Exhibit 10.2
 

 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
 
 
 
 
AMENDED AND RESTATED
 
LICENSE AND DISTRIBUTION AGREEMENT
 

 

 
BY AND BETWEEN
 

 
SHIRE LLC
 
AND
 
IMPAX LABORATORIES, INC.
 
 
 
 
 
 
 
 
 
 
DATED FEBRUARY 7, 2013
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

AMENDED AND RESTATED
LICENSE AND DISTRIBUTION AGREEMENT
 
THIS AMENDED AND RESTATED LICENSE AND DISTRIBUTION AGREEMENT (this “Agreement”)
dated February 7, 2013 (the “Effective Date”) is hereby entered into by and
between Shire LLC, a Kentucky limited liability company with offices located at
9200 Brookfield Court, Florence, KY 41042 (“Shire”), and Impax Laboratories,
Inc. , a Delaware corporation with offices located at 30831 Huntwood Ave.,
Hayward, CA 94544 (“Impax”).
 
R E C I T A L S:
 
WHEREAS, Shire and Impax settled certain claims pursuant to a certain Settlement
Agreement by and between Shire Laboratories, Inc.  and Impax dated January 19,
2006 (the “Patent Litigation Settlement Agreement)”;
 
WHEREAS, in connection therewith, Shire and Impax entered into a certain License
and Distribution Agreement dated January 19, 2006 (the “Original Effective
Date”), as amended on March 1, 2010 (the “Original License and Distribution
Agreement”);
 
WHEREAS, the Parties are now entering into another Settlement Agreement
contemporaneously herewith (the “Supply Litigation Settlement Agreement”) which
settles the Pending Litigation (as defined in the Settlement Agreement); and
 
WHEREAS, in connection therewith, the Parties are modifying their current
relationship as of the Effective Date and have agreed to amend and restate the
Original License and Distribution Agreement as set forth herein.
 
NOW THEREFORE, in consideration of the foregoing premises, mutual covenants, the
terms and conditions hereof and in the Supply Litigation Settlement Agreement,
and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the Parties hereby agree as follows.
 
1.           Definitions
 
1.1           “[***] QA Period” shall have the meaning assigned to such term in
Section 5. 3(h).
 
1.2           “Act” shall mean the United States Federal Food, Drug and Cosmetic
Act, as amended from time to time, and the rules, regulations and guidelines
promulgated thereunder.
 
1.3           “ADR Procedure” shall have the meaning assigned to such term in
Section 16. 13(d).
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
1.4           “Adderall XR” shall mean the pharmaceutical product that contains
the Compound as its sole active ingredient which is approved for Marketing in
the Territory pursuant to Shire’s NDA and sold under the trade name Adderall XR.
 
1.5           “Adderall XR ANDA” shall mean an ANDA seeking approval of a
Generic Equivalent.
 
1.6           “Adderall XR Intellectual Property” shall mean (i) U. S.  Patent
Nos.  6,322,819, 6,605,300, and 6,913,768 and any patent that issues as a result
of a reexamination or reissue thereof; (ii) any patent that issues from, or from
any continuation, continuation-in-part or divisional application relating to, U.
S.  Patent Application Serial Nos.  09/176,542, 10/353,073, 10/758,417,
10/774,697, and 11/030,174; and (iii) any other present or future U. S.  patent
owned or controlled by Shire which may read upon the making, using, selling or
importing of a Generic Product.
 
1.7           “Adderall XR License” shall mean a license under the Adderall XR
Intellectual Property.
 
1.8           “Adverse Drug Experience” shall mean an adverse event associated
with the use of Generic Product in humans, whether or not considered drug
related, including the following:an adverse event occurring in the course of the
use of a drug product in professional practice; an adverse event occurring from
drug overdose whether accidental or intentional; an adverse event occurring from
drug abuse; an adverse event occurring from drug withdrawal; and any failure of
expected pharmacological action. The above definition of “Adverse Drug
Experience” is defined by 21 C. F. R.  § 314. 80(a), and will be deemed to be
changed to reflect any changes to that section of 21 C. F. R.  § 314. 80.
 
1.9           “Affiliate” shall mean a Person that controls, is controlled by or
is under common control with a Party.  For the purposes of this definition, the
word “control” (including, with correlative meaning, the terms “controlled by”
or “under common control with”) means the actual power, either directly or
indirectly through one or more intermediaries, to direct the management and
policies of such Person, whether by the ownership of at least fifty percent
(50%) of the voting interest of such Person (it being understood that the direct
or indirect ownership of a lesser percentage of such interest shall not
necessarily preclude the existence of control), or by contract or otherwise.
 
1.10           “AG Product” shall mean generically Labeled Adderall XR, commonly
called an authorized generic product, approved for sale by the FDA pursuant to a
labeling supplement to Shire’s NDA.
 
1.11           “Agreement” shall have the meaning assigned to such term in the
introduction, as may be amended by a signed written instrument pursuant to
Section 16. 4.
 
1.12           “Allocated Quota” shall have the meaning assigned to such term in
Section 5. 3(b).
 
1.13           “Allocation Deadline” shall have the meaning assigned to such
term in Section 5. 3(c).
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
1.14           “Allocation Period” shall mean, except as modified herein
pursuant to Section 5. 3(f), the [***] period immediately preceding the calendar
month in which a DEA Quota Grant Letter is dated for which [***] at such date.
 
1.15           “Allocation Plan” shall have the meaning assigned to such term in
Section 5. 3(c).
 
1.16           “ANDA” shall mean an Abbreviated New Drug Application to the FDA
for approval to Manufacture and/or Market a pharmaceutical product in the
Territory.
 
1.17           “Annual DEA Quota Grant” shall mean the initial DEA Quota Grant
permitting the procurement of Compound beginning in a calendar year for the
Manufacture of AG Product and Adderall XR.
 
1.18           “Applicable Law” shall mean the applicable Laws, rules,
regulations, guidelines and requirements of any Governmental Authority related
to the development, registration, Manufacture and Marketing of the Generic
Product in the Territory or the performance of either Party’s obligations under
this Agreement.
 
1.19           “Authorization and License” shall have the meaning assigned to
such term in Section 2. 3.
 
1.20           “Business Day” shall mean any day other than a Saturday, Sunday
or a day on which banks in New York, New York are authorized or required by Law
to close.
 
1.21           “Cancellation Period” shall have the meaning assigned to such
term in Section 5. 13(d)(ii).
 
1.22           “cGMP” shall mean all applicable standards relating to
manufacturing practices for fine chemicals, active pharmaceutical ingredients,
intermediates, bulk products or finished pharmaceutical products, including the
principles detailed in the U. S.  Current Good Manufacturing Practices, 21 C. F.
R.  Parts 210 and 211.
 
1.23           “Claim” shall have the meaning assigned to such term in Section
12. 1(a).
 
1.24           “Commercially Reasonable Efforts” shall mean efforts and
diligence in accordance with the subject Party’s reasonable and sound business,
legal, medical and scientific judgment and in accordance with the efforts and
resources such Party would use in other aspects of its business that have
similar commercial value and market potential, taking into account the
competitiveness of the marketplace, the business life-cycle, the proprietary
position of the company and the profitability of the pertinent product.
 
1.25           “Compound” shall mean mixed amphetamine salts.
 
1.26           “Confidential Information” shall mean any scientific, technical,
formulation, process, Manufacturing, clinical, non-clinical, regulatory,
Marketing, financial or commercial information or data relating to the business,
projects, employees or products of either Party and provided by one Party to the
other by written, oral, electronic or other means in connection with this
Agreement.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
1.27           “Cost of Goods” shall mean the [***] to be paid by Impax to Shire
for Packaged and Labeled AG Product. With respect to Impax Product, the Cost of
Goods shall equal the [***].
 
1.28           [***]
 
1.29           “DEA” shall mean the United States Drug Enforcement
Administration or any successor agency thereof.
 
1.30           “DEA Quota” shall mean an amount of Compound authorized by the
DEA to be procured by Shire or Shire’s Manufacturer for the commercial
Manufacture of Adderall XR and AG Product.
 
1.31           “DEA Quota Grant” shall mean the issuance by the DEA of DEA Quota
to Shire or Shire’s Manufacturer.
 
1.32           “DEA Quota Grant Letter” shall mean the letter from DEA to Shire
or Shire’s Manufacturer setting forth a DEA Quota Grant.
 
1.33           “Deficient Lot” shall have the meaning assigned to such term in
Section 5. 2.
 
1.34           “Delivery Delay” shall have the meaning assigned to such term in
Section 5. 3(f).
 
1.35           “Delivery Month” shall have the meaning assigned to such term in
Section 5. 3(h).
 
1.36           “Delivery Schedule” shall have the meaning assigned to such term
in Section 5. 3(e).
 
1.37           “Disputed Quota” shall have the meaning assigned to such term in
Section 5. 3(c).
 
1.38           “Effective Date” shall have the meaning assigned to such term in
the introduction.
 
1.39           “Exclusive” shall mean, when used in connection with a specific
grant of rights, that the granting Party (i) shall retain for itself no ability
to use such granted rights and (ii) shall have no ability to authorize its
Affiliates or Third Parties (other than the grantee of such specific rights) to
use such granted rights, in the Territory and in the granted field of use, for
the term of the grant.
 
1.40           [***]
 
1.41           “FDA” shall mean the United States Food and Drug Administration
or any successor agency thereof.
 
1.42           “Force Majeure” shall mean any circumstances reasonably beyond a
Party’s control, including, without limitation, acts of God, civil disorders or
commotions, acts of aggression, fire, explosions, floods, drought, war,
sabotage, embargo, unexpected safety or efficacy results obtained with the
Generic Product, utility failures, [***], [***], labor disturbances, a national
health emergency, or appropriations of property.
 
1.43           “Forecast Period” shall have the meaning assigned to such term in
Section 5. 10.
 
1.44           [***]
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
1.45           “GAAP” shall mean generally-accepted accounting principles in
effect in the United States from time to time, consistently applied.
 
1.46           “Generic Equivalent” shall mean a pharmaceutical product which is
submitted to the FDA for Regulatory Approval pursuant to an ANDA (or equivalent
regulatory mechanism) as a Therapeutic Equivalent to Adderall XR. Generic
Equivalent shall also mean the AG Product.
 
1.47           “Generic Product” shall mean both Impax AG Product and Impax
Product.
 
1.48           “Governmental Authority” shall mean any court, tribunal,
arbitrator, agency, legislative body, commission, official or other
instrumentality of (i) any government of any country, or (ii) a federal, state,
province, county, city or other political subdivision thereof.
 
1.49           “Impax” shall have the meaning assigned to such term in the
introduction.
 
1.50           “Impax AG Product” shall mean AG Product supplied to Impax
pursuant to this Agreement.
 
1.51           “Impax ANDA” shall mean ANDA No.  76-852, and any amendment and
supplement thereto.
 
1.52           “Impax Liability” shall have the meaning assigned to such term in
Section 12. 2.
 
1.53           “Impax [***] Notice” shall have the meaning assigned to such term
in Section 5. 13(c).
 
1.54           [***]
 
1.55           “Impax Party” shall have the meaning assigned to such term in
Section 12. 1.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
1.56           “Impax Product” shall mean the Generic Equivalent that is the
subject of the Impax ANDA.
 
1.57           [***]
 
1.58           “Impax Allocated Share” and “Impax’s Allocated Share” shall mean,
including as may be modified pursuant to Sections 5. 3(c), 5. 3(f), or 5. 4(b),
the product (in kilograms) obtained by [***] or [***], as applicable.
 
1.59           “Impax’s Launch Notice” shall have the meaning assigned to such
term in Section 3. 7.
 
1.60           [***]
 
1.61           [***] shall have the meaning assigned to such term in Section 5.
13(d)(iv).
 
1.62           [***]
 
1.63           [***]
 
1.64           “JAMS Rules” shall have the meaning assigned to such term in
Schedule 16. 13(d).
 
1.65           “January – December 2013 Delivery Schedule” shall have the
meaning assigned to such term in Section 5. 3(g).
 
1.66           “January – December 2012 Period” shall have the meaning assigned
to such term in Section 5. 3(f).
 
1.67           [***]
 
1.68           “Label” shall mean any Package (immediate container) labeling
designed for use with a product, including the package insert for such product
that is approved by the FDA, and “Labeled” or “Labeling” shall have the
correlated meaning.
 
1.69           “Late-Supplied AG Product” shall have the meaning assigned to
such term in Section 5. 13(c).
 
1.70           “Launch” shall mean the first commercial sale of a product to an
unaffiliated Third Party.
 
1.71           “Law” or “Laws” shall mean all laws, statutes, rules, codes,
regulations, orders, judgments and/or ordinances of any Governmental Authority.
 
1.72           “License Effective Date” shall mean October 1, 2009.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
1.73           “Losses” shall mean any liabilities, damages, costs or expenses,
including reasonable attorneys’ fees and expert fees, incurred by any Party that
arise from any Claim, lawsuit or other action by a Third Party.
 
1.74           [***]
 
1.75           “Manufacture” shall mean all activities related to the
manufacturing of a pharmaceutical product, or any ingredient thereof including,
but not limited to, manufacturing Compound or supplies for development,
manufacturing, as the case may be, Impax Product, Impax AG Product, AG Product,
and/or Adderall XR for commercial sale, Packaging, in-process and finished
product testing, release of product or any component or ingredient thereof,
quality assurance activities related to manufacturing and release of product,
ongoing stability tests and regulatory activities related to any of the
foregoing, and “Manufactured” or “Manufacturing” shall have the correlated
meaning.
 
