PURCHASE & SUPPLY AGREEMENT
EXHIBIT
10.43
PURCHASE
& SUPPLY AGREEMENT
This
Purchase & Supply Agreement (this “Agreement”) is effective as of the 14th
day of January, 2008 (the “Effective Date”) by and between Scientific Protein
Laboratories LLC, a Delaware limited liability company having its principal
place of business at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇
("SPL") and Alfacell Corporation, a Delaware corporation with its principal
place of business at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
("Alfacell").
RECITAL
SPL
and
Alfacell wish to enter into a Purchase and Supply Agreement for
Ranpirnase.
AGREEMENTS
ARTICLE
1 DEFINITIONS
1.1 “cGMP”
means relevant current good manufacturing practices, rules and guidelines
set
out by the U.S. Food and Drug Administration ("FDA") and the International
Conference on Humanization of Technical Requirements for Registration of
Pharmaceuticals for Human Use ("ICH") in force and/or becoming applicable
during
this Agreement and such other standards as
agreed
in writing by the parties.
1.2 “Product”
means Ranpirnase Bulk Drug Substance Solution produced in conformity with
the
Specifications, cGMP, and this Agreement.
1.3 “Raw
Material” means conforming Rana pipiens oocytes to be supplied to SPL by
Alfacell.
1.4 “Specifications”
means the Product specifications attached hereto as Exhibit
1.
1.5 “Quality
Agreement” means the product quality agreement to be negotiated in good faith
and entered into by and between SPL and Alfacell in accordance with the terms
of
this Agreement.
1.6 “Term”
has the meaning set forth in Article 9 below.
1.7 "IP"
shall mean the Intellectual Property.
ARTICLE
2 DEVELOPMENT
AND SUPPLY
2.1 Alfacell
is responsible for storing the Raw Material at a third party storage facility,
paying directly for storage costs and insuring such Raw Material. Alfacell
shall
provide (without charge) and deliver Raw Materials sufficient to produce
ordered
quantities of Product to SPL, FOB SPL's Facility in Waunakee, Wisconsin.
All Raw
Material supplied to SPL shall comply in all respects with regulatory
requirements and with the procurement storage and
delivery
requirements set forth in the Quality Agreement (defined in Section 2.2).
SPL
agrees that after it has taken possession of the Raw Material, it will store
or
have stored the Raw Material under the conditions set forth in the Quality
Agreement. SPL's receiving, storage, and handling costs are included within
the
price of Product. If the Raw Material is destroyed or becomes unusable due
to
SPL's negligence while in SPL's possession, SPL will reimburse to Alfacell
the
Fully Burdened Price for the Raw Material. The "Fully Burdened Price" shall
mean
Alfacell’s out-of-pocket costs for the Raw Material. This is Alfacell's
exclusive remedy for SPL’s negligent destruction of Raw Material or otherwise
causing the Raw Material to be unuseable or unsuitable for use in or with
Product. On termination of this Agreement, SPL shall return any unused Raw
Material to Alfacell, FOB SPL's Facility.
2.2 During
the term of this Agreement and subject to the terms of this Agreement, Alfacell
shall purchase exclusively from SPL, and SPL shall sell exclusively to Alfacell,
the Product. The Product will be manufactured in accordance with the Quality
Agreement and set forth in Exhibit
3
hereto
and made a part hereof under the terms and conditions set forth in this
Agreement. The Quality Agreement shall set forth provisions concerning, among
other things typical for a quality agreement, testing, acceptance, and rejection
of Products; avoidance of cross contamination; packaging, labeling, segregation;
stability, amendment to specifications, validation batches; recalls; and
complaints, all to the extent not set forth herein.
2.3 SPL
agrees that with respect to the Raw Material, no express or implied licenses
or
other rights relating to the Raw Material are provided to SPL under any patents,
patent applications, trade secrets or other proprietary rights of Alfacell,
other than the rights specifically set forth herein. Title in all Raw Material
shall remain at all times in Alfacell. SPL agrees that the Raw Material shall:
(i) only be used as specified in writing by Alfacell and not for any other
purpose; (ii) only be made accessible to those employees of SPL who need
access
in order to complete the relevant services to be provided by SPL under this
Agreement (the "Services"); (iii) be used in compliance at all times with
all
Applicable Law; (iv) not be transferred to any affiliate or third party without
the explicit prior written consent of Alfacell; (v) not be reverse engineered;
and (vi) not be subjected to testing procedures not specifically requested
by
Alfacell as part of the Services; provided, however, SPL shall be entitled
to
test Raw Material if SPL is required to do so under Applicable Law (including
regulatory requirements), to comply with cGMP, or, in the reasonable opinion
of
SPL, to comply with good risk management practices. SPL shall maintain detailed
records of the location and use of all Raw Material and shall provide Alfacell
an accounting of the same upon request.
2.4 The
current scale of production starts from five (5) kg of Raw Material. The
process
has been validated and the equipment is sized for this scale of production.
