Supply of API. (a) In accordance with the terms and subject to the conditions of this Agreement, Plantex shall supply Purepac and Purepac shall purchase from Plantex, the requirements of Purepac and the Purepac Designees for API for their validation and commercial manufacture of the Finished Products to be sold or distributed in the Territory. In addition to the **** MT of the Second API that Purepac presently has in its possession, Purepac shall purchase from Plantex during the period commencing April 2004 through **** (the "Initial Period") the quantity of API set forth in the schedule below (collectively, the "New API"). Plantex shall ship the New API to Purepac on the thirtieth (30th) day of each month set forth in such below schedule; provided, however, that at Plantex's option it may ship the New API and Purepac shall purchase same on a commercially reasonable accelerated basis determined by Plantex. **** **** MT **** **** MT **** **** MT **** **** MT **** **** MT **** **** MT **** **** MT **** **** MT **** **** MT (b) From and after the Initial Period in accordance with the provisions of this Agreement, Plantex shall supply Purepac with its and the Purepac Designees aggregate requirements of additional API pursuant to Purchase Orders. Purchases of all API hereunder shall be at the respective prices set forth in Section 5 hereof. 2.2 Except as otherwise specifically provided for in this Section 2.2, Purepac's purchase of API from Plantex and Plantex's supply to Purepac will be on a non-exclusive basis, provided however, that: (a) subject to the provisions set forth in Section 2.3 hereof, and subsection (b) below, Purepac shall purchase from Plantex not less than **** percent (****%) of its and the Purepac Designees aggregate commercial requirements of API for each fiscal year during the term of this Agreement; during the Initial Period, except as otherwise expressly provided, Purepac (for itself and all the Purepac Designees) shall purchase API exclusively from Plantex, and Plantex shall supply to Purepac (including the Purepac Designees), the New API according to the schedule set forth in Section 2.1(a) hereof. **** As such additional amounts become available, Plantex shall promptly notify Purepac. Plantex agrees to cooperate in good faith with Purepac to deliver the above additional amounts of API to Purepac as soon as practicable and as part of its regular API production in accordance with the production capacity notified to Purepac; and if, however, during any month of the Initial Period, Purepac desires to purchase quantities of API in excess of the amounts set forth above in Section 2.2(b) hereof, Purepac shall provide Plantex with written notice thereof setting forth the additional desired quantities in a proposed purchase order. Plantex shall have the right, but not the obligation, to supply such additional quantities or portions thereof. If it decides to supply less than all of such additional quantities, Purepac shall not be restricted from buying such remaining quantities from a third party. 2.3 Notwithstanding the foregoing Section 2.2, during any period in which Plantex for any reason, other than a breach of this Agreement by Purepac, fails to timely ship the specific quantities set forth in Section 2.1(a) hereof or as set forth in Purchase Orders hereunder (a "Period of Non-Supply"), Purepac shall be entitled to purchase from a third party such deficiency only and, as a result, Purepac's obligation to purchase **** percent (****%) or ****percent (****%), as the case may be, of Purepac's and the Purepac Designees requirements of API from Plantex for the fiscal year or years in which the Period of Non-Supply occurs shall be decreased by the amount of such deficiency purchased from such third party. Nothing in this Section 2.3 shall in any way be deemed to limit or restrict Purepac's right, if any, to terminate this Agreement, to the extent otherwise permitted by the provisions of Section 16, it being understood, however, that Plantex shall not be considered in default if it fails to ship during any month an amount of up to **** percent (****%) of the aggregate amount for any Purchase Orders hereunder (including as set forth in the Schedule in Section 2.1(a) hereof), provided that, ****. 2.4 Subject to the following conditions of this Section 2.4, Plantex shall not be restricted or otherwise limited in any way from selling API to any other parties for any purpose: (a) nothing in this Section 2.4 shall in any way limit or reduce any obligations of Plantex to meet all of its obligations to supply API to Purepac in accordance with the terms of this Agreement; (b) in the event that Plantex, at any time and for any reason, shall be unable to fill, on a timely basis, any Purchase Order (including deemed orders pursuant to Section 4.2 hereof) for API of Purepac (issued in accordance with the requirements of this Agreement) and any purchase order for API of third parties issued during the term of this Agreement, ****. 