Exhibit 10.2

 

Picture 1 [depo20170930ex102d8aaa6001.jpg]EXECUTION VERSION

CERTAIN MATERIAL (INDICATED BY [***])_ HAS BEEN OMITTED FROM THIS DOCUMENT
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT.  THE OMITTED MATERIAL HAS BEEN
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

DRUG PRODUCT MANUFACTURING SERVICES AGREEMENT

THIS DRUG PRODUCT MANUFACTURING SERVICES AGREEMENT (this “Agreement”) is
effective as of June 6, 2017 (the “Effective Date”) by and between Halo
Pharmaceutical, Inc., a Delaware corporation (“Halo”), and Depomed, Inc., a
California corporation (“Client”).

RECITALS

A. Client develops, markets and sells pharmaceutical products, including the
product(s) generally known as NUCYNTA IR (as defined below).

B. Halo provides pharmaceutical product development, manufacturing and packaging
services primarily from its facilities in New Jersey and Quebec.

C. Client desires to engage Halo to provide certain commercial manufacturing and
related services to Client, and Halo desires to provide such services, on the
terms and subject to the conditions set out below.

NOW THEREFORE, in consideration of the premises and the mutual covenants and
agreements contained herein, the parties hereto agree as follows:

ARTICLE 1  

DEFINITIONS

1.1 Glossary.  The following terms shall, unless the context otherwise requires,
have the respective meanings set out below and grammatical variations of such
terms shall have corresponding meanings:

“Active Material” means the active pharmaceutical ingredient tapentadol, which
the parties acknowledge is a controlled substances under Applicable Laws.

Halo Pharma • Confidential

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“Active Material Cost” means Client’s cost to purchase and deliver to Halo
Active Material, which cost is set forth on Schedule B. 

“Affiliate” of a party means a business entity that directly or indirectly
controls, is controlled by, or is under common control with such party, where
“control” means the ownership of shares or other ownership interests or rights
carrying at least a majority of the votes in respect of the election of the
directors of a corporation or the equivalent managers of any other business
form.  Notwithstanding anything to the contrary in this definition, Affiliates
of Halo shall exclude any shareholders of Halo Pharmaceutical, Inc. and any
business entity that would, but for this sentence, be an Affiliate of Halo
solely by reason of its Affiliation with such shareholders.

“Applicable Laws” means all laws, statutes, ordinances, regulations, rules,
judgments, decrees or orders of any Authority: (i) with respect to each party,
in any jurisdiction in which such party actually operates or performs activities
hereunder; (ii) with respect to Client, in any jurisdiction in which Active
Material or Product are produced, marketed, distributed, used or sold; and (iii)
with respect to Halo, in any jurisdiction expressly designated in the
Specifications.  The term Applicable Laws includes cGMPs.

“Authority” means any governmental authority, department, body or agency or any
court, tribunal, bureau, commission or other similar body, whether
international, supranational, federal, state, provincial, county or municipal,
including any Regulatory Authority.

“Business Day” means a day other than a Saturday, Sunday or a day that is a
statutory holiday in the state of New Jersey, United States, or the province of
Quebec, Canada.

“cGMPs” means current good manufacturing practices as described in Parts 210 and
211 of Title 21 of the United States Code of Federal Regulations together with
any binding FDA guidance documents pertaining to manufacturing and quality
control practice, and any equivalent rules governing the manufacture of
pharmaceutical products promulgated by any Regulatory Authority of any
jurisdiction expressly designated in the Specifications; in each case, as in
effect, updated, amended and revised from time to time during the Term.

“Commercially Reasonable Efforts” means, with respect to the performance of
activities under this Agreement, the carrying out of such activities by a party
using efforts and resources comparable to the efforts and resources that such
party would devote to similar activities if conducted for itself or under
another agreement of similar scope, taking into account commercial and other
relevant factors.

“Components” means, collectively, all raw materials, ingredients and packaging
(including labels, product inserts and containers), required to be used in order
to produce the Products in accordance with the Specifications, other than the
Active Material and Consumables.  The term Components includes Exclusive
Components.

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“Confidentiality Agreement” means the Mutual Nondisclosure Agreement between
Halo and Client dated May 29, 2015, and amended on February 6, 2017, relating to
the non-disclosure and non-use of confidential information.

“Conforming Product” means Products or Finished Goods, as applicable, delivered
by Halo hereunder that meet the warranties set forth in Section ‎9.3(e).

“DEA” means the United States Drug Enforcement Agency or any successor thereto.

“FDA” means the United States government department known as the Food and Drug
Administration or any successor thereto.

“Finished Goods” means the Product in its final configuration for purposes of
this Agreement (e.g., tablets in bottles with labels and package insert) as
described in the Specifications.

“Generic Equivalent” means any other pharmaceutical product that is an FDA
AB-rated (or its foreign equivalent) generic version of a Product in the
Territory, or a pharmaceutical product with the same Active Material (or
therapeutically equivalent, bioequivalent, biosimilar and legally substitutable
or interchangeable Active Material(s) thereto) and labeled indication(s) as a
Product. A product produced by or on behalf of or authorized by Client, its
Affiliates or licensors or any other authorized generic product will not
constitute a Generic Equivalent.

“Intellectual Property” means all of a party’s intellectual property rights and
embodiments thereof, including patents, patent applications, trademarks,
trademark applications, tradenames, know-how, copyrights, Confidential
Information, industrial designs, trade secrets and Inventions.

“Invention” means any invention, innovation, improvement, development,
discovery, computer program, device, formulation, data, trade secret, method,
know-how, process, technique or the like, whether or not written or otherwise
fixed in any form or medium, regardless of the media on which it is contained
and whether or not patentable or copyrightable, together with all Intellectual
Property rights therein.

“Inventory” means all inventories of Components, Consumables, Products, Finished
Goods, and work-in-process purchased, produced, held or maintained by Halo as
contemplated by Section ‎2.4(e) or Section ‎4.3, including any excess material
purchased by reason of vendor’s minimum purchase requirements and long lead time
material.  For the avoidance of doubt, Inventory does not include any Active
Material.

“Latent Defect” means any defect that results in the Products or Finished Goods
being nonconforming with the warranties of Section 9.3(e), which would not have
been discoverable at delivery through a commercially reasonable visual
inspection and was not known to Client at the time it accepted such Products or
Finished Goods, as applicable.

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“Manufacturing Services” means the manufacturing, quality control, quality
assurance and stability testing, packaging, labeling and related services, as
contemplated in this Agreement, required to produce Products and from Active
Material and Components, and Finished Goods from Products.

“Manufacturing Site” means the facility owned and operated by Halo or a Halo
Affiliate located at 30 North Jefferson Road, Whippany, New Jersey, 07981, USA.

“Maximum Credit Value” means the maximum value of Active Material that Halo can
be required to credit in a Year in which a Shortfall arose pursuant to this
Agreement, as set forth on Schedule B.  

“NUCYNTA IR” means NUCYNTA® immediate release tablets, in strengths of 50 mg, 75
mg, and 100 mg as described in New Drug Application 022304.

“Price” means the per-bottle sale price for Finished Goods payable by Client to
Halo and set forth in the Full Service Price column on Schedule A, as the same
may be adjusted in accordance with this Agreement.

“Product” means NUCYNTA IR tablets containing the Active Material, as
specifically listed on Schedule A, and as more specifically described in the
Specifications.

“Quality Agreement” means the agreement between the parties setting out the
quality assurance standards applicable to the Manufacturing Services and the
parties’ responsibilities in respect thereof; a copy of the current Quality
Agreement as of the Effective Date is attached hereto as Schedule F, which the
parties agree will be updated as needed during the Term. 

“Recall” means any action (i) by Client to recover title to or possession of
quantities of Finished Goods sold or shipped to Third Parties (including any
voluntary withdrawal of Finished Goods from the market) or (ii) by any
Regulatory Authority to recall, withdraw from the market, order any corrective
action, or otherwise detain or destroy any of the Finished Goods.

“Regulatory Authority” means any Authority competent to grant marketing,
distribution and related approvals for pharmaceutical products in the Territory
and in the jurisdictions in which the Manufacturing Site is located, including
the FDA and DEA, as applicable.

“Samples” means samples of reasonable amounts of Active Material retained by
Halo during a given Year as follows:  (i) Active Material that must be retained
by Halo as samples and for stability, (ii) Active Material contained in Product
that must be retained as samples, (iii) Active Material used in connection with
testing (if applicable), and (iv) Active Material received or consumed in
connection with technical transfer activities or development activities,
including any regulatory, stability, validation or test batches manufactured
during the Year

“Specifications” means, with respect to a Product and a Finished Good, the
following written information, which Client shall provide to Halo (and may
subsequently revise) in accordance with Section ‎3.3:

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(a) specifications for Active Material and those Components comprising
excipients (e.g.,  if described in a pharmacopoeia, the monograph and any test
methods; if not described in a  pharmacopoeia, a list of tests and limits for
results for each excipient, including solvents, liquids to adjust pH and
coatings, and any test methods; and in either case, microbiological limits for
materials of natural origin and storage requirements);

(b) specifications for Components not comprising excipients (e.g., as
applicable, primary and secondary packaging type and dimensions, artwork,
labeling, inserts, etc. and storage requirements); 

(c) Product manufacturing processes and directions;

(d) Finished Goods specifications;

(e) Product storage and shipping requirements; and

(d)all environmental, health and safety information relating to Active Material
and Product, including material safety data sheets.

“Territory” means the geographic area specified in Schedule H where the Finished
Goods are to be offered for sale by Client or its Affiliates or licensees.

“Third Party” or “Third Parties” means any person(s) or entity(ies), as
applicable, other than Halo, Client, or their respective Affiliates.

“Third Party Rights” means the rights held by a third party in Intellectual
Property.

“Year” means, (i) with respect to the first year of this Agreement, the period
from the Effective Date up to and including December 31 of the same calendar
year, (ii) with respect to the last year of this Agreement, the period from
January 1 of such last calendar year up to and including the date of termination
or expiration of this Agreement, and (iii) for all periods in between, a
calendar year. 

1.2 Index.  The following terms are defined in the section of this Agreement
indicated below:

Term

Section

Actual Annual Yield or AAY

‎2.3(c)

Agreement

Introductory paragraph

Broader Intellectual Property Rights

‎12.2(b)

Client

Introductory paragraph

Client Indemnitees

‎10.3(a)

Client Inventions

12.2(a)

CMC

‎7.8(c)

Commitment

‎3.2

Consumables

‎2.1(b)(iii)

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Deficiency Notice

‎6.1(a)

Dispute

‎13.1

Effective Date

Introductory paragraph

Exclusive Components

‎4.3(b)

Exclusive Components Purchasing Summary

‎4.3(b)

Facilitator

‎13.1

Firm Order

4.1(b)

First Production Year

‎5.1

Force Majeure Event

14.1

Forecast (including Forecasted)

‎3.2

Halo

Introductory paragraph

Halo Indemnitees

‎10.3(b)

Initial Term

8.1

Losses

‎10.3(a)

Materials Credit

‎2.3(e)

Non-Compliant Services

‎6.3(a)

Non-Conforming Product

‎6.1(a)

PPI

5.2

Purchase Order

‎4.1(a)

Quantity Converted

‎2.3(a)(iii)

Quantity Dispensed

‎2.3(a)(ii)

Quantity Received

‎2.3(a)(i)

Reconciliation Report

‎2.3(d)

Records

‎7.3

Renewal Term

8.1

Shortfall

‎2.3(d)

Supply Shortage

‎2.4(a)

Target Yield

‎2.3(b)

Target Yield Determination Batches

‎2.3(b)

Technical Dispute

‎13.2

Term

8.1

 

ARTICLE 2  

HALO’s services

2.1 Manufacturing Services. 

(a) Arrangement.  In consideration of Client’s payment of the fees due under,
and the other terms and conditions of, this Agreement, Halo shall perform the
Manufacturing Services at the Manufacturing Site in order to supply Finished
Goods to Client and its designees for sale in the Territory, and during the
Term, Client shall purchase from Halo, such quantities of Finished Goods as
Client and its designees may order in accordance with the terms and conditions
of this Agreement.  Except as specifically permitted in this Agreement, Client
and its Affiliates and

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licensees shall purchase from Halo [***] of its and their requirements for
Finished Goods in the Territory starting on the Effective Date and ending on the
[***] anniversary of the date of the first Firm Order under this Agreement.
Thereafter, except as specifically permitted in this Agreement, Client and its
Affiliates and licensees shall purchase from Halo at least [***] of its and
their requirements for Finished Goods in the Territory during the Term.

(b) Conversion of Active Material and Components.  Halo shall convert Active
Material and Components into Products in accordance with this Agreement. 

(i) Active Material. 

(A) Client will deliver all Active Material to Halo in accordance with Section
‎3.4.  Halo shall provide Client with a receipt of delivery with respect to each
shipment of Active Material supplied by Client or its designee hereunder. Halo
shall visually inspect Active Material upon receipt to verify their identity and
quantity.  Except to the extent expressly required by the Specifications, Halo
shall have no obligation to perform any testing of the Active Material. Halo
shall notify Client in writing within [***] days after receipt of Active
Material delivered by Client of any complaint regarding obvious qualitative
faults or quantitative shortcomings of the Active Material, and Halo shall
simultaneously send samples of faulty Active Material to Client or its designee.
Halo shall notify Client in writing within [***] days of Halo becoming aware of
any defects in the Active Material that may not or would not have been obvious
at delivery by visual inspection of such Active Material made with reasonable
care. Halo will assist Client, at Client’s expense, in substantiating any
defects or shortcomings and otherwise assist Client in order for Client to
obtain replacement Active Material or a refund or credit from Client’s supplier
of Active Material.

(B) Halo shall be and remain responsible for the proper care and handling of all
quantities of Active Material received from Client or its designee hereunder.
Halo shall hold all Active Material supplied by Client separate (individually
identifiable storage in rows or racking) from other materials owned or acquired
by Halo and other Third Parties and shall identify the Active Material as the
property of Client.  Halo shall store, handle, and protect the Active Material
with the same level of care that Halo stores, handles, and protects Halo’s own
active pharmaceutical ingredients, but in no event less than a commercially
reasonable level of care, which shall include taking commercially reasonable
precautions to ensure that no such Active Material is subject to contamination,
deterioration, destruction, or theft.

(C) Halo shall use such Active Material only to provide the Manufacturing
Services. Since the Active Material are controlled substances within the meaning
of Applicable Laws, Halo shall request and use Commercially Reasonable Efforts
to obtain from the applicable Regulatory Authority, including the DEA,
appropriate quota allowances for such Active Material in sufficient quantities
to meet Client’s Forecasts for Products to be manufactured by Halo in accordance
with the terms of this Agreement. Halo shall store such Active Material in
accordance with the Specifications and Applicable Laws. 

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(D) Client shall provide, at its own cost, the Active Material to Halo for use
in any replacement Products or Finished Goods produced in accordance with
Article 6; provided that, in the event that the failure of the Products or
Finished Goods to be Conforming Products was caused solely or primarily by Halo,
Halo shall reimburse Client for the cost of the Active Material used in the
replacement Products or Finished Goods. In no event, however, shall Halo’s
liability to reimburse Client for the cost of Active Material used in any
replacement Products or Finished Goods in any Year exceed [***]. The limit on
Halo’s liability for the cost of Active Material in the preceding sentence shall
not apply to the cost of Active Material being stored at the Manufacturing Site
that is lost or damaged as a result of Halo’s negligence, other than as a result
of Halo’s failure to produce Conforming Products, and Halo shall be liable for
the full cost of such lost or damaged Active Material less any insurance
proceeds received by Client for such Active Material.     

(ii) Components.  Halo shall purchase all Components and audit and approve all
vendors for such Components at Halo’s expense as required by the Specifications
and as further described in Section ‎4.3.  Halo shall procure only Components
that are warranted by the vendor to have been manufactured in accordance with
cGMPs.  Halo shall test all Components after receipt at the Manufacturing Site
as required by the Specifications and the Quality Agreement. 

(iii) Consumables.  Halo shall purchase all columns, standards, tooling, and
other Client-approved, project-specific items necessary for Halo to perform the
Manufacturing Services (“Consumables”).  Halo shall charge through to Client all
Third Party vendor fees for such purchases at Halo’s actual documented cost.

(iv) Equipment.  Except as the parties may agree in writing from time to time,
Halo shall provide at its cost all equipment needed to perform the Manufacturing
Services.

(v) Batch Number and Expiration Date.  Halo will assign each batch of Product
manufactured by it assigned a unique batch number using Halo’s batch numbering
system.  This batch number will appear on all documents relating to the
particular batch of Product.  Halo will calculate the expiration date for each
batch of Product by adding the expiration period of Active Material supplied by
Client to the date of manufacture of such batch.

(c) Packaging.  Halo shall package Product as required by the
Specifications.  Halo shall be responsible for imprinting or affixing the batch
number and expiration date of each batch of Product onto the Finished Goods and
shipping cartons as described in the Specifications and required by the Quality
Agreement and cGMPs.  Halo’s name shall not appear on any Product packaging
except to the extent (i) required by any Applicable Laws or (ii) Client
expressly consents in writing to such use of its name.

(d) Quality Control.  Halo shall perform the Product quality control and quality
assurance testing required by the Quality Agreement.  Product batch review and
release to Client shall be the responsibility of Halo’s quality assurance
group.  Halo shall perform such batch review and release responsibilities in
accordance with Halo’s standard operating procedures.  Unless prevented by
deviations or failures, or agreed to in writing by Client, Halo will complete
its batch

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review within [***] calendar weeks following completion of Product production.
Each time Halo delivers a batch of Product to Client, Halo shall provide Client
with a certificate of analysis and certificate of compliance for such batch.  At
Client’s request, Halo will provide copies of additional batch documentation,
including batch manufacturing records, lot packaging records, equipment data
printouts, raw material data, and laboratory notebooks, at no additional cost
for one copy.

2.2 Generic Competition.    During the Term, neither Halo nor its Affiliates or
successors in interest shall, directly or indirectly, manufacture, supply or
otherwise facilitate the manufacture and/or supply of a Generic Equivalent to or
by a Third Party. 

2.3 Active Material Yield.

(a) Interim Inventory Reports.  Halo shall provide Client with quarterly
inventory reports for the Active Material held by Halo at the Manufacturing
Site.  Each inventory report shall be in substantially the form set forth on
Schedule C, shall be based on data from Halo’s manufacturing resource planning
(MRP) system and/or manufacturing batch records, and shall contain the following
information with respect to the applicable period:

(i)“Quantity Received”:  The total quantity labeled on drums of Active Material
received at the Manufacturing Site that comply with the Specifications, less any
incoming samples, retains or quantities used for testing purposes (such as
stability samples);

(ii)“Quantity Dispensed”:    The total quantity of Active Material dispensed
from inventory at the Manufacturing Site in connection with commercial
manufacturing of Product, less any (A) Active Material that must be retained by
Halo as samples and stability, (B) Active Material contained in Product that
must be retained as samples, (C) Active Material used in connection with testing
(if applicable) and (D) Active Material received or consumed in connection with
technical transfer activities or development activities, including any
regulatory, stability, validation, or test batches manufactured; and

(iii)“Quantity Converted”:    The total amount of Active Material contained in
Product produced with the Quantity Dispensed (including any replacement Product
produced in accordance with Article 6), which Product was delivered by Halo to
Client and not rejected, Recalled or returned in accordance with Article 6 as a
result of Non-Compliant Services, excluding normal loss of Active Material
typical in the industry resulting from sampling, testing, and compliance with
quality control requirements of Applicable Laws, on an average annual basis. 