Alfacell may request SPL to conduct development work to alter the scale of
the
process and perform necessary cGMP validation work. SPL will use commercially
reasonable efforts to meet Alfacell’s request. SPL will prepare separate
proposals for such development and validation work, specifying the scope,
cost
and time to complete such work. The parties will negotiate in good faith
the
terms and provisions of a development agreement with respect to such process
development.
2.5 Currently
SPL plans to utilize its multi-use facilities for the production of Product.
In
the event that a dedicated facility or changes to SPL’s multi-use facility are
needed to meet cGMP requirements, or Alfacell requires to increase production
scale to over the current
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batch
size, SPL shall propose to Alfacell a capital expenditure budget to allow
SPL to
accommodate Alfacell’s needs. Alfacell and SPL will work together in good faith
to determine the reasonable budget for capital expenditures for increased
production, including any expansion of SPL's plant in Waunakee, Wisconsin.
Alfacell shall be responsible to prepay and/or reimburse SPL for all such
capital expenditures determined by the parties to be necessary for the expansion
of batch size. The parties shall negotiate in good faith a capital expenditure
agreement with respect to any capital expenditures to be made.
ARTICLE
3 ORDERING
3.1 SPL
shall
produce Product exclusively for Alfacell, and Alfacell shall purchase Product
exclusively from SPL. The parties acknowledge that SPL plans to produce the
Product in campaigns, and that each campaign currently requires a six-month
lead
time. Therefore, upon execution of this Agreement, Alfacell shall provide
SPL
with an initial twelve-month forecast, with a firm purchase order for the
manufacture of Product to be delivered within six months of the execution
of
this Agreement. The initial forecast shall become a twelve-month rolling
forecast, as described below.
3.2 After
the
initial Forecast, Alfacell shall update the twelve-month Forecast quarterly
(by
the 15th day of each calendar quarter). The Forecast shall set forth the
production of Product by SPL in batches over the twelve month period. Consistent
with the six month lead time provision set forth in Section 3.1, Alfacell
will
enter into binding purchase orders for batch production in the Forecast,
as well
as provide forward-looking Forecasts beyond the six month lead time provision,
which are not binding. SPL shall have the right to review and accept the
proposed binding portion of the Forecast, which approval shall not be
unreasonably withheld. Once the proposed Forecast is accepted Alfacell will
issue purchase orders representing the quantities laid out in the binding
portion of the Forecast. At current scale, SPL starts each batch of production
with five (5) kg of Raw Material. The first batch of a production campaign
typically requires five (5) weeks to be produced, tested and released. Each
subsequent batch can be started two (2) weeks from the start date of the
previous batch. Therefore, the maximum capacity per month is two (2) batches,
starting from end of the fifth week of a production campaign. In no event
shall
SPL be required to produce an amount of Product in excess of SPL's monthly
capacity described above and SPL shall use commercially reasonable efforts
to
maintain the monthly capacity described above. The remainder of each Forecast
shall not be binding.
3.3 Alfacell
shall order Product set forth in the binding portions of the Forecast by
submitting to SPL written purchase orders, in such form as the parties shall
agree from time to time. The amount and timing of delivery of Product shall
correspond to the Forecast. Any purchase orders for Product submitted by
Alfacell to SPL shall reference this Agreement and shall be governed exclusively
by the terms contained herein. The parties hereby agree that the terms and
conditions of this Agreement shall supersede any term or condition in any
order,
confirmation or other document furnished by Alfacell or SPL that is in any
way
inconsistent with these terms and conditions.
3.4 Alfacell
may from time to time request SPL to accelerate or increase production as
described in this section, and SPL shall use commercially reasonable efforts
to
do so.
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3.5 Alfacell
shall timely deliver Raw Material in quantities to allow SPL to manufacture
Product in accordance with the Forecast.
ARTICLE
4 DELIVERY
4.1 All
Product delivery is FOB SPL’s facility located at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "FOB
Point").
Risk
of loss of Product purchased hereunder shall pass to Alfacell upon delivery
to
the carrier at the FOB Point, Alfacell absorbs freight. Title in all Raw
Material, Product, and Product-in-process shall remain in Alfacell at all
times.
Carriers may be arranged by either SPL or as instructed by Alfacell, at
Alfacell’s discretion and written direction (and in collaboration with SPL) so
as to collectively ensure transportation of the Product in good
condition.
4.2 SPL
shall
supply and deliver the Product ordered by Alfacell on the dates specified
in
Purchase Orders submitted as set forth in Sections 3.2 and 3.3. SPL shall
immediately notify Alfacell of any unexpected delay in delivery, which notice
shall state the reason for the delay, provided such notice shall not modify
any
of SPL’s obligations hereunder.
ARTICLE
5 SUPPLY
PRICE FOR THE PRODUCT
Pricing
for Product is set forth in Exhibit
2
hereto.
ARTICLE
6 TERMS
OF PAYMENT
Subject
to Exhibit 2, payment of invoices shall be made thirty (30) days after the
shipping date of the Product. Failure to pay all or any part of an invoice,
not
subject to a bona fide dispute, when due will give rise to an obligation
of
Alfacell to pay late fees running from the initial date and calculated at
a rate
of one percent (1%) per month.