1.76           “Manufacturing Costs” for each dosage strength of AG Product
shall mean[***], accrued in accordance with GAAP. Manufacturing Costs for each
dosage strength of Impax Product shall mean [***], accrued in accordance with
GAAP.
 
1.77           “Manufacturing Failure or Delay” shall mean a failure or delay,
[***] in (i) the Manufacturing of AG Product or Adderall XR, as applicable, or
(ii) AG Product or Adderall XR, as applicable, meeting the specifications in
Shire’s NDA or applicable cGMP standards, including any period of time when an
investigation is being conducted into whether AG Product or Adderall XR, as
applicable, meets the specifications in Shire’s NDA or applicable cGMP
standards.
 
1.78           “Market” shall mean to distribute, promote, advertise, import,
market and sell, and “Marketing” or “Marketed” shall have the correlated
meaning.
 
1.79           “Modification” shall have the meaning assigned to such term in
Schedule 5. 3(e).
 
1.80           “Modification Date” shall have the meaning assigned to such term
in Schedule 5. 3(e).
 
1.81           “NDA” shall mean a New Drug Application filed with the FDA
pursuant to and under 21 U. S. C.  § 355(b) of the Act, together with the FDA’s
implementing rules and regulations.
 
1.82           “Net Profits” shall mean the difference between Net Sales for the
applicable Generic Product and the Cost of Goods for such product.
 
1.83           “Net Sales” shall mean, with respect to all sales of Generic
Product sold on or after April 1, 2011 and all related calculations, the gross
invoice price of sales of Generic Product in the Territory by Impax and its
Affiliates to unaffiliated Third Parties, less all applicable deductions
permitted by GAAP including, without limitation (i) trade discounts, (ii)
promotional allowances, (iii) cash discounts, (iv) customer refunds and credits,
(v) returns, (vi) reprocurement charges, (vii) customer and government rebates
(viii) chargebacks, (ix) retroactive price or shelf stock adjustments and price
equalizations; (x) Impax's actual freight, storage, and insurance expense, (xi)
administrative fees, (xii) fees for management and service of Third Party
contracts including contract maintenance, chargeback processing, credit and
collections and store level delivery, (xiii) marketing and administration fees
to cover national inventory costs, contract handling, and chargeback maintenance
costs, and (xiv) program fees for the administration of a private label generic
program. [***].

 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
1.84           [***]
 
1.85           [***]
 
1.86           “New Delivery Date” shall have the meaning assigned to such term
in Section 5. 13(d)(i).
 
1.87           “New Delivery Date Notice” shall have the meaning assigned to
such term in Section 5. 13(d)(i).
 
1.88           [***]
 
1.89           “Non-binding Forecast” shall have the meaning assigned to such
term in Section 5. 10.
 
1.90           “Non-Supplied AG Product” shall have the meaning assigned to such
term in Section 5. 13(d).
 
1.91           [***] shall have the meaning assigned to such term in Section 5.
13(d)(ii).
 
1.92           “Original Effective Date” shall have the meaning assigned to such
term in the whereas section.

1.93           “Original License and Distribution Agreement” shall have the
meaning assigned to such term in the whereas section.
 
1.94           “Original Schedule” shall have the meaning assigned to such term
in Schedule 5. 3(e).
 
1.95           “Package” shall mean all primary containers, including bottles,
cartons, shipping cases or any other like matter used in packaging or
accompanying a product, and “Packaged” or “Packaging” shall have the correlated
meaning.
 
1.96           “Party” or “Parties” shall mean Shire and/or Impax, as
applicable.
 
1.97           “Patent Litigation Settlement Agreement” shall have the meaning
assigned to such term in the whereas section.
 
1.98           “Payment Amount” shall have the meaning assigned to such term in
Section 9.9.
 

CONFIDENTIAL TREATMENT REQUESTED
BY IMPAX LABORATORIES, INC.

 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
1.99           “Person” shall mean any individual, partnership, association,
corporation, limited liability company, trust, or other legal Person or entity.
 
1.100           [***]
 
1.101           “QA Testing” shall have the meaning assigned to such term in
Section 5. 3(h).
 
1.102           “Quality Agreement” shall have the meaning assigned to such term
in Section 7. 7.
 
1.103           “Regulatory Approval” shall mean final Marketing approval by the
FDA for the sale and Marketing of a pharmaceutical product in the Territory.
 
1.104           “Reporting Period” shall have the meaning set forth in Section
9. 3.
 
1.105           “Reserve Quota” shall have the meaning assigned to such term in
Section 5. 3(b).
 
1.106           “Reserve Quota Event” shall have the meaning assigned to such
term in Section 5. 3(b).
 
1.107           “Returns and Final Reconciliation Report” shall have the meaning
assigned to such term in Section 9. 8.
 
1.108           [***]
 
1.109           “Shire” shall have the meaning assigned to such term in
introduction.
 
1.110           “Shire Liability” shall have the meaning assigned to such term
in Section 12. 1.
 
1.111           “Shire Party” shall have the meaning assigned to such term in
Section 12. 2.
 
1.112           “Shire’s Manufacturer” shall mean a Third Party designated by
Shire to conduct some or all of the Manufacturing of Adderall XR and AG Product.
 
1.113           “Shire’s NDA” shall mean Shire’s NDA No.  21-303, and all
supplements filed pursuant to the requirements of the FDA, including all
documents, data and other information concerning Adderall XR which are necessary
for FDA approval to Market Adderall XR in the Territory.
 
1.114           “Shortfall” shall have the meaning assigned to such term in
Section 5. 3(d).
 
1.115           “SKU” shall measure stock keeping units, which is expressed
herein in dosage amounts (in mgs. ).
 
 
 

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separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
1.116           “SKU Mix” shall mean the distribution of Impax’s Allocated Share
among the different dosage strengths of Impax AG Product.
 
1.117           [***]
 
1.118           “Subsequent Cancellation Period” shall have the meaning assigned
to such term in Section 5. 13(d)(iii).
 
1.119           “Subsequent Delivery Date Notice” shall have the meaning
assigned to such term in Section 5. 13(d)(iii).
 
1.120           “Supply Litigation Settlement Agreement” shall have the meaning
assigned to such term in the whereas section.
 
1.121           “Supply Term” shall have the meaning assigned to such term in
Section 15. 1.
 
1.122           “Term” shall have the meaning assigned to such term in Section
15. 1.
 
1.123           “Territory” shall mean the United States of America.
 
1.124           “Teva” shall mean Teva Pharmaceuticals USA, Inc.  and its
Affiliates, successor to Barr Laboratories, Inc.  as a result of Teva’s
acquisition of Barr Laboratories, Inc.  in 2008.
 
1.125           [***]
 
1.126           “Therapeutic Equivalent” shall have the meaning given to it by
the FDA in the current edition of the “Approved Drug Products with Therapeutic
Equivalence Evaluations” (the “Orange Book”) as may be amended from time to time
during the Term.
 
1.127           “Third Party” or “Third Parties” shall mean any Person or entity
other than a Party or its Affiliates.
 
1.128           “Undelivered Product” shall have the meaning assigned to such
term in Section 5. 4(c).
 
1.129           “Valid Claim” shall mean an issued and unexpired patent claim
which has not been held to be invalid or unenforceable by a court of competent
jurisdiction in a final unappealable decision.
 
2.           Authorization and License
 
2.1           Subject to the terms, conditions and limitations hereof, including
the conditions set forth in Section 3 [***], Shire hereby grants to Impax a
limited license, under the Adderall XR Intellectual Property and under any and
all statutory and regulatory exclusivities to Manufacture, have Manufactured and
Market Impax Product in the Territory on and after the License Effective Date.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
2.2           Subject to the terms, conditions and limitations hereof, including
the conditions set forth in Section 3, Shire hereby authorizes Impax to Market
Impax AG Product in the Territory from and after the License Effective Date. In
connection with and solely for purposes of such authorization, Shire hereby
grants to Impax a limited license under the Adderall XR Intellectual Property
and under any and all statutory and regulatory exclusivities to Market such
Impax AG Product in the Territory from and after the License Effective Date.
 
2.3           The authorizations and licenses granted by this Section 2. 1 and
2. 2 are referred to herein as the “Authorization and License. ”Except to the
extent of the assignment permitted pursuant to Section 16. 3, or pursuant to any
extension of licenses under Section 3. 8, Impax shall not have the right to
sublicense or assign any of its rights under the Authorization and License.
 
3.           Conditions
 
3.1           Impax shall not Market or authorize or knowingly facilitate the
Marketing of Impax AG Product outside the Territory and agrees to take all
appropriate and legal steps as may be required to ensure that its Affiliates or
customers do not sell or distribute Impax AG Product outside the Territory
including, without limitation, by limiting or terminating the supply of Impax AG
Product to customers which, to Impax’s knowledge, are distributing or selling
Impax AG Product outside the Territory.
 
3.2           Subject to the provisions of Sections 3. 3 and 3. 4 below, the
Authorization and License shall be on an Exclusive basis.
 
3.3           Shire reserves the right to license and authorize Barr
Laboratories, Inc.  to Manufacture, have Manufactured and Market a Generic
Equivalent in the Territory and supply AG Product to Teva (originally Barr
Laboratories, Inc.) in full and complete settlement of the original litigation
between Shire and Barr Laboratories, Inc.  involving the Adderall XR
Intellectual Property.
 
3.4           Shire reserves the right to grant licenses under the Adderall XR
Intellectual Property and any and all statutory and regulatory exclusivities to
any Third Party to Manufacture, have Manufactured and Market a Generic
Equivalent, but only under its applicable ANDA, in settlement of any
then-pending or then-threatened litigation involving the Adderall XR
Intellectual Property; provided, however, that such licenses shall be on terms
no more favorable to such Third Party than those set forth in this Agreement.
 
3.5           Except to the extent permitted under the Authorization and
License, neither Impax nor any of its Affiliates shall under any circumstances:
(a) Market any Generic Equivalent that infringes or misappropriates the Adderall
XR Intellectual Property or (b) aid, abet, enable or contract with any Third
Party regarding the Marketing of any Generic Equivalent that infringes or
misappropriates the Adderall XR Intellectual Property.
 
3.6           Nothing set forth herein shall be deemed to prevent or restrict
Impax or its Affiliates from Marketing any product which would not infringe or
misappropriate the Adderall XR Intellectual Property. In addition, nothing shall
prohibit Impax from entering into any agreement with a Third Party related to
any Generic Equivalent that does not infringe or misappropriate the Adderall XR
Intellectual Property; provided, however, that if Impax so enters into any such
agreement (except an agreement that is reasonably required for Impax to Market
the Generic Product and is approved by Shire pursuant to Section 8. 1), Impax
shall promptly notify Shire, and Shire shall be free to terminate the
Authorization and License and any supply obligations to Impax immediately upon
notice to Impax.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
3.7           Impax’s Right to Launch Impax Product. During the Supply Term,
Impax agrees and covenants not to Manufacture, have Manufactured or Market any
Impax Product in the Territory, or otherwise license, authorize or allow a Third
Party to Manufacture, have Manufactured or Market any Generic Equivalent in the
Territory under the Impax ANDA; provided, however, notwithstanding anything to
the contrary, Impax has the right to develop Impax Product; Manufacture
development, validation or commercial batches of Impax Product; seek and obtain
approval of the Impax ANDA; and engage in any supporting activities relating
thereto, and such activities will not affect Shire’s obligation to supply Impax
AG Product to Impax under the terms and conditions of this Agreement. During the
Supply Term, upon Launch of the Impax Product, Impax shall give Shire written
notice of the Launch within [***] thereafter (“Impax’s Launch Notice”). Upon
Impax Launch of an Impax Product, all outstanding allocations and purchase
orders for Impax AG Product shall be automatically cancelled and Shire shall
have no further obligation to supply Impax AG Product to Impax other than AG
Product that would have been otherwise delivered to Impax prior to the Impax
Product Launch, but which AG Product has not been delivered including, without
limitation, Undelivered Product; provided, further that with respect to any
finished Impax AG Product including Impax AG Product that has been encapsulated,
that Shire has not supplied to Impax prior to receipt of Impax’s Launch Notice,
Impax shall accept supply of all such Impax AG Product under the terms of this
Agreement. For clarity, notwithstanding any other provision of this Agreement,
an Impax Product Launch shall not release Shire from its obligation to [***] to
Impax under Section 5. 13(c) or 5. 13(d) for Late-Supplied AG Product or
Non-Supplied AG Product, or to deliver to Impax Late-Supplied AG Product,
Non-Supplied AG Product, or Undelivered Product as required thereunder.
 
3.8           Impax’s Right to [***] The license granted to Impax under the
Adderall XR Intellectual Property includes [***].
 
4.           Authorized Generic
 
The Parties hereby confirm that Impax elected, under the Original License and
Distribution Agreement, by providing written notice to Shire, to have Shire
supply Impax AG Product to Impax for sale in the Territory from and after the
License Effective Date.
 