(b) Target Yield.  As of the Effective Date, the target yield of Active Material
used in the Products at the Manufacturing Site shall be at least [***] (the
“Target Yield”). The Target Yield shall be reviewed after Halo has produced a
minimum of ten (10) commercial production batches of Products at the
Manufacturing Site pursuant to this Agreement (“Target Yield Determination
Batches”), after which the parties may agree to adjust the Target Yield for the
Active Material used in Products at the Manufacturing Site upon mutual written
agreement; provided, that the Target Yield Determination Batches shall not
include any batches that were

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produced in production runs involving technical difficulties or involving an
extraordinary loss of Active Material, as agreed by both parties. 

(c) Actual Annual Yield and Report.  Within sixty (60) days after the end of
each Year, Halo shall prepare for the Active Material used in the Products an
annual reconciliation report substantially in the form attached as Schedule D
(the “Reconciliation Report”), including the calculation of the “Actual Annual
Yield” or “AAY” for such Active Material used in such Products at the
Manufacturing Site during the Year, expressed as a percentage of Quantity
Dispensed and calculated as follows:

Quantity Converted during the Year + Samples

Quantity Dispensed during the Year

(d) Shortfall Calculation.  If the Actual Annual Yield falls more than [***]
below the Target Yield for a given Year, then the shortfall for such Year (the
“Shortfall”) shall be determined based on the following calculation:    

[(Target Yield-[***]) – AAY] ÷100 * Active Material Cost * Quantity Dispensed

Any Shortfall shall be disclosed by Halo on the Reconciliation Report and Halo
will undertake an investigation of the reasons for the Shortfall.

(e) Materials Credit.  If there is a Shortfall for a given Year, Halo shall
credit Client’s account for the amount of such Shortfall within sixty (60) days
after the end of such Year, up to a maximum aggregate credit amount equal to the
Maximum Credit Value (the amount of such Shortfall as capped by the Maximum
Credit Value, the “Materials Credit”).  Each Materials Credit shall be
summarized on the Reconciliation Report and shall be used to offset amounts owed
to Halo under invoices issued to Client in accordance with Section 5.4.  Upon
expiration or termination of this Agreement, Halo shall pay Client an amount
equal to any remaining Materials Credit (i.e., that was not used to offset
invoices issued to Client) within ninety (90) days following the date of such
expiration or termination.

(f) No Material Breach.  It shall not constitute a material breach of this
Agreement by Halo, for the purposes of Section ‎8.2(a), if the Actual Annual
Yield is less than the Target Yield; provided that if the Actual Annual Yield
falls more than [***] below the Target Yield for a given Year, Client may elect
to terminate this Agreement under Section 8.2(a), unless such fall in the Actual
Annual Yield is due to the supply of defective Active Material to Halo hereunder
in such Year. 

2.4 Supply Shortages and Safety Supplies.

(a) Supply Shortage.  A “Supply Shortage” shall be deemed to have taken place if
quantities of Conforming Product supplied by Halo to Client on or before or
within ten (10) days after the scheduled delivery date are less than [***] of
the quantities specified in Firm Orders issued by Client, over a period of [***]
consecutive months, unless such shortage is the result of any one or more of the
following reasons: (i) a lack of availability of Active Material due to

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Client’s failure to supply such Active Material on a timely basis or lack of DEA
procurement quota, (ii) defects in the Active Material as of the date it is
delivered to Halo by Client or its designee, which is not reasonably
discoverable by Halo by visual inspection and testing as required under Section
‎2.1(b)(i)(A), (iii) a significant increase in Client’s Forecast for Product
that results in a shortage of any Components, or (iv) any Force Majeure
Event.  A Supply Shortage shall be considered a material breach of this
Agreement, but such breach shall be deemed cured upon tender of delivery by Halo
of Conforming Product within the applicable cure period.    

(b) [***].  Subject to Halo’s obligations to other existing Halo clients as of
the Effective Date, to the extent that any anticipated or actual failure to
deliver the full quantity of Finished Goods in a Purchase Order can be remedied
or minimized by providing [***] for the Products and/or Finished Goods at the
Manufacturing Site, for example by providing [***] to the [***] at the
Manufacturing Site, Halo shall provide such [***] for the Products and/or
Finished Goods.

(c) Failure to Supply.  At any time during the Term following the date of the
first Firm Order under this Agreement, in the event a Supply Shortage, which,
for clarity, cannot result from a failure to supply Active Material on a timely
basis to Halo hereunder, occurs [***] or more times within any [***] consecutive
month period, which shall include a failure to supply Conforming Product, Client
may, in its sole discretion and by providing written notice to Halo, indicate
its election to immediately either (i) terminate this Agreement, or (ii) reduce
Client’s and its Affiliates’ and licensees’ exclusivity obligations under
Section 2.1(a) to obtain from Halo at least [***] of their respective
requirements of the Finished Goods in the Territory.  Any such written notice to
Halo under this Section 2.4(c) must be delivered within ninety (90) days of the
event giving rise to such notice in order for such election to be effective. 

(d) Failure to Meet Specifications.  Upon Halo’s discovery that there is a
potential for any batch or lot of Products or Finished Goods (in-process,
released and/or marketed) to fail to conform to the Specifications, Halo will
promptly notify Client of the discovery thereof and of the nature thereof in
detail, including supplying Client with all investigatory reports, data and
communications, out-of-specification reports and data and the results of all
outside laboratory testing and conclusions, if any. Halo shall investigate all
such failures promptly as set forth in the Quality Agreement, and at its expense
(unless such failure is due to supply of defective Active Materials to Halo
hereunder, in which case the expense will be borne by Client), cooperate with
Client or its designee in determining the cause for the failure and a corrective
action to prevent future failures.

(e) Safety Supplies.  Halo shall maintain an inventory of Active Material
(subject to DEA quotas) and Components that would reasonably be expected to
suffice for Halo to meet Client’s then-current Forecast.  Halo shall turn over
all such safety supplies as new Active Material and Components are received or
new lots of Product are delivered, respectively, to optimize the shelf life of
such safety supplies.  Halo shall promptly notify Client in writing at any time
if it reasonably anticipates that additional amounts of Active Material will be
needed for Halo to meet Client’s then-current Forecast.  If Halo reasonably
believes that it is or will be unable to obtain a sufficient supply of
Components from Third Party vendors for Halo to meet Client’s then-current

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Forecast, Halo shall promptly notify Client in writing and Client shall have the
right to negotiate directly with such Third Party vendors to secure an adequate
supply of such Components.  If Client fails to take possession of Finished Goods
within [***] days following its release, Client shall pay Halo a monthly storage
fee of $[***] per pallet per month thereafter for storing such Finished Goods
with partial pallets charged on a full pallet basis.  Upon [***] weeks’ written
notice to Client, Halo shall have the option to ship to Client at Client’s
expense any Finished Goods, Products, Components and Active Material held by
Halo in inventory hereunder longer than [***] months, provided Halo has been
properly turning over such safety supplies in accordance with this Section
2.4(e).    

2.5 Manufacturing Site.  Except as otherwise approved in writing by Client, Halo
shall perform the Manufacturing Services exclusively at the Manufacturing Site
in order to manufacture and supply Finished Goods to Client for sale in the
Territory.  Halo shall at its own cost obtain on a timely basis and maintain all
necessary licenses, permits and approvals of Authorities, and make any required
filings with Regulatory Authorities as further specified in Section 7.8, in
respect of the operation of Halo’s business generally, the Manufacturing Site,
and the performance of services of the nature of the Manufacturing Services. 

2.6 Second Manufacturing Site. 

(a) At any time during the Term, the parties agree that Client may elect, at its
sole discretion, to have one of: (i) itself, (ii) its Affiliate, (iii) Halo at a
second, separate manufacturing site, or (iv) a Third Party manufacturer selected
by Client, qualified with all applicable Regulatory Authorities, to manufacture
and supply the balance of Client’s and its Affiliates’ and licensees’
requirements of the Products and Finished Goods in the Territory during the
Term, provided that Client agrees that any supply of Finished Goods from such
additional site will remain subject to Client’s agreement to purchase certain
quantities of Finished Goods from Halo as set forth in this Agreement.

(b) During the Term, when Client is ready to seek a second manufacturing site
for the manufacture and supply of the balance of Client’s and its Affiliates’
and licensees’ requirements of the Products and Finished Goods in the Territory
during the Term, it will so notify Halo in writing, unless Client decides to
have itself or its Affiliate qualified as the second manufacturing site. Within
forty-five (45) days of receiving such notice, Halo will confirm by written
response to Client whether or not Halo is interested in negotiating with Client
to manufacture and supply such balance of Products and Finished Goods at a
second, separate manufacturing site other than the Manufacture Site. If Halo
does not confirm its interest within such 45-day period, Client will not be
required to have any further discussions with Halo regarding such second
manufacturing site. If Halo does confirm its interest within such 45-day period,
Client will include Halo in its process for negotiating and selecting a second
manufacturing site, provided Halo understands that Client may negotiate
simultaneously with other Third Party manufacturers for such second
manufacturing site. Client and Halo will negotiate in good faith the terms of a
definitive supply agreement directed to the manufacture and supply of the
balance of Client’s and its Affiliates’ and licensees’ requirements of the
Products and Finished Goods in the Territory during the Term at a second,
separate manufacturing site, including the financial terms thereof. If the
parties are unable to enter

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into a definitive supply agreement directed to such second manufacturing site
within one hundred and twenty (120) days after Halo’s confirmation of interest,
then Client will be free to enter into a definitive supply agreement with a
Third Party manufacturer at any time thereafter, provided the financial terms of
such Third Party manufacturer agreement are no less favorable to Client as a
whole than the terms last offered by Halo.

ARTICLE 3  

CLIENT OBLIGATIONS

3.1 Payment.   Client shall pay Halo the fees set forth on Schedule A for the
provision of Manufacturing Services (including the Price for the Finished Goods,
the annual product review fee, the supplier audit fees and commercial stability
fees) and all other amounts owing pursuant to this Agreement (including in
respect of Components and Consumables), as specified in this Agreement.

3.2 Rolling Forecasts.  Concurrently with the execution of this Agreement,
Client shall provide Halo with a written twenty-four (24) month forecast of the
volume of each Finished Good that Client anticipates it will require Halo to
supply during each month of that 24-month period (the “Forecast”).  Client shall
provide Halo with an updated Forecast (i) on or before the tenth (10th) day of
each calendar month on a rolling 24-month basis and (ii) promptly following any
determination by Client that the volumes set forth in the Forecast most recently
provided to Halo have changed [***] or more.  The first three (3) months of each
Forecast shall be binding on Client with respect to the quantities of Product
specified therein (the “Commitment”), and the balance shall be a non-binding,
good faith estimate.  Client shall place orders for Manufacturing Services
against the Forecast as specified in Article 4.

3.3 Specifications.  Prior to the Effective Date, Client has provided Halo with
a preliminary copy of the Specifications pertaining to Products and Finished
Goods which are attached to Schedule A.  Prior to Client placing its first Firm
Order, Client shall provide Halo with originally executed copies of final
Specifications and other Product-related and Finished Good-related information
reasonably requested by Halo in connection with the Manufacturing
Services.  Client may revise the Specifications from time to time, so long as
(i) Client provides Halo with originally executed copies of such revised
Specifications, (ii) the parties have complied with Section ‎5.4, and (iii) the
parties have agreed on a timeline for Halo’s implementation of such change.    

3.4 Active Material.  Client shall, at its sole cost and expense, deliver the
Active Material to Halo DDP (Incoterms 2010) the Manufacturing Site specified by
Halo during the Term in sufficient quantities and at such times as to enable
Halo to timely provide the Manufacturing Services.  Title to and risk of loss of
the Active Material shall at all times remain with Client, and Client will
insure the Active Material at Client’s cost.  Client acknowledges and agrees
that the timely delivery of the Active Material is a threshold event to Halo’s
ability to supply Product by the scheduled delivery date set forth in a Purchase
Order. Any failure of Client or its designee to timely deliver to Halo Active
Material shall extend, day-for-day of such delayed delivery by Client or its
designee, the scheduled delivery date of the corresponding Products Manufactured
by Halo hereunder using such Active Material, and Halo shall have no liability
to Client or its Affiliates

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or licensees as a result thereof for such delay in the scheduled delivery date
of such Products, provided however that such delay shall not constitute a
material breach of this Agreement.    

3.5 Packaging.  Halo will perform the packaging and testing of Product under the
Specifications in the Territory, including quality control, quality assurance,
stability testing, packaging, and related services, set forth in this Agreement,
required to package and test the Product, and resulting in the Finished Goods.
Client shall be solely responsible for the development all artwork and labeling
in connection with Product packaging into Finished Goods, including all
associated content and intellectual property matters, and Client will be
responsible for submitting any such artwork and labeling to all applicable
Authorities responsible for the approval of the Products in the
Territory.  Client may, in its sole discretion and at its cost, make changes to
Product packaging, including labels, inserts and cartons; provided, that Client
shall be responsible for the cost of all obsolete Components held by Halo when
any such changes occur to the extent Halo procured such Components consistent
with Client’s then-current Forecast and the vendor’s minimum purchase
requirements.  Client may also request multi-country packaging as specified in
Section ‎5.5.  Any failure of Client or its designee to timely provide to Halo
necessary artwork or labeling shall extend, day-for-day of such delay by Client
or its designee, the scheduled delivery date of the corresponding Products
Manufactured by Halo hereunder using such artwork or labeling, and Halo shall
have no liability to Client or its Affiliates or licensees as a result thereof
for such delay in the scheduled delivery date of such Products, provided however
that such delay shall not constitute a material breach of this Agreement. 

3.6 Quality Control.  Client shall have sole responsibility for the release of
Finished Goods to the market and for handling customer matters as contemplated
by Section ‎6.5. 

3.7 Permits.  Client shall at its own cost obtain on a timely basis and maintain
all licenses, permits and approvals of Regulatory Authorities, and make any
required filings with Regulatory Authorities as further specified in Section
‎7.8, in respect of the operation of Client’s business generally, the
Manufacturing Site, the Finished Goods and the Specifications, including,
without limitation, all marketing and post-marketing approvals. Halo shall
maintain Manufacturing Site in a state of repair and operating efficiency
consistent with the requirements of the Specifications, the Manufacturing
Services, cGMP and Applicable Laws. Halo shall maintain in the Manufacturing
Site adequate and segregated holding accommodations (segregated as defined as a
row or physical storage location designation) for the Finished Goods, Products,
and all intermediates thereof, used in Manufacturing Services in accordance with
the Specifications, the Manufacturing Services, cGMP and Applicable Laws. If
required under Applicable Laws, all Finished Goods shall be held by Halo in a
segregated area until delivery to Client.

ARTICLE 4  

ORDERS, authorization to procure, SHIPMENT

4.1 Orders.    

(a) Purchase Orders.  From time to time as provided in this Section ‎4.1(a),
Client shall submit to Halo a binding, non-cancellable purchase order for
Manufacturing Services identifying

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an order number, the Finished Goods to be manufactured, the number of batches,
the batch size (to the extent the Specifications permit batches of different
sizes), Client’s requested delivery date for each batch, and any other elements
necessary to ensure the timely production and delivery of the Finished Goods
(each, a “Purchase Order”).  Concurrently with the submission of each Forecast,
Client shall submit a Purchase Order for all portions of the Commitment not
already ordered.  Purchase Orders for quantities of the Finished Goods in excess
of the Commitment shall be submitted by Client at least three (3) months in
advance of the delivery date requested in the Purchase Order. 

(b) Firm Orders.  Halo will confirm in writing each Purchase Order, including
the Product, quantity and scheduled delivery date, within [***] Business Days of
receipt, provided that if Client receives no written communication from Halo
within [***] Business Days of receipt of the Purchase Order, the Purchase Order
will be deemed accepted by Halo.  If Halo is unable to meet the delivery date
requested by Client in its Purchase Order, Halo shall so notify Client in Halo’s
confirmation of such Purchase Order and provide to Client an alternative
scheduled delivery date, which shall not be more than thirty (30) days earlier
or later than the initial delivery date requested by Client in its Purchase
Order.  Only upon Halo’s confirmation of Client-issued Purchase Orders will such
orders become firm (each, a “Firm Order”).  In the event Halo provides a written
communication rejecting a Purchase Order (e.g., because of insufficient
manufacturing lead time based on the scheduled delivery date in such Purchase
Order), the communication will state the reason for the rejection, and the
Parties will discuss in good faith reasonable modifications to such Purchase
Order. Halo may change the scheduled delivery date of any Firm Order within a
+/- five (5) day window to a new scheduled delivery date upon written notice to
Client (and without Client’s prior approval).  Halo may not change the quantity
of Product in any Firm Order except with Client’s prior written approval;
provided, that Client shall accept any minor change in quantity delivered due to
normal yield variation.  Client may not change the quantity of Product in any
Firm Order; provided, that Client may cancel any Firm Order without penalty or
other liability if (i) Halo is unable to meet the delivery date requested by
Client in its Purchase Order within +/- thirty (30) days or (ii) a Supply
Shortage then exists; unless any failure by Halo to meet such delivery date or
such Supply Shortage is due to a failure to supply Active Material on a timely
basis to Halo hereunder. 

(c) Rejection; Excess Volume.  Halo may reject any Purchase Order without
penalty or liability to Client (i) for any Product quantities that are in excess
of the Commitment, (ii) if Halo has an insufficient DEA procurement quota in
respect of the applicable Active Material, or (iii) the Purchase Order is not
given in accordance with this Agreement. Notwithstanding the foregoing, Halo
shall use Commercially Reasonable Efforts to supply Client with quantities of
Product that are up to [***] of Commitment quantities, subject to Halo’s other
supply commitments and manufacturing, packaging and equipment capacity.

4.2 [Intentionally Deleted.]

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4.3 Authorization to Procure.