ARTICLE
7 QUALITY/REGULATORY
ISSUES
7.1 The
parties will negotiate in good faith, and execute and deliver the Quality
Agreement. The Quality Agreement will specify the division of responsibility
between the parties for complying with all applicable regulatory requirements
required by U.S. or other countries, as agreed in writing by the parties,
relating to the manufacture of Product, including cGMP. Alfacell shall be
responsible for the cost of compliance of changes of the regulatory requirements
relating to the Product. If there are changes to applicable regulatory or
governmental requirements which, if made, would require significant capital
or
costs with respect to the production of the Product in SPL's facility, SPL
shall
promptly notify Alfacell of such change. In such event, Alfacell shall be
responsible for such expenditures or costs. If Alfacell determines not to
pay
such costs or expenditures, SPL may terminate this Agreement in accordance
with
Section 10.3. the parties shall work together expeditiously to minimize
disruption in supply of Product to Alfacell under such
circumstances.
7.2 SPL
shall
provide a copy of the certificate of analysis ( the “Certificate”)
to
Alfacell with or at the same time as each delivery of Product supplied
hereunder. In the event
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Alfacell
requires additional documentation due to a change in the law or a regulatory
approval without which the Product under any regulatory approval would be
impossible or impracticable, (a) Alfacell shall immediately notify SPL of
the need for such additional documentation, and (b) SPL will supply such
documentation with each delivery of Product. Subject to any variations agreed
to
in the Quality Agreement, Certificate shall certify, with respect to each
shipment and batch (identified by batch number), (i) the quantity of the
batch, (ii) that the Product delivered conforms to, and was handled in
compliance with, the Product Specifications and (iii) that the Product was
manufactured in accordance with cGMP and any applicable regulatory approval,
as
well as any further information required by the relevant regulatory authorities
that Alfacell may have previously notified SPL is necessary. Alfacell shall
be
under no obligation to accept any shipment of Product without the accompanying
Certificates.
7.3 Alfacell
may reject any delivery of Product if the Product does not conform to
Specifications. Rightly rejected Product shall be replaced by SPL at its
own
cost plus Alfacell’s Fully Burdened Price for the Raw Material.
7.4 If
SPL
believes that Product was wrongly rejected, it shall notify Alfacell in writing,
within twenty (20) days of receipt by SPL of Alfacell’s written notice of
rejection, that SPL disagrees with such basis for rejection (an “Objection
Notice”).
If
SPL and Alfacell cannot agree, within twenty (20) days after receipt by Alfacell
of the Objection Notice, whether Product rejected by Alfacell failed to conform
to the Specifications at the time of delivery of the Product to Alfacell
at the
FOB Point, representative samples of the batch of Product in question shall
be
submitted to a mutually-acceptable independent laboratory or consultant for
analysis or review to determine whether the Product conformed to the
Specifications at the time of delivery at the FOB Point. The results of such
evaluation shall be binding upon the parties. The party that is determined
to
have been incorrect in its determination of whether the Product should be
rejected shall pay the costs of any such evaluation and reimburse the other
for
any amounts previously paid by the other to the independent laboratory or
consultant in connection with such evaluation. If it cannot be determined
which
party is responsible for such failure to conform to the Specifications, then
the
parties shall each be responsible for one-half of the costs related to such
evaluation and Alfacell may, in its discretion, purchase replacement Product
when available for delivery. The parties may also mutually agree in their
discretion to further testing.
7.5 During
the pendency of any rejection discussions, SPL shall supply on a priority
basis
to Alfacell, upon Alfacell’s request, with the same amount of Product as is
subject to rejection discussions and Alfacell shall purchase such amount
on the
same terms as such rejected Product. Shipping costs related to such replacement
Product shall be borne by SPL if the Product is determined to have failed
to
conform to the Specifications at the FOB Point. If the Product is determined
to
have so conformed to the Specifications, then Alfacell shall bear such costs.
If
Product is rightly rejected, but it cannot be determined which party is
responsible for such failure to conform, SPL and Alfacell shall each be
responsible for one-half of such shipping costs.
7.6 SPL
shall
obtain the prior written consent of Alfacell with respect to any proposed
revision to the Product Specifications, site of manufacture and any change
in
the Raw Materials, equipment, process or procedures used to manufacture the
Product (the “Manufacturing Process”).
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7.7 Upon
written request to SPL by Alfacell, Alfacell and its designees as agreed
to by
the Parties in the Quality Agreement may audit SPL’s manufacturing facilities
during normal business hours to review and discuss any issues regarding
manufacturing and management personnel and to review and inspect (i) the
manufacturing and storage facilities, (ii) the quality control procedures,
and/or (iii) any records and reports pertinent to the manufacture, disposition
or transport of Product, as may be necessary to evidence SPL’s compliance with
all applicable regulatory approvals for the manufacture of Product, including
compliance with cGMP. Alfacell and its designees may make such visits to
SPL’s
manufacturing facilities once per calendar year unless Alfacell identifies,
during any such visit or as a result of any Form 483 received by SPL pertinent
to the Alfacell Product, any defects or deficiencies provided in any of the
foregoing clauses (i), (ii) or (iii) above, in which case Alfacell may make
as
many subsequent visits to such facilities as are reasonably required to
determine that such defects have been cured.