5.           Supply; Delivery Schedule; SKU Mix; and [***] for Delay and
Nondelivery
 
5.1           All AG Product supplied will be released for sale under a generic
Label in Packaged form which complies with Shire’s NDA. Subject to compliance
with Shire’s NDA, Impax will provide Shire with appropriate and customary
generic Package and Label design which will be utilized by Shire in
Manufacturing AG Product. Any costs incurred by Shire in utilizing such
Packaging or Labeling, or in performing other Manufacturing specifications (such
as tablet imprints) requested by Impax and to which Shire agrees (such agreement
not to be unreasonably withheld, delayed or conditioned), including related
capital expenditures, shall be included in Manufacturing Costs.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
5.2           Shire’s Supply Obligations. Subject to the terms, conditions and
limitations of this Agreement, Shire agrees to supply AG Product to Impax for
Marketing pursuant to Section 4 and in accordance with the terms of this
Agreement. Consistent with the Delivery Schedule, (i) Impax shall submit
purchase orders for each Delivery Month specifying the amount of Impax AG
Product by SKU Mix and in full lot increments of [***] bottles, and (ii) Shire
shall deliver Impax AG Product. The Parties agree that the amount of [***]
bottles represents an approximation of the average size of a lot of Impax AG
Product that will be Manufactured to satisfy each SKU lot ordered by Impax and
that Shire shall deliver, and Impax will accept, the actual number of bottles
for such SKU lot that is Manufactured to fill Impax’s ordered SKU lot, whether
greater or less than [***] bottles. Shire’s delivery of such actual Manufactured
bottles shall be in full satisfaction of Impax’s order for a SKU lot provided
that the actual number of bottles for such SKU lot delivered to Impax is at
least [***] bottles. In the event a SKU lot delivered to Impax is less than
[***] bottles (a “Deficient Lot”), Shire shall Manufacture and deliver to Impax
the difference between [***] bottles and the amount actually delivered to Impax
from such Deficient Lot as promptly as practicable. With respect to all DEA
Quota Grants issued prior to the Effective Date, Shire’s obligation to supply
Impax AG Product under this Agreement shall be limited to the delivery of Impax
AG Product as set forth in the Delivery Schedule in Section 5. 3(g) below and in
accordance with all the terms and conditions of this Agreement.
 
5.3           Allocation of DEA Quota Grants to Impax. With respect to all DEA
Quota Grants issued after the Effective Date, the amount and timing of Impax’s
ordering and Shire’s delivery of Impax AG Product to Impax will be determined in
accordance with the procedures set forth in this Section 5. 3. Except as
required to meet its supply obligations to Impax under this Agreement, nothing
in this Agreement shall be interpreted or construed as in anyway limiting
Shire’s right or ability to allocate any DEA Quota Grant for use in the
Manufacture of Adderall XR or AG Product. The Parties agree that the provisions
of this Agreement are intended to set forth, among other things, the terms and
conditions for Impax’s ordering of Impax AG Product, and the supply and delivery
of Impax AG Product by Shire to Impax; certain rights and obligations of Impax
relating to Impax AG Product; and Shire’s supply obligations for Impax AG
Product.
 
(a)           Notification to Impax of DEA Quota Grants. Shire will notify Impax
of receipt of each DEA Quota Grant and provide Impax with a copy of the DEA
Quota Grant Letter as soon as possible, but in any event no later than [***]
after Shire receives such DEA Quota Grant Letter. To the extent a DEA Quota
Grant Letter contains information not related to Adderall XR or any AG Product
(for example, relating to another Shire product), such information will be
redacted before transmission to Impax.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
(b)           Allocation to Impax of DEA Quota Grants.  In determining the total
amount of any DEA Quota that will be subject to the allocation methodology set
forth herein (the “Allocated Quota”), the following amounts will be excluded:
(i) [***] percent ([***]%)] of the DEA Quota shall be designated for use in
[***]; and (ii) [***] percent ([***]%)] of such grant shall be designated as
reserve quota (the “Reserve Quota”) to be used for Manufacturing replacement
product for any of Impax, Shire and/or Teva due to product loss caused by [***]
(each one, a “Reserve Quota Event”). To the extent any or all of the Adderall XR
Manufactured [***] is not [***], Shire shall be free to use such Adderall XR at
its discretion.  To the extent that the Reserve Quota is not used to replace AG
Product for Teva and/or Impax or Adderall XR for Shire that was not delivered
due to a Reserve Quota Event that occurs prior to the next DEA Quota Grant, such
unused Reserve Quota will be added to the quota available for allocation with
the next succeeding DEA Quota allocation that occurs and Impax’s share of such
unused Reserve Quota shall be allocated in accordance with the Allocation Plan
applicable to such next succeeding DEA Quota allocation set forth in Section 5.
3(c).  However, with respect to unused Reserve Quota remaining from the last DEA
Quota Grant granted on or prior to [***], based on a SKU Mix provided by Impax,
Shire shall deliver to Impax its share of such unused Reserve Quota which will
be based on [***]. Shire shall deliver to Impax such unused Reserve Quota
remaining from [***] within [***] which utilizes any of the DEA Quota Grant
immediately following [***]. With respect to any Reserve Quota Event, Shire
shall provide Impax with the information and documentation in its possession
reasonably needed to confirm the cause of the relevant Reserve Quota Event. In
addition, within thirty (30) days of each DEA Quota Grant, Shire shall provide
to Impax an accounting of Reserve Quota reserved from the preceding DEA Quota
Grant including documentation detailing, by Reserve Quota Event, use of any
quantities of the Reserve Quota for Reserve Quota Events and the amount of
Reserve Quota remaining for allocation.
 
(c)           Allocation Plan.  Within [***] after the date Shire receives a DEA
Quota Grant Letter, Shire will prepare and deliver to Impax, for its review, a
proposed “Allocation Plan” that calculates [***] and Impax’s Allocated Share
[***] for the Allocation Period. At the time of delivery of the proposed
Allocation Plan, Shire will also provide Impax with justification documents in
support of its calculation of [***], [***], and Impax’s Allocated Share, which
documents shall include copies of all data and information used in the
calculations, as well as a detailed description of the related calculations.
Within [***] of receipt of Shire’s proposed Allocation Plan and justification
documents, Impax will either agree to the proposed Allocation Plan, or provide
to Shire any proposed adjustments to the Allocation Plan based upon what Impax
believes are errors or miscalculations of [***], [***] and/or Impax’s Allocated
Share. At the time of delivery of the proposed adjustments, Impax will also
provide Shire with justification documents in support of its belief that there
were such errors or miscalculations, which documents shall include copies of all
data and information used to confirm the errors or miscalculations, as well as a
detailed description of the related calculations. The Parties shall use their
best efforts to agree upon a final Allocation Plan not less than [***]
thereafter (the “Allocation Deadline”). In the event the Parties do not agree on
Impax’s Allocated Share by the Allocation Deadline, the dispute resolution
procedure set forth in Section 16. 13(d) hereof shall be immediately implemented
in order to definitively resolve all disputes related to the calculation of
Impax’s Allocated Share. In addition, Shire shall: (i) place an amount of
kilograms equal to the difference between Shire’s proposed Impax’s Allocated
Share and Impax’s proposed Impax’s Allocated Share (the “Disputed Quota”) into
reserve pending resolution of the dispute in accordance with the terms herein;
and (ii) make and deliver Impax AG Product not in dispute in accordance with the
Delivery Schedule contemplated in Section 5. 3(e). To the extent the dispute is
resolved in Impax’s favor, the Allocation Plan shall immediately be recalculated
to include the relevant amount of Disputed Quota, and Impax’s Allocated Share
and [***] shall be increased accordingly [***]. With respect to the delivery of
Impax AG Product representing any Disputed Quota allocated to Impax following
resolution of the relevant dispute, Shire will use its best efforts to deliver
such batches to Impax as soon as practicable.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
(d)           SKU Mix. Within [***] of the earlier of: (i) the Allocation
Deadline, or (ii) the Parties’ agreement on an Allocation Plan, Impax will
provide to Shire its SKU Mix and Impax’s preferred delivery sequence for the SKU
Mix; provided, however, that the SKU Mix shall not exceed the total kilograms of
Impax’s Allocated Share. To the extent that the total kilograms of DEA Quota
used in Impax’s SKU Mix is less than Impax’s Allocated Share, then Shire shall
place the balance of Impax’s Allocated Share (the “Shortfall”) into reserve and
Impax shall have the right to have the Shortfall added to Impax’s Allocated
Share as part of the next DEA Quota allocation or to any Disputed Quota that is
ultimately allocated to Impax in accordance with Section 5. 3(c). If there is a
dispute as to Impax’s Allocated Share, the SKU Mix submitted by Impax shall not
include the Disputed Quota. If any Disputed Quota is ultimately allocated to
Impax, then within [***] after such allocation, Impax shall provide the SKU Mix
and Impax’s preferred delivery sequence for the SKU Mix and Shire shall reserve,
without limitation, any Shortfall from the Disputed Quota for future use by
Impax. After the resolution of outstanding disputes related to the Disputed
Quota, the aggregate reserve amount of Shortfall shall neither exceed [***] nor
be less than [***]. To the extent the aggregate reserve amount of Shortfall is
greater than [***], Shire shall be free to allocate the excess above [***] at
its sole discretion. In the event the Shortfall is less than [***], Shire shall
be free to allocate such amount at its sole discretion.
 
(e)           Delivery Schedule. Within [***] of receiving any SKU Mix and
preferred delivery sequence from Impax, Shire will provide to Impax an estimated
monthly delivery schedule, based on the form of the delivery schedule set out in
Section 5. 3(g), setting out the number of lots by month, and specifying SKU, of
Impax AG Product Shire expects to deliver to Impax, consistent with the
Allocation Plan and the SKU Mix and which takes into account all of the
requirements set forth in this Subsection (e) (“Delivery Schedule”). In
preparing the Delivery Schedule, Shire shall take into account [***], and
Manufacturing-related issues. The Delivery Schedule shall provide that:
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
(i)           for any Annual DEA Quota Grant, Impax will receive at a minimum:
(a) within [***] which utilizes any such DEA Quota Grant, [***] percent
([***]%)] of Impax’s Allocated Share of such DEA Quota Grant and, (b) in each
Delivery Month thereafter, Impax AG Product constituting [***] percent ([***]%)]
of Impax’s Allocated Share of such DEA Quota Grant until all of Impax’s
Allocated Share is delivered; and

(ii)           for any supplemental DEA Quota Grant, Impax will receive at a
minimum: (y) within [***] which utilizes any such DEA Quota Grant, [***] percent
([***]%)] of Impax’s Allocated Share of such DEA Quota Grant, and (z) in each
Delivery Month [***] percent ([***]%)] of Impax’s Allocated Share of such DEA
Quota Grant.

Shire shall use its best efforts to schedule the Manufacturing of Adderall XR
and AG Product in order to ensure that [***]. Within [***] of receiving Shire’s
proposed Delivery Schedule, Impax may propose modifications to Shire’s proposed
Delivery Schedule, including the SKU Mix for a Delivery Month, and Shire will
use its best efforts to accommodate Impax’s requests, and within [***] deliver
to Impax an updated Delivery Schedule reflecting the same. With respect to any
Disputed Quota, the Parties shall also update the Delivery Schedule to reflect
the resolution of the dispute and such AG Product shall be delivered as soon as
practicable in accordance with the last sentence of Subsection (c) above. The
Delivery Schedule may only be modified as follows: (i) to add to the Delivery
Schedule for Disputed Quota allocated to Impax; (ii) to revise the Delivery
Schedule as required in Section 5. 3(i) due to delays; and (iii) by the Parties
as part of a Delivery Schedule Modification in the form annexed as Schedule 5.
3(e) hereto, executed on behalf of Impax by one of its Senior Vice Presidents
(or a more senior Impax officer) and Shire.

(f)           Additional Considerations for Allocation to Impax of DEA Quota
Grants. If either Party has verifiable evidence that, [***], such Party may
provide evidence to the other Party of the same, and upon the other Party’s
consent, not to be unreasonably withheld, [***]. In the event that in any
Allocation Period, [***] as permitted in this Section [***], such that [***]
remain a part of the calculation of [***], then the [***] shall be replaced with
[***]. With respect to [***] applicable to the period beginning on January 1,
2012 and ending on December 31, 2012 (the “January-December 2012 Period”)], each
Party acknowledges and agrees that [***] for the January-December 2012 Period
has been calculated utilizing an acceptable method, and accurately reflects
[***] for the January-December 2012 Period. Further, if at any time, whether due
to [***], Impax AG Product not delivered to Impax according to the Delivery
Schedule is: (i) more than [***], or (ii) more than [***] in any [***] period
(either being a “Delivery Delay”), at Impax’s sole option [***] shall for the
next Allocation Period, subject to the following sentence, be deemed to be the
greater of: [***] or [***]; provided, however, the foregoing option shall not be
available to Impax if Shire can reasonably demonstrate that the difference
between [***] and [***] resulted solely from factors other than a Delivery Delay
(e. g. , [***]).  In the event of a Shire failure to supply resulting from
[***], and such Shire failure to supply [***] due to such [***], then [***] for
the next Allocation Period shall be that of the [***] beginning immediately
prior to the month of the first delayed or missed product delivery resulting
from such [***].
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
(g)           Supply of Impax AG Product January-December 2013. The Delivery
Schedule with respect to any DEA Quota Grant issued prior to the Effective Date
(the “January-December 2013 Delivery Schedule”) shall be as follows:
 

SKU
Jan
2013
(lots)
Feb
2013
(lots)
March
2013
(lots)
April
2013
(lots)
May
2013
(lots)
June
2013
(lots)
July
2013
(lots)
Aug
2013
(lots)
Sept
2013
(lots)
Oct
2013
(lots)
Nov
2013
(lots)
Dec
2013
(lots)
Total
Lots
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
Total lots per month
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]
[***]

The Parties acknowledge and agree that as of the Effective Date: (i) Shire has
supplied the Impax AG Product ordered by Impax for delivery before the Effective
Date; and (ii) all purchase orders and forecasts issued by Impax before the
Effective Date are cancelled.
 