(a) Reliance on Forecast.  Client understands and acknowledges that Halo will
rely on the Forecast, Commitment and Firm Orders to procure Components necessary
for Halo to fulfill its obligations to supply Product under this Agreement.  In
addition, Client understands that to ensure an orderly supply of such
Components, it may be desirable for Halo to purchase such Components in
sufficient volumes to meet the anticipated requirements for Products set forth
in part of the Forecast, or for such longer period as the parties may
agree.  Accordingly, Client authorizes Halo to purchase Components sufficient to
satisfy Client’s Product requirements set forth in the first [***] months of the
Forecast most recently provided by Client to Halo pursuant to Section ‎3.2, and
such longer period as the parties may agree in writing from time to time.  If
Components ordered by Halo as permitted by this Section ‎4.3(a) are not included
in Products manufactured for Client within [***] months after the Forecasted
month in respect of which such purchases were made (or such longer period as the
parties may agree) or if such Components have expired during such period, Client
shall reimburse Halo its documented costs for procuring and testing such items.
   

(b) Exclusive Components.    Halo shall provide Client with a list substantially
in the form set forth on Schedule G (the “Exclusive Components Purchasing
Summary”) of all Components unique to Client, the Products or the Finished Goods
that Halo expects to purchase pursuant to Section ‎2.1(b)(ii) (“Exclusive
Components”), in keeping with the volumes of Finished Goods set forth in the
then-current Forecast, Commitment and Firm Orders.  Halo shall provide a
preliminary Exclusive Components Purchasing Summary following execution of this
Agreement, a revised version following receipt of final Specifications, and
thereafter an updated version on an annual basis.  The Exclusive Components
Purchasing Summary shall indicate which Exclusive Components have a limited
shelf life and which are subject to minimum order quantities as specified by the
vendor.  Client shall reimburse Halo its documented costs for procuring and
testing all Exclusive Components purchased by Halo for use under this Agreement
that are not used to perform Manufacturing Services prior to the expiry of the
Exclusive Component’s shelf life, provided the Exclusive Components are
purchased as permitted under Section 4.3(a).  Client will also be responsible
for all costs incurred by Halo in connection with (i) Halo’s qualification of
any Exclusive Components vendor that has not been previously qualified by Halo
and (ii) any subsequent audit requested by Client of such vendor.

(c) Reimbursement.  Reimbursement from Client under this Section ‎4.3 shall be
due, where applicable, within thirty (30) days after Halo provides written
notice to Client that the relevant Component has not been used within the
required time period or has expired.  Halo shall deliver to Client documentation
reasonably sufficient to support the amount of such reimbursement; provided,
that Halo shall not be obligated to provide specific pricing information
regarding any Component that is subject to confidentiality obligations between
Halo and its vendor.  In respect of any unused, but unexpired, Components
reimbursed by Client hereunder, to the extent such Components are incorporated
into Product subsequent to such reimbursement, Halo will credit Client for the
amount reimbursed to Halo under this Section 4.3.

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(d) Halo shall not be liable for any delay in delivery of Product if (i) Halo is
unable to obtain any Component in a timely manner and (ii) Halo placed orders
for such Component in keeping with this Section ‎4.3.  In the event that any
Component becomes subject to purchase lead time beyond [***] months, the parties
will negotiate in good faith an appropriate amendment to Section ‎4.3(a).

4.4 Shipment.    

(a) Risk of Loss and Title.  Halo shall ship the Finished Goods to Client or its
designee Ex Works (Incoterms 2010) the Manufacturing Site.  Risk of loss of the
Finished Goods shall remain with Halo until Halo loads the Finished Goods onto
the carrier’s vehicle for shipment at the shipping point, at which time risk of
loss shall transfer to Client.  To the extent not already held by Client, title
to the Finished Goods shall transfer to Client concurrently with risk of loss. 

(b) Packing and Transport.  Halo shall pack and label shipping containers in
accordance with Applicable Laws and transport guidelines, the Specifications,
and Client’s written instructions (to the extent not inconsistent with any of
the foregoing).  At Client’s request, risk and expense, and with the express
consent of Client, Halo shall further arrange for shipping that meets any
applicable requirements of the Specifications (such as controlled temperature
and humidity).  Client shall arrange for insurance and shall select the freight
carrier to be used by Halo to ship the Finished Goods.

ARTICLE 5  

PRICING, COSTS, invoicing and payment

5.1 First Year Price.  Each Price set forth on Schedule A is valid through the
first full calendar year of commercial production of the Finished Goods under
this Agreement (the “First Production Year”); provided, that Halo reserves the
right to revise the Price if such commercial manufacturing has not commenced
within twelve (12) months of the Effective Date.  Halo also reserves the right
to revise the Price if this Agreement is substantially amended after the
Effective Date, subject to Client’s written consent, which shall not be
unreasonably withheld, conditioned or delayed.    

5.2 Subsequent Year Price Adjustments.  Effective on January 1 of each Year
following the First Production Year during the Term, the Price shall be adjusted
to reflect (i) inflation, which adjustment shall be based on the increase in the
United States Producers Price Index for Pharmaceutical Preparations (“PPI”),
published by the United States Department of Labor, Bureau of Labor Statistics
in September of the then-current Year compared to the same month of the
preceding Year, and (ii) documented changes in Component costs, so as to pass on
to Client the actual amount of any increase or decrease in such costs, provided,
however, that the actual amount of any increase in such Component costs will
only be passed on to Client to the extent such cost increase exceeds any
adjustment based on the PPI.  Halo shall provide in writing to Client by
November 1 of each Year the updated Price for the subsequent Year, with
appropriate supporting documentation; provided, that Halo may redact
confidential portions of any supporting documents subject to obligations of
confidentiality between Halo and its vendors, provided further that Client

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shall have a right to have a reputable firm of independent accountants audit
Halo’s records only to the extent that they are directly related to and form the
basis for such documented Price adjustment; provided that such accountants first
enter into a confidentiality agreement reasonably acceptable to Halo.  Such
revised fee shall be effective with respect to any Finished Goods delivered by
Halo after the end of the then -current Year.

5.3 Current Year Price Adjustments.  During any Year of this Agreement, the
Price shall be adjusted in accordance with this Section ‎5.3 to reflect
extraordinary increases or decreases in Component costs due to market
conditions.  A material change shall be deemed to have occurred if the aggregate
cost for all Components of a given Finished Good increases or decreases by [***]
or more of the total Component costs for such Finished Good upon which the most
recent fee quote was based.  To the extent that a Price has been previously
adjusted pursuant to Section ‎5.2 or this Section ‎5.3 to reflect an increase or
decrease in the cost of one or more Components, the adjustment above shall
operate based on the costs attributed to such Components at the time the last
such adjustment was made.  Halo shall provide in writing to Client the revised
Price, with documentation to support both Halo’s normal forecasted cost and new
materially changed cost; provided, that Halo may redact confidential portions of
any supporting documents subject to obligations of confidentiality between Halo
and its vendors, provided further that Client shall have a right to have a
reputable firm of independent accountants audit Halo’s records only to the
extent that they are directly related to and form the basis for such documented
Price adjustment; provided that such accountants first enter into a
confidentiality agreement reasonably acceptable to Halo.  Such revised Price
shall be effective with respect to any Finished Goods delivered by Halo on or
after the first day of the month following Client’s receipt of Halo’s notice.

5.4 Price Adjustments Due to Technical Changes.  Amendments to a Product’s
master batch record, Specifications or the applicable Quality Agreement
requested by either party will be implemented only following a technical and
cost review by the parties, and are subject to Client and Halo reaching
agreement on appropriate revisions to the Price and any other impacted fees
under this Agreement.  If the parties agree to proceed with such amendment and
Client accepts a proposed fee revision, Halo shall implement the proposed change
on the agreed timeframe, and the revised fee shall apply only to Finished Goods
that are manufactured under the amended master batch record, Specifications or
Quality Agreement, as applicable.  In addition, Client shall purchase from Halo
any Inventory rendered obsolete as a result of such amendment based on the
procedure described in Section ‎8.4(c), subject to the last sentence of Section
‎8.4.

5.5 Multi-Country Packaging Requirements.  If and when Client decides that it
wishes to have Halo provide Manufacturing Services in respect of Product for
countries in addition to those countries that then comprise the Territory,
Client shall inform Halo of the packaging requirements for each additional
country and Halo shall prepare a quotation for consideration by Client of any
revised Component costs and changeover fees for Product destined for each
additional country.  The agreed additional packaging requirements and related
packaging costs and change over fees shall be set out in a written amendment to
this Agreement as contemplated by Section ‎14.2.

5.6 Invoicing.  Invoices shall be sent by fax or email to such fax number or
email address as Client may provide to Halo in writing from time to time.  Halo
shall invoice Client for Finished Goods

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on the date on which Halo notifies Client that the Finished Goods have been
released by Halo’s quality assurance department and is ready for shipment.  Each
invoice for Finished Goods shall, to the extent applicable, identify Client’s
Purchase Order number, Product batch numbers, names and quantities, Price,
freight charges and the total amount to be remitted by Client.  Halo shall also
submit to Client with each shipment of Finished Goods an invoice covering such
shipment.  Halo shall invoice Client for all other fees due under this Agreement
(including in connection with Components and Consumables) as and when
appropriate.  Any fees assessed on an annual basis will be invoiced as of the
first day of each Year during the Term.  Each such invoice shall reference this
Agreement and identify in reasonable detail the nature of the charges therein or
in a separate agreement.  Notwithstanding the foregoing, each process validation
batch of Product will be invoiced upon completion of manufacturing activities
for such batch at [***] of the commercial per bottle Price for such batch at an
assumed [***] yield. Each packaging validation batch of Product will be invoiced
at [***] of the commercial per bottle Price at an assumed [***] yield upon
completion of packaging activities for such batch. Validation batch sample
analysis will be invoiced upon completion of testing activities.

5.7 Payment Terms.  Client shall pay all invoiced amounts that are not subject
to a good faith dispute by Client in full within thirty (30) days following the
invoice date.    Client shall make payment in U.S. dollars, and otherwise as
directed in the applicable invoice.  If any payment is not received by Halo by
its due date, Halo may, in addition to any other remedies available at equity or
in law, charge interest on the outstanding sum from the due date (both before
and after any judgment) at two percent (2%) per month (or, if less, the maximum
amount permitted by Applicable Laws) until paid in full.

5.8 Taxes.  All taxes, duties and other amounts assessed by any Authority
(excluding tax based on net income and franchise taxes) on Active Material,
Manufacturing Services or Product are the responsibility of Client, and Client
shall reimburse Halo for all such taxes, duties and amounts paid by Halo to any
Authority (or such sums will be added to invoices directed at Client, where
applicable).

ARTICLE 6  

PRODUCT CLAIMS AND RECALLS

6.1 Product Claims.

(a) Product Claims.  Client has the right to reject any portion of any shipment
of Finished Goods that is alleged not to be Conforming Product (“Non-Conforming
Product”) without invalidating any remainder of such shipment.  Client or its
designee shall inspect Finished Goods supplied by Halo upon receipt thereof and
shall give Halo written notice (a “Deficiency Notice”) of all claims that such
Finished Goods are Non-Conforming Product within forty-five (45) days after
Client’s or its designee’s receipt thereof (or, in the case of Latent Defects,
within forty-five (45) days after discovery thereof by Client or its designee,
but in no event after the expiration date of the Finished Goods), together with
a sample of the Non-Conforming Product.  Should Client fail to provide Halo with
the Deficiency Notice within the applicable 45-day period,

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then the Finished Goods shall be deemed to have been accepted by Client as of
the 46th day after delivery or discovery, as applicable, and Halo shall have no
liability therefor. 

(b) Evaluation.  Upon receipt of a Deficiency Notice, Halo shall have fifteen
(15) days to advise Client in writing whether it agrees or disagrees with the
Deficiency Notice.  If Client and Halo fail to agree within fifteen (15) days
after Halo's disagreement notice as to whether any Finished Goods identified in
the Deficiency Notice are Non-Conforming Product, then the parties shall
mutually select an independent laboratory or qualified person, as appropriate,
to evaluate whether such Finished Goods are Non-Conforming Product and the cause
of any non-conformity.  Such evaluation shall be binding on the parties.  If
such evaluation confirms that such Finished Goods are Non-Conforming Products or
if Halo does not disagree with the Deficiency Notice, such Finished Goods shall
be deemed properly rejected under this Section ‎6.1, and Halo shall bear the
expenses associated with the evaluation, if any.  If such evaluation determines
that Finished Goods are Conforming Product, Client shall be deemed to have
accepted delivery of such Finished Goods on the date of such determination, and
Client shall bear the expenses associated with such evaluation.

(c)Shortage. Claims for shortages in the quantity of Finished Goods shipped by
Halo shall be dealt with as may reasonably be agreed to by the parties in the
ordinary course of business. 

6.2 Product Recalls.

(a) Records and Notice.  Halo and Client shall each maintain such records as may
be necessary to permit a Recall of any Finished Goods delivered to Client, its
Affiliates or licensees, or their respective customers.  Each party shall
promptly notify the other by telephone (to be confirmed in writing) of any
information that might affect the marketability; safety or effectiveness of any
Finished Goods and/or that might result in a Recall of any Finished Goods.  The
decision to initiate a Recall or to take some other corrective action, if any,
shall be made and implemented solely by Client.

(b) Recalls.  In the event (i) any Authority issues a directive, order or,
following the issuance of a safety warning or alert with respect to a Finished
Good, a written request that any Finished Goods be Recalled, (ii) a court of
competent jurisdiction orders such a Recall, or (iii) Client determines that any
Finished Goods should be Recalled, Halo will co-operate as reasonably requested
by Client, having regard to all Applicable Laws. 

6.3 Halo’s Responsibility for Non-Conforming and Recalled Products.

(a) Non-Conforming Product.  In the event Client rejects Finished Goods in
accordance with Section ‎6.1 and defect in Non-Conforming Product is determined
to have arisen solely from Halo’s failure to provide the Manufacturing Services
in accordance with the Specifications, the Quality Agreement and/or Applicable
Laws (including cGMPs) (“Non-Compliant Services”), Halo will credit Client’s
account for the invoiced Price for such Non-Conforming Products.  If Client
shall have previously paid for such Non-Conforming Products, Halo shall
promptly, at Client’s election, either (i) offset the invoiced Price for such
Non-Conforming Products against

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other amounts due to Halo hereunder or (ii) replace such Non-Conforming Products
with Conforming Products, contingent upon the receipt from Client of Active
Material necessary for the manufacture of such replacement Products. Subject to
Section 2.1(b)(i)(D), Halo’s responsibility for any loss of Active Material in
connection with Non-Conforming Product shall be captured and calculated in the
Actual Annual Yield under Section ‎2.3 and will be subject to the Maximum Credit
Value.

(b) Recalled Product.  Halo shall not be responsible for any Recall costs and
shall be entitled to full payment for all Finished Goods delivered if a Recall
is due to clinical reasons that cannot be solely attributed to Halo’s
Non-Compliant Services.  Notwithstanding the foregoing, to the extent that a
Recall results from Halo’s Non-Compliant Services, Halo shall be responsible for
Client’s documented [***] of conducting such Recall, including the [***] of the
recalled Finished Goods and all other documented [***] incurred in connection
with such Recall, and shall use its Commercially Reasonable Efforts to replace
the Recalled Products with Conforming Products, contingent upon the receipt from
Client of all Active Material necessary for the manufacture of such replacement
Products. Subject to Section 2.1(b)(i)(D), Halo’s responsibility for any loss of
Active Material in connection with Non-Conforming Product shall be captured and
calculated in the Actual Annual Yield under Section ‎2.3 and will be subject to
the Maximum Credit Value.  If Halo is unable to replace the Recalled Products
(except where such inability results from a failure to receive the required
Active Material), Client may request Halo to reimburse Client for the Price paid
by Client for Manufacturing Services in respect of the affected Finished Goods.
If there is any dispute concerning whether such Recall of Finished Goods arose
from such Finished Goods being Non-Conforming Product, either party may exercise
any right or remedy available to it, after following the Dispute procedures set
forth in Article 13, below, including litigation, regarding any other dispute
concerning which party’s acts or omissions gave rise to such Recall of Finished
Goods.  

(c) Limitations.  For avoidance of doubt, Halo shall have no obligation for
Non-Conforming Product if any deficiencies in, or other liabilities associated
with, such Non-Conforming Product (i) are caused by deficiencies with respect to
the Specifications, by the safety, efficacy or marketability of the Finished
Goods or by any distribution of the Finished Goods, in each case not resulting
from Non-Compliant Services, (ii) result from any defect in Active Material or
other materials supplied by Client as of the date such material is delivered to
Halo by Client or its designee, which is not reasonably discoverable by Halo by
visual inspection and testing as required under Section ‎2.1(b)(i)(A), (iii) are
caused by actions of Third Parties occurring after such Finished Goods are
shipped by Halo pursuant to Section ‎4.4(a), or (iv) are caused by any other
breach by Client of its obligations under this Agreement.

6.4 Disposition of Non-Conforming Products.  Client shall not, without Halo’s
prior written consent, dispose of any Non-Conforming Products in relation to
which it intends to assert a claim against Halo.  Halo shall bear the cost of
disposition with respect to Non-Conforming Products in relation to which it
bears responsibility under Section ‎6.3.  In all other circumstances, Client
shall bear the cost of such disposition.

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6.5 Customer Questions and Complaints.  Client or its designee shall have the
sole responsibility for responding to questions and complaints from Client’s
customers and for handling customer returns of the Finished Goods.  Questions or
complaints received by Halo from Client’s customers shall be promptly referred
to Client in writing.  Halo shall co-operate and provide such information as
reasonably required to allow Client to determine the cause of, respond to, and
resolve any customer questions and complaints.  Unless it is determined that the
cause of any customer complaint is Non-Compliant Services, all costs incurred by
Halo under this Section ‎6.5 shall be borne by Client.

6.6 Sole Remedy.  Except for Halo’s indemnity obligations under Section ‎10.3(a)
and subject to the limitations set forth in this Agreement (including Sections
‎10.1 and ‎10.2), the remedies described in this Article 6 shall be Client’s
sole remedy for any Non-Conforming Product and/or Non-Compliant Services.

ARTICLE 7  

COOPERATION

7.1 Quarterly Review.  Promptly following execution of this Agreement, each
party shall appoint one of its employees to be a relationship manager
responsible for liaison between the parties.  The relationship managers shall
meet not less than quarterly to review the current status of the business
relationship and manage any issues that have arisen.

7.2 Communication with Authorities.  Subject to Section ‎7.8, Halo may
communicate with any Authority, including any Regulatory Authority, regarding
Products and Finished Goods if, in the opinion of Halo’s counsel, such
communication is necessary to comply with the terms of this Agreement or the
requirements of any Applicable Laws; provided, that unless, in the reasonable
opinion of Halo’s counsel, there is a legal prohibition against doing so, Halo
shall permit Client to accompany and take part in any communications with the
Regulatory Authority regarding Products and Finished Goods, and to receive
copies of all such communications from the Regulatory Authority regarding
Products and Finished Goods.  Nothing in this Agreement shall be construed to
limit Client’s ability to communicate with any Authority, including any
Regulatory Authority, concerning the Products and Finished Goods; provided, that
to the extent such communication pertains to the Manufacturing Services, unless,
in the reasonable opinion of Client’s counsel, there is a legal prohibition
against doing so, Client can request and shall permit Halo to accompany and take
part in communications with the Regulatory Authority regarding Manufacturing
Services, and Client will provide Halo with copies of all communications from
the Regulatory Authority regarding Manufacturing Services.