7.8 In
the
event Alfacell believes a recall, field alert, product withdrawal or field
correction is necessary with respect to Product provided under this Agreement,
SPL shall fully cooperate in the investigation and performance of the same.
SPL
shall be responsible for the costs of any recall, field alert, product
withdrawal or field correction only to the extent SPL failed to deliver Product
conforming to the Specifications at the FOB Point.
7.9
Within 5
business days after any regulatory agency inspection, SPL shall furnish Alfacell
with a notice of such inspection and summary of results such as they are
pertinent to the Product. In addition, SPL shall notify Alfacell within five
(5)
business days of its receipt of any other written regulatory actions or
communications (other than ministerial, non-substantive communications) relating
to the Product or any Product-related facility that is involved in the supply
of
Product to Alfacell hereunder. The parties shall confer with each other with
respect to any response regarding such action or communication and the best
means to comply with such action or communication, but the final response
shall
be within SPL’s final decision-making authority.
7.10 SPL
shall comply
with all applicable orders, regulations, requirements and laws of any and
all
governmental authorities, including all U.S. laws and regulations applicable
to
the transportation, storage, use, handling and disposal of hazardous materials.
SPL represents and warrants to Alfacell that it has and will maintain during
the
term of this agreement all government permits, including health, safety and
environmental permits, necessary for the conduct of the actions and procedures
that it undertakes pursuant to the Agreement;
provided, however,
that if
SPL ceases to hold such permits, licenses, registrations and other forms
of
governmental authorizations, SPL shall have a reasonable time to regain
compliance with the foregoing requirement so long as during such time SPL
is
able to supply Product to Alfacell in accordance with this Agreement.
7.11 For
three
(3) years after the termination of this Agreement, SPL shall keep complete,
accurate and authentic accounts, notes, data and records of the work performed
under this Agreement (including batch records). SPL shall maintain complete
and
adequate records pertaining to the methods and facilities used for the
manufacture, processing, testing, packing, labeling, holding and distribution
of
a Product in accordance with all applicable laws and regulations by the U.S.
or
other countries, as agreed in writing by the parties.
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7.12
Alfacell retains all responsibility for regulatory submissions and approvals
related to the Product
ARTICLE
8 WARRANTIES
AND INDEMNIFICATION
8.1 Each
party represents and warrants to the other party that the execution of this
Agreement and the full performance and enjoyment of the rights of such party
under this Agreement will not breach or in any way be inconsistent with the
terms and conditions of any license, contract, understanding, or agreement,
whether express, implied, written, or oral between such party and any third
party.
8.2 As
of the
Effective Date, to the knowledge of Alfacell, no third party patents or patent
applications, except those it has a right to practice or SPL’s manufacturing
intellectual property, will be infringed by the manufacture of Product or
its
transfer to Alfacell hereunder; provided the foregoing representation shall
not
apply to any intellectual property of SPL or used by SPL without the express
approval of Alfacell.
8.3 As
of the
Effective Date, to the knowledge of SPL, no third party patents or patent
applications, except those it has a right to practice, or Alfacell's
intellectual property, will be infringed by the manufacture of the Product;
provided, the foregoing representation shall not apply to any intellectual
property of Alfacell or supplied to SPL by Alfacell.
8.4 SPL
represents, warrants and covenants that it will not use any third party
intellectual property in fulfilling its duties hereunder unless SPL has the
right (by ownership or license or other similar arrangement) to use such
intellectual property to fulfill such duties, including making Product and
transferring Product to Alfacell.
8.5 Alfacell
represents, warrants and covenants that it will not use any third party
intellectual property in fulfilling its duties hereunder unless Alfacell
has the
right (by ownership or license or similar arrangement) to use such intellectual
property to fulfill such duties, including supplying Raw Materials and
transferring Raw Materials to SPL, and including any manufacturing technology
of
Alfacell with respect to the Product derived or licensed by Alfacell and
used by
SPL under this Agreement.
8.6 SPL
represents and warrants that it has not been debarred and is not subject
to a
pending debarment and that it will not use in any capacity, in connection
with
the services to be performed under this Agreement, any person who has been
debarred pursuant to section 306 of the Federal Food, Drug, and Cosmetic
Act, 21
U.S.C. § 335a, or who is the subject of a conviction described in such section.
SPL agrees to inform Alfacell in writing immediately if it or any person
who is
performing services hereunder is debarred or is the subject of a conviction
described in section 306, or if any action, suit, claim, investigation, or
legal
or administrative proceeding is pending or, to the best of SPL‘s knowledge, is
threatened, relating to the debarment or conviction of SPL.
