AGREEMENT FOR THE PURCHASE AND SALE OF BLOOD PLASMA
AGREEMENT
FOR THE PURCHASE AND SALE
OF
BLOOD PLASMA
THIS
AGREEMENT (the “Agreement”) is made and entered into this July 12, 2007, by and
between LEV
PHARMACEUTICALS, INC,
a
Delaware corporation, with its principal place of business at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ (“Purchaser”) and DCI
MANAGEMENT GROUP LLC,
a
Delaware Limited Liability Corporation with its principal place of business
at
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (“Seller”).
ARTICLE
1. RECITALS
This
Agreement is made on the basis of the following facts:
1.1 Definition
of Plasma.
The
term “Plasma” as used in this Agreement shall refer to the production of normal
source plasma (as defined by the U.S. Food and Drug Administration (“FDA”) in 21
C.F.R. 640.40) to be derived from automated plasmapheresis procedures conducted
at Seller’s FDA-approved and IQPP-certified Plasma donor centers (the
“Centers”), which Centers shall be operated by Seller , all of which Plasma,
collected and released by Seller shall comply with the specifications set forth
herein, specifically those specifications set forth in the Source Plasma
Specifications and Contract Manufacturing Agreement (hereafter, the
“Specifications”), attached hereto as Exhibit A and otherwise in compliance with
all Applicable Laws. As used herein, “Applicable Laws” means all applicable
federal, state and local laws, regulations, rules, requirements and directives,
including applicable current Good Manufacturing Practices (“cGMPS”), including
all specifications and procedures for plasma sourcing, plasma testing, and
in
process testing and all applicable FDA laws, requirements, regulations,
guidelines, licenses and directives, now in effect and as may be amended from
time to time during the term of this Agreement.
ARTICLE
2. TERMS
OF SALE
2.1 Agreement
to Purchase and Sell.
During
the 24 month period commencing upon the date of signing of this Agreement,
the
Seller will give its best efforts to supply to Purchaser a total of * * * liters
of Plasma (the ‘first * * * liters). Thereafter, Seller will use its best
efforts to supply the minimum quantities of Plasma indicated below. This total
includes production from current existing centers and 1 future center (the
‘New
Center’). Exhibit ‘C’ below contains a list of Seller’s existing centers. The
New Center is estimated to be opened by the Seller by the end of 2007 with
some
Plasma produced by the New Center designated to the Purchaser. The Plasma from
the New Center is estimated to be available after FDA approvals are obtained
by
the end of 2008 or beginning of 2009. The proposed delivery schedule is below.
Proposed
Delivery Schedule: From Existing Centers
July,
2007-December, 2007:
* * *
Liters
Actual
volume and schedule for 2007 will be determined by August 15, 2007. This will
include an estimated monthly shipping schedule.
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
From
Existing and New Centers (combined):
January,
2008-December, 2008: Minimum *
* *
Liters.
Plasma
for 2008 will come from the New Center and from existing centers. Plasma from
the New Center collected in 2007 and 2008 as applied against the committed
volumes for 2007 and 2008 will not be released to Purchaser until FDA licensure
is obtained for the New Center. * * * Accordingly, during 2008 a minimum of
* *
* liters of Plasma will be supplied from existing centers only.
January,
2009-December, 2009: Minimum *
* *
Liters
January,
2010-December, 2010: Minimum *
* *
Liters
January,
2011-December, 2011: Minimum *
* *
Liters
Note:
For the yearly periods beginning in January, 2009 thru December 2011, Seller
will provide the Purchaser a more specific range with estimated monthly
production. This information will be given to Purchaser by September 30 of
the
prior year.
Note:
For all periods above, Seller will use its best efforts to supply +/- 10% of
the
volumes indicated.
Note:
Any
additional volume desired by Purchaser above the Minimum requirements provided
above must be presented to Seller and reviewed by Seller and mutually agreed
to
by Purchaser and Seller by June 30 of the prior year.
2.2 Price
and Payment.
2.2.1 Prices
Initial
*
* *
Liters
(the First *
*
*)
collected (from either existing centers or the New
Center):
IQPP
Automated Source Plasma *
* *
/liter FOB Center *
Note:
The
price paid by Purchaser will be * * * /Liter as long as Seller is bearing the
cost of the 2 required NAT tests. See Section 3.2 below.
Volume
over initial *
* *
Liters
collected (from either existing centers or the New
Center):
IQPP
Automated Source Plasma *
* *
/liter FOB Center Initial price after threshold of * * * Liters is
reached.
Note:
The
price paid by Purchaser will be * * * plus any required NAT testing provided
by
Seller. See Section 3.2 below.
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
2
*
This
price * * * will be in effect for the first * * * Liters. As soon as that
threshold is reached the price is reduced to the lower price of * * * until
December 31 of that year.
The
price
for subsequent years will be reviewed by October 31st
of the
prior year and mutually agreed to between the parties. * * *
All
prices are FOB Center. Transportation charges to RxCrossroads will be the
responsibility of the Purchaser except as noted below for New Centers - centers
that have not yet been licensed by the FDA. If Purchaser does not have an
account at RxCrossroads Seller will arrange for transportation and storage
(if
required) and charge Purchaser at cost. The charges will be indicated on each
invoice.
