provided, however, if ▇-▇ fails to Launch the Product in any Priority
Market or Secondary Market within twelve (12) months of the date of grant of the
relevant Approval for such country, Unigene shall have the right to terminate
this Agreement with respect to such country pursuant to Section 14.2.
(b) ▇-▇ shall, at its sole expense, obtain all
Approvals necessary to accomplish the Marketing, distribution and sale of the
Product in each country in the Territory, and any pricing approvals, or their
equivalent, required in connection therewith in such country. ▇-▇ shall bear all
costs and expenses arising out of or relating to the Marketing, distribution and
sale of the Product. All sales of Product in the Territory shall be made by, and
for the account of, ▇-▇ or its Affiliates or Sublicensees, as the case may be.
36
4.2 Finishing Product.
(a) ▇-▇ shall (i) Finish the Product in accordance
with the Product Specifications, and (ii) obtain all regulatory approvals
necessary to Finish the Product, import the Raw Material to the place of
Finishing, and ship the Product to the place of sale. ▇-▇ shall bear all costs
and expenses arising out of or relating to such activities.
(b) ▇-▇ warrants that it shall (i) comply with all
applicable laws, rules and regulations of each country in the Territory relating
to the importation of Raw Material or the Product, as the case may be, and (ii)
Market, distribute, and sell Product that (A) has been Finished, stored and
shipped by or on behalf of ▇-▇ or its Affiliates in accordance with applicable
Good Manufacturing Practices and all other rules, regulations or requirements of
the applicable Regulatory Authorities, (B) has been manufactured from Raw
Material that has been produced, stored and shipped in accordance with
applicable Good Manufacturing Practices and all other rules, regulations or
requirements of the applicable Regulatory Authorities, (C) has been Finished in
accordance with the Product Specifications, and (D) has not been adulterated or
misbranded by ▇-▇, its Affiliates or Sublicensees under the Federal Food Drug,
and Cosmetic Act, as amended, or the other applicable laws, rules, and
regulations of the countries in the Territory.
37
(c) ▇-▇ shall maintain, or cause to be maintained,
all records necessary to comply with all applicable laws, rules and regulations
in the Territory relating to the Finishing of the Product. All such records
shall be maintained for such period as may be required by law, rule or
regulation; provided, however, that all records relating to the Finishing,
stability and quality control of each batch of the Product shall be retained at
least until the first anniversary of the end of the approved shelf life for the
Product made from such batch.
4.3 Compliance. ▇-▇ and Unigene shall comply, and shall cause
their Affiliates (and, in the case of ▇-▇, Sublicensees, and, in the case of
Unigene, its licensees in the Semi-Exclusive Territory) to comply, with all
applicable laws, regulations and Approvals in conducting their respective
activities relating to the manufacturing, Finishing, Marketing, distribution and
sale of the Product in each country in the Territory, including, without
limitation, all requirements as to pre-marketing approval of product labelling.
4.4 Marketing Plans, Marketing Reports and Launch Meetings.
(a) From time to time prior to the initial Launch of
the Product and thereafter during the term of this Agreement, ▇-▇ shall promptly
furnish Unigene with copies of ▇-▇'s Marketing Mix Document, Global Pre-Launch
Plan and
38
Global Marketing Plan or any comparable reports for the Product, as well as any
updates to the foregoing.
(b) Unigene and ▇-▇ agree to meet on a semi-annual
basis through their designated representatives, beginning six (6) months prior
to the initial Launch, at which meetings ▇-▇ shall make a progress report
describing the Marketing activities it has performed to date and evaluating the
work performed in relation to the goals of the Marketing Plan, and provide such
other information as Unigene or its representatives may reasonably request.
(c) Unigene shall have the right to attend the
meetings for the Launch of the Product.
4.5 Marketing Materials. ▇-▇ shall develop, at its sole
expense, appropriate advertising and promotional materials for the Product in
the Territory, and shall own all rights, title and interest in such materials.
▇-▇ shall furnish Unigene with all significant English language advertising and
promotional materials used in connection with the Marketing, sale or
distribution of the Product on a quarterly basis or as reasonably requested by
Unigene.
4.6 Development and Use of Trademarks. ▇-▇ shall develop all
Product Trademarks. Unigene shall not, and shall not permit its Affiliates or
licensees to, use in their respective businesses any trade name, trademark or
other designation which is similar to or substantially similar to
39
any of the Product Trademarks, or which so nearly resembles any of them as to be
likely to cause deception or confusion.
4.7 Liability Insurance.
(a) During the term of this Agreement and for three
(3) years thereafter, ▇-▇ shall maintain, at its sole expense, clinical trial
and product liability insurance relating to the Product that is comparable in
type and amount to the insurance it maintains with respect to its most similar
other prescription pharmaceutical products that are Marketed, distributed and
sold in the Territory, and which names Unigene as an insured party, as its
interests may appear.
(b) From and after the date of first supply of Raw
Material to ▇-▇ for the Phase I Clinical Trials, through the third anniversary
of the termination or expiration of this Agreement, Unigene shall maintain, at
its sole expense, product liability insurance relating to the Raw Material in an
amount of at least Two Million United States Dollars (US $2,000,000) annual
limit, which names ▇-▇ as an insured party, as its interest may appear.
4.8 Competition. ▇-▇ agrees that, during the term of this
Agreement and for one (1) year after the termination hereof, it shall not, and
shall not permit any of its Affiliates or Sublicensees to, develop, Market or
sell in any country in the Territory any product (other than the Product)
containing the Compound or any derivative thereof; provided, however, that such
obligation shall not survive with respect
40
to the Territory or a country, as the case may be, in the event that this
Agreement shall be terminated by ▇-▇ with respect to the Territory pursuant to
Sections 14.3 or 14.5, or by Unigene with respect to a country pursuant to
Section 3.7, 11.6(a) or 11.6(b). The parties acknowledge that all restrictions
contained in this Section 4.8 are reasonable, valid and necessary for the
adequate protection of the Product business. Nothing in this Section 4.8 shall
be construed to prevent ▇-▇ from purchasing the Raw Material from a third party,
or from developing, Marketing or selling in any country in the Territory Product
manufactured from such Raw Material, after the purchase obligation of ▇-▇
pursuant to Section 3.1 shall have ended (or, after termination notice has been
given under Section 14.2(e), for the limited purpose of qualifying a third party
manufacturer of the Raw Material).
4.9 Export. To the extent permitted by applicable law, ▇-▇
shall use its best efforts to ensure that the Product is not Marketed,
distributed or sold or otherwise exported outside of the Territory, and shall
not, and shall not permit its Affiliates to, Market, distribute or sell the
Product directly or indirectly (i) to any Person outside the Territory, or (ii)
to any Person inside the Territory that (A) is reasonably likely to directly or
indirectly Market, distribute or sell the Product outside the Territory or
assist another Person to do so, or (B) has directly or indirectly
41
Marketed, distributed or sold the Product outside the Territory or assisted
another Person to do so.
SECTION 5
LICENSE GRANT
5.1 Grant of License. Subject to the terms and conditions of
this Agreement, Unigene hereby grants to ▇-▇ an exclusive, royalty-bearing
license (i) under the Licensed Technology to develop, Finish, have Finished,
use, Market, sell and offer for sale the Product in the Territory for use in
humans, and (ii) to use in the Territory, for the purpose of obtaining all
Approvals required in connection with the importing, Finishing, Marketing,
distributing and use of the Product in the Territory, such Unigene Regulatory
Documentation as may be necessary to obtain such Approvals; provided, however,
that Unigene shall have the right to grant to one third party such a license
(with the right to sublicense) for each country or territory in North America
(other than the United States and Canada), Central America, South America and
the Caribbean (the "Semi-Exclusive Territory").
5.2 Sublicenses. ▇-▇ shall have the right to grant to third
parties (each, a "Sublicensee") sublicenses under the licenses granted in
Section 5.1, only as necessary to perform its obligations under this Agreement
and, in any event, subject to the prior written approval of Unigene, not to be
42
unreasonably withheld. Notwithstanding the foregoing, the grant of any such
sublicense shall not relieve ▇-▇ of any of its obligations under this Agreement.
SECTION 6
LICENSE FEES; ROYALTIES; EQUITY INVESTMENT
6.1 Consideration for License.
(a) In consideration of the licenses and other rights
granted herein and subject to the terms and conditions set forth in this
Agreement, ▇-▇ shall make the following payments to Unigene:
(i) a payment of Three Million U.S. Dollars
(U.S. $3,000,000) upon the execution of this Agreement;
(ii) a payment of [ ] after [
] upon [ ];
(iii) a payment of [ ],
in three installments of [ ], payable
on the dates of (a) [ ], (b) [
], and (c) [ ];
(iv) a payment of [ ]
upon [ ];
(v) a payment of [ ],
in installments of [ ],
payable beginning on the date of [ ]
and continuing every ninety days thereafter, with
43
the balance due (if not paid in full before then)
upon [ ];
(vi) a payment of [ ]
upon the earlier to occur of (A) [
], and (B) [ ];
(vii) a payment of [ ], in installments of [
], payable beginning on the date of [ ] and continuing every
ninety days thereafter, with the balance due (if not paid in
full before then) upon [
];
(viii) a payment of [
] upon [ ];
(ix) a payment of [ ]
upon [ ];
(x) a payment of [ ] on
[ ];
(xi) a payment of [
] upon [ ];
(xii) a payment of [ ]
upon [ ];
(xiii) a payment of [ ]
upon [ ]; and
(xiv) a payment of [ ]
upon [ ].
44
None of the amounts paid pursuant to this Section 6.1(a) shall
be refundable or creditable towards any other payments due under any other
Section of this Agreement.