7.3 Records and Accounting by Halo.  Halo shall keep materially complete and
accurate records of the manufacture, testing, storage, and shipping of Products
and Finished Goods, including master batch records, completed batch records,
quality control documentation and results for all acceptance tests performed
(collectively, “Records”) and retain samples of Products and Finished Goods as
necessary to comply with Applicable Laws, as well as to assist with resolving
any Product and Finished Good complaints and other similar
investigations.  Copies of Records and samples shall be retained for a period of
one (1) year following the date of Product expiry, or

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longer if required by Applicable Laws, at which time Client will be consulted
prior to any decisions concerning the delivery and destruction of such Records,
subject to Section ‎14.3. 

7.4 Audit/Inspection by Client.  

(a) Halo agrees that Client and its agents shall have the right exercisable no
more than once per 12 month period (other than “for cause” audits, which may be
conducted more frequently), to inspect the Manufacturing Site as well as the
manufacturing of Products, Finished Goods, and any intermediates thereof, as
applicable, including inspection of (i) the materials used in the manufacture of
Products and Finished Goods, (ii) the holding facilities for such materials.
including the Active Material, the Products, and the Finished Goods, (iii) the
equipment used in the Manufacturing Services, and (iv) all records relating to
such Manufacturing Services and the Manufacturing Site. Notwithstanding the
provisions of this Section 7.4(a), Client shall have no obligation or be deemed
to have an obligation to inspect the Manufacturing Site. Any agents conducting
such inspection must first enter into a confidentiality agreement reasonably
acceptable to Halo. 

(b) Following such audit, if in Client’s sole discretion, it is appropriate,
Client shall discuss its observations and conclusions with Halo and, if any
Non-Compliant Services were identified in such audit, Halo shall use
Commercially Reasonable Efforts to implement such corrective actions as needed
to address such Non-Compliant Services within ninety (90) days after
notification thereof by Client, subject to the provisions of Section 5.4,
provided, however, that in the event such corrective action is directed to the
Manufacturing Site or its equipment and relates to a process or analytical cGMP
issue/regulatory risk, such corrective action shall be at Halo’s cost.

(c) Client and its agents may inspect Halo’s Records, samples, and reports
relating to this Agreement at a reasonable frequency, but not more than once per
Year unless for cause, during normal business hours and with reasonable advance
notice, provided a Halo representative is present during any such inspection. 
This right to inspect shall extend throughout the Term and for so long as
Finished Product manufactured by Halo under this Agreement remains on the
market.  Any agents conducting such inspection must first enter into a
confidentiality agreement reasonably acceptable to Halo.

7.5 Access.  Halo shall provide Client with reasonable access at mutually
agreeable times to Manufacturing Site areas in which Products and/or Finished
Goods are manufactured, handled, stored or shipped in order to permit Client's
verification of the performance of the Manufacturing Services in accordance with
the Specifications and Applicable Laws (including cGMPs). 

7.6 Notification of Regulatory Inspections or Action.   Halo shall notify Client
within one (1) Business Day of learning of any inspections by any Regulatory
Authority specifically involving any Products or Finished Goods, and Client
shall have the right to attend any such inspection.  Halo shall notify Client of
receipt of any Form-483’s, warning letters or any other significant regulatory
action that (i) could reasonably be expected to impact the regulatory status of
any Products, Finished Goods, or Halo’s ability to perform Manufacturing
Services, (ii) relate to the

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manufacture or storage of the Products and Finished Goods, or (iii) concern the
Manufacturing Site.  Halo shall provide to Client un-redacted copies of the
sections of all Form-483’s or comparable regulatory notices that are specific to
the manufacturing of the Products and Finished Goods for Client.

7.7 Reports.  On an annual basis, Halo will provide Client with a copy of all
Product and Finished Goods data in its control (including release test results,
complaint test results, and all investigations in manufacturing, testing and
storage) that Client reasonably requires in order to complete any filing
required by any Regulatory Authority, including an annual report within the
meaning of 21CFR314.81(b)(2).  Each Year at a mutually agreed date, Halo will
provide Client with a copy of the annual product review report within the
meaning of 21CFR211.180(e).  Any additional reports requested by Client beyond
the scope of cGMPs and customary requirements of Regulatory Authorities shall be
subject to an additional fee to be agreed upon between Halo and Client. 

7.8 Regulatory Filings.

(a) Regulatory Authority.  Client shall have the sole responsibility for filing
all Product-specific and Finished Goods-specific documents with all Regulatory
Authorities and taking any other actions that may be required for the receipt
and/or maintenance of Regulatory Authority approval for the commercial
manufacture of the Products and Finished Goods.  Halo shall assist Client, to
the extent consistent with Halo’s obligations under this Agreement, to obtain
Regulatory Authority approval for the commercial manufacture of all Products and
Finished Goods as quickly as reasonably possible.  Halo shall have the sole
responsibility for filing all documents with Regulatory Authorities and taking
any other actions that may be required for the receipt and/or maintenance of
Regulatory Authority licensure of the Manufacturing Site.

(b) Verification of Data.  At least twenty one (21) days prior to filing in
connection with obtaining regulatory approval of the Products any documents with
any Regulatory Authority that incorporate data generated by Halo, Client shall
provide Halo with a copy of the documents incorporating such data so as to give
Halo the opportunity to verify the accuracy of such documents as they relate to
the Halo generated data.

(c) Verification of CMC.  At least twenty one (21) days prior to filing with any
Regulatory Authority any documentation which is or is equivalent to the FDA’s
Chemistry and Manufacturing Controls (“CMC”) related to any marketing
authorization, such as a New Drug Application or Abbreviated New Drug
Application, for a Product, Client shall provide Halo with a copy of the CMC
documents which have relied upon Halo data for preparation.  Such disclosure
shall permit Halo to verify that the CMC accurately describes the work that Halo
has performed and the manufacturing processes that Halo will perform pursuant to
this Agreement.  Client shall provide Halo with copies of those sections of FDA
filings at the time of submission that contain chemistry, manufacturing and
controls information derived from Halo data regarding such Product.

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(d) Deficiencies.  If, acting reasonably, Halo determines that any of the
information provided by Client in accordance with clause (b) or (c) above is
inaccurate or deficient, Halo shall notify Client in writing of such matter
within ten (10) Business Days of receipt of documents from Client. The parties
shall work together to have such matters resolved prior to Client’s submission
to the Regulatory Authority.

ARTICLE 8  

TERM AND TERMINATION

8.1 Term.  Unless terminated earlier by one of the parties in accordance with
Section 8.2, this Agreement shall become effective as of the Effective Date and
shall continue until December 31, 2025 (the “Initial Term”), and thereafter,
this Agreement shall automatically renew for successive terms of two (2) Years
(each, a “Renewal Term”), unless either party gives written notice to the other
party of its intention to terminate this Agreement at least twenty-four (24)
months prior to the end of the then-current Initial Term or Renewal Term. The
Initial Term together with all Renewal Terms or parts thereof shall be referred
to in this Agreement as the “Term”.

8.2 Early Termination.

(a) Either party may terminate this Agreement upon written notice to the other
party if other party has failed to remedy a material breach of this Agreement
within ninety (90) days following receipt of a written notice that describes the
breach in reasonable detail and expressly states that it is a notice under this
Section ‎8.2(a).    

(b) Either party may terminate this Agreement immediately without further action
(including without any written notice to the other party) in the event that (i)
the other party is declared insolvent or bankrupt by a court of competent
jurisdiction, and such declaration or order remains in effect for a period of
sixty (60) days, (ii) a voluntary petition of bankruptcy is filed in any court
of competent jurisdiction by such other party, or (iii) this Agreement is
assigned by such other party for the benefit of creditors.

(c) Client may terminate this Agreement as to any Product and applicable portion
of the Territory upon thirty (30) days’ prior written notice to Halo in the
event that (i) any Authority takes any action or raises any objection that
prevents Client from importing, exporting, purchasing or selling such Product in
all or part of the Territory, or (ii) subject to Section ‎8.3, Client elects to
discontinue selling or otherwise withdraws from the market such Product in all
or part of the Territory.

(d) Client may immediately terminate this Agreement as to any Product and
applicable portion of the Territory, pursuant to the terms of Section 2.4(c);

(e) Either party may terminate this Agreement upon written notice as permitted
by Section ‎14.1 (Force Majeure).

8.3 Product Discontinuation.  Client shall use Commercially Reasonable Efforts
to provide at least twelve (12) months’ advance notice to Halo if it intends to
no longer order Manufacturing

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Services for a Product during the Term due to its election to discontinue or
otherwise withdraw from the market any Product in all or part of the Territory.

8.4 Obligations on Termination.  If this Agreement expires or is terminated in
whole or in part for any reason, then, in addition to the applicable terms of
Section ‎8.5:

(a) At Client’s election, Halo shall either (i) complete any Products or
Finished Goods that are a work in process, which Products and Finished Goods
shall be subject to Section ‎8.4(b), or (ii) cease such work and transfer such
work in process into storage containers, which work in process shall be subject
to Section ‎8.4(c); it being understood that if Client fails to timely make such
an election or if termination is by Halo under Section ‎8.2(a) or ‎8.2(b),
clause (ii) above shall automatically apply;

(b) Client shall take delivery of and pay for, at the Price in effect at the
time, all completed, undelivered Product that Halo has produced pursuant to a
Firm Order;

(c) That Halo may redact confidential portions of any supporting documents
subject to obligations of confidentiality between Halo and its vendors. Client
shall purchase, at Halo’s cost, all Inventory then in stock or that is later
delivered by a Third Party vendor pursuant to non-cancellable orders, and shall
reimburse Halo for any cancellation fees assessed by Third Party vendors for
Inventory orders that are cancellable;

(d) Halo shall return to Client all unused Active Material and deliver to Client
all Inventory paid for by Client pursuant to clause (c) above;

(e) Each party shall, at the request of the other party, return all data, files,
records and other materials in such party’s possession or control containing or
comprising the other party’s Confidential Information, except one copy which may
be retained for legal purposes only;

(f) Halo shall maintain reserve samples and batch production records in
accordance with Applicable Laws;

(g) At Client’s election, Halo shall either (i) continue to perform any ongoing
stability testing or (ii) ship the stability samples to Client; it being
understood that if Client fails to timely make such an election or if
termination is by Halo under Section ‎8.2(a) or ‎8.2(b), clause (ii) above shall
automatically apply;

(h) At Client’s request and so long as Client is not in breach of Article 11,
Halo shall permit Third Parties to access to the Manufacturing Site for purposes
of effecting a technology transfer of Client’s Products, Finished Goods and
Specifications, subject to Halo’s prior written consent, which shall not be
unreasonably withheld;

with any costs incurred by Halo’s to comply with the foregoing obligations,
including shipping and related expenses, to be borne by Client, except in the
event of termination of this Agreement for Halo’s uncured material breach under
Section ‎8.2(a), in which case Halo shall bear all such expenses.  In lieu of
taking possession of any of the materials described in clause (b), (c), (d), or

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(e) above, Client may direct Halo to destroy such items, which Halo shall cause
to be done at Client’s cost.

8.5 Survival.  Any termination or expiration of this Agreement shall not affect
any obligations or payments due hereunder and outstanding as of the date of such
termination or expiration, nor shall it prejudice any other rights or remedies
that a party may have under this Agreement.  Notwithstanding any termination or
expiration of this Agreement for any reason, the parties rights and obligations
under the following provisions shall survive and continue in effect in
accordance with their respective terms: Sections 2.3(c), 2.3(d) and 2.3(e) (in
each case, solely with respect to calculation and payment of any Materials
Credit accruing prior to termination or expiration), Section 2.4(d) (for so long
as Finished Product manufactured by Halo under this Agreement remains on the
market), Section 2.4(e) (solely with respect to storage payments and shipment of
Finished Goods, Products, Components and Active Materials held by Halo in
inventory longer than six (6) months), Sections 3.1, 4.3(c), 5.7, 5.8, and 7.2,
Section 7.3 (for the time period set forth therein), Section 7.4(c) (for the
time period set forth therein),  Sections 8.4 and 8.5, and Article 6, Article 9
(provided that Sections 9.1, 9.2 and 9.3 shall survive solely for purposes of
determining indemnification obligations for breach of representations that
occurred prior to expiration or termination of this Agreement), Article 10
(provided that Section 10.4 shall survive only for so long as Finished Product
manufactured by Halo under this Agreement remains on the market), Article 11
(for the time period set forth therein), Articles 12 and 13, and Article 14
(other than Section 14.2).

ARTICLE 9  

REPRESENTATIONS, WARRANTIES AND COVENANTS

9.1 Authority.  Each party represents and warrants to the other that (a) it has
the full right and authority to enter into this Agreement, (b) it is in good
standing in its jurisdiction of organization and all jurisdictions in which it
operates, (c) the execution and delivery of this Agreement and the performance
of such its obligations hereunder do not conflict with, or constitute a default
or require any consent under, any contractual obligation of such party, and (d)
it will comply with all Applicable Laws in performing its obligations under this
Agreement.

9.2 Client Warranties.  Client covenants, represents and warrants to Halo that:

(a) the preliminary copy of the Specifications provided by Client to Halo
further to Section ‎3.3 is true and accurate in all material respects, and, to
the best of Client’s knowledge, there will be no material change to such
Specifications after the Effective Date;

(b) Client owns or has a valid right and license to use all Specifications for
each Product and Client may lawfully disclose all Specifications to Halo for
Halo’s use in connection with providing Manufacturing Services;

(c) to Client’s knowledge as of the Effective Date, all Intellectual Property
(other than Halo’s Intellectual Property) provided by Client to Halo for use in
connection with providing Manufacturing Services (i) may lawfully be used by
Halo in connection with providing

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Manufacturing Services and (ii) so long as Halo uses such Intellectual Property
solely as contemplated by this Agreement, such use does not and will not
infringe, violate or misuse any Third Party Rights;

(d) to Client’s knowledge as of the Effective Date, there are no Third Party
Rights related to Client’s Intellectual Property that would be infringed,
violated or misused by Client’s performance of the Agreement;

(e) it has no knowledge of any claims, actions or other actual or threatened
legal proceedings, the subject of which is the infringement, violation or misuse
of Third Party Rights related to any Specifications, Active Material or Product,
including the manufacture, use, distribution, sale or other disposition of any
Active Material or Product;

(f) to Client’s knowledge as of the Effective Date, all artwork, the content of
all labelling and packaging, and all other Specifications comply with Applicable
Laws;

(g) to Client’s knowledge, all Active Material Client will provide to Halo
hereunder will be manufactured in accordance with Applicable Laws, including
cGMPs, and shall at the time of delivery under Section ‎3.4 meet all
Specifications and not be adulterated, misbranded or mislabeled within the
meaning of Applicable Laws;

(h) the Active Material Cost fairly and accurately reflects Client’s actual,
out-of-pocket cost to procure the Active Material from Third Party vendors and
provide it to Halo; and

(i) all Product delivered to Client by Halo hereunder shall be held, used,
distributed, sold and otherwise disposed of by or on behalf of Client in
accordance with all Applicable Laws.

9.3 Halo Warranties.  Halo covenants, represents and warrants to Client that:

(a) to Halo’s knowledge as of the Effective Date, there are no Third Party
Rights related to Halo’s Intellectual Property that would be infringed, violated
or misused by Halo’s performance of the Agreement;

(b) it has no knowledge of any claims, actions or other actual or threatened
legal proceedings or investigations by any Regulatory Authority, the subject of
which is (i) the infringement, violation or misuse of Third Party Rights related
to any Halo’s Intellectual Property or (ii) the violation of Applicable Laws by
Halo or the Manufacturing Site;

(c) it does not and will not use in the performance of its obligations under
this Agreement the services of any person debarred or suspended under 21 U.S.C.
§335(a) or (b);

(d) it does not have and will not hire as an officer or employee any person who
has been convicted of a felony under the laws of the United States for conduct
relating to the regulation of any drug product under the Federal Food, Drug, and
Cosmetic Act;  

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(e) all Products and Finished Goods provided to Client hereunder (i) have been
manufactured in accordance with Applicable Laws, including cGMPs, and the
Quality Agreement; (ii) shall at the time of delivery under Section ‎4.4(a) meet
all Specifications, and will conform with the certificate of analysis and
certificate of compliance provided therewith; (iii) will not be adulterated,
misbranded or mislabeled within the meaning of Applicable Laws; (iv) have been
manufactured at the Manufacturing Site, which is in compliance with Applicable
Laws at the time of such manufacture; (v) will be manufactured, packaged, and
labeled in accordance with cGMP and ICH guidelines and in accordance with the
requirements of the applicable Regulatory Authorities; (vi) shall be free from
defects in material and workmanship; (vii) will have a shelf life expiring no
earlier than 18 months after the date of delivery by Halo under Section 4.4; and
(viii) shall conform to the applicable batch number and expiration date;
provided,  however, the foregoing representations and warranties made by Halo
will not be applicable to the Products and Finished Goods provided to Client
hereunder to the extent of (and Halo shall not be liable for any defect in
Product attributable to) any defect in Active Material as of the date such
Active Material is delivered to Halo by Client or its designee hereunder, which
is not reasonably discoverable by Halo by visual inspection and testing as
required under Section 2.1(b)(i), or incorrect or unlawful Specifications
(including artwork and labeling); and

(f) unencumbered title to all Products and Finished Goods will be conveyed to
Client upon delivery.

9.4 Limited Warranty.  EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT,
NEITHER PARTY MAKES ANY REPRESENTATION, WARRANTY OR GUARANTEE OF ANY KIND,
EITHER EXPRESS OR IMPLIED, BY FACT OR LAW.  HALO EXPRESSLY DISCLAIMS THE IMPLIED
WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE AND ANY WARRANTY OF MERCHANTABILITY
WITH RESPECT TO THE PRODUCTS.

ARTICLE 10  

REMEDIES, INDEMNITIES and INSURANCE

10.1 No Consequential Damages.  Except for liabilities expressly assumed under
each party’s indemnification obligations hereunder, or for any breach of Article
11 (Confidentiality), under no circumstances whatsoever shall either party be
liable to the other in contract, tort, negligence, breach of statutory duty or
otherwise for (a) any (direct or indirect) loss of profits, revenues,
production, anticipated savings, data, business or goodwill or (b) any other
liability, damage, cost or expense of any kind incurred by the other party of an
indirect, consequential, punitive or special nature, regardless of any notice of
the possibility of such damages.

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10.2 Limitation of Liability.

(a) Active Material. Except as expressly set forth in this Agreement, under no
circumstances whatsoever shall Halo be responsible for any loss or damage to the
Active Material. Subject to Section 2.1(b)(i)(D), Halo’s maximum liability for
loss or damage to all Active Material shall not exceed the Maximum Credit Value
in any given Year.  