(h)           Manufacture and Delivery of Impax AG Product. The Parties agree
and acknowledge that all or some of the Manufacturing of Impax AG Product may be
conducted by Shire’s Manufacturer, including [***], provided that Impax AG
Product [***]. Should Shire desire to [***] then Shire shall give Impax not less
than [***]’ prior written notice of the same, along with a complete explanation
as to the [***]. [***]. In addition, Shire shall [***] of AG Product to Impax in
accordance with the Delivery Schedule. Impax AG Product shall only be delivered
to Impax following Shire’s completion of the testing and inspections of the
applicable Product as set forth in Section 6. 4 (the “QA Testing”). Subject to
any extensions for the [***] QA Period, the delivery due date for each month of
the Delivery Schedule (a “Delivery Month”) shall be the last Business Day of the
month, provided that Shire shall make Impax AG Product available for pickup by
Impax earlier in a Delivery Month when Impax AG Product has completed QA
Testing. If Impax AG Product is received by Shire from Shire’s Manufacturer in
the last several days of a Delivery Month, it will be supplied to Impax within
[***] after receipt thereafter in order to allow for Shire to complete QA
Testing (the “[***] QA Period”).
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
(i)           Delays in Delivery. In the event that any Impax delivery will be
delayed, in whole or in part, including without limitation, due to [***], Shire
will notify Impax of such late delivery as soon as possible and promptly
thereafter agree with Impax, such agreement not to be unreasonably withheld, on
a later date for delivery that is intended to accommodate the delay, taking into
consideration [***]. Except as provided in Section 5. 13(d), in no event shall a
delay in delivery alter Shire’s obligation to supply Impax’s Allocated Share
according to the Delivery Schedule. If a delay in delivery is unique to batches
for Impax, Shire will use its best efforts including, without limitation,
utilizing available Reserve Quota, to deliver such batches to Impax as soon as
practicable but not later than within [***] after the delivery date set forth in
the Delivery Schedule. If a delay in delivery is caused by [***], then Shire
will, in consultation with Impax, set a later date for delivery intended to
deliver Impax AG Product to Impax as close to the Delivery Schedule as possible,
[***], as the case may be. In connection with any [***] related to Impax AG
Product in addition to notices required by Section 16. 1 hereof, Shire shall
provide Impax with the information in its possession reasonably needed to
confirm [***].
 
5.4           Allocation of DEA Quota to Impax in 2014
 
(a)           [***]. Shire shall allocate Impax AG Product in an amount not less
than Impax’s Allocated Share and provide a Delivery Schedule for Impax AG
Product with respect to: (i) any quota granted by DEA pursuant to [***]; and
(ii) any supplemental quota granted by DEA [***].
 
(b)           With respect to the Allocation Plan for the Annual DEA Quota Grant
for 2014, Impax shall be allocated Impax’s Allocated Share, [***]; provided,
however, that Impax will never receive less than the [***] Impax Allocated Share
for such DEA Quota Grant. [***]. For all DEA Quota Grants received [***] but
after [***], [***] shall be utilized to determine Impax’s Allocated Share.
[***].
 
(c)           Except for DEA Quota allocated to Impax during the Supply Term,
including without limitation any replacement for such DEA Quota, the Parties
agree that Shire shall have no obligation to allocate to Impax any Impax AG
Product from any DEA Quota Grant that is granted after [***].  Notwithstanding
anything to the contrary in this Agreement, Shire is obligated to deliver to
Impax all Impax AG Product to be Manufactured from Impax’s Allocated Share which
Impax was entitled to receive under this Agreement, but which was undelivered as
of the end of the Supply Term including, without limitation, AG Product owed
from a Deficient Lot, AG Product to be reallocated to Impax pursuant to Section
5. 3(b), Disputed Quota allocated to Impax pursuant to Section 5. 3(c),
Shortfall, delayed Impax AG Product, and all undelivered replacement product
(“Undelivered Product”). It is understood that the Delivery Schedule may extend
beyond expiration of the Supply Term and all Undelivered Product shall be
delivered to Impax in accordance with the Delivery Schedule. Impax has the right
to Market its inventory after the Supply Term until the inventory is depleted.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
(d)           Notwithstanding anything to the contrary in this Agreement, [***];
provided, however, that Shire may request a [***] to replace any Adderall XR or
AG Product subject to a recall, market withdrawal or seizure. In the event of
any discussion or correspondence with DEA concerning a [***], or if any DEA
Quota Grant actually grants a [***], Shire shall notify Impax within five (5)
days of such discussion, correspondence or grant in writing with full details
including, without limitation, an explanation of any basis for such a [***] or
discussion thereof, of which Shire has knowledge. Shire shall be solely
responsible for compliance with any [***] and Impax shall have no liability
therefor, provided that such [***], further provided, however, that if there is
a [***].
 
5.5           Payment for Impax AG Product. Shire shall invoice Impax at the
time of each shipment of AG Product at the [***] for such shipment. Impax shall
pay each such invoice within thirty (30) days of receipt.
 
5.6           Deliveries. All deliveries to Impax of Impax AG Product shall be
[***] facility to a carrier designated by [***]. The terms and conditions of
this Agreement shall be controlling over any conflicting terms and conditions
stated in Impax’s purchase order or Shire’s invoice or confirmation. Any other
document which shall conflict with or be in addition to the terms and conditions
of this Agreement is hereby rejected (unless the Parties shall have mutually
agreed to the contrary in writing in respect of a particular instance).
 
5.7           Records. During the Term, and for a period of three (3) years
thereafter, Shire shall, and shall ensure that its Affiliates shall, keep at
either its normal place of business, or at an off-site storage facility,
detailed, accurate and up to date:
 
(a)           records and books of account sufficient to confirm the calculation
of the Cost of Goods; and
 
(b)           information and data contained in any invoices provided to Impax
in connection with this Agreement.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
5.8           Impax Audit of Shire. On no less than five (5) Business Days’
notice from Impax, Shire shall make all (i) records, books of account,
information and data concerning the Manufacturing Costs of Impax AG Product and
(ii) documentation to verify first receipt by Shire of Adderall XR and AG
Product from Shire’s manufacturer from each Quota Grant (with any other product
information redacted), available for inspection during normal business hours by
Impax or its nominee for the purpose of general review or audit, provided that
Impax may not request such inspection more than twice in any calendar year. In
the event Impax’s auditors believe there is a discrepancy in the calculation of
Manufacturing Costs or the dates of first receipt, Impax’s auditors shall be
entitled to take copies or extracts from such records, books of account,
information and data (but only to the extent related to the calculation of
Manufacturing Costs or to verify dates of receipt) during any review or audit
provided the auditor signs a confidentiality agreement with Shire providing that
such records, books of account, information and data shall be treated as
Confidential Information which may only be disclosed to Impax, its auditors, its
legal and other advisors, and as otherwise required by Applicable Laws. If
Impax’s external auditor’s results shows an overpayment by Impax, Shire shall
pay the amount of such overpayment, plus simple, non-compounded interest at an
annual rate of [***] percent ([***]%)] beginning on the date such overpayment
occurred. If Impax’s external auditor’s results shows an underpayment to Shire,
Impax shall pay the amount of such underpayment to Shire. Any underpayment or
overpayment of amounts due hereunder due to a discrepancy in the calculation of
Manufacturing Costs shall be paid or refunded by the applicable Party within
thirty (30) days of the earlier of: (i) the Parties’ agreement in writing as to
the appropriate overpayment or underpayment; or (ii) the resolution of any
disputes related thereto if a dispute is referred for resolution pursuant to
Section 16. 13(d). For clarity, all disputes related to Impax’s, or Shire’s or
their auditor’s conclusions, shall be resolved by the dispute resolution process
in Schedule 16. 13(d).
 
5.9           Audit Costs. Impax shall be solely responsible for its costs in
making any such review and audit, unless Impax identifies a discrepancy in
Manufacturing Cost paid to Shire hereunder of five percent (5%) or greater in
which event Shire shall be solely responsible for the cost of such review and
audit and refund Impax any overpayment. All information disclosed by Shire or
its Affiliates pursuant to this Section 5. 9 shall be deemed Confidential
Information.
 
5.10           Rolling Twelve (12) Month Non-Binding Forecasts. Within fourteen
(14) Business Days of the Effective Date and on or before the fifth (5th)
Business Day of every calendar quarter thereafter, Impax will deliver a
non-binding forecast (“Non-binding Forecast”) to Shire, for planning purposes
only, of the quantities of Impax AG Product, by SKU, which Impax anticipates it
will require for Marketing during the twelve (12) month period (“Forecast
Period”) beginning three (3) months following the date of such Non-binding
Forecast and will include delivery quantities for each month of the Forecast
Period.
 
5.11           No Other Agreements; [***]. Other than Teva, Shire shall not
grant to any Third Party the right to take delivery of or sell AG Product prior
to the end of the Supply Term. In addition, Shire agrees to give Impax not less
than five (5) Business Days’ written notice of [***].
 
5.12           Communication. Personnel from Shire and Impax with the requisite
decision-making authority will conduct conference calls every two (2) weeks to
discuss all issues related to the supply of Impax AG Product to Impax including,
all information relating to Shire’s DEA Quota Grant requests and DEA Quota
Grants, Impax’s Allocated Share, [***], Allocation Plans for Impax AG Product,
SKU Mix, Delivery Schedules, Purchase Orders, Non-binding Forecasts, increased
Impax business, timing and quantity estimates for delivery of Impax AG Product,
relevant quality assurance issues and relevant batch issues for Impax AG
Product. To facilitate increased communication, [***] and [***] will make
themselves available to participate on such calls (or in person) for at least
the first two (2) months following the Effective Date.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
5.13           [***] for Late Deliveries and Non-Delivery. Notwithstanding
anything to the contrary in this Agreement, if Shire fails to provide supply of
Impax AG Product in accordance with the terms of this Agreement, then the
following shall apply.
 
(a)           If the Impax AG Product is delivered within [***] days of the
delivery date set forth in the Delivery Schedule for such AG Product (including
only modifications expressly permitted under Section 5. 3(e)), Impax shall have
[***] due to the delay in delivery. In the event Shire believes that it will be
unable to deliver a particular SKU lot within [***] days of the delivery date
set forth in the Delivery Schedule for such SKU lot, Shire shall provide Impax
prompt written notice of the same and may offer Impax timely delivery of a
different SKU lot in lieu thereof. If Impax notifies Shire within [***] Business
Days thereafter that Impax will accept the delivery of the different SKU lot
offered by Shire, then (i) the Delivery Schedule will be deemed amended to
include, as a replacement for the original SKU lot, the different SKU lot (with
the same delivery date as the original) and (ii) Shire shall deliver such
different SKU lot on or prior to such delivery date.
 
(b)           Provided that replacement or delayed Impax AG Product is provided
to Impax as contemplated herein (including, without limitation, in accordance
with Sections 5. 3(b) and 5. 3(i)) such that Impax receives Impax AG Product
representing all of Impax’s Allocated Share, Impax will [***] due to any delay
in supplying Impax AG Product later than [***] days from the delivery date set
forth in the Delivery Schedule if the delay is caused by [***]. For any delay in
delivery caused by [***], Impax’s sole remedy for such delay will be [***].
 
(c)           If Shire supplies Impax AG Product not covered by an event
described in Section 5. 13(b) above, later than [***] days but before [***] days
after the delivery date set forth in the Delivery Schedule (“Late-Supplied AG
Product”), Impax’s sole and exclusive remedy for such delay will be [***]. The
Parties shall fully cooperate in the prompt calculation [***] under this
Section, which calculation shall be completed not later than thirty (30) days
after Impax has determined [***]. In connection with such calculation, Impax
shall provide Shire with written notice of Impax’s calculation (the “Impax [***]
Notice”), along with all the information, documentation, and calculations
reasonably needed for Shire to confirm Impax’s calculation.
 
(d)           If Shire has failed to supply Impax AG Product not covered by an
event described in Section 5. 13(b) above, within [***] days of the delivery
date set forth in the Delivery Schedule (“Non-Supplied AG Product”):
 
(i)           Shire shall deliver to Impax written notice (the “New Delivery
Date Notice”) of a new firm delivery date (the “New Delivery Date”) for the
Non-Supplied AG Product.