(b) In consideration of the licenses and other rights
granted herein and subject to the terms and conditions set forth in this
Agreement, for each full or partial Calendar Quarter after the Launch of the
Product in any country, ▇-▇ shall pay Unigene a royalty in an amount equal to
the difference between:
(i) the greater of (x) the Minimum Royalty Amount for
such period, if any, and (y) the aggregate of the product of
the Net Sales of the Product in such period in each country in
the Territory and the applicable royalty rate set forth below:
(A) during each Calendar Year continuing until the
later to occur of (1) (I) in the case of each country
in the Territory excluding Europe, the later of the
tenth anniversary of the Launch of the Product in
such country and the launch of another oral
calcitonin product, the sales of which materially
adversely affect the Net Sales of the Product in such
country, and (II) in the case of each country in
Europe, the tenth anniversary of the Launch of the
Product in such country, and (2) the date on which
there is no longer any Valid Claim in such country (a
"Royalty Transition Date"), the royalty rate shall be
as follows:
a) On aggregate Net Sales of the Product of
less than [ ], the
royalty rate shall be [ ] for
all countries in the Territory except
countries in the Semi-Exclusive Territory,
for which countries the royalty rate shall
be [ ];
45
b) on any increment of aggregate Net Sales of
the Product between [ ] and
[ ], the royalty rate
shall be [ ] for all
countries in the Territory except
countries in the Semi-Exclusive Territory,
for which countries the royalty rate shall
be [ ];
c) on aggregate Net Sales of Product in
excess of [ ], the
royalty rate shall be [ ] for
all countries in the Territory except
countries in the Semi-Exclusive Territory,
for which countries the royalty rate shall
be [ ]; and
d) after the date on which there is no longer
any Valid Claim in a country, the
applicable rate for such country under
clauses a) through c) above shall be [
] during each of the ten (10) successive
twelve (12) month periods thereafter,
provided that no royalty obligation shall
continue under this Section 6.1(b) after the
tenth anniversary of the date on which there
is no longer any Valid Claim in such
country.
Provided, however, that, even after the Royalty
Transition Date occurs in a country, the Net Sales in
such country shall be included in the aggregate Net
Sales for purposes of determining the appropriate
royalty rate for those countries in which the Royalty
Transition Date has not yet occurred (for purposes of
illustration only, an example of an annual royalty
calculation after the Royalty Transition Date has
occurred in part but not all of the Territory is
attached as Annex E hereto); and provided further the
Net Sales in the Semi-Exclusive Territory shall be
included in the aggregate Net Sales for purposes of
determining the appropriate royalty rates for all
countries in the Territory; and provided further that
if applicable law so permits, then the Royalty
Transition Date for each of the countries in Europe
shall be determined in the manner set forth in
Section 6.1(b)(i)(y)(A)(1)(I); and
46
(B) after the Royalty Transition Date in a country,
the royalty rate in such country shall be zero.
AND
(ii) any amounts paid to Unigene pursuant to
Section 3.8 for Raw Material contained in such
Product.
▇-▇ shall pay any amounts owed to Unigene pursuant to this
Section 6.1(b)(i)(y) on a quarterly basis within sixty (60) days following the
end of each full or partial Calendar Quarter during the term of this Agreement.
If, for the twelve (12) month period commencing on the first day of the first
full Calendar Quarter after the Launch in each of the United States, Europe and
Japan, or the twelve (12) month periods beginning on the first and second
anniversary thereof, the amounts paid under Section 6.1(b)(i)(y) do not exceed
the amounts stated in Section 6.1(b)(i)(x) for such country or Europe for such
period, ▇-▇ shall pay the difference within forty-five (45) days of the end of
the relevant twelve (12) month period. Net Sales made in foreign currencies
shall be converted into United States Dollars using the average of the exchange
rates set forth in the United States eastern edition of The Wall Street Journal
for the last business day of the full or partial Calendar Quarter in which such
Net Sales were booked and the last business day of the previous Calendar
Quarter.
47
With respect to any partial Calendar Quarter or Calendar Year,
any Minimum Royalty Amount and Net Sales thresholds for the royalty rate
adjustments for such period shall be prorated to reflect the percentage of such
period that elapsed before this Agreement terminated. (By way of example, and
not in limitation of the parties' rights hereunder, if this Agreement were
terminated at the end of the sixth month in any twelve month period, both the
Minimum Royalty Amount, if any, and the Net Sales thresholds (but not the
corresponding royalty rates) for such period would be reduced by fifty percent
(50%).)
Each payment hereunder shall be accompanied by written report,
certified by an officer of ▇-▇ or his or her designee, providing a detailed
breakdown of the Net Sales, and the components thereof, during such period.
6.2 Withholding Taxes. ▇-▇ shall pay any and all withholding
taxes or similar charges imposed by any governmental unit in the Territory on
any amounts due to Unigene from ▇-▇ pursuant to this Section 6 to the proper
taxing authority, and proof of payment of such taxes or charges shall be secured
and sent to Unigene as evidence of such payment. All amounts paid by ▇-▇
pursuant to this Section 6.2 shall be paid for the account of Unigene and
deducted from the amounts due from ▇-▇ to Unigene pursuant to Section 6.1.
48
6.3 Equity Investment. As partial mutual consideration for
entering into this Agreement, the parties agree to enter into a Stock Purchase
Agreement of even date herewith, in the form of Annex C hereto, pursuant to
which ▇-▇ shall purchase an equity interest in Unigene.
SECTION 7
DEVELOPMENT TEAM
7.1 Formation of the Development Team.
(a) ▇-▇ shall form a Development Team (the
"Development Team") to which Unigene may appoint up to three (3) members.
(b) The Development Team shall meet monthly (or at
other intervals as determined by the team) to monitor and manage the Development
Activities, as necessary to execute the Development Activities. It is
anticipated that members of the Development Team will be employees of Unigene or
▇-▇, will be multi-disciplinary in their fields of expertise, and will have
appropriate technical credentials and knowledge and ongoing familiarity with the
objectives of the Development Plan.
7.2 Authority of the Development Team. The Development Team
shall (i) manage the day-to-day Development Activities and perform such other
activities as Unigene and ▇-▇ may mutually agree, (ii) approve any changes in
the Development Plan, (iii) formulate recommendations or proposals for ▇-▇
management related to (A) all formulations of the
49
Product used in the Phase I Clinical Trials and their foreign equivalents, and
the final formulations of the Product used in the Phase III Clinical Trials and
their foreign equivalents, (B) the protocol and design of all clinical trials,
and (C) the labelling and packaging of any finished formulation of the Product,
and (iv) take such other actions as are set forth herein or as the parties may
mutually agree, except that the Development Team may not take any action that
would conflict with any provision of this Agreement.
7.3 Procedural Rules of the Development Team.
(a) The Development Team shall take action by
consensus of the members present; provided, however, that final decision-making
authority with respect to decisions and actions of the Development Team shall
reside with ▇-▇.
(b) The Development Team shall meet at least monthly
or as otherwise agreed by the Development Team Leaders, at times and places
mutually agreed upon, to discuss the overall progress of the Development
Activities, the status of the Development Plans, any problems arising in the
course of the Development Activities, and any other matter that a member of the
Development Team may reasonably request. Notwithstanding the foregoing, the
parties shall regularly exchange minutes of the monthly meetings and Status
Reports every four months regarding the Development Team Activities.
(c) Members of the Development Team may attend
meetings in person, by telephone or by video conference. Upon
50
reasonable notice, ▇-▇ shall furnish video conferencing facilities for Unigene
at its ▇▇▇▇▇▇ Plains facility.
SECTION 8
REPORTING
8.1 Reporting by Parties. Notwithstanding, and without
limitation of, the reporting requirements contained elsewhere in this Agreement,
the parties hereto shall use their commercially reasonable efforts to keep each
other informed of their respective Project Activities, including, without
limitation, material developments relating to the performance of their
respective obligations under this Agreement.
8.2 Financial Records. ▇-▇ shall, and shall cause its
Affiliates and Sublicensees to, keep complete and accurate books and records
pertaining to the Marketing, sale and use of the Product, including, without
limitation, books and records of the Net Sales of Product, in sufficient detail
to calculate the royalties payable under this Agreement and to identify the
purchase order details for each customer to which it sells the Product. Such
books and records shall be retained by ▇-▇ and its Affiliates and Sublicensees
at least until five (5) years after the end of the period to which such books
and records pertain, or for such longer period as may be required by applicable
law.
51
8.3 Audit of Records. At the request of Unigene, ▇-▇ shall,
and shall cause its Affiliates and Sublicensees to, permit an independent
certified public accountant, to which ▇-▇ has no reasonable objection, at
reasonable times and upon reasonable notice, to examine the books and records
maintained pursuant to Section 8.2 to verify the accuracy of the royalty
payments made or payable hereunder, but only as to any period ending not more
than two (2) years prior to the date of such request. Said accountant shall not
disclose to Unigene or any other party any information except that which should
properly be contained in a royalty report required under this Agreement. ▇-▇
shall pay any additional royalties owed to Unigene not later than ten (10) days
after such accountant makes its findings. Unigene shall pay the cost for any
review of records conducted at the request of Unigene pursuant to this Section
8.3, unless such audit shall reveal an underpayment by ▇-▇ in excess of ten
percent (10%), in which case ▇-▇ shall pay the cost of such review.
SECTION 9
ADVERSE EVENT AND OTHER INFORMATION EXCHANGE
9.1 Notification. Each party shall provide prompt Notice to
the other party of information in or coming into its possession or control
concerning any unusual or unexpected reaction or side effect, customer
complaint, reported defect, adverse reaction, injury or toxicity or sensitivity
reaction associated with commercial and clinical uses, studies,
52
investigations or tests of the Product (animal or human), whether or not
determined to be attributable to the Product, and whether arising out of
clinical studies or Marketing and sale of the Product. Further, each party shall
notify the other's responsible drug safety department (or in the case of
Unigene, its chief executive officer), by facsimile, with a confirmation copy by
mail, such notice to include a copy of the complaint, as soon as possible, but
in no event later than four (4) calendar days (and in those countries in which
the Regulatory Authorities require shorter notice, each party shall provide the
other with Notice within twenty-four (24) hours), after the time a party first
becomes aware of any information concerning any serious and/or unexpected side
effect, injury, toxicity or sensitivity reaction or any unexpected incidence,
and the severity thereof, associated with the Product. "Serious" as used in this
Section 9.1 shall refer to an experience which (i) is fatal or immediately life
threatening; (ii) requires or prolongs inpatient hospitalization; (iii) results
in persistent or significant disability and/or incapacity; (iv) is a congenital
anomaly and/or birth defect, cancer or overdose (intentional or accidental); or
(v) is considered a medically significant event (includes laboratory
abnormalities). Medically significant events are those which may not be
immediately life threatening or result in death or hospitalization but may
jeopardize the patient or may require intervention to prevent
53
one of the outcomes listed above to define Serious. By way of illustration and
not limitation, examples of medically significant events are: intensive
treatment in an emergency room or at home for allergic bronchospasm, blood
dyscrasia, convulsions that do not result in hospitalization, development of
drug dependency or drug abuse or laboratory abnormalities. Information
concerning other complaints and other adverse reactions regarding the Product
shall be exchanged between the parties in writing promptly, but in any event not
less frequently than monthly. ▇-▇ shall be responsible for reporting adverse
experiences with respect to the Product to the FDA in conformance with
applicable law; provided, however, that each party shall make such reports as
are necessary to comply with laws and regulations applicable to it, at its sole
expense. Each party shall promptly provide the other with any information
concerning any adverse experiences as described above with respect to the
Product or the Compound from outside the Territory, which is known to such
party, within four (4) calendar days after receipt of notice thereof. Each party
shall have the right to audit the other party's drug safety surveillance data
base to assure regulatory compliance.