(b) Maximum Liability. Halo’s maximum liability under this Agreement for any
reason whatsoever resulting from a breach of its representations, warranties or
other obligations under this Agreement shall not exceed [***].  The foregoing
shall not apply to (i) Halo’s wilful misconduct, (ii) any amounts due to Third
Parties by Halo as a result of Halo’s indemnification obligations under
Section 10.3, or (iii) or Halo’s breach of Article 11 (Confidentiality). 

10.3 Indemnification. 

(a) By Halo.  Halo agrees to defend, indemnify and hold Client, its Affiliates,
and their respective officers, employees and agents (“Client Indemnitees”)
harmless against any and all losses, damages, costs, claims, demands, judgments
and liability to, from and in favor of Third Parties (“Losses”) resulting from
or relating to (i) a breach by Halo of its obligations, warranties, or
representations under this Agreement, including any failure by Halo to perform
the Manufacturing Services in accordance with the Specifications, the Quality
Agreement, and/or Applicable Laws (including cGMPs), (ii) the negligence,
recklessness or wilful misconduct of any Halo Indemnitee, or (iii) any actual or
alleged infringement, violation or misuse of any Third Party Rights solely in
respect of any aspect of Halo’s Intellectual Property used in the Manufacturing
Services; in each case except to the extent that such Losses arise or result
from the negligence, recklessness, wilful misconduct or breach of this Agreement
by any Client Indemnitee.

(b) By Client.  Client agrees to defend, indemnify and hold Halo, its
Affiliates, and their respective officers, employees and agents (“Halo
Indemnitees”) harmless against any and all Losses resulting from or relating to
(i) a breach by Client of its obligations, warranties, or representations under
this Agreement, (ii) the negligence, recklessness or wilful misconduct of any
Client Indemnitee, (iii) any actual or alleged infringement, violation or misuse
of any Third Party Rights in respect of any aspect of any Product (other than
solely by reason of Halo’s Intellectual Property), or (iv) any distribution,
sale or use of or exposure to any Active Material or Product or Finished Goods;
in each case except to the extent that such Losses arise or result from the
negligence, recklessness, wilful misconduct or breach of this Agreement by any
Halo Indemnitee. 

(c) Procedure.  In the event of a claim, the party seeking indemnity shall: (a)
promptly notify the indemnifying party of any such claim; (b) use Commercially
Reasonable Efforts to mitigate the effects of such claim; (c) reasonably
cooperate with the indemnifying party in the defense of such claim; and (d)
permit the indemnifying party to control the defense and settlement of such
claim using counsel reasonably satisfactory to the indemnified party, all at the
indemnifying party’s cost and expense.  The indemnified party may be represented
by its own counsel in connection with such claim, and such representation shall
be at the indemnified party’s own expense unless the indemnifying party fails to
assume the defense of such claim as required

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hereunder. The indemnifying party shall have the right, after consultation with
the indemnified party, to resolve and settle any such demand, action or lawsuit;
provided that, in no event may the indemnifying party compromise or settle any
such demand, action or lawsuit in a manner which admits fault or negligence on
the part of the indemnified party or includes injunctive relieve or includes the
payment of money or other property by the indemnified party without the prior
written consent of the indemnified party, which consent shall not be
unreasonably withheld or delayed.

10.4 Insurance. 

(a) Coverage.  Each party shall purchase and maintain insurance, at its own
expense, as required to protect Client and Halo as follows:

(i) Commercial General Liability Insurance (Primary) with limits of not less
than five million dollars ($5,000,000) per occurrence and in the aggregate for
bodily injury, personal injury and property damage, with coverage for blanket
contractual liability, products and completed operations, independent
contractors and severability of interest;

(ii) Automobile Liability with a limit of liability not less than one million
dollars ($1,000,000) per occurrence combined single limit for bodily injury
(including death) and property damage liability, with coverage for owned,
non-owned and hired vehicles;

(iii) Excess or Umbrella Coverage of not less than twenty-five million dollars
($25,000,000); and

(iv) Professional Liability (errors and omissions) insurance with limits of not
less than five million dollars ($5,000,000) per occurrence and in the aggregate,
and including coverage for gross negligence.  

(b) Additional Requirements.  The foregoing insurance, excluding auto, shall be
on a claims made basis, shall remain in force throughout the Term and for three
(3) years following expiration or termination of this Agreement, and shall be
maintained with companies having an A.M. Best’s rating of A- VII or
better.   Each party shall provide the other party with certificates of
insurance evidencing the required insurance within three (3) days of the
Effective Date of this Agreement and thereafter on written request.  In no event
shall work be performed until such evidence of the required insurance has been
furnished.  Each party shall give the other party at least thirty (30) days’
prior written notice in the event of cancellation or non-renewal of any such
required insurance.  Each party shall name the other party, its agents and
employees, as additional insureds on all policies of required insurance.

10.5 Reasonable Allocation of Risk.    The provisions of this Agreement
(including this Article) are reasonable and create a reasonable allocation of
risk having regard to the relative profits the parties respectively expect to
derive from the Products; and that Halo, in its fees for the provision of the
Manufacturing Services, has not accepted a greater degree of the risks arising
from the manufacture, distribution, sale and use of the Products, based on the
fact that Client has developed the Products and requires Halo to manufacture and
label the Products strictly in accordance with

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the Specifications; and that Client and not Halo is in a position to inform and
advise potential users of the Products as to the circumstances and manner of use
of the Products. 

ARTICLE 11  

CONFIDENTIALITY

11.1 Confidentiality.  The provisions of the Confidentiality Agreement shall
apply to all confidential information (within the meaning of the Confidentiality
Agreement) exchanged between the parties in connection with this Agreement.  The
scope of the Confidentiality Agreement shall be deemed automatically expanded as
necessary to cover the activities contemplated by this Agreement, and in the
event the Confidentiality Agreement expires or is terminated prior to the
expiration or termination of this Agreement, the terms of the Confidentiality
Agreement shall continue to govern the parties’ obligations of confidentiality
with respect to any confidential information hereunder for the Term and for ten
(10) years following expiration or termination of this Agreement, as though such
Confidentiality Agreement remained in full force and effect.

11.2 Publicity.  Neither party will make any press release or other public
disclosure regarding this Agreement or the transactions contemplated hereby,
including identifying the other party as a business partner or in connection
with any scholarly or industry publications or presentations, without the other
party’s express prior written consent.  The foregoing shall not apply to the
extent disclosure is required under Applicable Laws, by any Authority or by the
rules of any stock exchange on which the securities of the disclosing party are
listed, in which case the disclosing party shall use Commercially Reasonable
Efforts to obtain the approval of the other party as to the form, nature and
extent of the press release or public disclosure prior to issuing or making the
disclosure.  This Section ‎11.2 is intended to supplement, and not to supersede,
the parties’ obligations under the Confidentiality Agreement.

ARTICLE 12  

INTELLECTUAL PROPERTY

12.1 Intellectual Property.    

(a) Existing Intellectual Property.  Subject to the other provisions of this
Article 12:  (a) each party shall retain exclusive ownership rights to all
Intellectual Property owned or controlled by (whether through license,
sublicense or contract, or through control over an Affiliate with such right)
such party (i) prior to the Effective Date, or (ii) independent of this
Agreement and without the use of any Confidential Information of the other
party; (b) neither party has, nor shall it acquire, any interest in any of the
other party’s Intellectual Property except to the extent expressly set forth in
this Agreement, and (c) each party agrees not to use any Intellectual Property
of the other party except as specifically authorized by the other party or as
required for the performance of its obligations under this Agreement.

(b) License to Halo.  Subject to the terms and conditions of this Agreement,
during the Term, Client hereby grants to Halo a non-exclusive, paid-up,
royalty-free, non-transferable,

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limited license to use Client’s Intellectual Property solely in connection with
the Manufacturing Services provided by Halo under this Agreement. Halo
acknowledges and agrees that the license granted in this Section 12.1(b) is for
the sole purpose of enabling Halo to use the Intellectual Property of Client to
perform the Manufacturing Services for or on behalf of Client and its Affiliates
and licensees pursuant to this Agreement.  Halo acknowledges and agrees that
Client reserves and retains whatever right, title and interest Client has in and
to the Client’s Intellectual Property, subject to the license granted herein.

(c) License to Client.  Subject to the terms and conditions of this Agreement,
Halo hereby grants to Client, an exclusive (even as to Halo), transferable,
royalty-free, fully paid-up license, including the right to sublicense to
Client’s Affiliates and licensees, to use Halo’s Intellectual Property solely to
use, import, export, market, sell, offer for sale and/or otherwise commercialize
the Products and Finished Goods supplied hereunder by Halo in the Territory.

12.2 Inventions.

(a) Client Inventions.  All right, title and interest in and to any Inventions
generated, created, developed, discovered or derived by or on behalf of Halo or
any of its employees, contractors or agents in the course of performing the
Manufacturing Services, to the extent specific to, or dependent upon, the
development, manufacture, use and/or sale of Client’s Products or Finished
Goods, and all Intellectual Property pertaining to such Inventions (“Client
Inventions”), shall be the exclusive property of Client or its designee.  Such
Client Inventions are included in the Intellectual Property licensed to Halo
under Section ‎12.1(b).  Halo agrees to assign and does hereby assign, and shall
cause its employees, contractors or agents to so assign, to Client or its
designee any and all of its right, title or interest Halo may have in or to the
Client Inventions.

(b) Halo Inventions.  All Inventions generated or derived by or on behalf of
Halo or any of its employees, contractors or agents in the course of performing
the Manufacturing Services to the extent they are not Client Invention, and
which have application to manufacturing processes or formulation development of
drug products or drug delivery systems generally, and all Intellectual Property
pertaining to such Inventions, shall be the exclusive property of Halo (the
“Broader Intellectual Property Rights”).  Halo hereby grants to Client a
perpetual, non-exclusive, paid-up, royalty-free, sublicensable license to use
Halo’s Broader Intellectual Property Rights to manufacture or have manufactured
Client’s Products and Finished Goods.

(c) Disclosure.  Halo shall promptly submit to Client a written description of
all Inventions generated or derived by or on behalf of Halo or any of its
employees, contractors or agents in the course of performing the Manufacturing
Services, including any Client Inventions and Broader Intellectual Property
Rights.  Client may disclose Broader Intellectual Property Rights in any patent
application claiming Client Inventions, as Client may reasonably require to
support the claimed subject matter of such patent application, subject to Halo’s
prior written approval, which shall not be unreasonably withheld or delayed.

(d) Each party shall be solely responsible for the costs of filing, prosecution
and maintenance of patents and patent applications on its own Intellectual
Property.

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ARTICLE 13  

DISPUTE RESOLUTION

13.1 Escalation.  The parties shall try to resolve any dispute arising out of or
in connection with this Agreement other than a dispute determined in accordance
with Section ‎6.1(b) (a “Dispute”) amicably between themselves before resorting
to any formal dispute resolution proceeding.  To this end, either party may send
a notice of Dispute to the other, whereupon each party shall appoint, within ten
(10) Business Days, a single, senior representative having full power and
authority to resolve the Dispute (a “Facilitator”).  The Facilitators shall meet
and discuss as necessary to try to resolve the Dispute as quickly as
practicable.

13.2 Technical Disputes.  Where a Dispute relates exclusively to technical
aspects of the Manufacturing Services or related activities under this Agreement
(a “Technical Dispute”), the Facilitators shall be competent to address the
technical nature of the issues in question.  If, despite their reasonable
efforts, the Facilitators have not resolved the Technical Dispute within a
reasonable period of time given the nature of the issue, but in any event within
thirty (30) Business Days of the date of the Dispute notice, the Technical
Dispute shall, at the request of either party, be referred for determination to
an expert in accordance with Schedule E.  If the parties cannot agree whether a
dispute is a Technical Dispute, Section ‎13.3 shall govern.  For the avoidance
of doubt, nothing in this Agreement (including Schedule E) is intended to or
shall remove or limit the authority of the relevant qualified person (as
specified by the Quality Agreement) to determine whether any Finished Goods are
to be released for sale or distribution.

13.3 Commercial Disputes.  If a party fails to timely appoint a Facilitator or
if, despite their reasonable efforts, the Facilitators have not resolved a
Dispute (other than a Technical Dispute) within one (1) month from the date of
the Dispute notice, the Dispute shall immediately be referred to the President
of each party (or such other officer as he/she may designate), who will meet and
discuss as necessary to try to resolve the Dispute.  Should such officers fail
to resolve the Dispute, either party may resort to a court of competent
jurisdiction or any other method of binding dispute resolution on which the
parties may agree.    

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ARTICLE 14  

MISCELLANEOUS

14.1 Force Majeure.  Neither party shall be liable for the failure to perform
its obligations under this Agreement if such failure is occasioned by a cause or
contingency beyond such party's reasonable control, including strikes or other
labor disturbances, lockouts, riots, quarantines, communicable disease
outbreaks, wars, acts of terrorism, fires, floods, storms, interruption of or
delay in transportation, lack of or inability to obtain fuel, power or
components or compliance with any order or regulation of any Authority acting
within color of right (a “Force Majeure Event”).  A party claiming a right to
excused performance under this Section ‎14.1 shall immediately notify the other
party in writing of the extent of its inability to perform, which notice shall
specify the Force Majeure Event.  If the performance of any obligation under
this Agreement is delayed owing to a Force Majeure Event for any continuous
period of more than ninety (90) days, the other party may terminate this
Agreement without penalty upon written notice to the party unable to
perform.  Neither party shall be entitled to rely on a Force Majeure Event to
relieve it from an obligation to pay money (including any interest for delayed
payment) that would otherwise be due and payable under this Agreement.

14.2 Additional Products and Expanded Territory.  Additional products and
countries may be added to this Agreement upon the parties written agreement, and
such additional products and countries shall be governed by the general
conditions hereof.  The parties shall amend or supplement this Agreement
(including the Schedules) as necessary to reflect their agreement with respect
to product-specific or country-specific terms, including Price and Territory.

14.3 Right to Dispose and Settle.  If Halo requests in writing Client’s
direction with respect to disposal of any Inventory, Active Material, equipment,
Records, samples or other items belonging to Client and is unable to obtain a
response from Client within a reasonable time period after making reasonable
efforts to do so, Halo shall have the right to dispose of such items at Client’s
expense (which may be by set off against any credit on Client’s account).

14.4 Notices.  Any notice, approval, instruction or other written communication
required or permitted hereunder shall be sufficient if made or given to the
other party by personal delivery, by facsimile communication, by delivery via
nationally recognized overnight courier service, by first class mail postage
prepaid, or by PDF attachment to an email or similar electronic transmission to
the mailing address, facsimile number or email address set forth below:

If to Client:

Depomed, Inc.

7999 Gateway Blvd., Suite 300

Newark, California  94560 USA

Attention:  Legal Department

Facsimile No.: (510) 744-8001

If to Halo:

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Halo Pharmaceutical, Inc.
30 North Jefferson Road

Whippany NJ 07981 USA

Attention: Chief Executive Officer

Facsimile No.: (973) 428 4254

or to such other contact information provided to the other party in accordance
with the terms of this Section ‎14.4.  Notices or written communications made or
given by personal delivery, overnight courier service, facsimile or email shall
be deemed to have been sufficiently made or given when sent (receipt
acknowledged), or if mailed, five (5) days after being deposited in the United
States or Canadian mail, postage prepaid or upon receipt, whichever is sooner.

14.5 Assignment.  This Agreement will be binding upon and inure to the benefit
of the parties, their successors and permitted assigns.  Neither party may
assign any of its rights or delegate any of its obligations under this
Agreement, in whole or in part, except with the other party’s prior written
consent.  If a party desires to assign this Agreement, it shall give written
notice to the other party with sufficient detail to enable the other party to
properly consider the matter, and any assignee reasonably acceptable to the
other party shall be required to covenant in writing with such party to be bound
by the terms of this Agreement.  In the event a party consents to the delegation
of any of the other party’s obligations under this Agreement, the delegating
party shall remain responsible for any breach of this Agreement by any such
delegee.  Notwithstanding the foregoing, either party may assign this Agreement
in its entirety without the other party’s consent, but subject to prior written
notice, to any of its Affiliates or to a successor to or purchaser of all or
substantially all of the business or assets of the assigning party or the
assigning party’s business unit responsible for performance under this
Agreement.  Any purported assignment in violation of this Section 14.5 shall be
null and void and of no effect.

14.6 Construction.  

(a) Independent Contractors.  The parties are independent contractors to one
another and this Agreement shall not be construed to create between Halo and
Client any other relationship such as, by way of example only, that of
employer-employee, principal-agent, joint-venturers, partners or any similar
relationship, the existence of which is expressly denied by the parties. Neither
party will have the authority to make any statements, representations or
commitments of any kind, or to take any action, which will be binding (or
purport to be binding) on the other party.

(b) No Third Party Benefit or Right.  Nothing in this Agreement shall confer or
be construed as conferring on any Third Party any benefit or the right to
enforce any express or implied term of this Agreement.

(c) Entire Agreement.  This Agreement, together with the Quality Agreement and
the Confidentiality Agreement, constitutes the full, complete, final and
integrated agreement between the parties relating to the subject matter hereof
and supersedes all previous written or oral negotiations, commitments,
agreements, transactions or understandings with respect to the subject matter
hereof. 

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(d) Other Terms.  In case of a conflict amongst agreements referenced herein not
specifically addressed elsewhere in this Agreement, the prevailing order of
documents shall be this Agreement, the Quality Agreement and the Confidentiality
Agreement,  provided, however, that in the event of a conflict between the terms
of the Quality Agreement and the terms of this Agreement, the terms of this
Agreement shall prevail, except with respect to quality issues, which shall be
governed by the Quality Agreement.  No terms, provisions or conditions of any
purchase order, quote, proposal, invoice, or other business form or written
authorization used by Client or Halo will have any effect on the rights, duties
or obligations of the parties under, or otherwise modify, this Agreement,
regardless of any failure of Client or Halo to object to such terms, provisions,
or conditions, except to the extent such document specifically refers to this
Agreement, sets forth an express intent to override it, and is signed by both
parties.

(e) Amendments.  Any modification, amendment or supplement to this Agreement
must be in writing and signed by authorized representatives of both parties to
be effective, except to the extent otherwise expressly provided in this
Agreement.

(f) Waivers. Either party’s failure to require the other party to comply with
any provision of this Agreement shall not be deemed a waiver of such provision
or any other provision of this Agreement.  

(g) Severability.  If any provision of this Agreement is determined by a court
of competent jurisdiction to be invalid, illegal or unenforceable in any
respect, such determination shall not impair or affect the validity, legality or
enforceability of the remaining provisions hereof, and each provision is hereby
declared to be separate, severable and distinct.

(h) Drafting Party.  The language in this Agreement is to be construed in all
cases according to its fair meaning. Halo and Client 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, are not to be employed in the interpretation of this Agreement.