The
costs
of any additional testing or other procedures required by FDA, QPP or any other
regulatory authority or the Purchaser other than as contemplated hereunder
(including the Specifications) shall be added to the per liter prices as stated
above and will not be included in the annual increase calculations based on
costs to be incurred by Seller. Correspondingly, in the event that Purchaser
reduces or eliminates any testing or other quality procedure so as to result
in
an actual decrease in Seller’s incurred costs to procure, store, provide or
supply the Plasma hereunder, the price then in effect under this Agreement
shall
be proportionately decreased to reflect all of Seller’s corresponding cost
savings.
New
Center: The
Seller will open a New Center to meet the current and future requirements of
the
Purchaser. The Purchaser shall purchase plasma from the New Center (the
“Pre-Licensed Product”) prior to the center’s receipt of FDA approval. Once FDA
approval has been obtained and the Pre-Licensed Product conforms to the
Specifications, it shall be deemed to be Plasma. For the avoidance of doubt,
plasma that is delivered to Purchaser and becomes in conformity with the
Specifications later than 36 months after the date it is collected, shall not
be
deemed to be Plasma. * * * such payment to be made within fifteen (15) days
after receipt of a valid and accurate monthly invoice. * * * Such payment will
be made within Fifteen (15) days after receipt by the Purchaser of the Seller’s
invoice. A late fee of 18% per Annum will be applied to all late invoice
payments.
In
the
event that the Pre-Licensed Product has not been deemed to be Plasma within
36
months of the date the Pre-Licensed Product was collected, the * * *.
The
price
and volume commitments for the Pre-Licensed Plasma will be based on the * *
* as
per the terms of this agreement. * * *, the Purchaser shall be responsible
for
all NAT testing costs as stated below
The
Seller will be responsible for all storage charges at RxCrossroads until *
*
*.
2.2.2
Terms / Title.
Payment
for Plasma collected from Seller’s existing centers shall be Cash in Advance
(immediately available US funds) wired into Seller’s designated bank account on
a monthly basis as follows:
a)
The
first payment of * * * will be due at signing to cover the first * * * liters
shipped.
b)
In the
month before the last of the initial * * * liters is shipped, the following
procedure will be initiated on a monthly basis. The Seller will issue a
pro-forma invoice to the Purchaser covering the estimated monthly total volume
to be shipped to the Purchaser in the following month. This invoice will be
forwarded to the Purchaser by the 15th
of the
month prior to the shipments.
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
3
c)
The
Purchaser will then transfer the invoiced amount as available funds in the
Seller’s bank account by the 20th
of the
month prior to the shipments. (Within 5 days of purchaser’s receipt of invoice)
The wiring instructions are in Exhibit D at the end of this
agreement.
d)
During
the shipment month previously invoiced and paid for by the Purchaser, the Seller
will issue invoices against the received funds. These invoices will represent
the actual amount shipped from the center and the Seller will provide the
Purchaser a running total of funds used against the monies previously
received.
e)
If, at
the end of the month, there are unapplied funds on the Purchaser’s side, these
funds will be applied to the following month shipments.
f)
If at
the end of the month, the Seller has shipped more plasma than covered by the
monies previously received, the Seller will request that the Purchaser make
immediate transfer to the Seller’s bank account for the difference.
g)
If any
shipment to the Purchaser is made from Seller’s center to * * * as specified in
section 3.2 below, because the * * *, this will be considered a sale to the
Purchaser on the day of shipment and the payment will be applied immediately
against monies received. In this event, the Seller will be * * *.
h)
Clean
and unrestricted title to Plasma shipped to Purchaser transfers at the Seller’s
center upon execution of ▇▇▇▇ of Lading (BOL) with RxCrossroads. This covers
shipments directly to Purchaser * * *. Since title transfers to Purchaser upon
execution of ▇▇▇▇ of Lading at Seller’s center, any damages sustained beyond
that point, even if shipped under Seller’s account, will be the responsibility
of the Purchaser.
2.2.3 Shipment
Costs.
Purchaser agrees to bear all costs of shipments, freight, insurance and all
governmental taxes and duties incurred during shipping of the Plasma sold
hereunder from the Centers to Purchaser’s receiving terminal (RxCrossroads) * *
*. It is agreed that the shipments from the plasma centers will be bi-weekly
or
weekly depending on the volume at each of Seller’s Centers designated to
Purchaser.
2.3 Term
of the Agreement.
The
term of this Agreement shall be fifty-four (54) months commencing on the date
first set forth above and ending on December 31, 2011 (the “Initial Term”). The
Initial Term and any renewal term shall, collectively, be referred to herein
as
the “Term”.
2.4
Purchase
of Closing Inventory
At
the
termination or expiration of this agreement, the Seller is obligated to sell,
and Purchaser is obligated to buy from the Seller, the Seller’s inventory of
source Plasma collected at the Centers by Seller for Purchaser prior to the
termination or expiration of this Agreement, provided such Plasma meets all
specifications set forth in this Agreement, and such Plasma shall be purchased
at the same price that Purchaser was paying Seller prior to the termination
or
expiration of the Agreement. Any volumes collected by the Seller for the
Purchaser during the 60 day period prior to such termination or expiration
to
meet the minimum commitment during the last year of the Agreement will be the
sole Closing Inventory and will be accepted by Purchaser when all required
testing is complete. In no event shall the total Closing Inventory which
Purchaser may be obligated to purchase exceed the minimum quantity specified
in
Section 2.1 of this Agreement.