9.2 Regulatory Action. Each party shall immediately notify the
other of any information received regarding any threatened or pending action by
the FDA or other governmental agency which may affect the Compound or the
Product or the continued manufacture, distribution, Marketing,
54
sale or use of the Product. Upon receipt of any such information, the parties
shall consult in an effort to arrive at a mutually acceptable procedure for
taking appropriate action; provided, however, that nothing set forth in this
Section 9.2 shall be construed as restricting the right of either party to make
a timely report of such matter to any government agency or take other action
that it deems appropriate or required by applicable law or regulation.
9.3 Material Communications. In addition to the notifications
required by Section 2.6, each party shall promptly provide Notice to the other
party of any material communications with any governmental agency concerning the
Product, including, without limitation, adverse drug reaction reports. Copies of
all such material communications shall be attached to the Notice sent pursuant
to this Section 9.3.
SECTION 10
PRODUCT RECALL
10.1 Notification and Recall.
(a) In the event that any governmental agency or
authority issues or requests a recall or takes similar action in connection with
the Product, or in the event either party determines an event, incident or
circumstance has occurred which may result in the need for a recall or market
withdrawal, the party notified of or calling such recall or similar action
shall, within three hours, advise the other party thereof by telephone or
facsimile.
55
(b) Following notification pursuant to Section
10.1(a), within forty-eight (48) hours, the parties' representatives from
business, medical, regulatory, quality assurance and legal functions (and any
others deemed necessary by a party) shall discuss whether or not to conduct a
recall (except in the case of a government-mandated recall), and if so, the
timing of the recall, the breadth, extent and level of customer to which the
recall shall reach, the strategies and notifications to be used, and other
related issues. In the event that such representatives cannot agree on any such
decision, the issue shall be resolved by senior management of ▇-▇.
(c) In the event that Unigene recommends that a
recall be conducted in connection with a problem or potential problem with the
Raw Material that Unigene has identified, and ▇-▇ decides not to conduct a
recall of the Product, then ▇-▇ shall indemnify Unigene pursuant to Section 13.4
from and against all Losses that Unigene may incur as a result of any such
failure by ▇-▇ to conduct a recall.
(d) Nothing set forth in this Section 10.1 shall be
construed as restricting the right of either party to make a timely report of
such matter to any government agency or take other action that it deems
appropriate or required by applicable law or regulation.
10.2 Recall Expenses. ▇-▇ shall bear the expenses of any
recall of Product; provided, however, that Unigene
56
shall bear the expense of a recall to the extent that such recall resulted from
Unigene's breach of its obligations hereunder. Such expenses of recall shall
include, without limitation, the expenses of notification and destruction or
return of the recalled Product and the refund to consumers of amounts paid for
the recalled Product.
SECTION 11
INTELLECTUAL PROPERTY RIGHTS
11.1 Ownership and Prosecution of Intellectual Property.
(a) Except as otherwise expressly provided in Section
5.1, as between the parties, Unigene shall own all right and title to, and
interest in, the Unigene Patent Rights, Licensed Technology and Sole
Improvements of Unigene. Unigene, at its expense and through patent attorneys or
agents of its choice, shall file and prosecute applications for Patents related
to the foregoing in the United States, Europe and Japan and such other countries
as determined by Unigene or as mutually agreed by Unigene and ▇-▇. Unigene shall
not abandon any such application for a Patent or permit any Patent issuing
therefrom to lapse without first notifying ▇-▇ and permitting ▇-▇ to continue
the prosecution of such applications or pay any required fees in the name of
Unigene, at ▇-▇'s expense and through patent attorneys or agents of its choice.
▇-▇ shall not become an assignee of any application for Patent or Patent as a
result of its continuing the
57
prosecution of an application for patent or paying any fees according to this
Section.
(b) ▇-▇ shall own any and all interest in the ▇-▇
Patent Rights and Sole Improvements of ▇-▇. ▇-▇, at its expense and through
patent attorneys or agents of its choice, shall file and prosecute applications
for Patents related to the foregoing in the United States, Europe and Japan and
such other countries as determined by ▇-▇ or as mutually agreed by Unigene and
▇-▇. ▇-▇ shall not abandon any such application for a Patent or permit any
Patent issuing therefrom to lapse without first notifying Unigene and permitting
Unigene to continue the prosecution of such applications or pay any required
fees in the name of ▇-▇, at Unigene's expense and through patent attorneys or
agents of its choice. Unigene shall not become an assignee of any application
for Patent or Patent as a result of its continuing the prosecution of an
application for patent or paying any fees according to this Section.
(c) Neither party shall license, assign, sell, convey
or otherwise transfer its rights in any Joint Improvement without the prior
consent of the other party, which consent shall not be unreasonably withheld.
The parties shall consult with one another to coordinate their activities with
respect to obtaining appropriate Patent protection for Joint Improvements.
58
(d) The non-filing party or the party not responsible
for prosecuting an application for patent according to 11.1 (a) or (b) (Unigene
or ▇-▇, as the case may be) shall assist, as reasonably requested by the other
party, and cooperate in the activities set forth in this Section 11.1. Each
party shall keep the other party currently informed of all steps to be taken in
the preparation and prosecution of all applications filed by it according to
this Section 11 and shall furnish the other with copies of such applications for
Patents, amendments thereto and other related correspondence to and from patent
offices and permit the other party to offer its comments thereon before a party
makes a submission to a patent office which could materially affect the scope or
validity of the patent coverage that may result. Each party shall offer its
comments promptly. All determinations regarding whether or not an Improvement is
a Sole Improvement or a Joint Improvement shall be made in accordance with the
patent laws of the United States.
11.2 Ownership of and Validity of Trademarks. The parties
agree that ▇-▇ shall own all right and title to and interest in the Product
Trademarks and that Unigene shall own all right and title to and interest in the
Unigene Trademarks
11.3 Ownership of Regulatory Documentation and Approvals.
Unigene shall own all right and title to and interest in all Unigene Regulatory
Documentation and all information contained therein. ▇-▇ shall own all right and
59
title to and interest in all ▇-▇ Regulatory Documentation and all information
contained therein. For purposes of this Section 11.3, Unigene and ▇-▇ shall be
deemed to include their respective Affiliates and, in the case of ▇-▇,
Sublicensees.
11.4 Ownership of Project Information and Inventions.
(a) Except as otherwise provided in this Section 11,
all right and title to and interest in Project Information and Inventions
developed or created jointly by the parties shall be owned jointly by the
parties, and all right and title to and interest in Project Information and
Inventions developed or created solely by one party shall be owned solely by the
discovering or creating party. All determinations regarding whether a specific
Project Information and Invention was developed or created jointly by the
parties or solely by one party shall be made on the basis of the relevant
doctrines of the patent laws of the United States.
(b) ▇-▇ and Unigene each shall promptly (i) disclose
to the other in writing, and shall cause its respective Affiliates and, if
applicable, Sublicensees to so disclose, the development, making, conception or
reduction to practice of all Project Information and Inventions, whether created
or discovered solely by a party (and/or its Affiliates and/or Sublicensees) or
jointly, as the same are discovered, invented, made, acquired, conceived of or
reduced to practice,
60
and (ii), with respect to such solely-owned Project Information and Inventions,
grant to the other party, without any additional consideration, a non-exclusive,
royalty-free license (with right to sublicense) (A) if the licensee is ▇-▇, to
use such Project Information and Inventions solely in connection with the
Product in the Territory, and (B) if the licensee is Unigene, to use such
Project Information and Inventions (1) in the Territory and in the
Semi-Exclusive Territory, solely with respect to products other than the
Product, and (2) outside the Territory, with respect to any and all products.
11.5 Enforcement of Intellectual Property Rights.
(a) In the event of any infringement by a third party
of any intellectual property rights relating to the Product or the Compound, or
any data related thereto or developed as a result of or in connection with the
Project Activities in the Territory, including without limitation the Licensed
Technology, the Unigene Regulatory Documentation, any Project Information and
Inventions owned or controlled solely by Unigene or licensed to Unigene (other
than Project Information and Inventions licensed to Unigene pursuant to Section
11.4(b)), Unigene shall have the first right (but not the obligation) to pursue
any and all injunctive, compensatory and other remedies and relief
(collectively, "Remedies") against such third party. If Unigene shall determine
not to pursue Remedies with respect to any such infringement within
61
sixty (60) days after Notice from ▇-▇ requesting Unigene to do so, then ▇-▇
shall have the right (but not the obligation) to pursue Remedies against such
third party.
(b) In the event of any infringement by a third party
of any intellectual property rights relating to ▇-▇ Regulatory Documentation and
Project Information and Inventions owned or controlled solely by ▇-▇ or jointly
by Unigene and ▇-▇, ▇-▇ shall have the first right (but not the obligation) to
pursue any and all Remedies against such third party. Should ▇-▇ determine not
to pursue Remedies with respect to any such infringement within sixty (60) days
after Notice from Unigene requesting ▇-▇ to do so, then Unigene shall have the
right (but not the obligation) to pursue Remedies against such third party.
(c) In the event that a party shall pursue Remedies
hereunder, the other party shall use all reasonable efforts to assist and
cooperate with the party pursuing such Remedies. Each party shall bear its own
costs and expenses relating to such pursuit. Any damages or other amounts
collected shall be distributed, first, to the party that pursued Remedies to
cover its costs and expenses and, second, to the other party to cover its costs
and expenses, if any, relating to the pursuit of such Remedies; any remaining
amount shall be distributed to the party that pursued the Remedies.