(i) Divisions.  The division of this Agreement into Articles, sections,
subsections and Schedules and the insertion of headings are for convenience of
reference only and shall not affect the interpretation of this
Agreement.  Unless otherwise indicated, any reference in this Agreement to a
Section or Schedule refers to the specified Section or Schedule to this
Agreement.  In this Agreement, the terms “this Agreement”, “hereof”, “herein”,
“hereunder” and similar expressions refer to this Agreement as a whole
(including any Schedules hereto) and not to any particular part, Section,
Schedule or the provision hereof.

(j) Certain Terms.  Whenever used in this Agreement, unless otherwise
specified:  (i) all monetary amounts are expressed in, and all references to “$”
or “Dollars” mean, the lawful currency of the United States of America; (ii) the
word “include” (with its grammatical variations) mean “include, without
limitation,” “include but are not limited to”, or words of similar import; (iii)
the words “agree” or “written agreement” will not impose any obligation on
either party to agree to any terms or to engage in discussions relating to such
terms, except as such party may

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elect in such party’s sole discretion; (iv) the word “Client” includes its
Affiliates whenever the context requires or to the extent applicable; (v) the
word “days” means calendar days; (vi) the words “copy” and “copies” include, to
the extent available, electronic copies, files or databases containing the
information, files, items, documents or materials to which such words apply;
(vii) the words “shall” and “will” have the same meaning and are used
interchangeably; and (viii) all references to the singular shall include the
plural and vice versa.

(k) Schedules.  The following Schedules are attached to, incorporated in and
form part of this Agreement:

Schedule A-Finished Goods List, Price & Manufacturing Services Fees

Attachment:  Preliminary Product Specifications

Schedule B-Active Material, Active Material Cost & Maximum Credit Value

Schedule C-Form of Active Material Inventory Report

Schedule D-Form of Annual Reconciliation Report

Schedule E-Technical Dispute Resolution

Schedule F-Quality Agreement

Schedule G-Form of Exclusive Components Purchasing Summary

Schedule HList of Territories

14.7 Governing Law.  This Agreement shall be construed and enforced in
accordance with the laws of the State of New York and the laws of the United
States applicable therein.  The UN Convention on Contracts for the International
Sale of Goods shall not apply to this Agreement. 

14.8 Further Assurances.  The parties agree to execute, acknowledge and deliver
such further instruments and to take all such other incidental acts as may be
reasonably necessary or appropriate to carry out the purpose and intent of this
Agreement.

14.9 Execution in Counterparts.  This Agreement may be executed in two
counterparts, by original or facsimile signature, each of which shall be deemed
an original, but all of which together shall constitute one and the same
instrument.

 

Signature page follows

 

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IN WITNESS WHEREOF, the duly authorized representatives of the parties have
executed this Agreement as of the Effective Date.

HALO PHARMACEUTICAL, INC.

by  /s/ L. Lee
Karras___________________________________________________________________________

Name: L. Lee
Karras___________________________________________________________________________

Title: Chief Executive
Officer_________________________________________________________________ 

 

DEPOMED, INC.

by /s/ Arthur
Higgins___________________________________________________________________________

Name: Arthur
Higgins_________________________________________________________________________

Title:
CEO___________________________________________________________________________________ 

 

 

Signature Page to Drug Product Manufacturing Services Agreement

 

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SCHEDULE A

Finished goods LisT, Price & manufacturing services FEES

Nucynta IR Tablets, Commercial Unit Pricing 1

Unit Description

Batch Size

(Kg)

Theoretical Qty

Per Batch (Tablets)

Theoretical Qty

Per Batch (Bottles)

Material Cost (excluding Active Materials)

per bottle

(USD)

Conversion Price

per bottle

(USD)

Full Service Price

(excluding Active Materials)

per bottle

(USD)

Nucynta IR Tablets,

50 mg strength,

100’s bottles,

250

[***]

[***]

[***]

[***]

[***]

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*Nucynta IR Tablets,

50 mg strength,

100’s bottles

125

[***]

[***]

[***]

[***]

[***]

Nucynta IR Tablets,

75 mg strength,

100’s bottles,

250

[***]

[***]

[***]

[***]

[***]

*Nucynta IR Tablets,

75 mg strength,

100’s bottles

125

[***]

[***]

[***]

[***]

[***]

Nucynta IR Tablets,

100 mg strength,

100’s bottles,

250

[***]

[***]

[***]

[***]

[***]

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*Nucynta IR Tablets,

100 mg strength,

100’s bottles

125

[***]

[***]

[***]

[***]

[***]

 

*Batches split into two strengths at the granulation stage will incur an
additional [***] surcharge on each split sublot unit price.  A batch may only be
split once.

1 Finished Good Price includes:  As per Agreement (e.g., costs of manufacturing,
testing, QA release, excipients and packaging materials, packaging of Products
as Finished Goods, etc.) 

  Finished Good Price excludes:  As per Agreement (e.g., costs of Active
Materials, Consumables, post marketing stability testing, artwork development
and other costs, obsolescence of materials, new vendor audit, etc.)

 

Additional Fees

Description

Price (USD)

Annual product review (APR)

[***]

Audit fees for Canada/US materials suppliers

[***]

On-going commercial stability fees, price per pull point

[***]

 

** Travel, accommodations and meal expense are in addition to the Audit fees
listed.

 

(see attached preliminary Product Specifications)

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SCHEDULE B

ACTIVE MATERIAL, ACTIVE MATERIAL COST
& MAXIMUM CREDIT VALUE

Product

Active Material

Controlled Substance?

Vendor

Active Material Cost

Maximum Credit Value1

Nucynta IR Tablets (product family)

Tapentadol HCl

Yes

Noramco

[***]

[***]

Additional Products may be added per Section ‎14.2 of the Agreement

--

--

--

--

--

 

1Halo's liability for Active Material in a given Year shall not exceed this
amount in the aggregate for all Active Material indicated.

 

 

 

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SCHEDULE C

FORM OF ACTIVE MATERIAL INVENTORY REPORT

TO:DEPOMED, INC.

 

FROM:HALO PHARMACEUTICAL, INC.

 

RE: Active Material Inventory Report

 

This report is provided pursuant to Section ‎2.3(a) of the Drug Product
Manufacturing Services Agreement dated as of June 6, 2017 (the
“Agreement”).  Capitalized terms used in this report have the meanings given to
such terms in the Agreement. 

 

Active Material:

Tapentadol HCl

 

 

Reporting period (month or quarter):

 

 

 

 

 

 

 

Active Material on hand at beginning of period:

 

kg

(A)

Active Material on hand at end of period:

 

kg

(B)

Quantity Received during period:

 

kg

(C)

Quantity used in sample: 1

 

kg

(D)

Quantity Dispensed during period:

 

kg

(A + C – B – D)

Quantity Converted during period 2

 

kg

 

 

1 Includes any (i) Active Material that must be retained by Halo as samples and
stability, (ii) Active Material contained in Product that must be retained as
samples, (iii) Active Material used in connection with testing (if applicable)
and (iv) Active Material received or consumed in connection with technical
transfer activities or development activities, including any regulatory,
stability, validation or test batches manufactured during the reporting period.

 

2 Reflects total Active Material in Products produced and not rejected, Recalled
or returned.

 

 

DATE:

 

 

 

Signed:

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Name:

Title:

 

 

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SCHEDULE D

FORM OF ANNUAL RECONCILIATION REPORT

TO:DEPOMED, INC.

 

FROM:HALO PHARMACEUTICAL, INC.

 

RE: Active Material Annual Reconciliation Report

 

This report is provided pursuant to Section ‎2.3(c) of the Drug Product
Manufacturing Services Agreement dated as of June 6, 2017 (the
“Agreement”).  Capitalized terms used in this report have the meanings given to
such terms in the Agreement. 

 

Active Material:

Tapentadol HCl

 

 

Reporting Year:

 

 

 

 

 

 

 

Quantity Dispensed during Year:

 

kg

(A)

Quantity Converted during Year:

 

kg

(B)

Active Material Cost:

 

$/kg

(C)

Target Yield:

 

%

(D)

Actual Annual Yield:                    (( B ∕ A) * 100)

 

%

(E)

Shortfall:             ((((D – [***]) - E) ∕ 100) * C * A)

                               (if a negative number, insert zero)

 

$

(F)

Maximum Credit Value

 

$

(G)

 

Based on the foregoing calculation Halo will reimburse Client the LESSER OF
(F): $___________________ or (G): $_________________.

 

 

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DATE:

 

 

Signed:

Name:

Title:

 

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SCHEDULE E

technical dispute resolution

Any Technical Dispute that cannot be resolved by negotiation as provided in
Sections ‎13.1 and ‎13.2 shall be resolved in the following manner:

1. Appointment of Expert.  Within ten (10) Business Days after a party requests
pursuant to Section ‎13.2 that an expert be appointed to resolve a Technical
Dispute, the parties shall jointly appoint a mutually acceptable expert with
experience and expertise in the subject matter of the Technical Dispute.  If the
parties are unable to so agree within such ten (10) Business Day period, or in
the event of disclosure of a conflict by an expert pursuant to paragraph 2 below
which results in the parties not confirming the appointment of such expert, then
an expert (willing to act in that capacity hereunder) shall be appointed by an
experienced arbitrator on the roster of the American Arbitration Association.

2. Conflicts of Interest.  Any person appointed as an expert shall be entitled
to act and continue to act as such notwithstanding that at the time of such
appointment or at any time before giving a determination, the expert has or may
have some interest or duty that conflicts or may conflict with the appointment;
provided, that before accepting such appointment (or as soon as practicable
after becoming aware of the conflict or potential conflict) the individual fully
discloses any such interest or duty and the parties after such disclosure shall
have nevertheless confirmed or re-confirmed the appointment.

3. Not Arbitrator.  No expert shall be deemed to be an arbitrator and the
provisions of the American Arbitration Act and no Applicable Laws (including the
American Arbitration Act) shall apply to any such expert or the expert’s
determination or the procedure by which the expert reaches a determination to be
made pursuant to this Schedule.

4. Procedure.  Where an expert is appointed:

(a) Timing.  The expert shall be so appointed on condition that (i) the expert
promptly fixes a reasonable time and place for receiving representations,
submissions or information from the parties and issues such authorizations to
the parties and any relevant Third Party for the proper conduct of a
determination and any hearing and (ii) the expert renders a decision (with full
reasons) within fifteen (15) Business Days (or such other date as the parties
and the expert may agree) after receipt of all information requested by the
expert pursuant to paragraph 4(b) hereof.

(b) Disclosure of Evidence.  The parties undertake to provide to the expert all
such evidence and information within their respective possession or control as
the expert may

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

 

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reasonably consider necessary for determining the Technical Dispute, which they
shall disclose promptly and in any event within five (5) Business Days of a
written request from the expert.

(c) Advisors.  Each party may appoint such counsel, consultants and advisors as
it feels appropriate to assist the expert in making a determination and so as to
present their respective cases so that at all times the parties shall co-operate
and seek to narrow and limit the issues to be determined.

(d) Appointment of New Expert.  If within the time specified in paragraph 4(a)
above the expert shall not have rendered a decision in accordance with the
appointment, a new expert may (at the request of either party) be appointed and
the appointment of the existing expert shall thereupon cease for the purposes of
determining the Technical Dispute, save that if the existing expert renders a
decision with full reasons prior to the appointment of the new expert, then such
a decision shall have effect and the proposed appointment of the new expert
shall be withdrawn.

(e) Final and Binding.  The determination of the expert shall, save in the event
of fraud or manifest error, be final and binding upon the parties.

(f) Costs.  Each party shall bear its own costs in connection with any Technical
Dispute to an expert hereunder and, in the absence of express provision in the
Agreement to the contrary, the costs and expenses of the expert shall be shared
equally by the parties.

 

For the avoidance of doubt, nothing in this Schedule is intended to or shall
remove or limit
the authority of the relevant qualified person (as specified by the Quality
Agreement)
to determine whether any Finished Good is to be released for sale or
distribution.

 

 

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

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SCHEDULE F

quality agreement

(See Attached)

 

 

 

 

 

 

Confidential Information indicated by [***] has been omitted from this filing
and filed separately with the Securities Exchange Commission.

 

 

--------------------------------------------------------------------------------

 

 

QUALITY AGREEMENT

 

 

 

 

 

 

 

BY AND BETWEEN

 

DEPOMED, INC

Contract Giver

 

7999 Gateway Blvd., Suite 300

Newark, CA 94560

 

AND

HALO PHARMACEUTICAL, INC

Contract Receiver

 

30 North Jefferson Road

Whippany, NJ 07981

 

 

 

 

 

 

 

 

 

 

 

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TABLE OF CONTENTS

 

1.

PURPOSE and SCOPE …………………………….…………….…………. 1

2.

Article 1 - DEFINITIONS and ACRONYMS …………..….…….……….… 3

3.

Article 2 -  QUALITY REQUIREMENTS …………………………………  5

4.

Article 3 -  MANUFACTURE ……………………….………………………6            

5.

Article 4 -  AGENCY REGULATIONS …….…………………………….…8

6.

Article 5 -  QUALITY ASSURANCE…….…….……………………………8

7.

Article 6 - STORAGE and SHIPPING…….…….…………..……………….12

8.

Article 7 - TERMINATION…….…….………………………..…………….13

9.

Article 8 - COMPLIANCE RESPONSIBILITIES…….…..……...………….13

10.

Article 9 -  MISCELLANEOUS…….…….………………………………….18

11.

APPROVALS …….…….…………………...……………………………….20

12.

APPENDICES

       Appendix A - Halo and Depomed Contacts and Responsible Persons………..21

       Appendix B - Product List…………………………………………………....22

       Appendix C - Halo Approved Contract Laboratories………………………....23

       Appendix D - Vendors – API and Excipients………………………………....24

 

           

 

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PURPOSE and SCOPE

 

This Quality Agreement ("Agreement"), is effective as of the date of the last
signature below, ("Effective Date"), by and between Halo Pharmaceutical, Inc.,
having its principal place of business at 30 North Jefferson Road, Whippany, NJ
07981, the Contract Receiver, hereinafter referred to as Halo and Depomed Inc.,
having its principal place of business at 7999 Gateway Blvd., Suite 300, Newark,
CA 94560, the Contract Giver, hereinafter referred to as Depomed. 

 

WHEREAS, the parties desire to allocate between themselves the responsibility
for procedures impacting the identity, strength, quality and purity of the
Product, a schedule II controlled substance product to be manufactured at Halo.

 

The purpose of this agreement (“Quality Agreement”) is to ensure a mutual
understanding and documentation of key responsibilities between Halo and Depomed
relating to the following:

-

Production, testing, packaging, storage, product release and shipping of Depomed
Products listed in Appendix B according to agreed manufacturing and release
specifications (combination regulatory and internal).

-

Compliance with all relevant agency regulations, Company policies and
procedures, and Marketing Authorizations.

 

This agreement applies to the manufacture and release testing of Nucynta® IR
(Immediate Release) Tablets 50mg, 75mg and 100mg. In addition, this agreement
only applies to the packaging of Nucynta® ER (Extended Release) Tablets for
50mg, 100mg, 150mg, 200mg and 250mg. The Contact list for both Halo and Depomed
is listed in Appendix A.

 

NOW, therefore, the parties intending to be legally bound, hereby agree as
follows:

 

 

ARTICLE 1 – DEFINITIONS and ACRONYMS 

 

1.1

Affiliate or Affiliates – shall mean, with respect to any party, any entity,
directly or indirectly, controlling, controlled by or under common control with
such party, for only so long as such control exists.

 

1.2

ANDA – shall mean an Abbreviated New Drug Application (“ANDA”) for a United
States generic drug approval for an existing licensed medication or approved
drug.

 

1.3

cGMP – means the current Good Manufacturing Practices of all applicable health
authorities (including Regulatory Authorities), including all applicable rules,
regulations, guides, and guidance, including 21 CFR parts 11, 210, and 211 and
International Conference on Harmonization (ICH) guidance documents.  

 

 

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1.4

Field Alert – shall mean any incident that causes the Product or its labeling to
be mistaken for or applied to another article, bacterial contamination, a
significant chemical, physical, or other change, deterioration in the
distributed Product, and failure of one or more distributed batches of the
Product to meet the specifications established in its application.  The Field
Alert report is filed with the United States FDA by pharmaceutical companies.  
 

 

1.5

Marketing Authorization (“MA”) – shall mean an official document issued by the
competent drug regulatory authority for the purpose of marketing or free
distribution of a Product after evaluation for safety, efficacy and
quality.  Marketing Authorization may occasionally also be referred to as a
license or Product license.

 

1.6

NDA – shall mean a New Drug Application (“NDA”) submitted by the manufacturer of
a drug to the United States FDA, after clinical trials have been completed for a
license to market the drug for a specified indication.

 

1.7

OOS – shall mean an Out of Specification test result that, after an initial
investigation to determine whether there has been a clear obvious error due to
external circumstances does not comply with the predetermined acceptance
criteria or has fallen outside of established acceptance criteria which have
been established in official compendia and/or by company documentation.

 

1.8

Product – shall mean the Product or Products described in Appendix B of this
Agreement. 

 

1.9

Quality Complaint Classifications – Critical and Major Quality Defects (for
example, but not limited to):

 

Critical – These are quality defects which are potentially life threatening or
could cause serious risk to health.  For example, but not limited to: Wrong
Product (label and contents are different Products); Correct Product but wrong
strength, with serious medical consequences; Microbial, physical or chemical
contamination, with serious medical consequences; Mix up of Products (‘rogues’)
within a pack (for example, two different blister strips within one carton or
two different tablets within the one blister strip); Wrong active pharmaceutical
ingredient in a multi-component Product with serious medical consequences; or
Non-compliance with specifications (for example,  assay, stability,
fill/weight).

 

Major – These are quality defects, which could cause illness or mistreatment but
not a life threatening extent. For example, but not limited to:  Mislabeling –
wrong or missing text or figures; Missing or incorrect information – leaflets or
inserts; Microbial, physical or chemical contamination, with medical
consequences; Mix up of Products (‘rogues’), (for example, a case of Product A
contains one or more of Product B); or Insecure closure

 

--------------------------------------------------------------------------------

 

with serious medical consequences (for example, child-resistant containers,
potent Product, sterile Product).

 

1.10

Recall – shall apply to all Field Actions such as Product recall, market
withdrawal, stock recovery, corrections, safety alert and press release.

 

1.11

Regulatory Authority – shall mean a public authority or government agency
responsible for exercising autonomous authority over some area of human activity
in a regulatory or supervisory capacity.

 

1.12

Reprocessing – shall mean subjecting all or part of a batch or lot of finished
dosage form (at any stage) of Manufacturing to a previous step or repeat of same
step as per the validated process due to a failure to meet predetermined
specifications.  This does not include resorting for visual defects and
repackaging.

 

1.13

Reworking – shall mean subjecting an in-process drug, a bulk process
intermediate or final Product of a single batch/lot to an alternate
manufacturing process due to a failure to meet predetermined specifications.
This does not include resorting for visual defects and repackaging.