 
 

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separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
(ii)           Beginning on the date the Impax AG Product becomes Non-Supplied
AG Product and ending [***] days after Impax’s receipt of the New Delivery Date
Notice from Shire (the “Cancellation Period”), Impax will have the option to
cancel its order for the Non-Supplied AG Product, in whole or in part, but only
in whole lot increments, and, subject to [***] adjustments set forth in Section
5. 3(f), Impax’s sole and exclusive remedy for such amount of cancelled
Non-Supplied AG Product will be [***]. In the event Impax cancels its order for
the Non-Supplied AG Product, the amount of DEA Quota that Shire or Shire’s
Manufacturer would have used to produce the Non-Supplied AG Product shall revert
to Shire for its use at its sole discretion. With respect to any amount of
Non-Supplied AG Product not cancelled by Impax by the end of the Cancellation
Period, Shire shall deliver all such uncancelled Non-Supplied AG Product on or
before the New Delivery Date set forth in the New Delivery Date Notice. Subject
to [***] adjustments set forth in Section 5. 3(f), Impax’s sole and exclusive
remedy for the amount of Non-Supplied AG Product that is not cancelled by Impax
as permitted hereunder and is delivered by the New Delivery Date will be [***].
For clarity, in connection with such calculation, [***] will be calculated based
on the delivery date as originally set forth in the Delivery Schedule, and not
based on any New Delivery Date.
 
(iii)           If Shire does not deliver to Impax all of the uncancelled
Non-Supplied AG Product subject to a New Delivery Date Notice on or before the
New Delivery Date, with respect such Non-Supplied AG Product, Shire shall
deliver to Impax another New Delivery Date Notice (a “Subsequent Delivery Date
Notice”) and, beginning on the first day after the New Delivery Date and ending
[***] days after Impax’s receipt of such Subsequent Delivery Date Notice (a
“Subsequent Cancellation Period”), Impax will have the option to cancel its
order for the Non-Supplied AG Product, in whole or in part, but only in whole
lot increments, and, subject to [***] adjustments set forth in Section 5. 3(f),
Impax’s sole and exclusive remedy for such amount of cancelled Non-Supplied AG
Product will be [***]. With respect to the amount of Non-Supplied AG Product not
cancelled by Impax by the end of the Subsequent Cancellation Period, Shire shall
deliver all such uncancelled Non-Supplied AG Product on or before the New
Delivery Date set forth in the Subsequent Delivery Date Notice. Subject to [***]
adjustments set forth in Section 5. 3(f), Impax’s sole and exclusive remedy for
the amount of Non-Supplied AG Product that is not cancelled by Impax as
permitted hereunder and is delivered by the New Delivery Date set forth in the
Subsequent Delivery Date Notice will be [***]. For clarity, in connection with
such calculation, [***] will be calculated based on the delivery date as
originally set forth in the Delivery Schedule, and not based on any New Delivery
Date. The foregoing process shall be repeated until all remaining Non-Supplied
AG Product is either (i) cancelled by Impax and Shire [***] for such cancelled
Non-Supplied AG Product or (ii) delivered to Impax by Shire by or before the
then-applicable New Delivery Date.

 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
(iv)           The Parties shall fully cooperate in the prompt calculation of
[***] which calculation shall be completed no later than thirty (30) days after
Impax’s delivery of notice of cancellation of any Non-Supplied AG Product. In
connection with such calculation, Impax shall provide Shire with written notice
of Impax’s [***] along with all the information, documentation, and calculations
reasonably needed for Shire to confirm Impax’s calculation.

(e)           If Shire believes there is an error or miscalculation in Impax’s
calculation under Sections 5. 13(c) or (d), then (i) Shire shall provide Impax
with an explanation of the reasons why it believes there has been an error or
miscalculation and Shire shall pay all undisputed amounts within ten (10) days
of receipt of the Impax [***] Notice or the [***] (as applicable) and (ii) Impax
shall provide Shire any additional documents that it believes may assist in
understanding the calculations in dispute. With respect to any disputed amounts,
upon request from Shire, Impax shall permit reasonable access to its records in
order for Shire to verify Impax’s relevant calculations. In addition, the
Parties shall have the right to seek a resolution pursuant to the dispute
resolution procedure required by Section 16. 13(d). Disputed amounts shall be
paid within ten (10) Business Days of agreement between the Parties or
resolution of dispute resolution. If any dispute is resolved in favor of Impax,
interest [***] at the rate set forth in Section 5. 13(h).
 
(f)           In the event that Shire has failed to supply Impax AG Product to
Impax as contemplated by Section 5. 13(d), [***].
 
(g)           During any period when any Impax AG Product has not been delivered
by its delivery date set forth in the Delivery Schedule, all incoming Impax AG
Product shall be credited as follows: (i) first, against any deliveries of Impax
AG Product scheduled for the Delivery Month in which the delayed Impax AG
Product is delivered, and (ii) second, against delayed Impax AG Product
originally scheduled for delivery in each prior Delivery Month, beginning with
the most recent Delivery Month preceding the Delivery Month referred to in
clause (i) of this subsection and continuing to the next most recent Delivery
Month until all Impax AG Product deliveries are up to date. Except as provided
for in Section 5. 13(f), nothing in this Agreement shall be interpreted or
construed to allow or permit a Party to delay, withhold, deduct, or cancel any
amounts due and payable to the Party under this Agreement, including, without
limitation, royalties due and payable by Impax under Section 9 and payment for
Impax AG Product under Section 5. 5.
 
(h)           All [***] to be made pursuant to Section 5. 13(d) shall be subject
to simple, non-compounded interest at an annual rate of [***] percent ([***]%)
beginning on the delivery date in the Delivery Schedule until such [***].
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
6.           Quality Assurance; Acceptance
 
6.1           Shire represents, covenants and warrants to Impax that:
 
(a)           all AG Product hereunder shall be produced in accordance with cGMP
and other Applicable Laws, rules and regulations and that none of the AG Product
supplied hereunder shall be adulterated or misbranded as defined by the Act;
 
(b)           all shipments of AG Product supplied hereunder shall meet the
specifications and quality control standards set forth in Shire’s NDA;
 
(c)           Shire or a Shire Affiliate will use Commercially Reasonable
Efforts to maintain throughout the term of this Agreement all permits, licenses,
registrations and other forms of governmental authorization and approval
required in order for Shire to perform its obligations hereunder in accordance
with all Applicable Laws;
 
(d)           to Shire’s knowledge upon due investigation, as of the Original
Effective Date, the Manufacture or Marketing of the AG Products in the Territory
pursuant to this Agreement does not infringe, misappropriate or otherwise
conflict with any intellectual property rights of any Third Party;
 
(e)           Shire or a Shire Affiliate owns and possesses all right, title and
interest in the Shire NDA; and
 
(f)           Shire has the right to grant all of the rights and licenses
granted herein to Impax under the Adderall XR Intellectual Property, and it is
not under any obligation to any Third Party that conflicts with the terms of
this Agreement.
 
6.2           Impax AG Products shall (i) have a shelf life of at least [***]
months from the date of Manufacture and (ii) conform to Shire’s NDA.
 
6.3           All AG Products will be in finished dosage form, filled, Packaged
and Labeled for commercial sale in accordance with the terms and conditions of
this Agreement, the Quality Agreement, and Applicable Laws.
 
6.4           Shire shall perform all quality control tests and other
inspections required by applicable cGMP standards and Shire’s NDA and shall
furnish to Impax a certificate of analysis together with each lot of AG Product
shipped to Impax. Shire will also provide Impax with Material Safety Data Sheets
as required by Law for the AG Products, and updates of same as necessary.
 
6.5           Shire will promptly notify Impax of any request from the FDA to
change AG Product specifications or Labeling and will notify Impax of any
changes in specifications. No such change which requires FDA approval will be
implemented prior to obtaining such Impax approval.
 
 
 

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separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
6.6           Impax shall conduct, at its own expense, such tests as it deems
necessary to determine the compliance of the AG Product with the requirements of
Sections 6. 1(a-b), 6. 2 and 6. 3. Impax shall notify Shire within thirty (30)
days of its receipt of each shipment of the AG Product of any non-compliance of
the AG Product with the requirements of Sections 6. 1(a-b), 6. 2 or 6. 3
revealed by such testing.  If no notice of non-compliance is delivered to Shire
within such thirty (30) day period, the AG Product so delivered shall be deemed
to comply with Sections 6. 1(a-b), 6. 2 or 6. 3.
 
6.7           Subject to the provisions of Section 6. 8, Shire shall replace, at
its own expense including, without limitation, all freight costs, any AG Product
that does not meet the requirements of Sections 6. 1, 6. 2 and 6. 3. Subject
only to the indemnification obligations set forth in Section 12. 1, Shire shall
have no other obligation with respect to Losses in respect of such AG Product or
the representations set forth in Sections 6. 1, 6. 2 and 6. 3.
 
6.8           If, following the timely delivery of a notice by Impax pursuant to
the provisions of Section 6. 6, Impax and Shire do not agree that any lot or
lots of the AG Product referred to in the notice meets the requirements of
Sections 6. 1(a-b), 6. 2 or 6. 3, that lot or those lots of the AG Product shall
be tested for such compliance, within thirty (30) days after notice of the
defect is delivered to Shire, by a disinterested Third Party expert selected by
the mutual agreement of Impax and Shire. The decision of such Third Party expert
with respect to the question of compliance shall be binding upon Impax and Shire
for the purposes of Sections 6. 1(a-b), 6. 2 or 6. 3 of this Agreement only. The
costs of such testing shall be borne by Shire if such lot or lots are found not
to meet the requirements of Sections 6. 1(a-b), 6. 2 or 6. 3 and by Impax if
those lot or lots are found to meet the requirements of Sections 6. 1(a-b), 6. 2
or 6. 3.
 
6.9           At least once per calendar year following the License Effective
Date, Impax will provide Shire with a certificate of a duly authorized officer
with regulatory responsibilities to the effect that Impax stores and ships AG
Product in accordance with all Applicable Laws and regulations, including cGMP
standards.
 
6.10           Impax represents, covenants and warrants to Shire that all
Generic Product Marketed by Impax will be stored, shipped and handled in
accordance with cGMP and all Applicable Laws, rules and regulations and all
Impax Product Manufactured by Impax, or for Impax by a Third Party, shall be
Manufactured, shipped and handled in accordance with cGMP and all Applicable
Laws, rules and regulations and the Impax ANDA.
 
7.           Regulatory Responsibilities; Adverse Event Reporting; Recalls
 
7.1           As the holder of Shire’s NDA, Shire will have sole authority to
deal with regulatory matters relating to Shire’s NDA or AG Product. During the
term hereof, Shire shall maintain Shire’s NDA in accordance with all applicable
requirements of the FDA and other Governmental Authorities, including, without
limitation, the filing of all annual and other reports or filings required by
the FDA.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
7.2           Impax shall submit to Shire all reports of Adverse Drug
Experiences, together with all relevant information possessed by it, in time for
Shire to meet all periodic and annual safety regulatory obligations to the FDA.
Impax shall also promptly submit to Shire all AG Product inquiries or complaints
for handling by Shire. Each Party shall cooperate with the other and provide
information in its possession to the extent necessary for the other Party to
comply with all legal requirements relating to the Manufacture or Marketing of
Generic Product and the Parties will use diligent efforts to agree upon a
customary pharmacovigilance protocol as promptly as practicable after the date
hereof to provide for the necessary exchange of adverse event and related
information to permit Shire to comply with Applicable Laws and regulations on a
timely basis.
 
7.3           Each of Shire and Impax will immediately inform the other in
writing if it believes one or more lots of any AG Product should be subject to
recall from distribution, setting forth the reasons therefore with reasonable
specificity. To the extent permitted by legal and public safety requirements,
the Parties will confer before initiating any recall. If the Parties do not
reach agreement on the need for a recall, either Party may initiate a recall.
The Party initiating the recall shall initially bear the cost thereof and shall
carry out the recall in accordance with best industry practices. In the event it
is determined that a recall resulted from a breach by a Party of any of its
representations or warranties hereunder, such Party shall be responsible for the
costs of the recall and the cost of any unnecessary or groundless recall or
other recall which is not the result of a breach by the other Party or any of
its representations and warranties hereunder, shall be borne by the Party
initiating or requesting such recall. In no event shall a Party’s liability to
the other hereunder exceed the actual out-of-pocket costs incurred or the cost
of replacement of AG Product at a price equal to the Manufacturing Costs, as the
case may be, and neither Party shall be liable for lost profits or other
consequential damages.
 
7.4           As the holder of the Impax ANDA, Impax will have sole authority
and responsibility to deal with regulatory matters relating to the Impax ANDA or
Impax Product including maintaining the Impax ANDA as applicable in accordance
with all applicable requirements of the FDA, including, without limitation, the
filing of all annual and other reports or filings required by the FDA.
 
7.5           Shire shall keep, or cause its Affiliates to keep, as required,
such samples and such records (or copies thereof) in respect of the AG Products
as are required by Applicable Law for such period of time as may be required
thereunder.
 
7.6           Each of Shire and Impax shall promptly inform the other of any
correspondence from the FDA regarding the Generic Products that would materially
affect its ability to meet its obligations under this Agreement. Each of Shire
and Impax shall notify the other promptly, but in no event later than ten (10)
Business Days following the occurrence thereof, of any materially adverse
inspections by the FDA or other regulatory authorities which pertain to the
Generic Products or to the facilities of such Party or its Affiliate where the
Generic Products are being Manufactured or stored.
 