62
11.6 Infringement of Third Party Rights.
(a) If one or more patents covering the Marketing or
sale of the Product, but not the Raw Material itself, has issued to a third
party in the Territory and if ▇-▇ reasonably determines that it is advisable to
obtain a license from such third party under such patent or patents, then ▇-▇
shall devote all reasonable efforts to obtaining a license from such third
party. ▇-▇ shall be solely responsible for all royalties and other payments to a
third party under any license resulting from the provisions of this Section
11.6(a). If ▇-▇ determines that such a license is unnecessary, ▇-▇ may agree to
indemnify Unigene for any and all liability that Unigene might incur in
connection with the manufacture or sale of the Raw Material by Unigene or the
marketing or sale of the Product by ▇-▇ in the absence of such a license. In the
event that ▇-▇ determines that such a license is unnecessary and does not agree
to indemnify Unigene in accordance with the preceding sentence, then Unigene may
terminate this Agreement with respect to the country or countries involved,
pursuant to Section 14.4(a). In the event that ▇-▇ determines that such a
license is necessary and (i) the patent owner is unwilling to grant such a
license, or (ii) the cost of such a license would render the Product
commercially infeasible, then either ▇-▇ or Unigene may terminate this Agreement
with respect to the country or countries involved, pursuant to Section 14.4(a).
63
(b) If one or more patents covering the Raw Material
has issued to a third party in the Territory and if Unigene reasonably
determines that it is advisable to obtain a license from such third party under
such patent or patents, then Unigene shall make the necessary arrangements to
obtain such license under such third party patent rights so that Unigene may
continue to meet its supply obligations hereunder. Any costs for such license or
sublicense shall be the sole responsibility of Unigene. In the event that
Unigene, despite its reasonable efforts, is unable to obtain such a license,
then ▇-▇ may use its commercially reasonable efforts to obtain such a license
from such third party and, if it shall obtain such a license, it shall grant a
sublicense thereunder to Unigene, and Unigene and ▇-▇ shall be responsible,
respectively, for seventy-five percent (75%) and twenty-five percent (25%) of
the payments to such third party thereunder. If ▇-▇ is not able to, or elects
not to negotiate such a license, then Unigene may terminate this Agreement with
respect to the country or countries involved, pursuant to Section 14.4(a).
(c) In the event that a third party institutes or
threatens a patent, trade secret or other infringement suit against ▇-▇ or its
Affiliates or Sublicensees during the term of this Agreement, alleging that
their Marketing, sale or use of the Product in the Territory infringes one or
more patent or other intellectual property rights held by such third
64
party, then ▇-▇ shall have the first right (but not the obligation), at its sole
expense, to assume direction and control of the defense of claims arising
therefrom (including the right to settle such claims at its sole discretion);
provided, however, that ▇-▇ shall obtain the written consent of Unigene prior to
ceasing to defend, settling or otherwise disposing of such claims; provided,
further, that if Unigene shall refuse to provide such consent, then Unigene
shall indemnify ▇-▇ pursuant to Section 13.3 for any and all Losses that ▇-▇,
its Affiliates or Sublicensees may suffer as a result of such refusal. If ▇-▇
determines not to assume such direction and control, Unigene shall have the
right, at its sole expense, to defend, settle or otherwise dispose of such
claims on such terms as Unigene, in its sole discretion, shall deem appropriate.
In the event that ▇-▇ controls the defense of an action challenging claims under
the Unigene Patents, all of the reasonable expenses and costs, including,
without limitation, attorneys' fees and damage awards, incurred by ▇-▇ in
connection therewith that are not offset by proceeds therefrom shall be
creditable against the royalties due under Section 6.1(b); provided, however,
that no royalty payment when due, regardless of the amount or number of credits
available to ▇-▇ in accordance with this Agreement, shall be reduced by more
than fifty percent (50%).
(d) In the event that a third party institutes a
patent, trade secret or other infringement suit against
65
Unigene, ▇-▇ or their respective Affiliates or sublicensees during the term of
this Agreement, each party shall, at its own cost and expense, use all
reasonable efforts to assist and cooperate with the other party in connection
with the defense of such suit.
(e) If (i) as a result of any claim made against ▇-▇
or any of its Affiliates or Sublicensees during the term of this Agreement
alleging that the Marketing or sale of the Product by such entity infringes or
misappropriates any patent or any other proprietary right of a third party, a
judgment is entered by a court of competent jurisdiction from which no appeal is
taken within the time permitted for appeal, such that ▇-▇ cannot sell the
Product in a Priority Market without infringing the patent or other proprietary
rights of such third party, and (ii) Unigene and/or ▇-▇ are unable to obtain the
license referred to in this Section 11.6 within sixty (60) days after such entry
of judgment, or such consideration to be paid to a third party for such license
would make the Product commercially impracticable, then ▇-▇ shall have the right
for thirty (30) days after the expiration of such sixty (60) day period to
terminate this Agreement by written Notice to Unigene.
(f) Nothing in this Section 11.6 shall prevent either
party, at its own expense, from obtaining any license or other rights from third
parties it deems appropriate in
66
order to permit the full and unhindered exercise of its rights under this
Agreement.
(g) The provisions of this Section 11.6 set forth the
parties' exclusive and sole remedies against each other in respect of the
subject matter thereof.
SECTION 12
CONFIDENTIALITY
12.1 Confidential Information. Except to the extent permitted
by this Agreement or as otherwise agreed by the parties in writing, the parties
agree that the party receiving information hereunder (the "Receiving Party")
shall keep completely confidential, shall not publish or otherwise disclose and
shall not use directly or indirectly for any purpose (except as otherwise
provided herein) any information furnished to it by the other party (the
"Disclosing Party") pursuant to this Agreement or otherwise relating to any
transaction contemplated hereby (including, without limitation, Regulatory
Documentation and Project Information and Inventions), including information
heretofore furnished to it (the "Confidential Information"), except to the
extent that the Receiving Party can establish by competent proof that such
information:
(a) was already known to the Receiving Party, other
than under an obligation of confidentiality, at the time of disclosure by the
Disclosing Party, as evidenced by the Receiving Party's prior written and dated
records;
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(b) was part of the public domain at the time of its
disclosure by the Disclosing Party;
(c) became part of the public domain after its
disclosure by the Disclosing Party, other than through any act or omission of
the Receiving Party in breach of this Agreement; or
(d) was disclosed to the Receiving Party by a third
party who was rightfully in possession of such information and had no obligation
not to disclose such information to others.
12.2 Authorized Disclosure. Each party may disclose
Confidential Information to the extent that such disclosure is:
(a) Made in response to a valid order of a court of
competent jurisdiction or other governmental body of a country or any political
subdivision thereof of competent jurisdiction; provided, however, that the
Receiving Party shall first have given notice to the Disclosing Party and given
the Disclosing Party a reasonable opportunity to quash such order and to obtain
a protective order requiring that the Confidential Information and/or documents
that are the subject of such order be held in confidence by such court or agency
or, if disclosed, be used only for the purposes for which the order was issued;
and provided further that if a disclosure order is not quashed or a protective
order is not obtained, the Confidential Information disclosed in response to
such
68
court or governmental order shall be limited to that information which is
legally required to be disclosed in such response to such court or governmental
order;
(b) Otherwise required by law, in the opinion of
legal counsel to the Receiving Party as expressed in an opinion letter in form
and substance reasonably satisfactory to the Disclosing Party, which shall be
provided to the Disclosing Party at least twenty-four hours prior to the
Receiving Party's disclosure of the Confidential Information pursuant to this
Section 12.2(b);
(c) Made by the Receiving Party to the Regulatory
Authorities as required in connection with applications for Approvals for the
Product or the Compound, provided that reasonable measures shall be taken to
assure confidential treatment of such information; or
(d) Made by the Receiving Party to third parties as
may be necessary in connection with the development and commercialization of the
Product as contemplated by this Agreement, including, without limitation,
subcontracting and sublicensing transactions in connection therewith, provided
that the Receiving Party in question shall in each case obtain from the proposed
third party recipient a written confidentiality undertaking containing
confidentiality obligations no less onerous than those set forth in this Section
12; provided, however, that, notwithstanding anything to the contrary in this
Section 12, ▇-▇ shall have the right
69
to disclose preclinical and clinical data and results relating to the Product to
qualified medical professionals for the limited purposes of advertising and
promoting such product and conducting medical education initiatives reasonably
designed to increase Net Sales of the Product.
12.3 Unigene Disclosure. Notwithstanding anything to the
contrary in this Section 12, Unigene and its Affiliates shall have the right to
use and disclose any and all Licensed Technology and, to the extent not included
therein, all Unigene Regulatory Documentation and any Project Information and
Inventions solely owned or controlled by or licensed to Unigene (other than
pursuant to Section 11.4(b)) relating to the Product or the Compound or any
Improvements thereto in accordance with the terms of this Agreement, without
obtaining the consent of ▇-▇.
12.4 Notification. The Receiving Party shall notify the
Disclosing Party immediately, and cooperate with the Disclosing Party as the
Disclosing Party may reasonably request, upon the Receiving Party's discovery of
any loss or compromise of the Disclosing Party's information.
12.5 Remedies. Each party agrees that the unauthorized use or
disclosure of any material information by the Receiving Party in violation of
this Agreement will cause severe and irreparable damage to the Disclosing Party.
In the event of any violation of this Section 12, the Receiving Party agrees
that the Disclosing Party shall be authorized and
70
entitled to obtain from any court of competent jurisdiction injunctive relief,
whether preliminary or permanent, as well as any other relief permitted by
applicable law. The Receiving Party agrees to waive any requirement that the
Disclosing Party post bond as a condition for obtaining any such relief.
12.6 Return of Information. Within thirty (30) days of the
termination of this Agreement, each party shall return to the other party any
and all copies of information covered by this Section 12 or otherwise owned by
the other party, including, without limitation, all Regulatory Documentation and
any Project Information and Inventions solely owned or controlled by or licensed
(other than pursuant to Section 11.4) to the other party.
12.7 Survival. This Section 12 shall be in effect during the
term of this Agreement and for a period of seven (7) years following the
termination thereof.
12.8 Use of Names. Except as required by law, neither party to
this Agreement shall use the name of the other in any public announcement, press
release or other public document without the prior written consent of such other
party.
12.9 Publication. Nothing contained herein shall be construed
so as to prevent ▇-▇, its Affiliates or Sublicensees from submitting for written
or oral publication any manuscript, abstract or the like which includes data or
71
other information derived from the clinical testing of the Product; provided,
however, that it shall furnish Unigene with a copy of the information to be
submitted no later than thirty (30) days prior to submitting the same for
written or oral publication. Nothing contained herein shall be construed so as
to prevent Unigene, its Affiliates or licensees (other than ▇-▇) from submitting
for written or oral publication any manuscript, abstract or the like relating to
the Compound itself or an injectable or nasal dosage form thereof; provided,
however, that it shall ▇▇▇▇▇▇▇ ▇-▇ with a copy of the information to be
submitted no later than thirty (30) days prior to submitting same for written or
oral publication. ▇-▇ shall not, nor shall it permit its Affiliates or
Sublicensees to, submit for written or oral publication any manuscript, abstract
or the like which includes data or other information relating to the Product or
the Compound without first obtaining the prior written consent of Unigene, which
consent shall not be unreasonably withheld. Unigene shall not, nor shall it
permit its Affiliates or sublicensees to, submit for written or oral publication
in the Territory any manuscript, abstract or the like which includes data or
other information directly relating to the Product without first obtaining the
prior written consent of ▇-▇, which consent shall not be unreasonably withheld;
provided, however, that nothing herein shall be construed to prevent Unigene
from submitting for written or oral publication any manuscript, abstract or the
72
like which includes data or other information relating to the Compound in
general or its injectable or nasal formulations. The contribution of each party
shall be noted in all publications or presentations by acknowledgment or
co-authorship, whichever is appropriate.
