MASTER SUPPLY AGREEMENT

 

THIS MASTER SUPPLY AGREEMENT (the “Agreement”), dated as of December 27, 2012
(the “Effective Date”) by and between Jubilant Life Sciences Ltd., a company
organized under the laws of India (“Jubilant”) and Jubilant Cadista
Pharmaceuticals, Inc., a Delaware corporation (“Cadista”). (Cadista and Jubilant
are sometimes referred to herein individually as a “Party” and collectively as
the “Parties”).

 

Jubilant is interested in buying certain of Cadista’s products manufactured by
Cadista and selling such products in certain territories outside of the United
States (and its territories and possessions).

 

Accordingly, in consideration of the mutual promises, covenants and agreements
hereinafter set forth, the Parties agree to the following terms and conditions:

 

ARTICLE I - DEFINITIONS

 

“Accepted Product” has the meaning set forth in Section 6.4(a).

 

“Affiliate” means any entity that directly or indirectly Owns, is Owned by, or
is under common Ownership with a Party to this Agreement. “Owns” or “Ownership”
means direct or indirect possession of more than fifty percent (50%) of the
votes of holders of a corporation’s voting securities or a comparable equity
interest in any other type of entity. For purposes of this Agreement Cadista and
Jubilant shall be deemed not to be Affiliates of each other.

 

“Agency” means any governmental regulatory authority responsible for granting
approvals for the sale of a Product.

 

“Agreement” means the present agreement together with all attachments.

 

“ANDA” means an “abbreviated new drug application,” as defined in the FD&C Act
and applicable FDA rules and regulations.

 

“API” means the active pharmaceutical ingredient of a particular Product.

 

“Applicable Country” means with respect to a Product, a country in the
Applicable Territory for such Product.

 

“Applicable Law” means, with respect to any Person, any domestic or foreign,
federal, state or local statute, treaty, law, ordinance, rule, regulation,
administrative interpretation, order, writ, injunction, judicial decision,
decree or other requirement of any Governmental Authority applicable to such
Person or any of such Person’s respective properties, assets, officers,
directors, employees, consultants or agents.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

 

 

 

“Applicable Territory” means with respect to a Product, the respective countries
for such Product set forth on Schedule 1.

 

“Average Selling Price” means with respect to a Product in an Applicable Country
for any period, (A) the gross sales (number of units shipped times the invoiced
price per unit) by Jubilant, its distributors or sublicensees, for such period
in such Applicable Country less accruals for expected rebates and retroactive
price reductions for such Product shipped to customers in such Applicable
Country during such period and any applicable prior periods, divided by (B) the
number of units of Product shipped to customers in such Applicable Country by
Jubilant for such period.

 

“Approved Manufacturer” has the meaning set forth in Section 6.6.

 

“Article” means any article of this Agreement.

 

“Bankruptcy Code” means 11 USC §§ 101, et seq.

 

“Business Day” means a day other than a Saturday, Sunday or other day on which
commercial banks in New York, New York, USA are authorized or required by law to
close.

 

“Cadista” has the meaning set forth in the preamble.

 

“cGMP” means (a) the FDA’s then-current Good Manufacturing Practices applicable
to the manufacture of pharmaceutical products for human use in the United
States, the FDA’s guidance documents, and all successor regulations and (b)
current good manufacturing practices as required by law in countries other than
the United States where manufacturing of Products is conducted.

 

“Commercially Reasonable Efforts” means exercising such reasonable efforts and
diligence in accordance with a Party’s reasonable business, legal, medical and
scientific judgment and in a manner consistent with and in accordance with the
efforts and resources of similar parties in the industry for a pharmaceutical
product owned or controlled by such Party which is of similar market potential
at a similar stage of its product life, taking into account the competitiveness
of the marketplace, the proprietary position of the product and the
profitability of the product.

 

“Components” means, collectively, all packaging components, raw materials and
ingredients (including labels, product inserts and other labeling for the
Product), required to be used in order to produce a Product in accordance with
the Product Specifications, other than the API.

 

“Competing Product with respect to a Product shall mean any pharmaceutical
product which has the same active ingredients in the same dosage form, as such
Product and is a Generic Equivalent.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

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“Confidential Information” has the meaning set forth in Article X.