2.5 Purepac represents and warrants to Plantex that the quantity of all API delivered or to be delivered to Purepac during the Initial Period is Purepac's good faith estimate of its (and the Purepac Designees) requirements for API to be processed into Finished Product for sale in the Territory during the Exclusivity Period. If notwithstanding such good-faith estimate Purepac or its Affiliates decide not to, or are otherwise unable to (including as a result of an event of force majeure) process any of such API in a timely manner so that such API can be sold as Finished Product in the Territory during the Exclusivity Period, ****. Further, Purepac covenants to process only so much of such API into Finished Product that it, in good faith, reasonably estimates it shall sell in the Territory during the Exclusivity Period. 2.6 In the event an injunction, restraining order or similar judicial relief, as well as a final non-appealable decision or judgment entered by an appropriate court is entered (the "Entry Date") against Purepac or any of its Affiliates prohibiting Purepac from manufacturing, marketing or selling Products in the Territory, then notwithstanding any other provision of this Agreement to the contrary, Purepac will be required to pay Plantex for all API ordered through the end of the calendar month following the month in which the injunction, order, relief, decision or judgment is entered (the "Wind-down Quantity"), payable ****percent (****%) within **** days of the Entry Date and the remaining **** (****%) percent within **** days of the Entry Date, and thereafter unless the parties otherwise mutually agree all further purchase requirements under this Agreement will be suspended until the vacating of such injunction, order or relief (at which time Plantex shall deliver, within a reasonable time thereafter, the Wind-down Quantities to Purepac). Likewise, in the event of the foregoing or similar judicial action, order, decision, relief or adverse decision or ruling of a court against or effecting Plantex or its Affiliates, Plantex may immediately suspend all further shipments of API to Purepac and the Purepac Designees and all further purchase requirements under this Agreement will be suspended until the vacating of such injunction, order or relief and, notwithstanding any other provision of this Agreement to the contrary, Purepac shall pay Plantex for all unpaid orders within **** days thereafter. To the extent that any amount of the **** MT of API referred to in Section 5.2(b) hereof has not yet been delivered to Purepac at the time any such Entry Date, all amounts paid for such portion of the **** MT of API yet to be delivered shall be offset against up to **** percent (****%) of the amounts payable for the Wind-down Quantities, with the balance of the payment for the Wind-down Quantities to be paid within the period set forth above in this Section 2.6. Any such off-set amount shall be paid by ALO to Plantex upon the delivery of such balance of said **** MT of API.
Appears in 1 contract
Sources: Supply Agreement (Alpharma Inc)
Supply of API. (a) In accordance with the terms and subject to the conditions of this Agreement, Plantex shall supply Purepac and Purepac shall purchase from Plantex, the requirements of Purepac and the Purepac Designees for API for their validation and commercial manufacture of the Finished Products to be sold or distributed in the Territory. In addition to the **** *MT of the Second API that Purepac presently has in its possession, Purepac shall purchase from Plantex during the period commencing April 2004 through **** December 2004 (the "Initial Period") the quantity of API set forth in the schedule below (collectively, the "New API"). Plantex shall ship the New API to Purepac on the thirtieth (30th) day of each month set forth in such below schedule; provided, however, that at Plantex's option it may ship the New API and Purepac shall purchase same on a commercially reasonable accelerated basis determined by Plantex. April **** *MT May **** *MT June **** *MT July **** *MT August **** *MT September **** *MT October **** *MT November **** *MT December **** **** MT **** **** MT **** **** MT **** **** MT **** **** MT
(b) From and after the Initial Period in accordance with the provisions of this Agreement, Plantex shall supply Purepac with its and the Purepac Designees aggregate requirements of additional API pursuant to Purchase Orders. Purchases of all API hereunder shall be at the respective prices set forth in Section 5 hereof.