SECTION 13
WARRANTIES; INDEMNITIES
13.1 Representations, Warranties and Covenants.
(a) Each party represents and warrants to the other
party as follows: (i) it is a duly organized and validly existing corporation
under the laws of its jurisdiction of incorporation; (ii) it has full corporate
power and authority and has taken all corporate action necessary to enter into
and perform this Agreement; (iii) the execution and delivery of this Agreement
and the transactions contemplated herein do not violate, conflict with, or
constitute a default under its charter or similar organization document, its
by-laws or the terms or provisions of any material agreement or other instrument
to which it is a party or by which it is bound, or any order, award, judgment or
decree to which it is a party or by which it is bound; and (iv) this Agreement
is its legal, valid and binding obligation, enforceable in accordance with the
terms and conditions hereof.
(b) Unigene represents, warrants and covenants to ▇-▇
that it will comply with all applicable governmental
73
laws and regulations relating to the manufacture of the Raw Material in the
United States.
(c) Unigene represents and warrants that (i) it is
the owner of the entire right and title in and interest to the Unigene Patent
Rights; (ii) it is not aware of any infringement of the Unigene Patent Rights
and has no knowledge of any claim or allegation or any basis thereof, of patent
infringement with regard to the Unigene Patent Rights; (iii) it is not aware of
any legal, administrative, arbitration or other actions, suits, claims or
proceedings at law, in equity, or otherwise against it in or before any court or
governmental or regulatory authority with respect to the Unigene Patent Rights
and no such actions, suits, claims or proceedings have been threatened against
it; (iv) it is not aware of any prior art or event (such as prior use, prior
sale or similar matter) not cited or disclosed during prosection of the Unigene
Patent Rights which is material to the issue of patentability other than that
prior art cited during the prosecution of the Unigene Patent Rights; and (vi) it
has or will have the financial ability to carry out its obligations hereunder.
(d) ▇-▇, represents, warrants and covenants to
Unigene that it will comply with all applicable governmental laws and
regulations relating to the development, Finishing, Marketing, distribution and
sale of Product in the Territory.
13.2 Warranties of Unigene; Limitations. EXCEPT AS SET FORTH
IN SECTIONS 13.1(b), 13.1(c) AND 3.7, UNIGENE HEREBY
74
DISCLAIMS ANY AND ALL WARRANTIES, WHETHER WRITTEN OR ORAL, OR EXPRESS OR
IMPLIED, WITH RESPECT TO THE RAW MATERIAL, LICENSED TECHNOLOGY, THE COMPOUND OR
THE PRODUCT, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF QUALITY,
PERFORMANCE, MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE.
13.3 Indemnification of ▇-▇. Subject to Section 13.6, Unigene
shall indemnify ▇-▇, its Affiliates and their respective directors, officers,
employees and agents, and defend and save each of them harmless, from and
against any and all losses, damages, liabilities, costs and expenses in
connection with any and all suits, investigations, claims or demands by third
parties (collectively, "Losses") arising from or occurring as a result of (i)
the breach by Unigene of this Agreement or (ii) any act, whether of omission or
commission, by Unigene (or its Affiliates) with respect to its areas of
responsibility under this Agreement, including, without limitation, the
manufacture of the Raw Material by or on behalf of Unigene, except for those
Losses for which ▇-▇ has an obligation to indemnify Unigene pursuant to Section
13.4, as to which Losses each party shall indemnify the other to the extent of
their respective liability for the Losses; provided, however, that Unigene shall
not be obligated to indemnify ▇-▇ for any Losses that arise as a result of gross
negligence or willful misconduct on the part of ▇-▇ or any of its Affiliates or
Sublicensees.
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13.4 Indemnification of Unigene. Subject to Section 13.6, ▇-▇
shall indemnify Unigene, its Affiliates and their respective directors,
officers, employees and agents, and defend and save each of them harmless, from
and against any and all Losses arising from or occurring as a result of (i) the
breach by ▇-▇ of this Agreement, (ii) any failure by ▇-▇ to conduct a Product
recall in the circumstances set forth in Section 10.1(c), or (iii) any act,
whether of omission or commission, by ▇-▇ (or its Affiliates or Sublicensees)
with respect to its areas of responsibility under this Agreement, including,
without limitation, the development, Finishing, Marketing, distribution or sale
of the Product, except for those Losses for which Unigene has an obligation to
indemnify ▇-▇ and its Affiliates pursuant to Section 13.3, as to which Losses
each party shall indemnify the other to the extent of their respective liability
for the Losses; provided, however, that ▇-▇ shall not be obligated to indemnify
Unigene for any Losses that arise as a result of gross negligence or willful
misconduct on the part of Unigene or any of its Affiliates.
13.5 Indemnification Procedure.
(a) Each indemnified party agrees to give the
indemnifying party prompt written Notice of any Losses or the discovery of a
fact upon which such indemnified party intends to base a request for
indemnification under Section 13.3 or 13.4.
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(b) Each party shall furnish promptly to the other,
copies of all papers and official documents received in respect of any Losses.
The indemnified party shall cooperate as requested by the indemnifying party in
the defense against any Losses.
(c) With respect to any Losses relating solely to the
payment of money damages and which will not result in the indemnified party's
becoming subject to injunctive or other relief or otherwise adversely affecting
the business of the indemnified party in any manner, and as to which the
indemnifying party shall have acknowledged in writing the obligation to
indemnify the indemnified party hereunder, the indemnifying party shall have the
sole right to defend, settle or otherwise dispose of such Losses, on such terms
as the indemnifying party, in its sole discretion, shall deem appropriate.
(d) With respect to Losses relating to all other
matters, the indemnifying party shall have the sole right to control the defense
of such matter, provided that the indemnifying party shall obtain the written
consent of the indemnified party, which shall not be unreasonably withheld,
prior to ceasing to defend, settling or otherwise disposing of any Losses if as
a result thereof (i) the indemnified party would become subject to injunctive or
other equitable relief or any remedy other than the payment of money by the
77
indemnifying party or (ii) the business of the indemnified party would be
adversely affected.
(e) The indemnifying party shall not be liable for
any settlement or other disposition of a Loss by the indemnified party which is
reached without the written consent of the indemnifying party.
(f) Except as provided above, the costs and expenses,
including reasonable fees and disbursements of counsel, incurred by any
indemnified party in connection with any claim shall be reimbursed on a Calendar
Quarter basis by the indemnifying party, without prejudice to the indemnifying
party's right to contest the indemnified party's right to indemnification and
subject to refund in the event the indemnifying party is ultimately held not to
be obligated to indemnify the indemnified party.
13.6 Limitation on Damages.
(a) Except in circumstances of gross negligence or
willful misconduct by a party or its Affiliates, neither ▇-▇ nor Unigene shall
be liable to the other for special, indirect, incidental or consequential
damages, whether in contract, warranty, negligence, tort, strict liability or
otherwise, arising out of the manufacture, use or sale of the Raw Material or
the Product by the other party.
(b) Notwithstanding Section 13.6(a), Unigene may be
subject to liability for such damages to the extent
78
that such damages result from Unigene's breach of the warranties set forth in
Section 3.7.
(c) Notwithstanding Section 13.6(a), ▇-▇ may be
subject to liability for such damages to the extent that such damages may result
from ▇-▇'s breach of the warranties set forth in Section 4.2(b).
SECTION 14
TERM AND TERMINATION
14.1 Term. The term of this Agreement shall commence as of the
date hereof and shall continue until terminated in accordance with this Section
14.
14.2 Termination of Agreement with Respect to a Secondary
Market or Region.
(a) Upon written Notice to ▇-▇, Unigene shall have
the right to terminate this Agreement with respect to each (i) Secondary Market
if ▇-▇ fails to (A) perform clinical tests and studies for the Product in such
Secondary Market in accordance with Section 2.1, (B) file submissions necessary
to obtain Approval for the Product with the appropriate Regulatory Authorities
in such Secondary Market in accordance with Section 2.2, or (C) Launch the
Product in such Secondary Market pursuant to Section 4.1(a); provided, however,
that termination pursuant to this Section 14.2 shall constitute the sole remedy
of Unigene with respect to any such default by ▇-▇.
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(b) In the event that ▇-▇ fails to pay Unigene the
Minimum Royalty Payment with respect to the United States, Europe (including,
without limitation, France, Germany, Italy, Spain and the United Kingdom,
regardless of whether such countries continue to be members of the European
Union) or Japan (each, a "Region") pursuant to Section 6.1(b)(i)(x), Unigene
shall have the right to terminate this Agreement with respect to such Region
pursuant to Section 14.3; provided, however, that such termination pursuant to
Section 14.3 shall constitute the sole remedy of Unigene with respect to any
such failure by ▇-▇.
(c) Upon twelve (12) months' prior written Notice to
Unigene, ▇-▇ shall have the right to terminate this Agreement with respect to
any Secondary Market.
(d) If Unigene terminates this Agreement with respect
to a country or Region under Section 14.2(a) or 14.2(b), respectively, or ▇-▇
terminates this Agreement with respect to a country pursuant to Section 14.2(c),
all of W-L's, as well as its Affiliate's and Sublicensee's, rights hereunder
with respect to such country shall revert to Unigene and ▇-▇ shall assign, and
shall cause its Affiliates and Sublicensees to assign, to Unigene, without any
additional consideration, all of their respective rights, titles and interests
hereunder with respect to such country, if any, including without limitation all
rights to the Product, the Regulatory Documentation, the Approvals, the Product
80
Trademarks, the Project Information and Inventions and any other information,
discoveries, materials or Improvements related thereto in connection with such
country. If Unigene terminates this Agreement with respect to a Region pursuant
to Section 14.2(b), ▇-▇ shall assign its rights to the Approvals and all
information contained therein and all other rights of ▇-▇ with respect to the
Product in such Region to Unigene only if Unigene so elects, provided that if
Unigene so elects, it shall be obligated to pay ▇-▇ the following: (i) [ ]
of any upfront payments that Unigene receives in connection with the grant of
any rights by Unigene to a third party to Market and sell the Product under such
Approval and/or such other rights of ▇-▇ in such Region, and [ ] of (A) any
royalty payments made by such third party to Unigene under such agreement and
(B) any supply payments received from such third party for Raw Material under
such agreement; and (ii) [ ] of any Net Sales of Product made by Unigene
or its Affiliates in such Region; and provided further that all such payment
obligations shall terminate on the Royalty Transition Date for such Region.