 

“Destination Charges” means all amounts paid or incurred by Jubilant for Product
to reach Jubilant’s or its Affiliates’ warehouses (including without limitation,
taxes, customs, insurance and shipping) from the place of manufacture, or if
shipped directly from the place of manufacture to a customer, to reach the port
of destination in the Applicable Country of such customer (but not including any
local freight charges incurred with respect to shipping Product, after arrival
at the port of destination, to any such customer).

 

“Drug Approval Application” means an application for product license approvals,
health registrations, marketing authorizations, regulatory submissions, notices
of compliance and other licenses and permits required to be submitted to the
applicable Agency before the commercial sale or use, of a particular Product as
a drug in a regulatory jurisdiction.

 

“Effective Date” has the meaning set forth in the preamble.

 

“FD&C Act” means the Federal Food, Drug and Cosmetic Act, as amended, and the
rules and regulations of the FDA promulgated thereunder.

 

“FDA” means the United States Food and Drug Administration, or any successor
thereto.

 

“GAAP” means generally accepted accounting principles in effect in the United
States from time to time applied on a consistent basis.

 

“Generic Equivalent” means a product which has been approved by an Agency in an
Applicable Country as meeting the necessary bioequivalence requirements of the
innovator product described on Schedule 1, which bioequivalence was established
through in vivo and/or in vitro testing, compared to a reference standard that
is currently approved by such Agency in such Applicable Country, or such other
testing as may be required by the Agency in an Applicable Country to show
therapeutic equivalence.

 

“Governmental Authority” means any foreign, domestic, federal, territorial,
state or local governmental authority, quasi-governmental authority,
instrumentality, court, government or self-regulatory organization (including
any securities exchange), commission, tribunal or organization or any
regulatory, administrative or other agency, or any political or other
subdivision, department or branch of any of the foregoing.

 

“Intellectual Property Rights” means any and all existing and future proprietary
rights, including but not limited to property rights, know-how rights, trade
secret rights, copyrights, design rights, any existing or future patents and
patent applications in the Country and all continuations, continuations-in-part,
divisions, reissues, reexaminations, extensions or other government actions
which extend the subject matter of the foregoing, and any corresponding patents,
patents of addition, granted or registered and all other intellectual property
rights (including without limitation the right, if any, to sue or bring other
actions for past, present and future infringement of such Intellectual Property
Rights).

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

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“Jubilant” has the meaning set forth in the preamble.

 

“Label”, “Labeled” or “Labeling” means, when used as a noun, all labels and
other written, printed or graphic matter upon (i) a Product or any container or
wrapper utilized with such Product, or (ii) any written material accompanying
such Product, including, without limitation, package inserts, in each case that
is subject to review by an Agency in an Applicable Country for such Product.
When used as verb, Label means to affix or insert a Label.

 

“Latent Defect” has the meaning set forth in Section 6.4(a).

 

“Loss” or “Losses” has the meaning set forth in Section 12.1.

 

“Marketing Plan” has the meaning set forth in Section 5.2.

 

“NDA” means a New Drug Application filed with the FDA pursuant to and under 21
U.S.C. Section 355(b) of the FD&C Act.

 

“Net Sales” means with respect to a Product for any period in an Applicable
Country, the Average Selling Price for such period for such Applicable Country
multiplied by the number of units shipped for such period less the following, to
the extent not included in the Average Selling Price for such Applicable Country
and without duplication: (a) rebates, quantity and cash discounts, promotional
allowances, and other usual and customary discounts and wholesaler or other fees
to customers in such Applicable Country, (b) taxes and duties paid, absorbed, or
allowed which are directly related to the sale, (c) the amount of chargebacks
and amounts repaid or credited by reason of rejections, damages or return of
goods (including, without limitation, for customer returns of Product for any
reason, including remaining shelf life), or because of retroactive price
adjustments justified by trade practices with respect to sales to customers in
the Applicable Country, and (d) discounts, rebates or other payments required by
law to be made under governmental special medical assistance programs in such
Applicable Country. To the extent returns are refunded under Section 7.8, they
shall not be deducted from Net Sales.