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
4
ARTICLE
3. GENERAL
PROVISIONS
3.1 Specifications.
Seller
warrants and agrees that all Plasma sold to Purchaser hereunder will meet the
Purchaser’s Specifications, as well as the following requirements and
conditions:
The
Seller's centers must be approved plasma centers and licensed by the Food and
Drug Administration (FDA) utilizing an approved system of procedures. The Seller
acknowledges that they have received a full, complete and accurate copy of
the
Purchaser’s Specifications as in effect as of the date of this agreement (see
Exhibit A). The Seller also agrees to have all of their plasma Centers QPP
certified (quality plasma program as defined by PPTA) and to maintain that
certification for the entire term (including renewal periods) of this agreement.
Any FDA licensed Center, that is not QPP certified during any portion of this
agreement can be excluded from supplying plasma to Purchaser, but the lost
plasma volume, at the Sellers option, may be replaced from one or more other
centers operated by the Seller that are approved plasma centers, and that meet
Purchaser specifications (including QPP certification).
The
Seller represents and warrants that all plasma sold to Purchaser under this
agreement will be collected, processed, tested, stored, packaged, labeled and
shipped in strict accordance with the Purchaser’s Specifications and all
Applicable Laws.
If
any of
the Seller's Centers are closed as a result of regulatory sanctions placed
on
the Seller's Centers by the FDA, or if any Center is found by Purchaser to
be
clearly deficient, the Seller will have 30 working days to provide, in writing,
a corrective action plan acceptable to Purchaser. If the action plan is
unacceptable, or if the Seller's Center cannot provide Plasma within 60 days
of
a closure, this Agreement, at the Seller's option, can be modified to eliminate
such center and replace it with one or more other approved plasma centers owned
by the Seller that meet Purchaser’s Specifications within 60 days of any such
modification of this agreement. If Seller requests an additional Center to
be
added to this agreement, Purchaser agrees to inspect and approve, if the Center
meets Purchaser’s specification, any such additional center within ten (10)
working days. Purchaser and Seller agree to give best efforts to complete all
documentation within the ten (10) day period.
The
Seller shall operate each Center in accordance with its FDA-approved Standard
Operating Procedure (SOP). Seller further warrants that each Center shall be
operated in full compliance with all applicable immigration and labor laws
and
regulations, including, but not limited to, satisfactory compliance with I-9
documentation and regulations.
Seller
agrees to permit Purchaser and any authorized representative of Purchaser,
the
FDA, and any State or local governmental agency to conduct inspections of the
centers and testing facilities at any time for the purposes of ensuring
compliance with this Agreement or with all Applicable Laws and regulatory
requirements, and will permit them to review all records kept by Seller
regarding the collection, storage, processing and shipment of source Plasma.
Purchaser, at its sole option and expense, shall have the right to make and
retain copies of all such records kept by Seller. The Seller agrees to provide
Purchaser with copies of all written reports (including FDA 483's) and
correspondence between the Seller's centers and any governmental agency
regarding any such inspection or review of records within thirty (30) days
of
the issuance of any such report. Not supplying these reports to Purchaser within
60 days after written request is received from Purchaser will constitute a
breach and will be grounds for the early termination of this agreement.
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
5
In
the
event that the costs incurred by the Seller in the collection, packaging,
sampling, labeling, testing, processing or storage of plasma are increased
or
decreased to any extent above or below the cost in effect as of the date of
this
Agreement as a result of a modification by Purchaser of the specification,
than
the purchase price per liter shall be increased or decreased to the extent
properly allocable to the plasma sold to Purchaser under this agreement, using
generally accepted cost accounting principles. In the event a governmental
mandated program significantly affects the Seller's costs, then the parties
will
negotiate how the costs or savings will be shared. All cost allocations are
independent of section 2.2 of this Agreement.
3.2 Testing:
Serology:
The
Seller will supply all ELISA testing: (HIV ½, HBsAg, and HCV) at its current
laboratory.
NAT:
PCR
testing as specified above shall be performed by:
National
Genetics Institute (“NGI”)
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Seller’s
collection centers currently send NAT (nucleic acid test) samples to NGI using
Seller’s NAT sample packing and shipment procedures and materials.
For
2007,
to expedite delivery to Purchaser, Purchaser agrees to require NAT testing
only
for NAT-HIV-1 and NAT-HCV using Seller’s account at NGI. The Purchaser agrees
that for plasma that is NAT tested using Seller’s accounts, there will be an
additional charge of * * * per Liter. This charge will include all supplies
and
materials required to ship samples and complete the NAT testing. Seller will
send samples to NGI using the Purchaser supplied FEDEX account number. If the
Seller’s costs for these tests increase, Purchaser agrees to pay the additional
costs.