(e) Either party may terminate the respective supply
and purchase obligations of the parties under Section 3 with respect to each
country in the Territory upon two (2) years' written notice to the other party;
provided, however, that such notice may not take effect prior to the Royalty
Transition Date in the country or countries involved.
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14.3 Termination for Material Breach. This Agreement shall be
subject to termination by either party in the event of a material breach hereof
by the other party with respect to its obligations, which breach is not cured
within sixty (60) days (or, in the case of a payment default, thirty (30) days)
following written Notice thereof by the non-breaching party.
14.4 Unilateral Termination.
(a) ▇-▇ shall have the right to terminate this
Agreement pursuant to Section 11.6(a) and 11.6(e) on sixty (60) days' written
Notice. Unigene shall have the right to terminate this Agreement pursuant to
Sections 11.6(a) and 11.6(b) on sixty (60) days' written Notice.
(b) After the first anniversary of the effective date
of this Agreement, ▇-▇ shall have the right to terminate this Agreement on six
(6) months' prior written Notice to Unigene, (i) if a product containing the Raw
Material is disapproved by the relevant Regulatory Authorities for sale and use
in the United States and Europe, (ii) if clinical tests and studies, conducted
in accordance with mutually agreed procedures and protocols, demonstrate that
the Product does not achieve a population mean of peak plasma levels of at least
[ ] per milliliter of blood in man, (iii) if ▇-▇ makes a reasonable
showing that, after due diligence in accordance with Section 2.2, successful
completion of its Development Activities is infeasible for
82
scientific or technical reasons, or (iv) on a Region-by-Region basis, (A) prior
to the initial Launch, if ▇-▇ makes a reasonable showing that, assuming the
exercise of due diligence in accordance with Section 4.1, ▇-▇ will not be able
to meet at least twenty-five percent (25%) of the Net Sales projections set
forth on Annex D for any of the first three (3) twelve (12) month periods set
forth therein, or (B) after the Launch, if, after due diligence in accordance
with Section 4.1, ▇-▇ shall not achieve Net Sales in a twelve (12) month period
(after the first three such periods) equal to at least twenty-five percent (25%)
of the Net Sales projections set forth on Annex D for such twelve (12) month
period, provided that such Notice is given within ninety (90) days after ▇-▇'s
failure to meet such Net Sales projections in any such period.
(c) In the event that ▇-▇ exercises any of its
unilateral rights of termination under this Section 14.4, ▇-▇ shall (i) pay all
amounts that are due under this Agreement prior to the effective date of such
termination, (ii) perform all of its Development Activities prior to the
effective date of such termination (unless and until Unigene in its sole
discretion may determine otherwise), and (iii) relinquish, and shall cause its
Affiliates and Sublicensees to relinquish, all of their respective rights
hereunder and shall assign, and cause its Affiliates and Sublicensees to assign,
to Unigene, without additional consideration, all of their respective rights,
titles and interests, if any, to the Product,
83
including without limitation all rights to the Regulatory Documentation, the
Approvals, the Product Trademarks, the Project Information and Inventions and
any other information, discoveries, materials or Improvements related thereto or
developed as a result of or in connection with the Project
Activities.
14.5 Termination for Other Events. Either party may terminate
this Agreement if, at any time, the other party shall file in any court or
agency pursuant to any statute or regulation of any state or country, a petition
in bankruptcy or insolvency or for reorganization or for an arrangement or for
the appointment of a receiver or trustee of that party or of its assets, or if
the other party proposes a written agreement of composition or extension of its
debts, or if the other party shall be served with an involuntary petition
against it, filed in any insolvency proceeding, and such petition shall not be
dismissed within sixty (60) days after the filing thereof, or if the other party
shall propose or be a party to any dissolution or liquidation, or if the other
party shall make an assignment for the benefit of its creditors.
14.6 Effect of Termination. No licenses granted in Section 5.1
or sublicenses granted pursuant to Section 11.6(a) shall survive the termination
of this Agreement. Any and all licenses granted pursuant to Section 11.4(b)
shall survive the termination of this Agreement. Upon termination of this
84
Agreement, ▇-▇ shall, and shall cause its Affiliates and Sublicensees to: (a)
cease all Finishing, Marketing, sales and distribution of the Product, provided
that ▇-▇ shall continue to fill existing orders and sell existing inventory of
Product for a period of ninety (90) days from such date of termination; (b)
promptly discontinue the use of any Product Trademarks, except as necessary to
carry out the sales activities set forth in 14.6(a); (c) within thirty (30) days
of such termination, return to Unigene (or, at Unigene's request, destroy) all
unfinished quantities of Raw Material, provided that Unigene shall credit ▇-▇
for any returned Raw Material; and (d) after the period referred to in clause
(a) above, destroy all unsold quantities of Product; provided, however, that
Unigene, in its sole discretion, may elect to extend any of the ninety (90) day
periods set forth in this sentence by an additional ninety (90) days.
The termination of this Agreement shall be without prejudice
to any rights or obligations of the parties that may have accrued prior to such
termination, and the provisions of Sections 2.7, 3.10, 4.2(c), 4.8 (except to as
otherwise provided therein), 4.9, 6.1 (as to amounts accruing prior to the
termination of this Agreement), 8.2, 8.3, 9, 10 (to the extent that the Product
in question was Marketed or sold pursuant to this Agreement), 11.5(c) (with
respect to actions commenced prior to the termination of this Agreement), 12,
13.3, 13.4, 13.5, 13.6, 15.2, 15.3, 15.6 and 15.7 and this
85
Section 14 shall survive the termination of this Agreement. Except as otherwise
expressly provided herein, termination of this Agreement in accordance with the
provisions hereof shall not limit remedies which may otherwise be available in
law or equity.
Subject to Section 14.2(d), ▇-▇ shall cooperate with Unigene
in transferring to Unigene or a third party, as Unigene may direct, within
thirty (30) days of the termination hereof, all data, files and other materials
in the possession or under the control of ▇-▇ or its Affiliates or Sublicensees
relating to the Compound or Product, including, without limitation, any
Regulatory Documentation, except to the extent that ▇-▇ requires such data,
files and materials for the purpose of performing any obligations under this
Agreement that may survive such termination.
SECTION 15
GENERAL PROVISIONS
15.1 Force Majeure. If the performance of this Agreement or of
any obligation hereunder, except for the payment of any amounts hereunder, is
prevented, restricted or interfered with by reason of a force majeure and
without fault or negligence of the affected party, such party, upon prompt
written Notice to the other party, shall be excused from such performance to the
extent of the aforementioned prevention, restriction or interference, provided
that the party so affected shall use its best efforts to avoid or remove such
86
causes of nonperformance and shall continue performance hereunder with the
utmost dispatch whenever such causes are removed. For purposes of this
Agreement, force majeure shall mean any extraordinary and unforeseen event that
is beyond the reasonable control of the affected party, but shall not include a
failure to commit sufficient resources, financial or otherwise, to the Project
Activities or general market or economic conditions.
15.2 Payments. All payments to be made by one party to the
other (the "Payee") under this Agreement shall be made in United States dollars
and shall be paid by bank wire transfer or by automated clearinghouse
(electronic funds transfer) in immediately available funds to such bank account
designated in writing by the Payee from time to time. Interest shall accrue on
delinquent payments from the date such payments are due at a rate of twelve
percent (12%) per annum.
15.3 Notice. All notices, requests, reports, statements and
other communications to either party (each a "Notice") shall be in writing,
shall refer specifically to this Agreement and shall be hand delivered or sent
by express courier service, costs prepaid, or by facsimile to the respective
addresses specified below (or to such other address as may be specified by
Notice to the other party):
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if to Unigene, to:
Unigene Laboratories, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇.▇.▇.
Attn: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇, President
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇., ▇.▇.
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
if to ▇-▇, to:
▇▇▇▇▇▇-▇▇▇▇▇▇▇ Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: President, Pharmaceutical Sector
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇-▇▇▇▇▇▇▇ Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Vice President and General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Any Notice delivered by facsimile or similar means shall be
confirmed by a hard copy delivered as soon as practicable thereafter. The
effective date of any Notice shall be: (a) the date of the addressee's receipt,
if delivered by hand or express courier; or (b) the date of receipt if received
by 5:00 p.m. local time on a business day or, if not, the first business day
after receipt, if sent by facsimile.
88
15.4 Further Assurances. Each party shall duly execute and
deliver, or cause to be duly executed and delivered, such further instruments
and do and cause to be done such further acts and things, including, without
limitation, the filing of such assignments, agreements, documents and
instruments, as may be necessary or as the other party may reasonably request in
connection with this Agreement or to carry out more effectively the provisions
and purposes hereof, or to better assure and confirm unto such other party its
rights and remedies under this Agreement.
15.5 Successors and Assigns. The terms and provisions hereof
shall inure to the benefit of, and be binding upon, Unigene, ▇-▇ and their
respective successors and permitted assigns. Except as expressly provided
herein, neither party may, without the prior written consent of the other party,
assign or otherwise transfer any of its rights and interests, or subcontract or
otherwise delegate any of its obligations, hereunder; provided, however, that
either party may assign its rights and delegate its duties hereunder to an
Affiliate thereof without obtaining such consent, provided that the assigning
party agrees to remain primarily (and not secondarily or derivatively) liable
for the full and timely performance by such Affiliate of all its obligations
hereunder. Any attempt to assign, transfer, subcontract or delegate any portion
of this Agreement in violation of this Section 15.5 shall be null and void.
89
15.6 Governing Law. This Agreement shall be governed by,
construed, and enforced in accordance with the laws of the State of New York,
without regard to the choice of law provisions thereof.