7.7           Impax and Shire have entered into a Quality Agreement in form and
content reasonably acceptable to Impax and Shire (“Quality Agreement”). The
Quality Agreement includes protocols and specific responsibilities for handling
AG Products quality complaints, ADE reports, and professional medical service
inquiries in accordance with Shire’s standard operating procedures and in
conformity with Applicable Laws.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
8.           Marketing of Generic Product
 
8.1           Impax shall, at its sole cost and expense, utilize all
Commercially Reasonable Efforts in Marketing the Generic Product in the
Territory to maximize sales and profits of Generic Product. During the Term
Impax shall not enter into any arrangements or agreements with any other Person
to Market or promote Generic Product in the Territory without Shire’s prior
written consent, except that Impax shall not be restricted in entering into
customary agreements with its ordinary trade customers including, without
limitation, distributors and retailers.
 
8.2           It is the intent of the Parties that Impax will seek to sell
Generic Product for its full market value. Impax will have sole discretion,
however, in setting the price for the sale of the Generic Product in the
Territory. Impax will also agree that if it prices Generic Product in order to
gain or maintain sales of other products, then for purposes of calculating the
payments due hereunder, the Net Sales of such Generic Product shall be adjusted
to reverse any discount which was given to a customer that was in excess of
customary discounts for the Generic Product (or, in the absence of relevant data
for this Generic Product, other similar products under similar market
conditions).
 
9.           Shire Profit Share
 
9.1           During the Term, Impax shall pay to Shire a royalty of [***]
percent ([***]%) of the Net Profits of Impax Product.
 
9.2           Impax shall pay a royalty to Shire equal to:
 
(a)           [***] percent ([***]%) of the Net Profits on sales of Impax AG
Product made by Impax during any period when the Impax AG Product is the only
Generic Equivalent being Marketed in the Territory other than a Generic
Equivalent marketed by or on behalf of Barr Laboratories, Inc.  or any successor
in interest to Barr Laboratories, Inc. ’s ANDA that is the subject of the past
litigation between Shire and Barr Laboratories, Inc.
 
(b)           [***] percent ([***]%) of the Net Profits on sales of Impax AG
Product made by Impax during any time period other than as described in Section
9. 2(a).
 
9.3           Payments due under this Section 9 shall be made within forty-five
(45) days from the end of each calendar quarter in which Generic Product is sold
(“Reporting Period”). All such payments shall include an invoice detailing the
calculation of Net Sales and Net Profits, including itemized calculations for
each of (i) through (xiv) set forth in Sections 1. 82 and 1. 83, as each may be
applicable and the royalties payable hereunder. In the event of two occurrences
where payment by Impax is delayed beyond the relevant Reporting Period, the
Reporting Period shall be changed to thirty (30) days from the end of each
calendar quarter at Shire’s election and upon ten (10) days advance written
notice from Shire to Impax. For clarity, the definition of Net Sales set forth
in Section 1. 83 of this Agreement shall be applied to all sales of Generic
Product sold on or after April 1, 2011 and shall be used for all related
calculations.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
9.4           In the event that Net Profits is a negative amount for any
Reporting Period, no payment or refund shall be due from Impax to Shire or from
Shire to Impax, in respect thereof and the Net Profits with respect to the
subsequent Reporting Period, shall be reduced by such negative amount for
purposes of determining Shire’s share of the Net Profits for such subsequent
Reporting Period.
 
9.5           Maintenance of Records. During the Term, and for a period of three
(3) years thereafter, Impax shall, and shall insure that its Affiliates shall,
keep at either its normal place of business, or at an off-site storage facility,
detailed, accurate and up to date:
 
(a)           records and books of account sufficient to confirm the calculation
of the Net Sales and Net Profits; and
 
(b)           information and data contained in any invoices or reports
accompanying any payment to Shire provided to Shire in connection with this
Agreement.
 
9.6           Inspection. On no less than five (5) Business Days’ notice from
Shire, Impax shall make all such records, books of account, information and data
concerning this Agreement available for inspection during normal business hours
by Shire or its nominee for the purpose of general review or audit, provided
that Shire may not request such inspection more than twice in any calendar year.
In the event Shire’s external auditors believe there is a discrepancy in the
calculation of Net Sales or Net Profits paid to Shire (including in the Returns
and Final Reconciliation Report) or [***] paid, or to be paid, by Shire pursuant
to Section 5. 13, Shire’s external auditors shall be entitled to take copies or
extracts from such records, books of account, information and data (but only to
the extent related to the contractual obligations set out in this Agreement)
during any review or audit provided the external auditor signs a confidentiality
agreement with Impax providing that such records, books of account, information
and data shall be treated as Confidential Information which may be disclosed to
Shire, its auditors, its legal and other advisors, and as otherwise required by
Applicable Laws. If Shire’s external auditor’s results shows an underpayment to
Shire, subject to the rights and remedies available to Impax including a right
to seek dispute resolution, Impax shall pay the amount of such underpayment,
plus simple, non-compounded interest at an annual rate of [***] percent ([***]%)
beginning on the date of such underpayment. If Shire’s external auditor’s
results shows an overpayment to Shire, Shire shall pay the amount of such
overpayment to Impax. Any underpayment or overpayment of amounts due hereunder
shall be paid or refunded by the applicable Party within thirty (30) days of the
earlier of (i) the Parties’ agreement in writing as to the appropriate
overpayment or underpayment or (ii) the resolution of any disputes related
thereto if a dispute is referred for resolution pursuant to Section 16. 13(d).
For clarity all disputes related to Impax’s, or Shire’s or their auditor’s
conclusions, shall be resolved by the dispute resolution process in Schedule 16.
13(d).
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
9.7           Inspection Costs. Shire shall be solely responsible for its costs
in making any such review and audit, unless Shire identifies a discrepancy in
the calculation of Net Sales or Net Profits paid to Shire under this Agreement
in any calendar year from those properly payable for that calendar year of five
percent (5%) or greater, in which event Impax shall be solely responsible for
the cost of such review and audit and refund Shire any overpayment. All
information disclosed by Impax or its Affiliates pursuant to this Section 9
shall be deemed Confidential Information.
 
9.8           12-Month True Up. Twelve (12) months after the end of the Supply
Term, Impax shall perform a “true-up” reconciliation of the items comprising
deductions from Net Sales and thereafter shall provide Shire with a written
report of such reconciliation (the “Returns and Final Reconciliation Report”).
The reconciliation shall be based on actual cash paid or credits issued through
the end of the Supply Term, and during the [***] month setoff period that
follows the Supply Term. In determining whether and to the extent an
underpayment or overpayment to Shire has been made, the reconciliation shall
calculate the payments due Shire based on the royalty rate due Shire under
Section 9. 1 or 9. 2 applicable at the time the deduction was originally
accrued. If the Returns and Final Reconciliation Report shows an underpayment to
Shire, subject to the rights and remedies available to Impax including a right
to seek dispute resolution, Impax shall pay the amount of such underpayment plus
simple, non-compounded interest at an annual rate of [***] percent ([***]%)
beginning on the date such deduction was accrued, to Shire within thirty (30)
days of the date of delivery of such report. If the Returns and Final
Reconciliation Report shows an overpayment to Shire, Shire shall pay the amount
of such overpayment, to Impax within thirty (30) days of the date of delivery of
such report. Shire shall be entitled to conduct an audit of Impax within thirty
(30) days of Shire’s receipt of the Returns and Final Reconciliation Report, in
accordance with the procedures set forth in Sections 9. 6 and 9. 7.
 
9.9           Shire Payment. As part of the consideration set forth herein,
Shire agrees to pay Impax Forty-Eight Million Dollars ($48,000,000) (the
“Payment Amount”). Within [***] after the Court’s entry of a Stipulation of
Dismissal or Order of Dismissal (each as defined in the Supply Litigation
Settlement Agreement) as applicable, Shire shall pay Impax the Payment Amount in
a single cash payment via wire transfer to an account designated by Impax at
least [***] prior to the date the Payment Amount is due.
 
10.           Confidentiality
 
10.1           Confidentiality Obligation. The Parties, their Affiliates and
their respective employees, directors, officers, consultants and contractors
shall keep and maintain as confidential any Confidential Information supplied by
the other Party during the Term. The confidentiality and non-disclosure
obligations contained in this Agreement shall not apply to the extent that such
Confidential Information is:
 
(a)           at the time of disclosure by one Party to the other, in the public
domain or otherwise publicly known;
 
(b)           after disclosure by one Party to the other becomes part of the
public domain, other than by breach of any obligation of confidentiality;
 
 
 

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has been requested with respect to the omitted portions. portions.

 
(c)           information which the receiving Party can establish by competent
evidence was already in its possession at the time of receipt or was
independently developed by the receiving Party; or
 
(d)           received from a Third Party who was lawfully entitled to disclose
such information free of an obligation of confidentiality.
 
10.2           Exceptions. Notwithstanding Section 10. 1, the Party receiving
Confidential Information may disclose such Confidential Information to the
extent that such disclosure has been ordered by a court of law or directed by a
Governmental Authority, provided that, the disclosure is limited to the extent
ordered or directed and wherever practicable, the Party that owns the
Confidential Information has been given sufficient written notice in advance to
enable it to seek protection or confidential treatment of such Confidential
Information.
 
10.3           Expiration of Confidentiality. The confidentiality obligation
contained in this Section 10 shall survive the termination or expiry of this
Agreement for so long as such information remains confidential.
 
10.4           Disclosure. If a Party is subpoenaed or otherwise requested by
any Person including, without limitation, any Governmental Authority to give
testimony or provide information which in any way relates to this Agreement, the
Generic Product or practices associated with the Generic Product, such Party
shall give the other Party prompt notice of such request, and unless otherwise
required by Law, shall make no disclosure until such other Party has had a
reasonable opportunity to contest the right of the requesting Person to such
disclosure. The Parties shall provide each other with all reasonable cooperation
and generally make its employees available to give testimony or to provide
reasonable assistance in connection with any lawsuits, claims, proceedings and
investigations relating to this Agreement, the Generic Product or practices
associated with the Generic Product.
 
10.5           The Parties agree that equitable relief, including injunctive
relief and specific performance, is appropriate in enforcing the confidentiality
provisions of this Agreement. In the event of any such action to construe this
provision, the prevailing Party will be entitled to recover, in addition to any
charges fixed by the court, its costs and expenses of suit, including reasonable
attorney’s fees. Such remedies shall not be deemed to be the exclusive remedies
for a breach of this provision, but shall be in addition to all other remedies
available at law or equity.
 
11.           Representations and Warranties of Both Parties
 
With respect to Sections 11. 1 and 11. 2 below, each of Shire and Impax
represents, warrants, and covenants, to the other Party that:
 
11.1           Organization and Authority. Such Party is a corporation duly
organized, validly existing and in good standing under the Laws of its
jurisdiction of incorporation. Such Party has the requisite corporate power and
authority to enter into this Agreement. Such Party has the requisite corporate
power and authority to execute and deliver this Agreement and to perform all of
its obligations hereunder. The execution and delivery of this Agreement and the
performance by such Party of its obligations hereunder have been authorized by
all requisite corporate action on its part. This Agreement has been validly
executed and delivered by such Party, and, assuming that such documents have
been duly authorized, executed and delivered by the other Party, constitutes a
valid and binding obligation of such Party, enforceable against such Party in
accordance with its terms.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
11.2           Consents and Approvals; No Violations
 
(a)           Except as otherwise set forth in this Agreement or the Supply
Litigation Settlement Agreement, no material filing with, and no material
permit, authorization, consent such Party of the transactions contemplated by
this Agreement, except for those filings, permits, authorizations, consents or
approvals, the failure of which to be made or obtained would not materially
impair such Party’s ability to consummate the transactions contemplated hereby
or materially delay the consummation of the transactions contemplated hereby.
 
(b)           Neither the execution nor the delivery of this Agreement by such
Party, nor the performance by such Party of its obligations hereunder, will
(i) violate the certificate of incorporation, by-laws or other organizational
document of such Party; (ii) conflict in any material respect with or result in
a material violation or breach of, or constitute a material default under, any
material contract, agreement or instrument to which such Party is a party; or
(iii) violate or conflict in any material respect with any material Law, rule,
regulation, judgment, order or decree of any court or Governmental Authority
applicable to such Party, except in the case of clause (ii) or (iii) for
violations, breaches or defaults which would not have a material adverse effect
on such Party’s ability to consummate the transactions contemplated hereby.
 
(c)           The Parties shall submit this Agreement together with the Supply
Litigation Settlement Agreement (as part of the Settlement Documents, as defined
in the Supply Litigation Settlement Agreement) to the Federal Trade Commission
Bureau of Competition and the Assistant Attorney General in charge of the
Antitrust Division of the Department of Justice as soon as practicable following
its execution and in no event later than ten (10) Business Days following its
execution.
 
12.           Indemnities; Product Liability; Insurance
 
12.1           Indemnity by Shire. Shire shall defend, indemnify and hold
harmless each of Impax and its Affiliates and its and their directors, officers,
employees and contractors (“Impax Party”) from and against any and all Losses,
(“Shire Liability”) arising from or in connection with:
 
(a)           any Third Party claim, lawsuit, investigation, proceeding,
regulatory action, or other cause of action (“Claim”) resulting from any
negligent acts or acts of willful misconduct of any Shire Party in connection
with the performance of its obligations under this Agreement;
 
 
 

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(b)           Shire’s failure to Manufacture, store or release the AG Product
for shipment in accordance with Applicable Laws, regulations or Shire’s NDA;
 
(c)           the breach by Shire of any of its representations or warranties
contained in this Agreement; or
 
(d)           any misuse by a Shire Party of Impax’s company name or logo or
other trademark;
 
except, in each case, to the extent that the Shire Liability is caused by the
negligence, breach of the terms of this Agreement, or willful misconduct of an
Impax Party.
 