After
2007, Purchaser has the option to establish a separate account with NGI that
will be used by Seller to submit NAT samples for source plasma designated for
Purchaser. A Data Interchange Agreement between NGI, Purchaser, and Seller
must
be established in order to facilitate NAT testing and result reporting to Seller
and Purchaser. This agreement will establish a new NGI account number to be
used
by Seller to test plasma units for Purchaser. As per FDA requirements, Seller
requires only NAT-HCV and NAT-HIV-1 results from NGI before shipment. Purchaser
may wish to test additionally for NAT-HBV and/or NAT-HAV and/or PARVO. Seller
will send samples to NGI using the Purchaser supplied FEDEX account number.
Any
additional test results may require adjustment to pricing and delivery
schedules. Please note that * * * will be charged to Purchaser at the contract
price per Liter. Seller will invoice Purchaser for all such units * * *; the
invoice will include a detailed listing of the units and volume involved. This
invoice will be issued to Purchaser on a quarterly basis for the volume * *
*.
Purchaser may inspect the Seller’s Center’s * * * during any inspection of
Seller’s Centers. Also, please note that for any units * * *.
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
6
|
1.
|
NGI
will report directly to Seller, under either Seller’s account or the
aforementioned new NGI account number to be established for the Purchaser,
the required NAT test results (NAT HIV-1 and NAT HCV) and, if using
the
Purchaser’s account, whatever the current Purchaser required additional
test (NAT-HAV and/or NAT-HBV and/or PARVO) that Supplier must have
before
shipment.
|
|
2.
|
In
the event that the Purchaser has established an account for NAT testing,
NGI will make available all test results to Seller and to Purchaser
as
specified in the aforementioned Data Interchange Agreement to be
established.
|
If
the
Purchaser’s account is established and utilized, all costs associated with NAT
testing including sample shipments, sample packaging supplies, and air freight
will be the responsibility of the Purchaser. The Purchaser will supply a FEDEX
airfreight account number to the Seller for this use.
The
Seller agrees that samples for PCR testing * * *. PCR samples from qualified
donors * * *. PCR results, with the exception of re-tests, are expected to
be
received within 21 days of sample submission to NGI. Except as stated in the
following paragraph relating to * * *, the Seller shall properly store such
plasma until such time that all applicable tests are performed and completed,
and shall ship such plasma to Purchaser, only at such time that the applicable
test results are received
*
*
*:
It
is
agreed that in the event * * *, Seller shall ship Purchaser plasma to
RxCrossroads * * *. Purchaser will pay all charges associated with the shipment
and storage of plasma shipped to RxCrossroads. * * * a final invoice including
these charges will be issued to Purchaser and applied against the monthly
advance.
Purchaser
shall not be obligated to buy or pay for any Plasma pursuant to this agreement
or any option under this agreement, which does not, in all respects, comply
with
the applicable Purchaser Specifications and Applicable Laws.
3.3 Shipping
of Plasma.
Plasma
shall be packed by Seller in such a manner as to prevent damage to the Plasma
or
Plasma containers during shipping and shall be shipped by RxCrossroads subject
to such other conditions set forth in the Specifications, and any other written
instructions provided by Purchaser. No Plasma shall be released pursuant to
this
Agreement unless and until such Plasma fully complies with the Specifications
and Applicable Laws and Seller shall be responsible for ensuring compliance
with
all such Specifications. The parties agree that there may be * * *.
3.4 Licenses,
Permits and Approvals.
Seller
represents and warrants that it has obtained and shall continue to possess
during the Term hereof, a current, valid and unrevoked license from CBER
authorizing and qualifying Seller to conduct automated plasmapheresis as well
as
any special programs to be pursued by Seller at any or all of the Centers
identified herein, as well as a license permitting Seller to produce and ship
Plasma related products derived from the automated plasmapheresis operations
conducted at the Centers. In addition, Seller represents and warrants that
it
shall maintain for the Term of this Agreement, all other local, state and
federal licenses, permits and approvals required to operate the Center and,
as a
condition precedent to the commencement of Purchaser’s performance of its
obligations hereunder, Seller agrees to furnish a copy of all such licenses,
permits, and approvals to Purchaser.
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
7
ARTICLE
4. PERSONNEL
AND MATERIAL TO BE FURNISHED BY SELLER
The
Seller agrees to furnish all managerial, administrative, medical and
professional personnel (including persons qualified to conduct plasmapheresis
operation) required to produce the projected output of plasma set forth in
Article 2.1 hereof. In addition, the Seller agrees to provide, at its own cost
and expense, all facilities, equipment, materials and softgoods needed to
produce plasma at each of the Seller’s centers.
ARTICLE
5. MISCELLANEOUS
PROVISIONS
5.1 Relationship
of the Parties.
The
relationship between Purchaser and Seller is, and during the term hereof shall
be, that of buyer and seller. Seller is in no way the partner, legal
representative or agent of Purchaser for any purpose whatsoever and has no
right
or authority to incur, assume, or create, in writing or otherwise, any warranty,
liability or obligation of any kind, expressed or implied, in the name of,
or on
behalf of Purchaser.
5.2 Omitted
5.3 Right
of Renewal.