 

1.14

Significant change – shall mean a change that could potentially cause the
Product to fail to meet its specification or acceptance criteria.

 

1.15

Specifications – shall mean specifications for tests, procedures and acceptance
criteria set forth in the applicable ANDA/NDA, dossier or Marketing
Authorization.

 

1.16

Subcontractor – shall mean a person or business, which has a contract with Halo
to provide some portion of the work or services related to the manufacture of a
Product, which Halo is obliged to perform under this Agreement.

 

1.17

Third Party – shall mean any party other than Halo or Depomed or their
respective Affiliates.

 

1.18

DEA – shall mean an abbreviation for Drug Enforcement Administration.

 

1.19

Schedule II – shall mean any compound controlled by DEA and referenced in Title
21 Code of Federal Regulations, Part 1308.12, Schedule II.

 

1.20

Significant Deviation – shall mean a change that could potentially cause the
Product to fail to meet product registration and GMP requirements. This would
also be categorized as a critical or major deviation.

 

1.21

API – shall mean active pharmaceutical ingredient, Tapentadol HCL, which is a
schedule II compound requiring unique controls as specified by DEA. 

 

 

 

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ARTICLE 2 - QUALITY REQUIREMENTS 

 

2.1

  A list of contact information for both parties is set forth in Appendix A
attached hereto.

 

2.2

  This Agreement defines the operating procedures to be followed when Products
are manufactured, packaged, tested, released or held by Halo for Depomed in
order to ensure compliance with current Good Manufacturing Practices ("GMP") and
other applicable regulatory requirements. This document must be executed prior
to any GMP processing of product by Halo for Depomed.

 

2.3

  The obligations set forth in this Agreement shall apply to Halo with respect
to Products manufactured, packaged, tested, released or held by Halo or by an
Affiliate of Halo.

 

2.4

  The Marketing Authorization Holder or Product License holder for the Product
is Depomed and is responsible for maintaining the Marketing
Authorization/license in a state of compliance. Review of the Marketing
Authorization or Product License variations, per the Product Quality Review,
will be the responsibility of Depomed.

 

2.5

  Raw materials supplied by qualified vendors and those supplied by Depomed may
be subject to reduced testing, as per Halo’s Vendor Management Program. Halo
will

inform and acquire Depomed’s approval before performing reduced testing on API.

 

2.6

  Halo to notify Depomed of any changes in qualified supply or manufacturing
locations for excipients and/or packaging components. 

 

2.7

  Halo must have adequate facilities and equipment, knowledge and experience,
and competent personnel to carry out satisfactorily the work required by the
Depomed set forth in this Agreement.

 

2.8

  Depomed will provide Halo with all the information necessary to carry out the
contracted operations correctly in accordance with the NDA, ANDA, dossier and/or
MA and any other legal requirements.

 

2.9

  Halo’s personnel shall receive initial and continuing training relevant to
their tasks, based on written standard operating procedures (SOPs) and in
accordance with a written training program.

 

2.10

Halo shall keep a record of all training, and the practical effectiveness of
training shall be periodically assessed and documented.

 

ARTICLE 3 – MANUFACTURE

 

3.1Premises

 

3.1.1Halo will not use an alternate site for, or transfer at a later date any of
the manufacturing, packaging, processing, or holding operations for any of the

 

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Products it supplies to Depomed without the prior written approval by Depomed.
Such approval of any new manufacturing, packaging, processing, or holding
operations shall not be unreasonably withheld. Approved contract testing
laboratories are shown in Appendix C.

 

3.1.2The premises and equipment that Halo uses for manufacturing, packaging,
processing, testing, or holding must be in compliance with current GMPs and
applicable regulatory requirements.

 

3.1.3Halo warrants that it does not handle specified risk materials, hazardous
or potentially hazardous materials such as certain cytotoxics, certain
antibiotics (i.e. penicillins, cephalosporins and other beta-lactams), certain
hormones (i.e. estrogens, androgens), certain highly active drugs, certain
teratogen or genotoxic compounds, non-medicinal products (i.e. herbicides,
pesticides) in the same building or buildings where the manufacturing of the
Products takes place.

           Further, Depomed must continue to keep Halo notified of any updated
information that may change the toxicological categorization of the API(s) for
the Product and will provide revised Safety Data Sheets (SDS).  

 

3.1.4Depomed personnel shall have the right to be present on the premises, with
prior approval, during the manufacturing, packaging, processing, testing and/or
holding/ release of the Product at Halo.

 

3.1.5   Halo shall ensure there are adequate controls and routine monitoring to
prevent microbiological and particulate contamination for compressed air, and
other gases piped into the facilities which may have contact to the equipment
and product itself.

 

3.1.6  Halo shall ensure prevention of cross-contamination in the sampling
areas, dispensing and Product manufacturing areas.

 

3.1.7    Halo shall ensure that there is adequate pest control and monitoring
program.

 

3.2Equipment

 

              3.2.1Halo shall only use appropriately designed and qualified
facilities, utilities and equipment, computer systems, calibration and
maintenance systems, water systems, and adequate environmental controls for the
manufacture and testing of the product.

 

 3.2.2     If agreed to, Halo shall ensure product related
qualification/validation activities are executed through a Validation Master
Plan (VMP).  Halo will provide validation status reviews and complete
qualification/validation as necessary.

 

3.3Qualification and Validation

 

 

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               3.3.1     Halo shall ensure that product related
manufacturing/process equipment, analytical equipment, computer systems with
quality impact, and other testing, measuring, calibrating equipment are
qualified before use, and results are documented.

 

3.2.2     Halo shall qualify and routinely monitor systems with quality impact
such as air handling, water system, compressed air and gas supply.

 

3.3.3    Halo shall ensure that all product related instruments are identified
and calibrated on a frequent basis using recognized National or International
standards. If external calibration agencies/contractors are employed, Halo shall
ensure that personnel involved are trained prior to performing the task.

 

3.3.4     Halo shall qualify and routinely monitor product manufacturing area
and packaging environment for particulate matter, microbial counts. Product
related cleaning processes shall be validated/verified for common equipment, but
may be verified for product contact surfaces of equipment dedicated to
Tapentadol manufacturing, based on Halo’s procedures.

 

ARTICLE 4 – AGENCY REGULATIONS

 

4.1Regulations

 

4.1.1The GMP regulations to be applied are as follows:

 

The United States Food and Drug Administration’s (“FDA”) GMPs listed in Title 21
Code of Federal Regulations ("C.F.R.") Parts 210 and 211 and associated
Compliance Guidance’s.

 

The United States Drug Enforcement Administration – Title 21 United States Code
Controlled Substance Act.

4.1.2International Conference on Harmonization of Technical Requirements for
Registration of Pharmaceuticals for Human Use (“ICH”) guidelines shall be used
for stability programs unless otherwise provided by Depomed.

 

 

ARTICLE 5 - QUALITY ASSURANCE

 

5.1Product(s) Refusal

 

5.1.1Product that fails to meet the Specifications and registration criteria for
Product release will be rejected after appropriate investigation.  Written
notification will be supplied by Depomed to Halo detailing the reason(s) for the
refusal of the Product.

 

5.1.2Disputes with Respect to Rejection. After notification to Halo by Depomed
of receipt of a nonconforming shipment,

 

--------------------------------------------------------------------------------

 

 

            5.1.2.1   Halo shall be permitted to analyze any Product rejected
for nonconformity to the Specifications and to present its findings to Depomed.
If Halo disputes Depomed’s rejections of all or part of any shipment of the
Product, and any dispute is not resolved by mutual agreement between the parties
within sixty (60) days of Depomed’s mailing of or sending by e-mail the written
notice of rejection to the appropriated responsible person or persons set forth
in Appendix A, then

 

            5.1.2.2      Such dispute shall be resolved by an independent
testing organization approved and licensed by the appropriate regulator or
consultant of recognized repute that is mutually agreed by both parties in
writing before expiry of sixty (60) days. 

 

            5.1.2.3     The determination of such testing entity with respect to
all or part of any shipment of Product shall be final and binding upon the
parties.  The fees and expenses of the third party making the determination
shall be paid by the party against which the determination is made.  If such
determination is not made, the parties shall discuss allocation of fees in good
faith. 

 

5.2Regulatory Inspection

 

5.2.1Halo will inform Depomed within one (1) business day of any Regulatory
Inspection that relates to the manufacturing, packaging, processing, testing,
and/or holding of the Product manufactured by Halo and supplied to Depomed.  If
the regulatory inspection is specific to Nucynta, Depomed representatives can be
on-site at Halo. They will not participate directly in the inspection.

 

5.2.1.1   A copy of any reports, summary or notices issued by a Regulatory
Authority that relate to the Product only, shall be provided to Depomed.

 

5.2.1.2   Halo shall be responsible for responding to the inspection and shall
provide Depomed with a copy of submitted responses.

 

5.2.1.3   Halo will consult with Depomed regarding any proposed corrective and
preventative actions ("CAPA") that may affect the Products and reach a mutual
agreement regarding regulatory responses prior to Halo’s submission of the
responses to the Regulatory Authority, if time permits.

 

5.2.1.4   Halo will have final say over any responses submitted to any
regulatory observation given to Halo by any regulatory agency.   

 

5.2.2Halo will inform Depomed within one (1) business day when an incident
occurs which may require notification to the applicable Regulatory Authorities.

 

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5.2.3Subcontracting shall not release Halo from its responsibility for its
obligations under this Agreement.

 

5.3Market actions such as:    Recalls and Field Alerts

 

5.3.1Whenever a field action, such as a Field Alert and/or Recall of a Product
is being contemplated by either party for any reason, the party contemplating
such action shall, without prejudice to its obligations under the law and prior
to any notification to the Regulatory Authorities, and, except as may be
otherwise provided herein, prior to any unilateral action and/or communication,
consult with the other party to enable it to participate in deciding the
appropriate actions to be taken during the implementation of such field action,
provided that;

 

            5.3.1.1   Depomed shall have the final decision-making authority as
to the field action.  However, nothing stated herein shall prevent, constrain or
delay any unilateral action which either party, in its sole discretion,
reasonably deems to be necessary to protect the public, comply with the law or
to protect its business interests or reputation, provided that;

 

           5.3.1.2  No such action will be taken without reasonable prior
written notice by mail or e-mail to the applicable responsible person or persons
at Depomed as set forth in Appendix A. 

 

5.3.2   Depomed shall manage and control the return of all recalled finished
drug Products, including routine communications with Regulatory Authorities for
Recalls stemming from an issue within Halo’s control.

 

5.3.3   Halo shall use all reasonable efforts to assist with the Recall
regarding Nucynta®  IR, as requested and agreed upon. 

 

5.3.4    Halo shall only be responsible to assist with the Recall, as requested
and agreed upon regarding Nucynta®  ER for packaging and labeling only. 

 

5.4Reworking & Reprocessing

 

5.4.1Reworking or reprocessing must not be undertaken by Halo.

 

5.4.2   Re-inspection, resorting and repackaging activities shall require
Depomed approval and will require a protocol prior to proceeding with the
activity.  

 

5.5Sample and Waste Disposal

 

5.5.1Halo will ensure samples and Product related waste and rejected Products
are disposed of in a safe and controlled manner, in accordance with applicable
GMP guidelines and laws.

 

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5.6Anti – Counterfeit

 

5.6.1If Depomed or Halo becomes aware of suspicion of counterfeit, counterfeit
incidents or illegal handling with respect to Product(s), Depomed will inform
Halo immediately within one (1) business day, and Halo will inform Depomed
immediately within one (1) business day.

 

5.7Change Control

 

5.7.1Halo shall have a documented and effective change control system in place.
Halo shall receive prior approval by Depomed of any changes to the manufacturing
process, specifications (except for compendial excipients and compendial changes
with respect to excipients) and analytical methods, labeling and primary
packaging, and equipment, which may have an impact on the quality of the
Product(s), and/or on any regulatory applications / submissions related to the
Product(s).

 

5.7.2Depomed shall assess any change request received from Halo in a timely
manner, i.e., within five (5) business days. Unless there are justified reasons
to reject the change request, or regulatory implications why Depomed may not
want to pursue the proposed change, Depomed will not unreasonably withhold its
approval of the request.

 

5.8Deviation

 

5.8.1Halo shall inform Depomed of significant deviation/non-conformance related
to product manufacturing, in-process testing, inspection, raw material (API)
within three (3) business days from discovery. 

 

5.8.2Halo shall inform Depomed regarding Out of Specification (OOS) related to
product testing or manufacturing within three (3) business days. Halo will
notify Depomed within three (3) business days from discovery of investigations
which are not critical and lab investigations (including incident/obvious lab
error). These types of lab investigations do not require Depomed approval.

 

5.8.3  Halo shall investigate, document and share the investigation report with
Depomed.

 

5.8.4  Depomed shall review and approve only the manufacturing/process final
investigation report but may request a copy of the corresponding
laboratory  report.

 

5.8.5Any investigations which require customer approval will be completed at
Halo within 30 calendar days (unless an extension is required). After receipt of
the investigation report, Depomed will review and approve the investigation. If
Halo

 

--------------------------------------------------------------------------------

 

has not received feedback within fifteen (15) calendar days, the investigation
will be considered closed.

 

5.9Annual Product Review

 

5.9.1Halo shall provide Depomed an Annual Product Review (APR) Report regarding
the quality profile review of the products listed in Appendix A. The Report
shall include the corrective action/s to be initiated based on the major quality
concerns reported.

 

5.9.2    Halo shall provide the APR Report to Depomed ninety (90) calendar days
after the anniversary date of U.S. approval of the application.. This report
will summarize the yearly Operations activities based on the anniversary date of
the US application approval (20 November).

 

5.10GMP Audit

 

           5.10.1    Halo and Depomed shall agree to a facility site compliance
audit with prior written notification given to assess manufacturing, packaging,
testing, validation, control systems or any other system or department that may
impact the Product(s).

 

           5.10.2    Halo agrees that an audit may be conducted annually or more
frequently if an event occurs that may affect the ability to supply the Product,
such as regulatory warnings, Product recall or significant critical Product
defects.

 

           5.10.3    Depomed agrees that the audit be limited to two auditors or
less, for two days or less, unless otherwise agreed and provide specific
findings in writing to Halo.

 

           5.10.4   Halo is to develop a corrective action plan within thirty
(30) calendar days of receipt of the audit findings and send this response to
Depomed. 

 

5.11Product Complaint

 

           5.11.1   Depomed shall handle all US markets and will coordinate all
customer related activities per Depomed procedures. ADE reporting is the sole
responsibility of Depomed.

 

           5.11.2    Depomed will submit an electronic request to Halo to
investigate manufacturing or packaging related complaints.

 

           5.11.3     Halo shall provide a final investigation report to Depomed
30 business days from date of the date of request.

 

5.12     Product Release

 

 

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           5.12.1   Halo shall review all relevant batch records and provide
finished product CoC and CoA to Depomed. Batch records will be retained at Halo.

 

           5.12.2    Halo shall ensure all deviations, change controls and
non-conformances related to a product lot are closed prior to release.

 

           5.12.3    Depomed shall review and approve significant
(critical/major) deviations.

 

           5.12.4   Halo shall provide Depomed finished product lot CoC and CoA
and copies of significant deviations related to the lot.

 

           5.12.5   Halo shall ship the product to the designated Depomed
distributor only upon receipt of the Finished Drug Product Disposition
Certificate from Depomed QA. Depomed releases product to the market.

 

5.12.6  Halo shall be responsible for Nucynta®  IR (Immediate Release)
manufacture,    packaging, labeling and release to Depomed.

 

5.12.7   Halo shall not be responsible for Nucynta®  ER (Extended Release) bulk
product manufacture but will be responsible for packaging, labeling and release
for shipment to Depomed’s distribution site.

 

 

ARTICLE 6 - STORAGE AND SHIPPING

 

6.1Halo must ensure that during manufacturing, packaging, processing, and
storage of the Product there is little possibility of deterioration,
contamination or mixing with any other materials and must comply with all
applicable GMP requirements in relation to required temperatures and conditions
for storage.

 

6.2Halo will also ensure Products are stored in appropriately safe and secure
areas, that adequate precautions are taken against spillage, breakage or theft
and that Products are not subjected to unacceptable levels of heat, cold, light,
moisture.

 

6.3Products must be stored and transported in accordance with GMPs, all of the
registered particulars and the Specifications, as specified by the Depomed.

 

6.4Product will only be shipped to facilities designated by Depomed.  Depomed
arranges shipment of product.

 

6.5Specific shipping and storage instructions may also be included in the
approved Proposal or similar document.

 

ARTICLE 7 - TERMINATION

 

 

--------------------------------------------------------------------------------

 

7.1This Agreement is valid for a period beginning on the Effective Date and
ending on the earlier of the termination or expiration of the Supply Agreement.
If a Supply Agreement does not exist, this Agreement will remain effective for
an unspecified period.  Either party may terminate this Agreement by giving
ninety-calendar days (90) written notice to the other party.

 

ARTICLE 8 - compliance RESPONSIBILITIES

Both parties agree to the following listed responsibilities for all the
operations that are marked with "X" in the respective column that bears its
name.

 

RESPONSIBILITIES

Depomed

Halo

10.1

 GENERAL

 

8.1.1

 

 

Manufacture, package, test, release and hold Product in accordance with the
applicable approved NDA and/or ANDA, MA or equivalent by reviewing all relevant
manufacturing and control information.

X

X

8.1.2

 

Maintain all licenses and authorizations as are required by applicable laws to
operate a GMP pharmaceutical facility. 

 

X

8.1.3

 

Provide information that Depomed is required by applicable laws to maintain or
to submit to regulatory agencies.

 

X

8.1.4

 

Do not subcontract any work or testing to a Third Party without prior written
approval of Depomed (which excludes calibration of instruments and maintenance
activity; and approved contract laboratories stated in Appendix C).

 

X

8.1.5

 

Develop cleaning validation program; perform cleaning validation/verification as
scheduled for Products.

 

X

8.1.6

Ensure that the heat treated wooden pallets used for storage and transport,
comply with ISPM 15. 

   

X  

8.1.7

 

Perform self-inspection and approval of facilities and quality systems as per
cGMP’s.

 

X

8.1.8

Keep GMP records of equipment usage, raw material batch numbers, in process
results, and previous product used in equipment if non-dedicated equipment is
used as per the specific regulatory requirements for the Products.

 

X

8.1.9

Obtain written approval from Depomed prior to implementation of any Significant
changes, which may affect the Product registration or GMP requirements.

   

X 

8.1.11

 

Initiate, manage and control Field Alerts, market withdrawals, and Product
Recalls.

X

 

8.1.12

Maintain original manufacturing, testing and/or packaging documentation and make
such documentations accessible to Depomed based on Halo’s procedures. Specific
Product documentation will be provided to Depomed upon request.

   

X 

 

--------------------------------------------------------------------------------

 

8.1.13

Use batch-numbering system based on Halo’s codes as per procedure.