8.7 SPL
warrants that all Product supplied by SPL to Alfacell hereunder shall (i)
conform to the Specifications; (ii) be manufactured in accordance with cGMP,
the
Quality Agreement, and all relevant chemistry, manufacturing and controls
data;
and (iii) shall not be
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adulterated
and misbranded under applicable laws, rules, regulations, guidelines and
standards (“Applicable Law”).
8.8 SPL
shall
indemnify, defend, and hold harmless Alfacell and its directors, officers,
employees and agents (“Alfacell Indemnitees”) from all actions, losses, claims,
demands, damages, costs, and liabilities (including reasonable attorneys’ fees)
of a third party to which Alfacell is or may become subject insofar as they
arise out of (i) any material breach by SPL of any of its obligations hereunder;
(ii) any negligent or willful act or omission by any SPL Indemnitee, or (iii)
any mishandling of the Product by SPL on or prior to delivery of the Product
to
Alfacell.
8.9 Alfacell
shall indemnify, defend, and hold harmless SPL and its directors, officers,
employees and agents (“SPL Indemnitees”) from all actions, losses, claims,
demands, costs and liabilities (including reasonable attorneys’ fees) of a third
party to which SPL is or may become subject insofar as they arise out of
(i)
personal injury, death or property damage sustained by any person(s) resulting
from the use of Product and not covered under Section 8.8; (ii) personal
injury,
death, or property damage sustained by any person(s) resulting by the use
of
Onconase for Injection manufactured by Alfacell or by a third party at the
direction of Alfacell (not SPL) and not covered under Section 8.8; (iii)
any
negligent or willful act or omission by an Alfacell Indemnitee; or (iv) any
marketing and sales of Onconase for Injection by Alfacell.
8.10 A
party
entitled to indemnification hereunder agrees to give prompt written notice
(in
no event later than ten (10) business days following its receipt) to the
indemnifying party after the receipt by such party of any notice to the
commencement of any action, suit, proceeding, or investigation, or threat
thereof, made in writing for which such party will claim indemnification
pursuant to this Agreement. The indemnifying party may assume the defense
of
such claim with counsel reasonably satisfactory to the indemnifying party.
If an
indemnified party settles any claim without the consent of the indemnifying
party, the indemnified party shall have no rights under Sections 8.8 or 8.9
(as
applicable). The indemnifying party will not be subject to any liability
of any
settlement made without its consent, which shall not be unreasonably
withheld.
8.11 Each
party represents that it has maintained and shall maintain during the Term,
as
well as after the termination of this Agreement, sufficient insurance which
may
include an appropriate program of self insurance, and in particular products
liability insurance, with appropriate policy limits to cover all risks
associated with the performance of its obligations under this Agreement.
Each
party agrees to provide copies of the certificate of insurance, when applicable,
upon request, as written evidence to the other party of such
coverage.
8.12 The
provisions and obligations of this Article 8 shall survive any termination
or
expiration of this Agreement.
8.13 Except
with respect to breaches of Article 10 or 14, or claims or losses attributable
to a party’s fraud, gross negligence, willful misconduct or claims or losses
subject to indemnification hereunder, in no event shall a party be responsible
to the other party for consequential or incidental damages in connection
with
this Agreement.
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ARTICLE
9 DURATION
The
term
of this Agreement shall begin on the Effective Date and shall continue in
full
force and effect for ten (10) years thereafter, unless earlier terminated
as set
forth in Article 10 (the "Term").
ARTICLE
10 TERMINATION
10.1 Termination
by Alfacell.
Alfacell shall have the right, at its sole discretion, to terminate this
Agreement: (i) upon two (2) years prior written notice to SPL, without cause,
or
(ii) upon sixty (60) days' written notice (with a right to cure within such
sixty (60)-day period) to SPL upon the occurrence of any of the
following:
a. the
failure of SPL to supply by the specified delivery date at least eighty percent
(80%) of the quantity of the Product specified in a firm order submitted
by
Alfacell in accordance with Article 3, more than one time in any twelve (12)
month period, for any reason including an event of force majeure (a “Supply
Failure”), but not including Supply Failure to the extent caused by Alfacell
failing to comply with its obligations under this Agreement, including a
failure
to timely supply Raw Material to SPL;
b. the
failure of SPL to obtain or maintain any governmental licenses, registrations,
or approvals required in connection with the manufacturing of Product or
the
closing or shut-down (temporary or permanent) of one of SPL’s manufacturing
facilities by a governmental or regulatory authority to the extent such failure
relates in any way to Product (each of the foregoing, a “Permitting or Facility
Failure”); or
c. either
(1) a transfer of control of SPL (i.e.,
a
transfer in excess of 50% of the voting securities of SPL) to a direct
competitor of Alfacell with respect to the Product, or (2) the attempted
assignment or delegation by SPL of any of its rights or obligations hereunder
to
a direct competitor of Alfacell in the context of the sale of SPL with respect
to the Product, in either case without the prior written consent of Alfacell,
which shall not be unreasonably withheld.