At the
expiration of the Initial Term, Purchaser and the Seller have the option to
renew this agreement for one (1) year using as a base price the 2011 contract
price for plasma which must then be adjusted within the agreed to range.
Thereafter, if mutually agreed to, the agreement may be extended by one year
options. All renewal options must be exercised on or before June 1st
of the
expiration year and must be evidence by a written statement executed by both
parties.
5.4 Indemnification
The
Seller and Purchaser hereby indemnify and agree to hold harmless each other
and
its respective affiliates, agents, employees, officers and directors, from
and
against any and all claims, losses, liabilities, damages, attorney's fees,
costs
and expenses which may be sustained by and/or claimed against the other party
by
virtue of the negligent performance of services rendered by the other party,
the
willful misconduct by the other party or its officers, employees or agents,
or
any representation or warranty contained in this agreement being breached,
untrue or materially misleading, by omission or otherwise. It being understood,
however, that the financial liability under this section shall be limited to
the
extent of each party's insurance coverage, if such coverage is in effect and
in
accordance with any requirements under this agreement at the time a claim is
asserted under this section.
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
8
The
obligations to indemnify, defend and hold harmless set forth in this Section
shall not apply to the Party to be indemnified (the “Indemnified Party”) unless
the Indemnified Party (i) notifies the Party providing such indemnification
(the
“Indemnifying Party”) as soon as practicable of any matters in respect of which
the indemnity may apply and of which the Indemnified Party has knowledge; (ii)
gives the Indemnifying Party, at the Indemnifying Party’s option, full
opportunity to control the response thereto and the defense thereof, including
any agreement relating to the settlement thereof, provided that the Indemnifying
Party shall not settle any such claim or action without the prior written
consent of the Indemnified Party (which consent shall not be unreasonably
withheld or delayed) or such settlement include as an unconditional term thereof
the giving by the claimant of an unconditional release from all liability in
favor of the Indemnified Party; and (iii) cooperates with the Indemnifying
Party, at the Indemnifying Party’s cost and expense, in the defense or
settlement thereof. Notwithstanding the foregoing, the indemnification
obligations hereunder shall not be relieved hereunder for failure to do the
foregoing, or delay with so doing, unless the Indemnifying Party is materially
prejudiced thereby. In addition, the Indemnified Party may, at its own expense,
participate in its defense of any claim.
5.5 Insurance
The
Seller represents and warrants that they will maintain, at all times during
the
term of this agreement, property damage, general liability, product liability
insurance against loss or damage caused by negligent performance of services
rendered by Seller, or by the non-conforming or negligent preparation of Plasma
or Plasma products, and such insurance shall not contain any contractual
exclusion and which shall cover the Seller's liability assumed under this
agreement, in an amount not less than * * * per occurrence and * * * in the
aggregate amounts.
5.6 Default
5.6.1 Rights
and Remedies
5.6.1.
a Nonpayment:
Subject
to Section 5.6.3, in the event that the Purchaser fails to transfer funds to
the
Seller according to the terms and schedule set forth in Section 2.2.2, then
upon
notice of such event, the Purchaser will be in breach of this agreement.
Correction of breach for non-payment must be made by Purchaser within 10
business days or
| a) |
Except
as provided in Section 5.6.1.a(b),Seller will have no further obligation
to sell Plasma to Purchaser, and
|
| b) |
Purchaser
will be liable to purchase from Seller (and Seller shall deliver)
the
minimum amounts of Plasma specified to be delivered during the
balance of
the Term of this Agreement. Seller will make reasonable endeavors
to sell
the contracted Plasma to third parties and Purchaser will be liable
for
all differences, if any, between contracted sales price and actual
price
received by Seller. It is understood that Seller will have additional
testing and administrative expenses to test and prepare contracted
Plasma
for another customer; these costs will also be the responsibility
of the
Purchaser.
|
5.6.1.
b Other
Remedies:
In the
event the Seller or Purchaser is in breach of any provision, other than
Non-payment by Purchaser which is covered above in Section 5.6.1.a, or is in
default of any other obligation under this agreement, or in the event of any
representation or warranty contained in this agreement is breached, untrue
or
materially misleading, by omission or otherwise, and such breach remains uncured
following thirty (30) days’ written notice to the breaching party, the
non-breaching party shall have the right to immediately terminate this agreement
upon written notice to the breaching party. In addition, Purchaser or the Seller
shall have the right to exercise any and all other rights and remedies available
to it, whether arising at law or in equity or arising under this agreement.
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
9
5.6.2 Remedies
Cumulative;
No Waiver
The
rights and remedies available to Purchaser or the Seller under this agreement
or
any other agreement among the parties are cumulative and the exercise of any
right or remedy shall not preclude or dismiss Purchaser's or the Seller's right
to pursue any other or additional right or remedy, including, without
limitation, any claim for damages. The failure to exercise any right or remedy
in the event of any breach or default shall not constitute a waiver or adversely
affect Purchaser's or the Seller's right to exercise any right or remedy in
the
future for the same or any other breach or default in the future.