2.2 Except as otherwise specifically provided for in this Section 2.2, Purepac's purchase of API from Plantex and Plantex's supply to Purepac will be on a non-exclusive basis, provided however, that:
(a) subject to the provisions set forth in Section 2.3 hereof, and subsection (b) below, Purepac shall purchase from Plantex not less than **** percent (****%) of its and the Purepac Designees aggregate commercial requirements of API for each fiscal year during the term of this Agreement; during the Initial Period, except as otherwise expressly provided, Purepac (for itself and all the Purepac Designees) shall purchase API exclusively from Plantex, and Plantex shall supply to Purepac (including the Purepac Designees), the New API according to the schedule set forth in Section 2.1(a) hereof. Plantex shall provide reasonable advance notice to Purepac of the date upon which Teva USA will have available to it, from any source, an aggregate amount of API equivalent to the aggregate amount of API shipped by Plantex to Purepac and the Purepac Designees (including the **** MT of the Second API); at such time Plantex shall also notify Purepac of its then current forecast capacity for the Territory for the use of the parties hereunder for the subsequent year. When Teva USA has received for the Territory an aggregate amount of API equivalent to the aggregate amount of API shipped by Plantex to Purepac and the Purepac Designees (including the **** MT of the Second API), Purepac shall have the right to issue a Purchase Order, for shipment during a designated calendar month during the Initial Period for additional amounts of API of up to **** percent (****%) of that portion of Plantex's API capacity then available to Teva USA for the Territory which exceeds **** times the amount of API allotted to Purepac for such calendar month as set forth in the schedule in Section 2.1(a) hereof. As such additional amounts become available, Plantex shall promptly notify Purepac. Plantex agrees to cooperate in good faith with Purepac to deliver the above additional amounts of API to Purepac as soon as practicable and as part of its regular API production in accordance with the production capacity notified to Purepac; and if, however, during any month of the Initial Period, Purepac desires to purchase quantities of API in excess of the amounts set forth above in Section 2.2(b) hereof, Purepac shall provide Plantex with written notice thereof setting forth the additional desired quantities in a proposed purchase order. Plantex shall have the right, but not the obligation, to supply such additional quantities or portions thereof. If it decides to supply less than all of such additional quantities, Purepac shall not be restricted from buying such remaining quantities from a third party.
2.3 Notwithstanding the foregoing Section 2.2, during any period in which Plantex for any reason, other than a breach of this Agreement by Purepac, fails to timely ship the specific quantities set forth in Section 2.1(a) hereof or as set forth in Purchase Orders hereunder (a "Period of Non-Supply"), Purepac shall be entitled to purchase from a third party such deficiency only and, as a result, Purepac's obligation to purchase **** percent (****%) or ***** percent (****%), as the case may be, of Purepac's and the Purepac Designees requirements of API from Plantex for the fiscal year or years in which the Period of Non-Supply occurs shall be decreased by the amount of such deficiency purchased from such third party. Nothing in this Section 2.3 shall in any way be deemed to limit or restrict Purepac's right, if any, to terminate this Agreement, to the extent otherwise permitted by the provisions of Section 16, it being understood, however, that Plantex shall not be considered in default if it fails to ship during any month an amount of up to **** percent (****%) of the aggregate amount for any Purchase Orders hereunder (including as set forth in the Schedule in Section 2.1(a) hereof), provided that, ****any such shortfalls are equally shared by Teva USA based upon its then current order for API.