10.2 Termination
by Either Party.
Either
party hereto shall have the right to terminate this Agreement by written
notice
to the other party hereto, upon the occurrence of any of the
following:
a. the
other
party files a petition in bankruptcy, or enters into an agreement with its
creditors, or applies for or consents to the appointment of a receiver or
trustee, or makes as assignment for the benefit of creditors, or becomes
subject
to involuntary proceedings under any bankruptcy or insolvency law (which
proceedings remain undismissed for sixty (60) days); or
b. the
other
party fails to cure a material breach of this Agreement within sixty (60)
days
after receiving written notice from the non-breaching party.
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10.3 Termination
by SPL.
SPL
shall have the right, at its sole discretion, to terminate this Agreement
if
Alfacell determines not to pay for the expenditures or costs proposed under
Section 7.1 of this Agreement. The notice of termination of this Agreement
shall
be provided by SPL in writing to Alfacell, with sufficient lead time to allow
the parties to undertake a commercially reasonable transition of manufacturing
under the applicable circumstances. In no case shall such period exceed
twenty-four (24) months.
10.4 Effect
of Expiration or Termination.
a Expiration
or termination of this Agreement shall not relieve the parties of any obligation
accruing prior of such expiration or termination. The rights and obligations
of
the parties under Sections 6,
8, 10,
12.2 (to the extent applicable), 13, 14, 15, 16, 17 and 18 shall survive
expiration or termination of this Agreement.
b Upon
the
expiration or termination of this Agreement and subject to its obligation
under
10.3(c), Alfacell, in its sole discretion, may purchase from SPL any inventories
of the Product held by SPL as of the date of such termination or expiration,
and
all Product-in-process, at prices to be mutually agreed, but not more than
those
set forth herein. In the event that Alfacell shall not purchase such
inventories, subject to any requirement to purchase Product in subsection
(c)
below, SPL shall promptly destroy such inventories and provide Alfacell with
proof of their destruction.
c. Upon
the
early termination of this Agreement for any reason other than by Alfacell
pursuant to Section 10.1(ii)(a) or (b) or 10.2, Alfacell shall pay SPL for
all
Product held by SPL as of the date of such termination or expiration at prices
established in this Agreement.
ARTICLE
11 FORCE
MAJEURE
The
performance or observance by either party of any obligations of such party
under
this Agreement, other than the payment obligation, may be suspended by it,
in
whole or in part, in the event of any of the following which prevents such
performance or observance: act of God, war, terrorist act, riot, fire,
explosion, accident, flood, sabotage, strike, lockout, injunctions, national
defense requirements, compliance with governmental laws, rules, regulations,
widespread raw material shortages including those caused by animal disease,
orders or action or any other cause (whether similar or dissimilar) beyond
the
reasonable control of such party; provided, however, that such party, not
later
than seven (7) days after the force majeure event, shall notify the other
party
in writing of such event, and such party shall exercise diligence in and
endeavor to remove or overcome the cause of such inability to comply; and
provided further that neither party shall be required to settle a labor dispute
against its own best judgment.
ARTICLE
12 ALTERNATIVE
SUPPLY
12.1 Alfacell
shall be permitted to, at its sole option, qualify a back-up supplier. If
Alfacell elects to qualify such a back-up supplier, then SPL shall provide
to Alfacell, or such
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third
party manufacturer, relevant production information, including, without
limitation, documentation, technical assistance, materials, and cooperation
by
appropriate employees of SPL (collectively, "Technical Assistance") as Alfacell
or such third party manufacturer may require in order to manufacture the
Product, subject to the following. In no event, however, shall SPL be required
to provide to Alfacell or any back-up supplier any Confidential Information
or
proprietary information of SPL, subject to Section 12.4.
12.2 If
SPL
proposes to introduce any Confidential Information or proprietary technology
of
SPL into the manufacturing process for the Product ("SPL Introduced
Technology"), it shall provide written notice thereof to Alfacell, along
with a
proposed royalty, if any, for SPL Introduced Technology. Alfacell may, in
its
discretion, reject the use of SPL Introduced Technology in the manufacturing
process for the Product. Any back-up supplier shall execute and deliver a
Confidentiality/Nondisclosure Agreement reasonably acceptable to SPL for
nondisclosure of the SPL Introduced Technology. SPL represents that no SPL
Introduced Technology is used in the process to make Product as of the signing
date of this Agreement.
12.3 .
If
Alfacell determines to utilize a back-up supplier, such back-up supplier
shall
be expected to bring its own technical and manufacturing expertise to such
relationship with Alfacell, and SPL shall have no obligation to provide
technical assistance or support to a back-up supplier if such back-up supplier
is not capable of producing the Products and is not reasonably practiced
in the
art of product manufacture. The parties shall negotiate in good faith as
to
pricing terms for any technical assistance required by SPL in order to assist
Alfacell in qualifying a back-up supplier.