 

“Package” or “Packaging” means, when used as a noun, all primary and secondary
containers, including cartons, shipping cases and other like matter used in
packaging or accompanying a Product. When used as a verb, “Package” means to
insert into a Package.

 

“Party” has the meaning set forth in the preamble.

 

“Person” means an individual, a corporation, a general partnership, a limited
partnership, a limited liability company, a limited liability partnership, an
association, a trust or any other entity or organization, including a
Governmental Authority.

 

“Product Claim” has the meaning set forth in Section 12.3.

 

“Product Purchase Price” shall be determined on a Product-by-Product, Applicable
Country-by-Applicable Country basis for a Product and is defined in Section 7.1.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

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“Product Specifications” means the specifications for each of the Products that
has received FDA approval as set forth in the ANDA or NDA, as applicable, for
such Product as approved by the FDA; provided, however, that if a Product
receives Regulatory Approval in an Applicable Country, either prior to having
received FDA approval for marketing in the United States or containing different
specifications than contained in an approved ANDA or NDA for such Product, then
the Product Specifications for such Product in such Applicable Country shall
mean the specifications for such Product set forth in the Drug Approval
Application in connection with which the Regulatory Approval in such Applicable
Country was granted or as the Parties shall otherwise agree in writing.

 

“Products” means each of the finished dosage pharmaceutical products listed and
described on Schedule 1 attached hereto in the dosage form set forth therein, as
Schedule 1 may be amended by mutual written agreement of the Parties.

 

“Recall” has the meaning set forth in Section 6.5.

 

“Regulatory Approval” means the license or marketing approval necessary as a
prerequisite for marketing a Product in an Applicable Territory.

 

“Rejection Notice” has the meaning set forth in Section 6.4(a).

 

“Renewal Period” has the meaning set forth in Section 9.1.

 

“Section” means any section of this Agreement.

 

“Service Level Charges” is defined in Section 6.2.

 

“Technical Information” means all techniques and data and other know-how and
technical information including inventions (including patentable inventions),
practices, methods, concepts, know-how, trade secrets, documents, computer data,
source code, apparatus, clinical and regulatory strategies, test data,
analytical and quality control data, manufacturing, patent data or descriptions,
development information, drawings, specifications, designs, plans, proposals and
technical data and manuals and all other proprietary information concerning the
development, manufacture, production, quality control, storage, distribution and
sale of a Product.

 

“Term” means the period of time specified in Section 9.1.

 

“Third Party” means any entity other than Jubilant or Cadista, and their
respective Affiliates.

 

ARTICLE II - OVERVIEW OF AGREEMENT

 

2.1           Overview. Cadista will manufacture, Label and Package, or have its
designee manufacture, Label and Package, the Products and supply the Products to
Jubilant, and Jubilant will market, sell and distribute each Product in the
respective Applicable Territory for such Product set forth on Schedule 1. The
Parties acknowledge and agree that additional Products and Applicable
Territories may be added to this Agreement, from time to time, upon the mutual
agreement of the Parties and the execution of a revised Schedule 1 to add such
additional Products and Applicable Territories.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

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ARTICLE III – TECHNICAL INFORMATION/COMPETING PRODUCTS

 

3.1           Ownership of Technical Information. Ownership of inventions,
whether patentable or not patentable, and Technical Information developed
pursuant to this Agreement shall be owned by the developing Party.

 

3.2           Covenant Not to Market Competing Products. From and after the
Effective Date until the termination of this Agreement, Jubilant shall not
directly or indirectly manufacture for sale, market or sell a Competing Product
to a Product in the Applicable Territory for such Product. This restriction
shall not apply with respect to a particular Product or an Applicable Country
with respect to a Product once the Term has ended with respect to such Product
or Applicable Country. Notwithstanding the foregoing, the Parties recognize and
agree that Persons to whom Jubilant sells Products for further distribution may
also without the assistance of Jubilant sell Competing Products.

 

ARTICLE IV
GENERAL COMMERCIAL OBLIGATIONS

 

4.1           Appointment. Cadista hereby appoints Jubilant as exclusive
distributor of each Product in the respective Applicable Territory for such
Product set forth on Schedule 1. During the Term of this Agreement for a
Product, Cadista hereby grants Jubilant the exclusive rights to market,
advertise, promote, distribute, sell and offer to sell such Product in the
respective Applicable Territory for such Product set forth on Schedule 1.