5.6.3
Termination
Right: Notwithstanding
anything else set forth in this Agreement, the Parties agree that Purchaser
shall have the right to terminate this Agreement (a) upon written notice by
supplying to Seller a copy of any press release and/or US Government
notification that Purchaser has not received regulatory approval in the U.S.
for
the commercialization of its lead product candidate (C1-INH for the treatment of
hereditary
angioedema)
on or
before December 31, 2008 or (b) upon written notice in the event that, prior
to
December 31, 2008, Purchaser does not enter into a financing or loan arrangement
or an issuance by Purchaser of a secondary stock offering providing it with
additional funds sufficient to cover the purchase price for First * * * liters
of Plasma. In either such event, Purchaser must complete the purchase of an
initial amount of * * * Liters total as described herein (minimum * * * Liters
from existing centers and up to * * * Liters from Seller’s ‘new’ center - a
total of * * * Liters). If Purchaser desires, Seller can assist in reselling
any
plasma purchased by the Purchaser that is no longer needed by the Purchaser.
In
that event, the Purchaser will be responsible to the Seller for any amount
that
is the difference in the selling price then obtained by the Seller and the
net
contracted price (including NAT testing) for such initial * * * Liters * *
*
/Liter). This amount shall be payable within ten (10) days of notice by
Purchaser to Seller of termination.
5.6.4
Effect of Termination. The
provisions of this Agreement which by their nature would continue beyond any
termination or expiration of this Agreement, including without limitation the
parties’ representations and warranties and Sections 5.4, and 5.6 - 5.20 shall
survive any termination or expiration of this Agreement to the degree necessary
to permit their complete fulfillment or discharge.
5.7 Force
Majeure.
The
performance of Purchaser and Seller hereunder is subject to all contingencies
except those beyond the direct control of Purchaser and the Seller including,
without being limited to, the following:
5.7.1 Strikes,
or other labor disputes or labor troubles of any kind;
5.7.2 Hurricanes,
floods, earthquakes, droughts, or accidents;
5.7.3 Commotions,
insurrections, riots, wars, or consequences of war;
5.7.4 Acts
of
God or perils of the sea;
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
10
5.7.5 Rules,
laws, orders, actions, quotas, embargoes, seizures, regulations, restrictions,
or actions of any governmental agency or divisions thereof, or rejections by
inspectors or retentions of goods by customs authorities;
5.7.6 Breakdowns
in manufacturing machinery, casualties, fires, loss of goods in public or
private warehouses, provided, however, that such breakdowns, casualties, fires
or losses are not the result of Purchaser’s or Seller’s intentional
acts;
5.7.7 Shortages
of, or failure, by third parties to deliver materials and
merchandise;
5.7.8 In
any
such event, Purchaser and Seller shall have the right, at its good faith and
election and without incurring any liability for such occurrence or event
to:
a. Notify
other party of its intention and mutually agree between the parties to perform
a
modified or restricted agreement and perform the Agreement as so restricted
or
modified because of any of the foregoing contingencies. In the event the parties
hereto mutually agree to perform a modified or restricted Agreement, the
restricted or modified performance shall operate as a complete discharge of
any
obligations hereunder which are inconsistent with such modification or
restriction; or
b. Perform
the Agreement within a reasonable time after the causes of nonperformance or
delay have terminated.
5.8 Notices.
All
notices or other communications required or permitted to be given or made under
this Agreement may be effected by personal delivery in writing, which shall
then
be deemed communicated the same day as the personal delivery thereof, or by
registered or certified mail, postage prepaid, return receipt requested, which
shall then be deemed communicated five (5) days from the mailing thereof.
Notices shall be addressed to the parties at the address given below or at
such
address as the respective parties may hereafter designate to the other in
writing:
| If addressed to Purchaser: |
Legal
Department
LEV
PHARMACEUTICALS, INC.
▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇
▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
|
| If addressed to Seller: |
DCI
Management Group LLC
Attn:
▇▇▇ London
▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
|
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
11
5.9 Applicable
Law.
This
Agreement shall be governed by and construed in accordance with the substantive
and procedural laws of the State of New York without giving effect to the
principles of conflicts of law as applied in the State of New York.
5.10 Effectiveness
of Agreement.
This
Agreement shall become effective only upon execution and acceptance by Purchaser
and Seller.
5.11 Integration
Clause.
This
Agreement and all exhibits and attachments constitute the entire agreements,
understandings, representations, conditions, warranties, and covenants made
between the parties hereto. Unless set forth herein, neither party shall be
liable for any representation made to the other, and all modifications and
amendments hereto must be in writing. No amendment to this Agreement shall
be
binding on either party unless in writing and signed by both parties.
5.12 Multiple
Originals.
This
Agreement may be executed simultaneously or in one or more counterparts, each
of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
5.13 Partial
Invalidation.
In the
event any provision of this Agreement shall for any reason be or become void
or
unenforceable, the remaining provisions shall continue in full force and effect,
and under no circumstances shall an unenforceable provision have any effect
upon
any provision which is otherwise enforceable.
5.14 Paragraph
Headings.
The
subject headings of the paragraphs and subparagraphs of this Agreement are
included for the purposes of convenience only, and shall not affect the
construction or interpretation of any of its provisions.
