EXHIBIT 10.23
FIRST AMENDMENT TO MANUFACTURING AND SUPPLY AGREEMENT
This First Amendment to Manufacturing and Supply Agreement (the "First
Amendment") is effective as of the 13th day of May, 2004 between aaiPharma Inc.
("AAI") and Mikart, Inc. ("Manufacturer").
WHEREAS, AAI and Manufacturer entered into that certain Manufacturing
and Supply Agreement dated July 16, 2003 (the "Supply Agreement").
WHEREAS, Section 15.5 of the Supply Agreement provides that the Supply
Agreement may only be amended by a written instrument executed by each Party to
the Supply Agreement.
WHEREAS, AAI and Manufacturer now wish to amend the Supply Agreement as
set forth herein.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and conditions herein contained, AAI and Manufacturer hereby agree to
amend the Supply Agreement as follows:
1. Capitalized terms not otherwise defined herein will have the meaning
given to them in the Supply Agreement.
2. Section 7.3 of the Supply Agreement shall be amended and restated in
its entirety as follows:
"7.3 Minimum Purchase Obligation. AAI will use commercially reasonable
efforts to promote the Product or "Substitute Products" (as hereinafter
defined), if any, during the first three (3) Contract Years.
Notwithstanding anything to the contrary contained in this Supply
Agreement, during the period beginning on the Supply Start Date and
ending as of the end of the third (3rd) Contract Year, AAI shall be
obligated to purchase from Manufacturer an aggregate of Two Million
Five Hundred Thousand (2,500,000) "Units" (as hereinafter defined) of
Product and/or any other product that the Parties mutually agree that
Manufacturer will manufacture for AAI pursuant to terms (including,
without limitation, market pricing) that are mutually agreeable to both
Parties ("Substitute Product"). For purposes hereof, a "Unit" of
Product shall mean a one hundred (100) count bottle of Product or such
other presentation that the Parties may mutually agree upon, and a
"Unit" of Substitute Product shall mean the presentation mutually
agreed upon by the Parties (e.g., the size of bottle). For purposes of
clarity, AAI may meet its minimum purchase obligation under this
Section 7.3 by purchasing any combination of quantities of Product and
Substitute Product (e.g., 1,500,000 Units of Product and 1,000,000
Units of Substitute Product). Notwithstanding anything else contained
herein to the contrary, in the event AAI fails to meet its minimum
purchase obligation set forth in this Section 7.3 for any reason other
than a breach of this Agreement by Manufacturer or a force majeure, AAI
shall pay to
Manufacturer an amount equal to the number of one hundred (100) count
bottles of Product by which AAI failed to meets its minimum purchase
obligation under this Section 7.3 multiplied by the Purchase Price set
forth in Section 8.1 hereof. Manufacturer and AAI acknowledge and agree
that nothing contained in this Section 7.3 shall be construed in any
way to relieve AAI of its minimum purchase obligation under this
Section 7.3."
3. This First Amendment modifies the Supply Agreement solely to the
extent provided herein and in all other respects the Supply Agreement shall
remain in full force and effect and Manufacturer shall retain all rights and
remedies available to it thereunder.
IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment as of the date first above written.
"Manufacturer"
Mikart, Inc.
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President and CEO
"AAI"
aaiPharma Inc.
By: /s/ Xxxx Xxxxxxxx
------------------------------------
Name: Xxxx Xxxxxxxx
Title: President/Chief Executive Officer