 

X

8.1.14

 

Assign a date of manufacture for each batch of Product; i.e. when API is first
used in processing.

 

X

8.1.15

 

Assign an expiration date to final market packages according to the applicable
regulatory Product approval.

X

X

8.1.16

Provide data/information for the Annual Product Review (APR) for applicable
activities.

 

X

8.2.1

8.1.17

8.2.2

Assure compliance with regulatory filings (NDA and/or ANDA, MA or equivalent)
and compile any full report that will be submitted to those filings.

8.2.3

X

 

8.2.4

8.1.18

8.2.5

In charge of Product registration and regulatory change submission. Provide
registration details annually, or as changes are approved.

8.2.6

X  

 

8.2   MATERIALS

 

8.2.1

 

Use only materials which are within their shelf life / retest period.

 

X

8.2.2

 

Maintain a program to ensure supplied materials (excipients and primary
packaging material) meet Transmissible Spongiform Encephalopathy ("TSE")
requirements per EMEA/410/01.

 

X

 

API

 

8.2.3

 

Provide the registered API and Specifications.

X 

   

8.2.4

 

Provide registered test methods for API.

X 

   

8.2.5

 

Develop and validate test methods for API, if not available. Non-pharmacopeia
methods should have analytical method transfers from Depomed.

X

X  

8.2.6

 

Identify the API and manufacturers. Provide TSE documentation for the API.

X

 

8.2.7

 

Qualify and approve API and manufacturers. See Appendix D.

X  

   

8.2.8

 

Responsible for an API and manufacturer qualification/assessment program and for
supply chain traceability. Provide specific supplier and manufacturer
information to Halo including manufacturer, manufacturing site, and status of
manufacturer’s regulatory compliance. API C of A must state the manufacturer and
manufacturer’s site address.

X

 

8.2.9

 

Analyze and release API.

 

X

8.2.10

 

Document and investigate any failures during API release testing.

 

X

8.2.11

 

Retain API reference sample (minimum quantity equal to two (2) times required
amount for full testing) for one year past Product expiration.

 

X

 

EXCIPIENTS

 

8.2.12

 

Responsible for excipients manufacturer qualification/assessment program, as per
Halo procedures. Vendors are specified in Appendix D. 

 

X

 

--------------------------------------------------------------------------------

 

8.2.13

 

Changes to excipient vendors would require evaluation by both Halo and Depomed.
Halo will not audit new excipient suppliers as a result of this Quality
Agreement.

X

X

8.2.14

 

Provide specifications and test methods for excipient ingredients.

X

X 

8.2.15

 

Develop and validate test methods for excipient ingredients if not available.

   

X  

8.2.16

 

Provide validation protocols and reports, on request.

   

X  

8.2.17

 

Approval of all compendial changes to excipients

  

X

8.2.18

 

Procure excipient ingredients.

   

X  

8.2.19

 

Analyze and release excipient ingredients.

 

X

 

PACKAGING MATERIALS FOR FINISHED PRODUCT

 

8.2.20

 

Provide artwork and text specifications for all labeling materials.

X

 

8.2.21

 

Provide approved master for printed packaging materials.

X

 

8.2.22

 

Approve label masters and/or printing proofs prior to first use.

X

 

8.2.23

 

Develop incoming inspection criteria for label receipts.

 

X

8.2.24

 

Inspect and release label receipts.

 

X

8.2.25

 

Assess component manufacturers.

X

X

8.2.26

 

Provide specifications for all packaging materials.

X

 

8.2.27

 

Develop methods and inspection criteria for incoming packaging materials.

 

X

8.2.28

 

Procure packaging materials.

 

X

8.2.29

 

Analyze / measure and release packaging materials.

 

X

8.3    BULK MANUFACTURING (only for Nucynta® IR)

8.3.1

 

Validate the manufacturing process, which includes demonstrating the robustness
of the process.

   

X

8.3.2

 

Provide validation protocols and reports, on request.

 

X

8.3.3

 

Approve validation protocols and reports

X

X

8.3.4

 

Create master batch record.

 

X

8.3.5

 

Approve master batch record.

X

X

8.3.6

 

Control, issue, and execute master batch record.

   

X  

8.3.7

 

Document, evaluate/ investigate and resolve deviations (planned and unplanned)
from approved manufacturing instructions or specifications.

 

X

8.3.8

 

Review and approve Significant (critical/major) deviations.

X

 

8.3.9

 

Conduct bulk-holding time study and provide hold time upon request.

X

X

8.3.10

 

Notify Depomed and get approval prior to implementation of any resorting or
reinspection.

 

X

8.3.11

 

Provide Master Manufacturing Documents to Depomed.

 

X

11.4

 PACKAGING AND LABELING (for Nucynta® IR and ER)

 

8.4.1

 

Qualification of packaging and labeling operations.

 

X

8.4.2

 

Create master bulk packaging and labeling master batch records.

 

X

8.4.3

 

Approve master packaging batch record.

X

X

 

--------------------------------------------------------------------------------

 

8.4.4

 

Control, issue, and execute packaging and labeling batch record.

   

X  

8.4.5

 

Perform all required in-process testing.

 

X

8.4.6

 

Document, investigate, and resolve any deviation from approved bulk packaging
instructions or specifications.

 

X

8.4.7

 

Review and approve Significant (critical/major) deviations.

X

 

8.4.8

 

Retain reference samples of Product (minimum quantity equal to two (2) times
required amount for full release testing), as per Halo’s SOPs.

 

X

8.4.9

 

Perform annual visual inspection of retention samples for evidence of
degradation for commercial products

   

X 

8.4.10

 

Provide master packaging documents to Depomed upon request.

 

X

8.5   TESTING OF FINISHED PACKED PRODUCT (for Nucynta® IR and ER)

8.5.1

 

Provide registered finished packed Product specifications.

X

 

8.5.2

 

Provide analytical methods for registered finished packed Product testing.

X

X

8.5.3

 

Transfer analytical methods for Finished Product testing.

X

X

8.5.4

 

Test finished packed Product.

 

X

8.5.5

 

Document and investigate out-of specification (OOS) results.  Notify Depomed
within three (3) business days of discovery of any OOS results. 

 

X

8.6   STABILITY TESTING (for Nucynta® IR and ER)

 

8.6.1

 

Take samples for stability study and ship to the appropriate stability testing
laboratory.

 

X

8.6.2

 

Coordinate shipment of stability samples to the appropriate testing laboratory.

X                  

 

8.7   COMPLAINTS

 

8.7.1

 

Investigate manufacturing / packaging related complaints, including customer
complaints and/or Depomed complaints.

 

X

8.7.2

 

Provide a final written report for any critical complaints within fifteen (15)
business days. Provide a final written report for all other complaints within
thirty (30) business days. 

 

X

8.8   AUDITS

 

 

8.8.1

 

Agree to a facility site compliance audit with prior written notification given
to assess manufacturing, packaging, testing, validation, control systems or any
other system or department that may impact the Product(s). 

 

X

 

--------------------------------------------------------------------------------

 

8.8.2

 

May inspect any of the documents that are obliged to be maintained under this
Agreement, and any of the facilities or subcontractors used in the
manufacturing, packaging, testing, processing, or holding of the Product(s) or
raw materials and package materials for the Products.

X

 

8.8.3

 

Provide specific audit findings in writing.

X

 

8.8.4

 

Develop a corrective action plan within thirty (30) calendar days of receipt of
the audit findings and send this response to Depomed. 

   

X  

4.9

PRODUCT RELEASE

 

8.9.1

 

Review production and analytical records and make available on request by
Depomed for any batch.

 

X

8.9.2

 

Identify deviations, planned and unplanned, from approved instructions.  Notify
Depomed of deviations.

 

X

8.9.3

 

Shall have the right to request and receive additional information and written
copies of any deviations.

X

 

8.9.4

 

Full documentation – provided for a minimum of the first three (3) production
lots of each Product strength and package configuration, if required, and upon
request thereafter.

 

X

8.9.5

 

May inspect each Product delivery. Depomed will disposition the Product for
distribution based on the documents provided and the results of any inspection
performed by Depomed.

X

 

8.9.6

 

Provide CoC/CoA and Bulk Drug Product Disposition Certificate for incoming
Nucynta® ER bulk product (coated and printed tablets in drums). Certificate will
state that bulk product was manufactured under GMPs.

X

 

8.9.7

 

Perform ID testing for in-coming Nucynta® ER bulk product and release bulk lot
for further processing (packaging/labeling)

 

X

8.9.8

 

Release labelled and packaged Nucynta® ER and send documents to Depomed.

 

X

8.9.9

 

Provide Finished Drug Product Disposition Certificate of the labelled and
packaged Nucynta® ER for shipment to the Distributor.

NOTE: Halo should not ship without Certificate from Depomed

X

 

8.9.10

 

Coordinate shipment of the labelled and packaged Nucynta® ER to Depomed’s
Distributor.

X

X

8.9.11

 

Issue Certificate of Analysis ("COA") and Certificate of Compliance ("COC") or
equivalent upon release of Nucynta® IR finished product. COA and COC may be
combined in a single document. 

 

X

 

--------------------------------------------------------------------------------

 

8.9.12

 

Release Nucynta® IR finished product lot and send release documentation (CoC and
CoA) to Depomed

 

X

8.9.13

 

Provide Finished Drug Product Disposition Certificate of the labelled and
packaged Nucynta® IR for shipment to the Distributor.

NOTE: Halo should not ship without Certificate from Depomed

X

 

 

ARTICLE 9 - MISCELLANEOUS

 

9.1 Amendment.  This Agreement may only be amended or modified by a written
instrument executed by both parties hereto. 

 

9.2 Successors and Assigns.  This Agreement shall be binding upon and inure to
the benefit of Depomed and Halo and their successors and assigns of all or
substantially all of either party's business or assets.  Any change of control
of either party shall not affect either party's rights or obligations under this
Agreement.  Halo shall not assign or transfer any of its rights or obligations
under this Agreement without the prior written consent of Depomed.  Depomed
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 upon notice to Halo. 

9.3 Severability.  In the event that any one or more of the agreements,
provisions or terms contained herein shall be declared invalid, illegal or
unenforceable in any respect, the validity of the remaining agreements,
provisions or terms contained herein shall in no way be affected, prejudiced or
invalidated thereby.

 

9.4 Entire Agreement.  This Agreement, together with the Exhibits and Appendices
hereto, contains the entire agreement between the parties hereto and supersedes
any agreements between them with respect to the subject matter hereof.  In case
of discrepancies between separate commercial agreement(s) and this Quality
Agreement regarding the quality obligations, the quality provisions included in
this Quality Agreement shall prevail.

 

9.5 Counterparts.  This Agreement may be executed in any number of separate
counterparts, each of which shall be deemed to be an original, but which
together shall constitute one and the same instrument.  Facsimile signatures and
electronic images of signatures shall be binding upon the parties.

 

9.6Debarment.  Each party represents that, to the best of its knowledge, it has
not and will not use the services of any persons debarred under 21 U.S.C. §335
(a) or (b).  Each party further represents that neither it nor any of its
officers, employees or affiliates have been (i) debarred; (ii) subject to or
threatened to be debarred; or (iii) convicted of a felony for which a person can
be debarred under 21 U.S.C. §335 (a) or (b). 

 

--------------------------------------------------------------------------------

 

  Each party represents that it has never been and, to the best of its
knowledge, none of its employees, affiliates, or agents has ever been (a)
threatened to be debarred or (b) indicted for a crime or otherwise engaged in
conduct for which a person can be debarred, under 21 U.S.C. §335 (a) or
(b).  Each party will each immediately notify the other party in the event of
any such debarment, conviction, threat, or indictment.

9.7 Notices.  Any notices given under this Agreement shall be sent in writing by
overnight courier delivery by a reputable service (e.g. FedEx) with an
additional copy by facsimile or email, and shall be deemed effective on the date
of mailing.  Unless otherwise changed by notice in writing, notices may be
served at the following addresses:

 

To Depomed:

To Halo:

Depomed Inc.

7999 Gateway Blvd., Suite 300

Newark, CA 94560

USA

Attn: Gail Stewart

Email: gstewart@depomed.com

Halo Pharmaceutical Inc.

30 North Jefferson Road

Whippany, NJ 07981

USA

Attn: Susan Saffar

Email: ssaffar@halopharma.com

With a copy to:

Depomed Inc.

7999 Gateway Blvd., Suite 300

Newark, CA 94560

USA

Attn: Gerd Kochendoerfer

Email: gkochendoerfer@depomed.com

With a copy to:  

Halo Pharmaceutical Inc.

30 North Jefferson Road

Whippany, NJ 07981

USA

Attn: Lee Karras

Email: lkarras@halopharma.com

 

9.8English Language.  This Agreement shall be written and executed in the
English language.  Any translation into any other language shall not be an
official version thereof, and in the event of any conflict in interpretation
between the English version and such translation, the English version shall
control.

 

 

 

 

 

 

This Agreement has been reviewed and approved as of the date of the last party’s
signature below:

 

--------------------------------------------------------------------------------

 

 

DEPOMED INC.

 

HALO PHARMACEUTICAL, INC.

 

By:_________________________________

 

By:_________________________________

 

Print Name:__________________________

 

Print Name:__________________________

 

Title:_______________________________

 

Title:_______________________________

 

Date:_______________________________

 

Date:_______________________________

 

 

 

 

--------------------------------------------------------------------------------

 

APPENDIX A

HALO CONTACTS AND RESPONSIBLE PERSONS

TITLE

INFORMATION

Sr. Director, Audits, Inspections & Supplier Compliance

Name: Susan Saffar

Email: ssaffar@halopharma.com

Telephone No.: 1-973-428-4676

Sr. Director, Quality Assurance

Name: Margaret Quinn

Email: mquinn@halopharma.com

Telephone No.: 1-973-428-4026

Director, Quality Control/GMP Labs

Name:   Preeti Singh

Email:   psingh@halopharma.com

Telephone No.:   1-973-428-4136

 

DEPOMED CONTACTS AND RESPONSIBLE PERSONS

TITLE

INFORMATION

Sr. Director, Quality Assurance

 

 

 

Sr. Manager, Quality Assurance

 

Name: Gail Stewart

Email: gstewart@depomed.com

Telephone No.: 1-510-744-8528

 

Name: Nina Pizarro-Simpson

Email: nsimpson@depomed.com

Telephone No.: 1-510-744-8618

Director, Contract Manufacturing

 

 

Associate Director, Contract Manufacturing

Name: Yolanda Puga

Email: ypuga@depomed.com

Telephone No.: 1-510-744-8547

 

Name: Larry Banda

Email: lbanda@depomed.com

Telephone No.: 1-510-744-8588

 

--------------------------------------------------------------------------------

 

Sr. Director, Quality Control and Analytical Development

 

 

Associate Director, Analytical Development

 

 

Manager, Quality Control

 

 

Name: Paul McGoff

Email: pmcgoff@depomed.com

Telephone No.: 1-510-744-8694

 

Name: Angela Liu

Email: aliu@depomed.com

Telephone No.: 1-510-744-8537

 

Name: Sam Ngo

Email: sngo@depomed.com

Telephone No.: 1-510-744-8544

 

 

 

--------------------------------------------------------------------------------

 

APPENDIX B

 

 

PRODUCTS for Manufacture and Packaging/Labeling

 

Product Description                                                           

Code

For Manufacturing and Labeling/Packaging

 

Nucynta® IR Tablets, 50mg, 100s, 24 Count

TBD

Nucynta® IR Tablets, 75 mg, 100s, 24 Count

TBD

Nucynta® IR Tablets, 100mg, 100s, 24 Count

TBD

Nucynta® IR Tablets, 50mg, HUD (2x5) x 10

TBD

Nucynta® IR Tablets, 75mg, HUD (2x5) x 10

TBD

Nucynta® IR Tablets, 100mg, HUD (2x5) x 10

TBD

 

For Labeling and Packaging only

 

Nucynta® ER Tablets, 50mg, 60s x 24 Count

TBD

Nucynta® ER Tablets, 100mg, 60s x 24 Count

TBD

Nucynta® ER Tablets, 150mg, 60s x 24 Count

TBD

Nucynta® ER Tablets, 200mg, 60s x 24 Count

TBD

Nucynta® ER Tablets, 250mg, 60s x 24 Count

TBD

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

APPENDIX C

 

 

HALO APPROVED CONTRACT LABS

 

CONTRACT LABORATORY

LOCATION

SERVICES

ALCAMI (AAI ANALYTICAL SERVICES)

165 Fieldcrest Avenue

Edison, New Jersey 08837

Analytical Services

CONSUMER PRODUCT TESTING COMPANY (CPTC)

70 New Dutch Lane 

Fairfield, New Jersey 07004

Analytical Services

MARYPAUL LABORATORIES INC.

12 Wilson Drive            

Sparta, New Jersey 07871

Microbiological Testing

EUROFIN LANCASTER LABORATORIES

2425 New Holland Pike

Lancaster, PA 17601

Analytical Services and Microbiological Testing

 

 

--------------------------------------------------------------------------------

 

APPENDIX D

 

VENDORS – API and EXCIPIENTS

 

 

Raw Material Description

Reference

Quality Standard

Function

Grade

Approved / Qualified Suppliers

Tapentadol HCL

Non-compendial

API

NA

Noramco

Microcrystalline Cellulose

NF / Ph.Eur.

Diluent

PH-102

FMC

Lactose Monohydrate

NF

Diluent

Impalpable

Foremost Farms

Croscarmellose Sodium

NF / Ph.Eur. / JP

Disintegrant

Ac-Di-Sol

FMC

Povidone

USP / Ph.Eur. / JP

Binder

K29 – K32

ISP / Ashland

Magnesium Stearate           (non-bovine)

NF / Ph.Eur.

Lubricant

HyQual 2257

Mallinckrodt, Inc.

Opadry II, Yellow

Non-compendial

Film coating

85F12381

Colorcon, Inc.

Opadry II, Yellow

Non-compendial

Film coating

85F12375

Colorcon, Inc.

Opadry II, Orange

Non-compendial

Film coating

85F13908

Colorcon, Inc.

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

SCHEDULE G

FORM OF exclusive components purchasing summary

TO:DEPOMED, INC.

 

FROM:HALO PHARMACEUTICAL, INC.

 

RE: Exclusive Components Purchasing Summary

 

This summary is provided pursuant to Section ‎4.3(b) of the Drug Product
Manufacturing Services Agreement dated as of June 6, 2017 (the
“Agreement”).  Capitalized terms used in this report have the meanings given to
such terms in the Agreement. 

 

PRODUCT:   Nucynta IR

Component #

Description

Unit of Measure

Qty /
Annual

Minimum Order Qty

Vendor

Order Comments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

SCHEDULE H

List of Territories

·

United States of America and its territories, districts, commonwealths and
possessions, including the Commonwealth of Puerto Rico and the District of
Columbia

·

Canada and its territories, districts, commonwealths and possessions

Additional countries may be added per Section ‎14.2 of the Agreement

 

--------------------------------------------------------------------------------