5.15 Assignability.
Except
as otherwise set forth herein, this Agreement shall not be assignable by either
party hereto, either voluntarily or by operation of law or otherwise, without
the prior written consent of the other party. Such prohibition on the assignment
of rights under this Agreement shall be operable to the extent permitted by
law.
Any assignment without prior written consent is void. Notwithstanding the
foregoing, Purchaser may assign or transfer this Agreement (i) to a successor
entity, solely in the event of an acquisition or merger by or with another
entity, upon ten (10) days prior written notice to Seller; or (ii) to an
Affiliate of the Purchaser.
5.16 Successors
and Assigns.
This
Agreement shall be binding upon and inure to the benefit of the parties hereto,
their successors and assigns, subject to the provisions of Article 5.15
above.
5.17 Third
Party Rights.
Except
for such corporation(s), firm(s), partnership(s) or other legal entity(ies)
affiliated with Seller which operate and/or manage the Center, nothing in this
Agreement, whether expressed or implied, is intended to confer any right or
remedies under or by reason of this Agreement of any persons other than the
parties to it and their respective successors and assigns, nor is this Agreement
intended to relieve or discharge the obligation or liability of any third
persons to any party to this Agreement, nor shall any provision give any third
persons any right of subrogation or action over or against any party to this
Agreement.
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
12
5.18 Arbitration.
Any
disputes or claims arising under or in connection with this Agreement, including
pricing, the interpretation or application of this Agreement, shall be settled
by arbitration in accordance with the rules of the American Arbitration
Association then in force. If the parties cannot agree upon a single arbitrator
within ten (10) days after demand by either of them for arbitration, then each
party shall select one arbitrator from a list of arbitrators supplied by the
American Arbitration Association. The two arbitrators so selected shall then
choose a third arbitrator in order that the dispute may be finally resolved
by a
majority of the panel of three arbitrators so selected. The decision of the
arbitrator or arbitrators shall be final and binding upon the parties both
as to
law and fact. The expense of the arbitration shall be shared equally by the
parties, unless the arbitration award states that the expense shall be otherwise
assessed. Any such arbitration shall take place in New York, NY.
5.19 Authority
to Execute.
Seller
is not a party to, nor is it bound by any agreement which precludes or otherwise
restricts the performance of its obligations hereunder. Seller represent and
warrants that it has the right, legal capacity and authority to enter into
this
Agreement and that the execution of this Agreement has been duly
authorized.
5.20 Confidentiality.
Purchaser and the Seller and its employees and agents shall hold in confidence
any and all documents, materials and information provided to Seller by
Purchaser, including but not limited to the terms and conditions of this
Agreement. Seller agrees that it will not disclose, except to their employees
and agents on a need-to-know basis, any such information or documents described
herein at any time during, or after termination of this Agreement, without
the
prior written consent of Purchaser. The requirements of this Paragraph shall
not
apply to information which is publicly disclosed by Purchaser. In addition
to
the above, both Seller and Purchaser shall fully comply with the U.S. Department
of Health and Human Services’ regulations on "Privacy Standards for Individually
Identifiable Health Information," which comprise 45 C.F.R. §§ 160.101 through
164.534, promulgated pursuant to the Health Insurance Portability and
Accountability Act of 1996 (“HIPAA”).
IN
WITNESS WHEREOF, the parties hereto have entered into this Agreement on the
date
first set forth above.
PURCHASER:
LEV PHARMACEUTICALS, INC.
| By | /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇ | |
| Name | ▇▇▇▇▇▇ ▇▇▇▇▇▇ | |
| Title | Chairman |
SELLER:
DCI MANAGEMENT GROUP, LLC
| By | /s/ ▇▇▇ London | |
| Name | ▇▇▇ London | |
| Title |
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
13
EXHIBIT
A - PLASMA SPECIFICATIONS
LEV
PHARMACEUTICALS, INC.
SOURCE
PLASMA SPECIFICATIONS:
a)
Origin of Plasma:
Human
Source Plasma collected from donors at USA-FDA licensed donor center(s). Each
donor center must adhere to PPTA (iQPP) voluntary standards. Plasma must be
collected as Source Plasma as defined by the FDA in 21 CFR Part 640 Subpart
G,
Source Plasma 640.60.
b)
Selection/Exclusion
Criteria for Donors (Donations): The
selection/exclusion criteria used for determining donor eligibility was
performed in accordance to the current SOP’s of the collecting facility at the
time of donation from donors meeting all donor screening and donor selection
criteria. Plasma must be collected from donors who fulfill all requirements
as
Qualified Donors as defined by iQPP standards and in accordance with 21 CFR
Part
640 Subpart G, Source Plasma Suitable Donors 640.63.
c)
Examination
and Interview of Donors: The
donor
examination and/or interview was performed in accordance to the current SOP’s of
the collecting facility and performed in accordance with all US requirements
at
the time of donation.
d)
Screening
Tests on Individual Donations:
Testing
requirements as described in 21 CFR 640.67 and 640.71 must be met and shall
meet
the following criteria:
|
TEST
|
TEST
RESULT
|
|
Anti
HIV ½
|
Non-reactive
|
|
HBsAg
|
Non-reactive
|
|
Anti-HCV
|
Non-reactive
|
|
HIV
NAT
|
Negative
|
|
HCV
NAT
|
Negative
|
|
Syphilis
|
Negative
or Non-reactive donor
|
|
Atypical
Antibody
|
Negative
donor
|
A
list of
all current test kits or methods shall be submitted to Lev Pharmaceuticals,
and
updated in the event a test or method is changed.