15.7 Arbitration.
(a) Disputes between the parties arising under or in
connection with this Agreement that are not resolved pursuant to Section 8.3(b)
or otherwise shall be referred to compulsory arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association to be held
in New York, New York. The parties shall appoint an arbitrator by mutual
agreement. If the parties cannot agree on the appointment of an arbitrator
within thirty (30) days after receipt of a demand for arbitration, each party
shall appoint one arbitrator, and the two arbitrators shall appoint a third
arbitrator. If the party-appointed arbitrators cannot agree on the third
arbitrator, the third arbitrator shall be appointed in accordance with the
Commercial Arbitration Rules of the American Arbitration Association.
(b) Any fees and expenses payable with respect to an
arbitration under this Section 15.7 shall be borne by the party losing the case.
All arbitration rulings and awards shall be final and binding on the parties.
15.8 Waiver. A party's failure to enforce, at any time or for
any period of time, any provision of this Agreement, or to exercise any right or
remedy, does not
90
constitute a waiver of such provision, right or remedy, or prevent such party
thereafter from enforcing any or all provisions and exercising any or all other
rights and remedies. The exercise of any right or remedy does not constitute an
election or prevent the exercise of any or all rights or remedies, all rights
and remedies being cumulative.
15.9 Severability. If any provision hereof, other than the
requirements to pay license fees and royalties pursuant to Section 6, should be
held invalid, illegal or unenforceable in any respect, then, to the fullest
extent permitted by applicable law, (a) all other provisions hereof shall remain
in full force and effect and shall be liberally construed in order to carry out
the intent of the parties as nearly as may be possible, and (b) the parties
agree to use their best efforts to negotiate a provision, in replacement of the
provision held invalid, illegal or unenforceable, that is consistent with
applicable law and accomplishes, as nearly as possible, the original intention
of the parties with respect thereto. To the fullest extent permitted by
applicable law, each party hereby waives any provision of law that would render
any provision hereof prohibited or unenforceable in any respect.
15.10 Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, and all
of which, taken together, shall constitute one and the same instrument.
91
15.11 Construction. Except where the context otherwise
requires, wherever used the singular shall include the plural, the plural the
singular, the use of any gender shall be applicable to all genders. The captions
of this Agreement are for convenience of reference only and in no way define,
describe, extend or limit the scope or intent of this Agreement or the intent of
any provision contained in this Agreement. The language of this Agreement shall
be deemed to be the language mutually chosen by the parties and no rule of
strict construction shall be applied against either party hereto.
15.12 Independent Contractors. The status of the parties under
this Agreement shall be that of independent contractors. No party shall have the
right to enter into any agreements on behalf of the other party, nor shall it
represent to any Person that it has any such right or authority. Nothing in this
Agreement shall be construed as establishing a partnership or joint venture
relationship between the parties hereto.
15.13 Nasal Product. The parties agree to use good faith
efforts to negotiate an agreement pursuant to which ▇-▇ would develop and
commercialize a nasally administered form of the Compound (i) in the United
States, such negotiation to occur within a period of ninety (90) days after the
date of this Agreement (or such longer period as the parties may agree), and
(ii) in Europe, such negotiation to occur within a
92
period of sixty (60) days after the date of this Agreement (or such longer
period as the parties may agree).
15.14 Publicity. Either party may make any public disclosure
about this Agreement required by law; provided, however, that it shall give at
least three (3) business days' prior written notice to the other party to the
extent consistent with applicable law. Neither party shall issue any press
release or other public disclosure about this Agreement or its terms without the
prior written consent of the other party, except pursuant to this Section 15.14.
15.15 Entire Agreement. This Agreement constitutes, on and as
of the date hereof, the entire agreement of the parties with respect to the
subject matter hereof, and all prior or contemporaneous understandings or
agreements, whether written or oral, between the parties with respect to such
subject matter are hereby superseded in their entireties. This Agreement shall
not be amended in any respect whatsoever except by a further agreement, in
writing, fully executed by each of the parties.
93
IN WITNESS WHEREOF, the parties have caused this License
Agreement to be duly executed and delivered as of the date first above written.
UNIGENE LABORATORIES, INC. ▇▇▇▇▇▇-▇▇▇▇▇▇▇ COMPANY
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------- --------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
President Vice President and
President, ▇▇▇▇▇-▇▇▇▇▇,
U.S. and Mexico
94
ANNEX A
Minimum Royalty Amounts
(U.S. Dollars in Millions)
If the indications for the Product include the treatment of
osteoporosis, but not the prevention of osteoporosis or the treatment of bone
pain, the Minimum Royalty Amounts in each of the successive twelve-month periods
beginning on the first day of the first Calendar Quarter after the relevant
Launch shall be as follows:
Successive Twelve-Month Periods after Launch
Region Year 1 Year 2 Year 3
------ ------ ------ ------
U.S. $[ ] $[ ] $[ ]
Europe [ ] [ ] [ ]
Japan [ ] [ ] [ ]
If the indications for the Product include the prevention and
treatment of osteoporosis, but not the treatment of bone pain, the Minimum
Royalty Amounts in each of the successive twelve-month periods beginning on the
first day of the first Calendar Quarter after the relevant Launch shall be as
follows:
Successive Twelve-Month Periods after Launch
Region Year 1 Year 2 Year 3
------ ------ ------ ------
U.S. $[ ] $[ ] $[ ]
Europe [ ] [ ] [ ]
Japan [ ] [ ] [ ]
95
If the indications for the Product include the prevention and
treatment of osteoporosis, as well as the treatment of bone pain, the Minimum
Royalty Amounts in each of the successive twelve-month periods beginning on the
first day of the first Calendar Quarter after the relevant Launch shall be as
follows:
Successive Twelve-Month Periods after Launch
Region Year 1 Year 2 Year 3
------ ------ ------ ------
U.S. $[ ] $[ ] $[ ]
Europe [ ] [ ] [ ]
Japan [ ] [ ] [ ]
96
ANNEX B
Patent Rights
Applications to Oral Peptides
1. U.S. Patent Application Serial No. [ ] filed [
], entitled [ ].
2. Patent Cooperation Treaty International Application [
] filed in the United States Receiving Office on [
], entitled [ ] designating, inter
alia, the United States, and claiming priority of U.S.
Patent Application Serial No. [ ] filed [
].
97
ANNEX C
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (the "Agreement"), dated as of
July 15, 1997, is entered into by and between Unigene Laboratories, Inc., a
Delaware corporation ("Unigene"), and ▇▇▇▇▇▇-▇▇▇▇▇▇▇ Company, a Delaware
corporation ("Purchaser").
W I T N E S S E T H:
WHEREAS, Unigene and Purchaser simultaneously herewith are
entering into a License Agreement, dated as of July 15, 1997 (the "License
Agreement"), pursuant to which Unigene has licensed to Purchaser rights to use
certain of Unigene's proprietary technology; and
WHEREAS, Unigene in connection therewith wishes to issue and
sell to Purchaser, and Purchaser wishes to purchase from Unigene, on the terms
and conditions set forth in this Agreement, the number of shares of Unigene's
common stock, par value $.01 per share (the "Common Stock"), determined in
accordance with the provisions of Section 1.1 hereof.
NOW THEREFORE, in consideration of the foregoing premises and
the mutual covenants contained in this Agreement and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound, hereby agree as follows:
ARTICLE I
PURCHASE AND SALE OF STOCK
1.1 Purchase of Stock. On the terms and conditions set forth in this
Agreement, Unigene agrees to issue and sell to Purchaser, and Purchaser agrees
to purchase from Unigene, at a purchase price of $3,000,000, the number of
shares of Common Stock that is equal to the total obtained by dividing (i)
$3,000,000, by (ii) the average of the closing sale prices of the Common Stock
as reported by the Nasdaq Stock Market for each trading day during the 30
calendar days preceding and the 30 calendar days beginning on the date of the
first public announcement of the entry by the parties into the License
Agreement; provided that if the calculation described in this Section 1.1 would
create a fractional share, such fractional share shall be disregarded and the
number of shares of Common Stock purchased and sold hereunder shall be the
number of whole shares.
98
1.2 Deliveries. On the date of the execution of this Agreement,
Purchaser shall deliver to Unigene, by wire transfer of immediately available
funds to such bank account as shall be designated by Unigene, an amount equal to
$3,000,000. Promptly following the conclusion of the 60-day period referred to
in Section 1.1, Unigene shall deliver to Purchaser a stock certificate
registered in the name of Purchaser representing the number of shares of Common
Stock determined in accordance with Section 1.1 hereof.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1 Representations and Warranties of Unigene. Unigene represents and
warrants to Purchaser that, as of the date hereof:
(a) Organization, Good Standing and Qualification. Unigene is
duly incorporated, validly existing and in good standing under the laws of the
State of Delaware.
(b) Authorization. Unigene has the corporate power necessary
to execute, deliver and perform this Agreement, and such execution, delivery and
performance have been duly authorized by all necessary corporate action on the
part of Unigene. This Agreement has been duly executed and delivered by Unigene
and constitutes a legal, valid and binding obligation of Unigene, enforceable
against Unigene in accordance with its terms.
(c) No Violations. The execution, delivery and performance of
this Agreement by Unigene does not and will not: (i) violate any provision of
Unigene's Certificate of Incorporation or By-laws; (ii) violate, breach or
constitute a default (or an event or condition that with the giving of notice or
the passage of time or both could give rise to a default) under any material
contract or agreement to which Unigene is a party or by which Unigene is bound;
(iii) result in the creation of a lien, security interest, charge or encumbrance
on any property or assets of Unigene; (iv) except for such filings with the
Securities and Exchange Commission or any state securities commission as may be
required to perfect a private placement or limited offering exemption for the
sale of the shares of Common Stock, require the authorization, consent or
approval of, or filing with, any court or any administrative or governmental
body pursuant to any law, statute, rule or regulation to which Unigene is
subject or any order, judgement or decree by which Unigene is bound; or (v)
constitute a default under or violate any law, statute, rule or regulation to
which Unigene is subject or any
99
order, judgement or decree of any court, administrative agency or arbitrator by
which Unigene is bound.
(d) Litigation. There is no suit, action or other proceeding
of any nature pending or, to the best knowledge of Unigene, threatened against
Unigene before any court or other governmental agency or instrumentally that
challenges or seeks to prevent the consummation of the transactions contemplated
by this Agreement.
(e) Valid Issuance of Common Stock. The shares of Common Stock
to be issued pursuant to this Agreement have been duly authorized and, upon
issuance in accordance with the terms of this Agreement, will be validly issued,
fully paid and nonassessable.