12.2           Indemnity by Impax. Impax shall defend, indemnify and hold
harmless each of Shire and its Affiliates and its and their directors, officers,
employees and contractors (“Shire Party”) from and against any and all Losses
(“Impax Liability”) arising from or in connection with:
 
(a)           any Claim resulting from any negligent acts or acts of willful
misconduct of any Impax Party in connection with the performance of its
obligations under this Agreement;
 
(b)           any Claim based on or arising out of the use, Manufacturing or
Marketing of Impax Product, including, without limitation, any investigation by
a Governmental Authority or any Claim for personal injury or property damage
asserted by any user of Impax Product;
 
(c)           any Claim based on or arising out of the use or Marketing of AG
Product by Impax, including, without limitation, any investigation by a
Governmental Authority or any Claim for personal injury or property damage
asserted by any user of AG Product in each case to the extent that such
liability is a result of the acts or failure to act of Impax or its employees,
agents, partners, contractors or the like;
 
(d)           the breach by Impax of any of its representations or warranties
contained in this Agreement; or
 
(e)           any misuse by the Impax Parties of Shire’s company name or logo or
other trademark;
 
except, in each case, to the extent that the Impax Liability is caused by the
negligence, breach of the terms of this Agreement, or willful misconduct of a
Shire Party.
 
12.3           Control of Proceedings. A Party seeking indemnification hereunder
shall provide prompt written notice to the other Party (and, in any event,
within five (5) Business Days) of the assertion of any Claim against such Party
as to which indemnity is to be requested hereunder. The indemnifying Party shall
have the sole control over the defense of any Claim, provided that, the
indemnifying Party shall obtain the written consent of the indemnified Party
prior to settling or otherwise disposing of such Claim if as a result of the
settlement or Claim disposal the indemnified Party’s interests are in any way
adversely affected.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
12.4           No Admissions. The indemnified Party shall not make any payment
or incur any expenses in connection with any Impax Liability or Shire Liability
(as the case may be), or make any admissions or do anything that may compromise
or prejudice the defense of any Claim without the prior written consent of the
indemnifying Party.
 
12.5           Claim Information. Each Party shall promptly:
 
(a)           inform the other by written notice of any actual or threatened
Claim to which Sections 12. 1 or 12. 2 apply;
 
(b)           provide to the other Party copies of all papers and official
documents received in respect of any such Claim; and
 
(c)           cooperate as reasonably requested by the other Party in the
defense of any such Claim.
 
12.6           Contributory Negligence. If any Shire Liability or Impax
Liability is caused by the negligence of both Shire and Impax, the apportionment
of liability shall be shared between Shire and Impax based upon the comparative
degree of each Party’s negligence and each Party shall be responsible for its
own defense and its own costs including, but not limited to, the cost of defense
attorneys’ fees and witnesses’ fees and expenses incident thereto.
 
12.7           Limitation of Liability. Except (i) as may be included in a Claim
under Section 12. 1 or 12. 2, or (ii) as provided in Section 5. 13, in no event
shall either Party or their respective Affiliates be liable for special,
punitive, indirect, incidental or consequential loss or damage, or for any lost
profits, business or revenue, based on contract, tort or any other legal theory
arising out of this Agreement, including as caused by Shire’s failure to deliver
Impax AG Product as required under this Agreement; even if the remedies provided
for in this Agreement fail of their essential purpose and even if either Party
has been advised of the possibility or probability of such damages.
 
12.8           Product Liability Insurance. Each Party shall maintain, at its
own cost, general commercial liability insurance (including comprehensive
product liability) in such amount as Shire and Impax respectively, customarily
maintain with respect to its other products and which is reasonable and
customary in the U. S.  pharmaceutical industry for companies of comparable size
and activities but in any event not less than $[***] per occurrence and $[***]
in the aggregate. In the event the insurance policy obtained by a Party is a
“claims made” policy (as opposed to an “occurrence” policy), such Party shall
obtain comparable insurance for not less than six (6) years following the expiry
or termination of this Agreement. Impax will cause Shire to be named as an
additional insured under Impax’s product liability insurance.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
12.9           Limitation on Representations, Warranties and Indemnification.
NEITHER PARTY SHALL BE DEEMED TO MAKE ANY REPRESENTATIONS OR WARRANTIES, WHETHER
EXPRESS OR IMPLIED, EXCEPT AS SPECIFICALLY SET FORTH HEREIN. ALL OTHER
WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, WITH REGARD TO
THE AG PRODUCT TO BE SUPPLIED BY SHIRE HEREUNDER, THE IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, ARE HEREBY DISCLAIMED BY
EACH PARTY.
 
13.           Force Majeure
 
13.1           Force Majeure. Neither Party shall be entitled to terminate this
Agreement or shall be liable to the other under this Agreement for loss or
damages attributable to any Force Majeure, provided the Party affected shall
give prompt notice thereof to the other Party. Subject to Section 13. 2, except
as provided in Sections 5. 3(i) and 5. 13(b), the Party giving such notice shall
be excused from such of its obligations hereunder for so long as it continues to
be affected by Force Majeure.
 
13.2           Continued Force Majeure. If any Force Majeure continues unabated
for a period of at least ninety (90) days, the Parties shall meet to discuss in
good faith what actions to take or what modifications should be made to this
Agreement as a consequence of such Force Majeure in order to alleviate its
consequences on the affected Party.
 
14.           Trademarks and Trade Names
 
Except for the identification of Shire as manufacturer of AG Product on
Packaging or Labeling to the extent required by Law, Impax shall have no right
to use any trademark or tradedress of Shire and shall have no rights to any
other intellectual property of Shire or its Affiliates (including patents or
other intellectual property relating to the shape, consistency, formulation or
Manufacturing process for the AG Product) other than to the extent of the
Authorization and License.
 
15.           Term and Termination
 
15.1           Unless sooner terminated in accordance with the terms hereof, the
term of this Agreement shall extend from the date hereof until the expiration of
the last Valid Claim within the Adderall XR Intellectual Property (the “Term”).
The foregoing notwithstanding, the obligations of Shire regarding supply of AG
Product under this Agreement shall extend from the date hereof only until the
earlier of: (i) September 30, 2014, or (ii) Impax’s Launch of an Impax Product
(the “Supply Term”), subject to Section 15. 3(c).
 
15.2           Termination. Either Party shall be entitled to terminate this
Agreement by written notice to the other if:
 
(a)           the other Party commits a material breach of this Agreement, and
fails to remedy it within sixty (60) days of receipt of notice from the first
Party of such breach and of its intention to exercise its rights under this
Section 15. 2; or
 
 
 

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has been requested with respect to the omitted portions. portions.

 
(b)           an order is made or a resolution is passed for the winding up of
the other Party (other than voluntarily for the purposes of solvent amalgamation
or reconstruction) or an order is made for the appointment of an administrator
to manage the other Party’s affairs, business and property or if a receiver
(which expression shall include an administrative receiver) is appointed over
any of the other Party’s assets or undertaking or if circumstances arise which
entitle the court or a creditor to appoint a receiver or manager or which
entitle the court to make a winding-up order or if a voluntary arrangement is
proposed in respect of the other Party or if the other Party takes or suffers
any similar or analogous action in consequence of debt, and such order,
appointment or similar action is not removed within ninety (90) days.
 
15.3           Effect of Expiration or Termination.
 
(a)           In the event of early termination of this Agreement for any
reason, Impax shall no longer have the right to Market Impax Product under the
Authorization and License; provided that Impax may continue to Market inventory
then on hand for an additional six (6) month period as to which Impax shall pay
Shire the applicable royalty under Section 9 above.
 
(b)           In the event of expiry or early termination of this Agreement for
any reason, Impax shall promptly return to Shire all Confidential Information of
Shire provided to Impax during the Term.
 
(c)           In the event of the expiry or early termination of the Supply Term
for any reason, Impax shall no longer have the right to Market Impax AG Product,
provided that Impax may continue to Market inventory of Impax AG Product then on
hand until such inventory is depleted; and Impax shall have the right to Market
any Impax AG Product that would have been otherwise delivered to Impax prior to
termination, but which AG Product had not been delivered including without
limitation Undelivered Product and any AG Product to be delivered post-Launch
pursuant to Section 3. 7; provided, however, that Impax shall pay Shire the
applicable royalty under Section 9 above for all such Impax AG Product Marketed.
 
15.4           Liability on Termination. The termination or expiry of this
Agreement shall not release either of the Parties from any liability which at
the time of termination or expiry has already accrued to the other Party, nor
affect in any way the survival of any other right, duty or obligation of the
Parties which is expressly stated elsewhere in this Agreement to survive such
termination or expiry.
 
15.5           Surviving Sections. The provisions of Sections 1, 3. 7, 3. 8, 5.
4(c), 5. 6, 5. 7, 5. 8, 5. 9, 5. 13, 6, 7, 9. 4, 9. 5, 9. 6, 9. 7, 9. 8, 10, 12,
14, 15 and 16, and any other provisions necessary and proper to give effect to
the intention of the Parties as to the effect of the Agreement after
termination, shall continue in force in accordance with their respective terms
notwithstanding expiry or termination of this Agreement for any reason.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
16.           Miscellaneous
 
16.1           Notice.
 
(a)           Any notice or other document given under this Agreement shall be
in writing in the English language and shall be given by hand or sent by prepaid
airmail, by fax transmission or e-mail to the address of the receiving Party as
set out in Section 16. 2 below unless a different address or fax number has been
notified to the other in writing for this purpose.
 
(b)           Each such notice or document shall:
 
(i)           if sent by hand, be deemed to have been given when delivered at
the relevant address;
 
(ii)           if sent by prepaid mail, be deemed to have been given five (5)
days after posting; or
 
(iii)           if sent by fax or email transmission be deemed to have been
given when transmitted, provided that, a confirmatory copy of such fax or email
transmission shall have been sent by prepaid mail within twenty-four (24) hours
of such transmission.
 
16.2           Address for Notice. The address for services of notices and other
documents on the Parties shall be:
 

If to Shire: Shire LLC  
9200 Brookfield Court
 
Florence, KY 41042
 
United States of America
 
Fax: (484) 595-8674
 
Attn: Associate General Counsel
   
If to Impax:
Impax Laboratories, Inc.
 
30831 Huntwood Avenue
 
Hayward, CA 94544
 
United States of America
 
Fax: (510) 240-6000
 
Attn: Chief Executive Officer
   
With a copy to:
Impax Laboratories, Inc.
 
31047 Genstar Road
 
Hayward, CA 94544
 
Fax: (510) 240-6096
 
Attn: Mark A.  Schlossberg, Esq. ,
 
Senior Vice President and General Counsel

                  
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
16.3           Assignment.
 
(a)           Subject to Section 16. 3(b), Impax shall not assign or transfer
any of its rights or obligations under this Agreement without the prior written
consent of Shire, such consent not to be unreasonably withheld or delayed.
 
(b)           Subject to Section 16. 3(c) in the case of Impax, each Party shall
be entitled to assign all or any of its rights or obligations under this
Agreement to an Affiliate or to a successor entity by way of merger or
acquisition of substantially all of the assets of Impax; provided the Affiliate
or other successor entity expressly assumes in writing those rights, duties and
obligations under this Agreement and this Agreement itself and the Affiliate or
other successor is a financially capable business entity.
 
(c)           Anything to the contrary in this Agreement notwithstanding, to the
extent that Impax assigns or transfers any of its rights or obligations under
this Agreement to any [***].
 
(d)           Subject to the foregoing this Agreement shall be binding upon and
inure to the benefit of the Parties and their respective successors and
permitted assigns. Any assignment or transfer in contravention of the terms of
this Agreement shall be null and void.
 
16.4           Amendment. Subject to the procedure for the modification of
Delivery Schedules required by Section 5. 3(e), this Agreement may not be
varied, changed, waived, discharged or terminated, except by an instrument in
writing signed by the Party against which enforcement of such variation, change,
waiver, discharge or termination is sought.
 
16.5           Public Announcements. Except as expressly provided for in the
Supply Litigation Settlement Agreement, neither Party shall make any publicity
releases, interviews or other dissemination of information concerning this
Agreement or its terms, or either Party’s performance hereunder, to
communication media, financial analysts or others without the prior written
approval of the other Party, which approval shall not be unreasonably withheld,
delayed or conditioned. Notwithstanding anything to the contrary in this
Agreement, the Parties understand and agree that either Party, may, if so
required, disclose some or all of the information included in this Agreement or
other Confidential Information of the other Party(a) in order to comply with its
obligations under the Law, including the United States Securities Act of 1933,
the United States Securities Exchange Act of 1934, (b) the listing standards or
agreements of any national or international securities exchange or The NASDAQ
Stock Market or other similar Laws of a Governmental Authority, (c) to respond
to an inquiry of a Governmental Authority or regulatory authority as required by
Law, or (d) in a judicial, administrative or arbitration proceeding. In any such
event the Party making such disclosure shall (x) provide the other Party with as
much advance notice as reasonably practicable of the required disclosure, (y)
cooperate with the other Party in any attempt to prevent or limit the
disclosure, and (z) limit any disclosure to the specific purpose at issue.
 