2.4 Subject to the following conditions of this Section 2.4, Plantex shall not be restricted or otherwise limited in any way from selling API to any other parties for any purpose:
(a) nothing in this Section 2.4 shall in any way limit or reduce any obligations of Plantex to meet all of its obligations to supply API to Purepac in accordance with the terms of this Agreement;
(b) in the event that Plantex, at any time and for any reason, shall be unable to fill, on a timely basis, any Purchase Order (including deemed orders pursuant to Section 4.2 hereof) for API of Purepac (issued in accordance with the requirements of this Agreement) and any purchase order for API of third parties issued during the term of this Agreement, ****then Plantex shall first supply the API under Purchase Orders for Purepac before supplying API under orders of any such third party; provided, that notwithstanding the foregoing, for purposes of this provision neither Teva nor any of its Affiliates shall be deemed third parties, and therefore if Plantex cannot fill both the purchase orders of Teva and its Affiliates for API and the Purchase Orders of Purepac, then (i) for API to be used in Products intended for sale in the Territory during the Exclusivity Period, the shortfall shall be allocated upon consideration of the then total API inventory for the Territory of Purepac and its Affiliates, on the one hand, and Teva USA, on the other hand, such that each ends up with the same total inventory amount of API following the allocation (e.g. if one such party has ten (10) tons of API less than the other such party in inventory, ten (10) tons of API would be allocated to it first, then the rest of the available API would be allocated equally between such parties) and (ii) for API to be used in Products intended for sale in the Territory after the Exclusivity Period, Purepac and its Affiliates, on the one hand, and Teva USA, on the other hand, shall be provided with such limited supply of API in the same proportion as the API used in Finished Products sold in the Territory by Purepac and the Purepac Designees during the then preceding six (6) month period bears to the API used in Product sold in the Territory by Teva USA and its designees during such preceding six (6) month period.
2.5 Purepac represents and warrants to Plantex that the quantity of all API delivered or to be delivered to Purepac during the Initial Period is Purepac's good faith estimate of its (and the Purepac Designees) requirements for API to be processed into Finished Product for sale in the Territory during the Exclusivity Period. If notwithstanding such good-faith estimate Purepac or its Affiliates decide not to, or are otherwise unable to (including as a result of an event of force majeure) process any of such API in a timely manner so that such API can be sold as Finished Product in the Territory during the Exclusivity Period, ****then it shall immediately offer to return such unprocessed API to Plantex and Plantex shall have the right to accept such return and credit to Purepac all amounts received in payment therefor. Further, Purepac covenants to process only so much of such API into Finished Product that it, in good faith, reasonably estimates it shall sell in the Territory during the Exclusivity Period.
2.6 In the event an injunction, restraining order or similar judicial relief, as well as a final non-appealable decision or judgment entered by an appropriate court is entered (the "Entry Date") against Purepac or any of its Affiliates prohibiting Purepac from manufacturing, marketing or selling Products in the Territory, then notwithstanding any other provision of this Agreement to the contrary, Purepac will be required to pay Plantex for all API ordered through the end of the calendar month following the month in which the injunction, order, relief, decision or judgment is entered (the "Wind-down Quantity"), payable ***** percent (****%) within **** sixty (60) days of the Entry Date and the remaining **** (****%) percent within **** one hundred and eighty (180) days of the Entry Date, and thereafter unless the parties otherwise mutually agree all further purchase requirements under this Agreement will be suspended until the vacating of such injunction, order or relief (at which time Plantex shall deliver, within a reasonable time thereafter, the Wind-down Quantities to Purepac). Likewise, in the event of the foregoing or similar judicial action, order, decision, relief or adverse decision or ruling of a court against or effecting Plantex or its Affiliates, Plantex may immediately suspend all further shipments of API to Purepac and the Purepac Designees and all further purchase requirements under this Agreement will be suspended until the vacating of such injunction, order or relief and, notwithstanding any other provision of this Agreement to the contrary, Purepac shall pay Plantex for all unpaid orders within **** one hundred and eighty (180) days thereafter. To the extent that any amount of the **** *MT of API referred to in Section 5.2(b) hereof has not yet been delivered to Purepac at the time any such Entry Date, all amounts paid for such portion of the **** *MT of API yet to be delivered shall be offset against up to **** percent (****%) of the amounts payable for the Wind-down Quantities, with the balance of the payment for the Wind-down Quantities to be paid within the period set forth above in this Section 2.6. Any such off-set amount shall be paid by ALO to Plantex upon the delivery of such balance of said **** *MT of API.
Appears in 1 contract
Sources: Supply Agreement (Alpharma Inc)