12.4 Notwithstanding
anything to the contrary herein, in the event of a Supply Failure or a
Permitting or Facility Failure or termination of this Agreement by Alfacell
pursuant to Section 10.1(a) or (b), or Section 10.2, or by SPL under Section
10.3, then SPL shall provide Technical Assistance on a commercially reasonable
basis to a third party manufacturer designated by Alfacell to manufacture
the
Product. In such case, Alfacell shall have a nonexclusive, worldwide, royalty
free license to SPL Introduced Technology to make, have made, use, have used,
sell and have sold Product (in any form or formulation). This remedy shall
be in
addition to any other rights or remedies Alfacell may have. The parties shall
negotiate in good faith the commercially reasonable charges SPL may receive
for
the Technical Assistance reduced by the reasonable damages (if any) that
Alfacell has incurred by reason of the cause giving rise to the right of
Alfacell to terminate this Agreement. The parties acknowledge that Force
Majeure
is not a breach of this Agreement, nor does it give rise to damages to
Alfacell.
ARTICLE
13 CONFIDENTIALITY
13.1 The
parties acknowledge and agree that they have entered into a Mutual
Confidentiality Agreement dated as of November 6, 2006 (the "MCA"). The
terms of the MCA, other than [Sections
8 – 12]
thereof,
are hereby incorporated herein, except that provisions incorporated herein
hereby reflect the following: (i) each party may use the other party’s
Confidential Information (as defined in the MCA) in order to carry out its
obligations hereunder; (ii) all Developed IP shall be the sole and exclusive
Confidential Information of Alfacell; and (iii) the obligations of
confidentiality shall continue for ten (10) years after the termination of
this
Agreement. If a party has Confidential Information which is in the nature
of a
trade secret,
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the
party
shall have no right to use or disclose trade secret information for as long
as
the other party continues to protect and hold such Confidential Information
as a
trade secret. A copy of the MCA is attached hereto as Exhibit
4.
ARTICLE
14 INTELLECTUAL
PROPERTY
14.1 For
the
purposes of this Agreement, “Alfacell Technology” shall mean all pre-existing or
independently developed Alfacell inventions (whether patentable or not),
developments, improvements, know-how, data and information related to Product
or
based on Alfacell Confidential Information. For the purposes of this Agreement,
“SPL's Technology” shall mean all pre-existing or independently developed SPL
inventions (whether patentable or not), developments, improvements, know-how,
data and information related to its proprietary manufacturing processes or
based
on SPL Confidential Information. For purposes of this Agreement, "Developed
IP"
shall mean inventions (whether patentable or not), developments, improvements,
know-how, data and information developed by a party in connection
herewith.
14.2 All
Alfacell Technology shall be the sole and exclusive Confidential Information
and
property of Alfacell and SPL shall have no right to any of the Alfacell
Technology except as set forth in this subsection. Alfacell gives SPL the
right
to use Alfacell Technology solely as necessary to allow SPL to comply with
its
obligations under this Agreement. Such license shall terminate on the earlier
termination or expiration of this Agreement.
14.3 All
SPL
Technology developed solely by SPL and not based on Alfacell Confidential
Information and property shall be the sole and exclusive Confidential
Information and property of SPL. In the case that SPL violates the provisions
of
Section 12.2, Alfacell shall have a nonexclusive, worldwide, royalty free
license to SPL Introduced Technology to use, have used, sell and have sold
Product (in any form or formulation) manufactured hereunder.
14.4 Developed
IP shall be the sole and exclusive Confidential Information of Alfacell;
provided, however, SPL shall have a non-exclusive license to utilize the
Developed IP in conjunction with its business to the extent that the Developed
IP relates solely to SPL’s [manufacturing processes] and is unrelated to
Product. Such non-exclusive license is royalty-free and shall survive
termination of this Agreement. SPL shall promptly and fully disclose to Alfacell
all Developed IP and shall execute and deliver such documentation as needed
to
evidence any of the foregoing rights.
14.5 Except
as
otherwise provided herein, upon the termination or expiration or early request
by the party owning the relevant Confidential Information, the non-owning
party
shall return to its owner all tangible Confidential Information and copies
thereof to the owning party, and shall erase all embodiments of the Confidential
Information from all storage devices owned or controlled by the non-owning
party, including but not limited to, random access memory (RAM) devices,
read
only memory (ROM) devices and disk drives. The non-owning party agrees to
promptly certify to the owning party, in writing, its fulfillment of its
obligation hereunder. The non-owning party may be required to retain certain
copies of pertinent documents for the purposes of complying with any regulatory
requirements, and will inform the owning party if any documents would be
involved in the duration of time required to retain them if
known.
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ARTICLE
15 JURISDICTION
This
Agreement shall be governed by and construed in accordance with the laws
of the
State of Delaware, without regard to any choice of law principle that would
dictate the application of the law of another jurisdiction.
ARTICLE
16 SEVERABILITY
If
any
provision of this Agreement should be or becomes fully or partly invalid
or
unenforceable for any reason whatsoever, or should violate any applicable
law,
the same shall be considered divisible as to such provision and such provision
shall be deemed deleted herefrom, and the remainder hereof shall be valid
and
binding as if such provision were not included herein.