 
 

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separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
16.6           Superiority of Agreement. The Parties agree that the provisions
of this Agreement, together with any amendments hereto, supersede the Original
License and Distribution Agreement and shall prevail over any inconsistent
statements or provisions contained in any prior discussions, arrangements or
comments between the Parties and in any documents passing between the Parties,
including, but not limited to, any forecast, purchase order, purchase order
revision, acknowledgment, confirmation or notice. It is agreed that:
 
(a)           neither Party has entered into this Agreement in reliance upon any
representation, warranty or undertaking of the other Party which is not
expressly set out in this Agreement, the Patent Litigation Settlement Agreement
or the Supply Litigation Settlement Agreement;
 
(b)           neither Party shall have any remedy in respect of
misrepresentation or untrue statement made by the other Party or for any breach
of warranty which is not contained in this Agreement;
 
(c)           this Section 16. 6 shall not exclude or limit any liability for,
or remedy in respect of, fraudulent misrepresentation; and
 
(d)           notwithstanding the foregoing, the Patent Litigation Settlement
Agreement and the Supply Litigation Settlement Agreement shall be deemed of
equal dignity to this Agreement and this Agreement shall be construed together
with the Patent Litigation Settlement Agreement and the Supply Litigation
Settlement Agreement in a consistent manner as reflecting a single intent and
purpose.
 
16.7           Governing Law. This Agreement shall be governed by the laws of
the State of New York without regard to the conflicts of law provisions thereof.
The Parties irrevocably agree that the federal district courts in the State of
New York shall have exclusive jurisdiction to deal with any disputes arising out
of or in connection with this Agreement and that, accordingly, any proceedings
arising out of or in connection with this Agreement shall be brought in the
United States District Court for the Southern District of New York.
Notwithstanding the foregoing, if there is any dispute for which the federal
district courts in the Southern District of New York do not have subject matter
jurisdiction, the state courts in New York, shall have jurisdiction. In
connection with any dispute arising out of it in connection with this Agreement,
each Party hereby expressly consents and submits to the personal jurisdiction of
the federal and state courts in County, City, and State of New York.
 
16.8           Agreement Costs. Each Party shall pay its own costs, charges and
expenses incurred in connection with the negotiation, preparation and completion
of this Agreement.
 
16.9           Counterparts. This Agreement may be executed in any number of
counterparts (including facsimile counterparts), each of which shall be an
original as against a Party whose signature appears thereon, but all of which
taken together shall constitute one and the same instrument.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
16.10           Severability. In the event that any of the provisions of this
Agreement shall be held by a court or other tribunal of competent jurisdiction
to be illegal, invalid or unenforceable, such provisions shall be limited or
eliminated to the minimum extent necessary so that this Agreement shall
otherwise remain in full force and effect.
 
16.11           Relationship of the Parties.  In making and performing this
Agreement, the Parties are acting and shall act as independent contractors.
Nothing in this Agreement shall be deemed to create an agency, joint venture or
partnership relationship between the Parties hereto.  This Agreement shall
become binding when any one or more counterparts hereof, individually or taken
together, bears the signatures of each of the Parties hereto.
 
16.12           Construction. The language in all parts of this Agreement shall
be construed, in all cases, according to its fair meaning. Shire and Impax
acknowledge that each Party and its counsel have reviewed and revised this
Agreement and that any rule of construction to the effect that any ambiguities
are to be resolved against the drafting Party shall not be employed in the
interpretation of this Agreement. The words “hereof,” “herein,” “hereto” and
“hereunder” and words of similar import, when used in this Agreement, shall
refer to this Agreement as a whole and not to any particular provision of this
Agreement. The terms defined in the singular shall have a comparable meaning
when used in the plural, and vice versa. Whenever used herein, the words
“include,” “includes” and “including” shall mean “include, without limitation,”
“includes, without limitation” and “including, without limitation,”
respectively. The masculine, feminine or neuter gender and the singular or
plural number shall each be deemed to include the others whenever the context so
indicates. With respect to any particular action or agreement, the use of the
words “Shire shall” or “Shire will” herein shall also mean “Shire shall cause”
the particular action to be performed. Similarly, with respect to any particular
action or agreement, the use of the words “Impax shall” or “Impax will” herein
shall also mean “Impax shall cause” the particular action to be performed.
Nothing in this Agreement shall operate to exclude any provision implied into
this Agreement by Law and which may not be excluded by Law or limit or exclude
any liability, right or remedy to a greater extent than is permissible under
Law.
 
16.13           Dispute Resolution.
 
(a)           Preliminary Process. Except as to a dispute arising out of Section
5, 6, 7, or 9 if there is a disagreement between the Parties as to the
interpretation of this Agreement or in relation to any aspect of the performance
by either Party of its obligations under this Agreement, the Parties shall,
within ten (10) Business Days of receipt of a written request from either Party,
meet in good faith and try to resolve the disagreement without recourse to legal
proceedings.
 
(b)           Escalation of Dispute. If resolution of the disagreement does not
occur within five (5) Business Days after such meeting, the matter shall be
escalated for determination by the President of Impax and Shire’s President of
Specialty Pharmaceuticals for resolution, who may resolve the matter themselves
or jointly appoint a mediator or independent expert to do so.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
(c)           Equitable Relief. Nothing in this Section 16. 13 restricts either
Party’s freedom to seek urgent relief to preserve a legal right or remedy, or to
protect a proprietary or trade secret right, or to otherwise seek legal remedies
through any available channel if resolution is not otherwise achieved under this
Section 16. 13.
 
(d)           ADR For Certain Disputes. Notwithstanding Section 16. 7, in the
event there is a dispute arising out of Sections 5, 6, 7 or 9 the Alternate
Dispute Resolution procedure (the “ADR Procedure”) set forth in Schedule 16.
13(d) will apply. For the avoidance of doubt, it is the Parties’ intent that the
ADR Procedure will apply solely to any disputes arising out of Sections 5, 6, 7
and 9; provided that either Party shall be free to raise defenses and
counter-claims in such ADR Procedure based on any Section of this Agreement.
 
16.14           Cumulative Rights. The rights and remedies of each of the
Parties under or pursuant to this Agreement are cumulative, may be exercised as
often as such Party considers appropriate and are in addition to its rights and
remedies under general law.
 
16.15           No Third Party Benefit. This Agreement shall be binding upon and
inure solely to the benefit of the Parties hereto, their successors and
permitted assigns, and nothing in this Agreement, express or implied, is
intended to or shall confer upon any other Person or Persons any right, benefits
or remedies of any nature whatsoever under or by reason of this Agreement.
 
16.16           Further Assurance. Each of the Parties shall do, execute and
perform and shall procure to be done and perform all such further acts deeds
documents and things as the other Party may reasonably require from time to time
to give full effect to the terms of this Agreement.
 
16.17           Waiver. No failure or delay by either Party in exercising any
right or remedy provided by law under or pursuant to this Agreement shall impair
such right or remedy or operate or be construed as a waiver or variation of it
or preclude its exercise at any subsequent time and no single or partial
exercise of any such right or remedy shall preclude any other or further
exercise of it or the exercise of any other right or remedy.
 
[Signature Page Follows]
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
 
 
 
 
 [Signature Page to Amended and Restated License and Distribution Agreement]
 
IN WITNESS WHEREOF, the undersigned have executed this Amended and Restated
License and Distribution Agreement as of the date and year first above written.
 

 
SHIRE LLC
             
 
By: /s/ Mike Chapman                        Name: Mike Chapman    
Title:   President                       IMPAX LABORATORIES, INC.              
  By: /s/ Larry Hsu                                  Name: Larry Hsu    
Title:   President and CEO  

 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
 
 
 
Schedule 5. 3(e)
 
DELIVERY SCHEDULE MODIFICATION FORM
 
THIS DELIVERY SCHEDULE MODIFICATION (this “Modification”) dated _________ __,
201_ (the “Modification Date”) is hereby entered into by and between Impax
Laboratories, Inc.  and Shire LLC in connection with the Amended and Restated
License and Distribution Agreement dated as of [____________ __, ____]. All
capitalized terms used herein not otherwise defined shall have the meaning given
to them in such Amended and Restated License and Distribution Agreement.
 
The Parties hereby agree, as of the Modification Date, as follows:
 
1.           The Delivery Schedule dated __________ and annexed hereto as
Exhibit A hereto (the “Original Schedule”) is hereby amended and replaced as of
[the Modification Date][OTHER SPECIFIC DATE] by the modified Delivery Schedule
annexed as Exhibit B hereto (the “Modified Delivery Schedule”). [The changes in
the Delivery Schedule reflect the following agreements of the
Parties:________________. ]

2.           FOR THE PURPOSES OF CALCULATING [***] IN CONNECTION WITH THE LATE
DELIVERY OF AG PRODUCT TO IMPAX UNDER THE AMENDED AND RESTATED LICENSE AND
DISTRIBUTION AGREEMENT INCLUDING, WITHOUT LIMITATION, UNDER SECTION 5. 13, THE
DELIVERY DATES SET FORTH IN THE MODIFIED SCHEDULE SHALL BE USED TO CALCULATE
SUCH [***].

3.           Once executed by the Parties, this Modification shall be deemed
incorporated as part of the Amended and Restated License and Distribution
Agreement.

Accepted and agreed to this __ day of _______________, 201_.

 
SHIRE LLC
       
 
By: ___________________________________________   Name:   Title:

 

  ONLY TO BE EXECUTED ON BEHALF OF IMPAX BY THE FOLLOWING PERSONS:      1.   CFO
     2.   PRESIDENT OF GLOBAL PHARMACEUTICALS      3.   GC      4.   A SENIOR
VICE PRESIDENT OR MORE SENIOR OFFICER  

 

  IMPAX LABORATORIES, INC.        
 
By: ___________________________________________   Name:    Title: 

 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
Schedule 16. 13(d)
 
The Parties agree that any dispute arising out of Sections 5, 6, 7 or 9 will be
elevated in the first instance to [***] and [***], or their designated
successors, for resolution.
 
In the event of a dispute as to any Allocation Plan or Delivery Schedule, [***]
and [***], or their designated successors, shall be available for an expedited
meet and confer meeting, at the request of either Party, within [***] of the
request to discuss and resolve in good faith the Parties’ differences regarding
such Allocation Plan or Delivery Schedule.
 
If [***] and [***] are unable to resolve a dispute within [***] of notice of the
dispute, the dispute will be referred to a single neutral arbitrator for a
binding and final resolution in the following manner.
 
a.            General Provisions
 
The arbitrator will be a duly licensed attorney-at-law with expertise in the
pharmaceutical industry.
 
The arbitration will be conducted in New York City at JAMS, currently located at
620 Eighth Ave, 34th Floor, New York, NY 10018, according to the JAMS
“Streamlined Arbitration Rules of Procedure,” effective July 15, 2009 (the “JAMS
Rules”), as modified herein.
 
The arbitration will be decided in accordance with the laws of the State of New
York, without reference to its conflicts of law rules.
 
The arbitrator’s decision will be binding and conclusive upon both Parties.
 
The proceedings will be kept confidential and will not be disclosed to the
public.
 
b.            Selection of Arbitrator
 
Within [***] of the initiation of arbitration each Party will propose up to
[***] candidates to act as arbitrator. If the Parties do not agree on any one
arbitrator within [***] of the exchange of the proposed arbitrators, they will
jointly inform JAMS and JAMS will promptly send the Parties a list of [***]
arbitrator candidates. JAMS will also provide each Party with a brief
description of the background and experience of each arbitrator candidate.
 
Within [***] of service of the list of names by JAMS, [***].
 
If this process does not yield an arbitrator (due to a tie or otherwise), JAMS
will designate the arbitrator within [***] thereafter.
 
 
 

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 [***] Certain information in this document has been omitted and filed
separately with the Securities and Exchange Commission.  Confidential treatment
has been requested with respect to the omitted portions. portions.

 
 
c.
Exchange of Information. There will be limited discovery during [***] commencing
on the day the arbitrator is selected, for the purposes of requesting and
obtaining documents, and asking and answering interrogatories.

 
 
d.
Hearing. An arbitration hearing will be scheduled not later than [***] after the
arbitrator has been selected.

 
 
e.
Pre-Hearing Submissions

 
Within [***] after the completion of the exchange of information, each Party
will submit concise written statements of its position, including summaries of
the facts and evidence a Party intends to present, discussion of the applicable
law and the basis for the requested award or denial of relief sought. The
statements will be filed with JAMS and served upon the other Party. [***].
 
Within [***] after submission of the Parties’ initial statements each Party may
submit a rebuttal statement[***]; and
 
[***] before the arbitration hearing the Parties will (a) submit a written
report for each expert they intend to present at the arbitration hearing,
drafted in accord with Fed.  R.  Civ.  P.  26(a) and (b) exchange a list and
copies of each document which they intend to introduce as exhibits at the
arbitration hearing and a list of all individuals who may be called upon to
testify at the hearing, including all experts.
 
 
f.
Arbitration Hearing. The arbitration hearing [***] and will be conducted in
accord with the JAMS Rules, as hereby modified.

 
 
g.
Decision. The arbitrator will render a reasoned decision within [***] of the
last day of the hearing, which decision will be final and binding upon the
Parties.

 
 
h.
Costs. The costs and fees of the arbitrator will be shared equally by the
Parties.

 
 
i.
Equitable Relief. Nothing contained in this Section will alter the Parties’
rights to seek an injunction or other equitable relief or to file a suit to
enforce these arbitration provisions, including the arbitrator’s award.