For
Lookbacks and notification for destruction of plasma notification must be made
to Lev Pharmaceuticals:
|
§
|
Within
three working days upon receipt of reactive or positive test results
from
a donor from whom prior or subsequent units have been shipped to
Lev
Pharmaceuticals
|
|
§
|
Within
one working day of notification of Post Donation Information resulting
in
product recalls or seizure concerning units shipped to Lev
Pharmaceuticals
|
|
§
|
Within
three working days of receipt of Post Donation Information not resulting
in a seizure or recall (e.g. tattoo, body piercing, high risk
behavior)
|
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
14
e)
Density: The
density of plasma must be 1.026.
f)
Shelf
life:
Each
bottle must have at least a remaining shelf life of 5 years as of
delivery.
g)
System
to Trace Donations:
Supplier
shall maintain systems that all donations are traceable to the individual
donors.
h)
Plasma
Collection System:
Source
Plasma collection in bottles in accordance to current SOP’s of the collecting
facility at the time of donation. Plasma must be collected in bottles that
fulfill all requirements sited by the FDA in 21 CFR Part 640 Subpart G, Source
Plasma 640.64(b). Plasma collection must fulfill all additional requirements
as
defined by the FDA in 21 CFR Part 640 Subpart G, Source Plasma 640.64. * *
*
Plasma
units that fall into one of the following categories is unacceptable for
shipment to Lev Pharmaceuticals:
|
§
|
Units
with reactive or positive viral marker test results; Prior or subsequent
units from donors that have been found to be reactive/positive for
required testing
|
|
§
|
Hemolyzed
or lipemic units
|
|
§
|
Units
with frozen plasma on the outside of the
container
|
|
§
|
Broken
or contaminated units
|
|
§
|
Untested
or units with incomplete testing
|
|
§
|
Orphan
units
|
|
§
|
Units
having errors that breech traceability such as units that cannot
be traced
back to an individual donor
|
i)
Plasma
Storage and Transport: Source
Plasma must be frozen by cooling rapidly at -20ºC or colder, as soon as possible
and at the latest within 24h of collection. When rapidly frozen, the temperature
must reach -20 °C or less (≤ -20 °C) inside the plasma within 60 minutes. Plasma
storage and transportation has been maintained at -20ºC or colder. The Seller
will provide one additional sample for each unit shipped to Purchaser with
the
Shipment.
j)
Quality
Specifications - Documentation:
Each
bottle has been labeled with at least the following information:
•
Supplier
name and license #
•
Plasma
Type
•
Unit Identification
will be by means of barcode unit number type CODE128
•
Volume
•
Anticoagulant
composition
•
Storage
temperature
•
Expiration
date
•
Plasma
bottle lot number (on bottle)
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT. EACH
SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK [***],
HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
15
•
Plasma shipment documentation (packing list) shall
include:
•
Collecting
facility’s name and address
•
Plasma
Type
•
Product/Unit
identification
•
Volume
•
Collection date
•
Testing
statement
Each
shipment of Plasma must be accompanied by a Certificate of Quality (see Exhibit
B below) along with routine shipment documentation including plasma Packing
Forms.
k)
Electronic
data of shipment: Every
shipment will include a shipment diskette that includes a number of files
containing information about the shipment. Included in these files is the
following information:
•
Unique
shipment number (Format Center ID + Shipment Number e.g., * * *
0672)
•
Carton number
for each unit (Format: contained in field consisting of year number + carton
number e.g. 20070123 is Carton 0123 from 2007))
•
Unit
number (Format is 2 character unique Center ID + 7 digit unit number; e.g.,
* *
* 1234567)
•
Center
identification (Integrated into unit number - first two alpha characters of
unit
number are Center unique ID; e.g., * * * 1234567 is from * * * center) - See
table in Exhibit C
•
Donor
identification (Donor Number Format: 5 characters numeric; e.g.,
12345)
•
Quantity
(volume) (Format: in liters to 3 decimal places; e.g., 0.877)
•
Donation
date (Format YYYYMMDD; e.g., 20070423 would be donation date
04/23/2007)
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT.
EACH SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK
[***], HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
16
Exhibit
B -
CERTIFICATE
OF QUALITY (SAMPLE)
*
* *
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT.
EACH SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK
[***], HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
17
CERTIFICATE
OF COMPLIANCE (SAMPLE)
*
* *
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT.
EACH SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK
[***], HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
18
EXHIBIT
C - LIST OF DCI EXISTING CENTERS (AS OF 07/05/2007)
*
* *
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT.
EACH SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK
[***], HAS
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19
Exhibit
D - Wiring Instructions to pay the Seller:
[*CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS DOCUMENT.
EACH SUCH
PORTION, WHICH HAS BEEN OMITTED HEREIN AND REPLACED WITH AN ASTERISK
[***], HAS
BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
20