ARTICLE
17 NOTICES
All
notices or other communications which are required or permitted hereunder
shall
be in writing and delivered personally, sent by telecopier (and promptly
confirmed by personal delivery, registered or certified mail or overnight
courier), sent by nationally-recognized overnight courier or sent by registered
or certified mail, postage prepaid, return receipt requested, addressed as
follows:
If
to
SPL, to:
SCIENTIFIC
PROTEIN LABORATORIES LLC
▇▇▇
▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Phone:
▇▇▇-▇▇▇-▇▇▇▇
Fax:
▇▇▇-▇▇▇-▇▇▇▇
With
a
copy to:
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ VAN DEUREN s.c.
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Phone:
▇▇▇-▇▇▇-▇▇▇▇
Fax:
▇▇▇-▇▇▇-▇▇▇▇
If
to
Alfacell, to:
ALFACELL
CORPORATION
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
Kuslima Shogen, Chief Executive Officer
Phone:
▇▇▇-▇▇▇-▇▇▇▇
Fax:
▇▇▇-▇▇▇-▇▇▇▇
With
a
copy to:
▇▇▇▇▇▇
▇▇▇▇▇▇
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▇
▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Phone:
▇▇▇.▇▇▇.▇▇▇▇
Fax:▇▇▇.▇▇▇.▇▇▇▇
or
to
such other address as the party to whom notice is to be given may have furnished
to the other party in writing in accordance herewith. Any such communication
shall be deemed to have been delivered: (i) when delivered, if personally
delivered, sent by telecopier on a business day, or if sent by
nationally-recognized overnight courier or (ii) on the fifth business day
following the date of mailing, if sent by mail. It is understood and agreed
that
this Article 17 is not intended to govern the day-to-day business communications
necessary between the parties in performing their duties, in due course,
under
the terms of this Agreement.
ARTICLE
18 MISCELLANEOUS
18.1 This
Agreement shall not be modified except by a duly signed instrument in
writing.
18.2 Any
waiver or delay by either party of exercising any remedy for any breach of
any
provision hereof shall not be construed to be a waiver of any subsequent
breach
of such provisions or a waiver of the provision itself or any waiver of any
other breach.
18.3 Alfacell
and SPL are independent contractors and nothing in this Agreement shall be
construed to create a partnership, joint venture, license or employment
relationship between the parties.
18.4 The
rights and obligations under this Agreement may not be assigned or transferred
by either party without prior written consent of the other party, except
that
SPL may assign this Agreement in the event of a transfer of control subject
to
Section 10.1(c).
Alfacell
may
assign this Agreement to an affiliated company or in connection with the
merger,
consolidation, sale or transfer of all or substantially all of the business
to
which this Agreement relates, whereafter the primary and sole obligor under
this
Agreement shall be the assignee.
18.5 This
Agreement constitutes the entire agreement of the parties with regard to
its
subject matter and supersedes all previous oral or written representations,
agreements and understandings between Alfacell and SPL with respect to the
supply of the Product. This Agreement may be changed only by a writing signed
by
both parties which specifically indicates the terms or provisions of this
Agreement are being amended by such writing.
18.6 In
the
event that any one or more provisions of this Agreement shall, for any reason,
be held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision of this
Agreement, and all other provisions shall remain in full force and effect.
If
any of the provisions are held to be excessively broad, any such provision
shall
be reformed and construed by limiting and reducing it so as to be enforceable
to
the maximum extent permitted by law.
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18.7 Neither
party shall make any public announcements with respect to this Agreement
without
the consent of the other party, which consent shall not be unreasonably
withheld. Each party shall submit all proposed press releases to the other
for
prior review, which review shall be accomplished as expeditiously as possible.
18.8 SPL
may
not subcontract with any third party to perform any of its obligations hereunder
without the prior written consent of Alfacell. In no event shall any such
subcontract release SPL from any of its obligations under this Agreement
except
to the extent they are performed by such subcontractor. SPL shall be primarily
responsible for the performance, in connection with all the terms and conditions
of this Agreement, of its permitted subcontractors. All permitted subcontractors
will be required by SPL in writing to adhere to the terms and conditions
of this
Agreement.
* * * * *
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IN
WITNESS WHEREOF, the parties hereto have caused this Purchase and Supply
Agreement to be executed in duplicate by their representatives duly authorized
as of the date first written above.
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SCIENTIFIC
PROTEIN
LABORATORIES
LLC
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ALFACELL
CORPORATION
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By:
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By:
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Print:
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Print:
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Title:
|
Title:
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EXHIBIT
1
SPECIFICATIONS
(please
see attached)
EXHIBIT
2
ANTICIPATED
VOLUME AND PRICING
EXHIBIT
3
QUALITY
AGREEMENT
(to
be
agreed and executed by the parties and annexed hereto)
EXHIBIT
4
CONFIDENTIALITY
AGREEMENT
(please
see attached)