(f) Capitalization. (a) The authorized capital stock of
Unigene consists of 60,000,000 shares of Common Stock, of which, as of May 15,
1997, (i) 37,264,165 shares were outstanding and (ii) 7,434,719 shares were
reserved for issuance either upon the conversion of outstanding convertible
securities or upon the exercise of outstanding options and warrants. There is
only one class of Common Stock.
(g) Securities Laws. Assuming the accuracy of the
representations and warranties of Purchaser contained in this Agreement, the
sale of the shares of Common Stock to be issued pursuant to the terms of this
Agreement will be exempt from registration under the Securities Act of 1933, as
amended (the "Securities Act").
2.2 Representations and Warranties of Purchaser. Purchaser represents
and warrants to Unigene that, as of the date hereof:
(a) Organization, Good Standing and Qualification. Purchaser
is duly incorporated, validly existing and in good standing under the laws of
the State of Delaware.
(b) Authorization. Purchaser has the corporate power necessary
to execute, deliver and perform this Agreement, and such execution, delivery and
performance have been duly authorized by all necessary corporate action on the
part of Purchaser. This Agreement has been duly executed and delivered by
Purchaser and constitutes a legal, valid and binding obligation of Purchaser,
enforceable against Purchaser in accordance with its terms.
(c) No Violations. The execution, delivery and performance of
this Agreement by Purchaser does not and will not: (i) violate any provision of
Purchaser's Certificate of Incorporation or By-laws; (ii) violate, breach or
constitute a
100
default (or an event or condition that with the giving of notice or the passage
of time or both could give rise to a default) under any material contract or
agreement to which Purchaser is a party or by which Purchaser is bound; (iii)
result in the creation of a lien, security interest, change or encumbrance on
any property or assets of Purchaser, (iv) require the authorization, consent or
approval of, or filing with, any court or any administrative or governmental
body pursuant to any law, statute, rule or regulation to which Purchaser is
subject or any order, judgement or decree by which Purchaser is bound; or (iv)
constitute a default under or violate any law, statute, rule or regulation to
which Purchaser is subject or any order, judgement or decree of any court,
administrative agency or arbitrator by which Purchaser is bound.
(d) Litigation. There is no suit, action or other proceeding
of any nature pending or, to the best knowledge of Purchaser, threatened against
Purchaser before any court or other governmental agency or instrumentally that
challenges or seeks to prevent the consummation of the transactions contemplated
by this Agreement.
(e) Purchase Entirely For Own Account; Investment Experience;
Access to Information. Purchaser is purchasing the shares of Common Stock for
its own account without a view to any distribution thereof in violation of the
Securities Act, or any applicable state securities laws, and Purchaser is
experienced in evaluation and making investments of this type, and has had
access to, and has received, all information concerning Unigene that it
reasonably has required to evaluate its investment in the shares of Common
Stock.
(f) Accredited Investor. Purchaser is financially able to bear
the risks of an investment in the shares of Common Stock and is an "accredited
investor" within the meaning of Rule 501 of Regulation D under the Securities
Act. Purchaser understands and acknowledges that an investment in the Common
Stock is speculative and involves a high degree of risk.
(g) Restricted Securities. Purchaser acknowledges that Unigene
is selling the shares of Common Stock pursuant to an exemption from registration
under Section 4(2) of the Securities Act in reliance on the representations and
warranties of Purchaser herein, and agrees that the shares of Common Stock may
be offered, sold, pledged or otherwise transferred by Purchaser only if the
transaction is registered under the Securities Act or is effected pursuant to an
exemption from such registration requirements.
101
(h) Legends. Purchaser agrees that the following legend shall
be placed on the certificate(s) evidencing the shares of Common Stock for so
long as the shares remain "restricted securities" within the meaning of Rule 144
under the Securities Act:
"The shares represented by this certificate have not been
registered under the Securities Act of 1933, as amended. Such
shares have been acquired for investment and may not be
offered, sold, pledged or otherwise transferred, except in
compliance with the registration requirements of said Act or
pursuant to an exemption therefrom."
Purchaser understands that, while such legend remains on the certificate(s)
evidencing the shares of Common Stock, Unigene will direct its transfer agent to
maintain "stop transfer" procedures with respect to the shares. Unigene agrees
that, when the Shares of Common Stock become eligible for sale pursuant to the
provisions of Rule 144(k) under the Securities Act, Unigene will direct the
transfer agent to remove the above-referenced legend from any certificates
tendered by Purchaser for such purpose.
ARTICLE III
MISCELLANEOUS
3.1 Expenses. All legal and other costs and expenses incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such expenses.
3.2 Amendments; Waivers. Any provisions of this Agreement may be
amended or waived by the parties hereto if, but only if, such amendment or
waiver is in writing and is signed by both parties hereto. No failure or delay
by any party hereto in exercising any right, power or privilege hereunder shall
operate as a waiver thereof nor shall any single or partial exercise of any
right, power or privilege hereunder preclude any other or further exercise
thereof or the exercise of any other right, power or privilege.
3.3 No Third Party Beneficiaries. This Agreement is made solely for the
benefit of the parties hereto and shall not confer any rights on any other
person.
3.4 Notices. Any notice, demand, request, consent, approval or other
communication that is required or permitted to be given or made by a party to
the other pursuant to any provision of this Agreement shall be given or made in
writing
102
and shall be served personally or shall be sent by facsimile transmission or
overnight delivery addressed to the party as follows:
If to Unigene:
Unigene Laboratories, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to Purchaser:
▇▇▇▇▇▇-▇▇▇▇▇▇▇ Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: President, Pharmaceutical Sector
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇▇-▇▇▇▇▇▇▇ Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Vice President and General Counsel
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address as either party may from time to time advise the other
party hereto by notice in writing. Every such notice so given shall be deemed to
be received only upon delivery to the party to be charged with notice.
3.5 Severability. Should any provision of this Agreement for any reason
be declared invalid or unenforceable, such invalidity shall not affect the
validity or enforceability of any of the other provisions of this Agreement,
which shall remain in full force and effect, and the application of such invalid
or unenforceable provision to persons or circumstances other than those as to
which it is held invalid or unenforceable shall be valid and enforced to the
fullest extent permitted by law.
3.6 Headings. The descriptive headings of the several Articles and
Sections of this Agreement are inserted for convenience only, do not constitute
a part of this Agreement and shall not affect in any way the meaning or
interpretation of this Agreement.
103
3.7 Applicable Law. The validity and interpretation of this Agreement,
and the performance by the parties of their respective obligations hereunder,
shall be governed by the laws of the State of New York, without regard to the
choice of law provisions thereof.
3.8 Counterparts. This Agreement may be executed in two counterparts,
each of which shall be deemed an original, and it shall not be necessary in
making proof of this Agreement to produce or account for more than one
counterpart signed by the party to be charged thereby.
3.9 Entire Agreement. This Agreement contains the entire agreement of
the parties hereto with respect to the subject matter hereof, and supersedes all
previous agreements and understandings between the parties with respect to such
matters.
3.10 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns and transferees. This Agreement may not be assigned by either
party without the prior written consent of the other; provided, however, that
either party may assign its rights and delegate its duties hereunder to an
Affiliate thereof without obtaining such consent, provided that the assigning
party agrees to remain primarily (and not secondarily or derivatively) liable
for the full and timely performance by such Affiliate of all its obligations
hereunder.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first above written.
UNIGENE LABORATORIES, INC.
By:_________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇
President
▇▇▇▇▇▇-▇▇▇▇▇▇▇ COMPANY
By:_________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Vice President and
President, ▇▇▇▇▇-▇▇▇▇▇,
U.S. and Mexico
104
ANNEX D
▇-▇ Marketing Projections
Unigene Project
Oral Calcitonin Forecasts
$ Millions
Treatment Only
------------------------------------------------------------------------------------------------------------------------------------
Years YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 YEAR 8
After
Launch
------------------------------------------------------------------------------------------------------------------------------------
U.S. $[ ] $[ ] $[ ] $[ ] $[ ] $[ ] $[ ] $[ ]
------------------------------------------------------------------------------------------------------------------------------------
Europe [ ] [ ] [ ] [ ] [ ] [ ] [ ] [ ]
------------------------------------------------------------------------------------------------------------------------------------
Japan [ ] [ ] [ ] [ ] [ ] [ ] [ ] [ ]
------------------------------------------------------------------------------------------------------------------------------------
Total $[ ] $[ ] $[ ] $[ ] $[ ] $[ ] $[ ] $[ ]
------------------------------------------------------------------------------------------------------------------------------------
Treatment & Prevention
------------------------------------------------------------------------------------------------------------------------------------
Years YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 YEAR 8
After
Launch
------------------------------------------------------------------------------------------------------------------------------------
U.S. $[ ] $[ ] $[ ] $[ ] $[ ] $[ ] $[ ] $[ ]
------------------------------------------------------------------------------------------------------------------------------------
Europe [ ] [ ] [ ] [ ] [ ] [ ] [ ] [ ]
------------------------------------------------------------------------------------------------------------------------------------
Japan [ ] [ ] [ ] [ ] [ ] [ ] [ ] [ ]
------------------------------------------------------------------------------------------------------------------------------------
Total $[ ] $[ ] $[ ] $[ ] $[ ] $[ ] $[ ] $[ ]
------------------------------------------------------------------------------------------------------------------------------------
Treatment/Prevention/Bone Pain
------------------------------------------------------------------------------------------------------------------------------------
Years YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 YEAR 8
After
Launch
------------------------------------------------------------------------------------------------------------------------------------
U.S. $[ ] $[ ] $[ ] $[ ] $[ ] $[ ] $[ ] $[ ]
------------------------------------------------------------------------------------------------------------------------------------
Europe [ ] [ ] [ ] [ ] [ ] [ ] [ ] [ ]
------------------------------------------------------------------------------------------------------------------------------------
Japan [ ] [ ] [ ] [ ] [ ] [ ] [ ] [ ]
------------------------------------------------------------------------------------------------------------------------------------
Total $[ ] $[ ] $[ ] $[ ] $[ ] $[ ] $[ ] $[ ]
------------------------------------------------------------------------------------------------------------------------------------
105
ANNEX E
Example of Royalty Calculation
Quarter Royalty Post-Royalty Cumulative Royalty
Sales Transition Sales Calculation
Date Sales
------- ------- ------------ ----------- ------------
1 $[ ] $[ ] $[ ] $[ ] @ [ ]
2 $[ ] $[ ] $[ ] $[ ] @ [ ]
$[ ] @ [ ]
3 $[ ] $[ ] $[ ] $[ ] @ [ ]
$[ ] @ [ ]
4 $[ ] $[ ] $[ ] $[ ] @ [ ]