 

4.2           Supply. Subject to the terms and conditions of this Agreement,
from and after the Effective Date and during the Term: (a) Cadista shall use
Commercially Reasonable Efforts to timely manufacture, Label, Package and supply
to Jubilant all of Jubilant’s requirements of each of the Products for use or
sale in the Applicable Territory for such Product in accordance with Jubilant’s
purchase orders, the Product Specifications for each Product, cGMP requirements,
Applicable Law and the terms hereof; (b) Cadista shall not manufacture a Product
for, or supply a Product to, its Affiliates (other than Jubilant or Jubilant
Affiliates’ designated by Jubilant in writing) or any Third Party for use or
sale within the Applicable Territory for such Product without the prior written
consent of Jubilant; and (c) except as provided in Sections 6.2 and 6.6,
Jubilant shall purchase all of its requirements of each Product for use or sale
in the Applicable Territory for such Product exclusively from Cadista.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

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4.3           Packaging and Labeling. Jubilant shall supply to Cadista, in a
timely fashion, all information necessary to create artwork required to Label
the Products (including private-label Product, where applicable) with such
trademarks, logos or designs as Jubilant shall select and in accordance with
Applicable Laws. Cadista shall be responsible for securing any approvals
required by Agencies in each Applicable Country in the Applicable Territory for
a Product or other applicable Regulatory Approvals for the initial Label for a
Product and for any changes or supplements to the Labeling for any Product
requested by Jubilant. In the event that Jubilant wishes to modify or change the
Label for a Product, when and where reasonably practicable, Jubilant shall
provide at least sixty (60) days’ advance notice of such desired change to
Cadista as reasonably possible and forward such modifications or changes to
Cadista for incorporation into the Packaging and Labeling of such Products.

 

4.4           Regulatory Approval. (a) Cadista shall be responsible at its sole
cost and expense, for the preparation of the Drug Approval Applications for each
Product in each Applicable Country of such Product’s Applicable Territory, in
form and substance capable of receiving Regulatory Approval, and obtaining and
maintaining Regulatory Approval, for each Product in each Applicable Country of
the Applicable Territory for such Product, and in the discharge of such
obligations Cadista shall exercise Commercially Reasonable Efforts; provided,
however, that Jubilant will cooperate with Cadista with respect to such
preparation, and will provide such assistance (including, without limitation,
guidance as to the regulatory requirements in each such Applicable Country), as
Cadista shall reasonably request, all without charge to Cadista. Jubilant shall
be responsible at its cost and expense, for the filing, with the applicable
Agencies in each Applicable Country of the Applicable Territory, and
prosecution, as regulatory agent of Cadista, the Drug Approval Applications for
each Product prepared by Cadista pursuant to the foregoing sentence, and for
maintaining for each Product such Regulatory Approvals as are granted in the
Applicable Territory for such Product, all in accordance with Cadista’s
instructions, and in the discharge of such obligations Jubilant shall exercise
Commercially Reasonable Efforts. If the Parties deem it necessary or desirable
with respect to obtaining and maintaining Regulatory Approval with respect to a
Product in a particular Applicable Country in the Applicable Territory, Cadista
shall provide an agency letter addressed to the applicable Agency in such
Applicable Country, or such other writing or agreement as the Parties shall deem
necessary or desirable, in order for Jubilant to coordinate the filing of the
applicable Drug Approval Application for such Product in such Applicable Country
and to maintain any Regulatory Approval granted for such Product in such
Applicable Country and to receive and reply to all communications from such
Agency in such Applicable Country relating to such Drug Approval Application or
maintenance and address any deficiencies or requests for additional information
provided by such Agency. Notwithstanding the foregoing or anything else to the
contrary contained herein: (i) all Regulatory Approvals with respect to each
Product in such Product’s Applicable Territory shall be owned by Cadista
regardless of whether Cadista or Jubilant files, prosecutes or maintains same;
and (ii) Cadista shall be responsible, at its sole cost and expense, for
providing Jubilant (for its provision to the applicable Agencies in the
Applicable Countries for the Products) any additional data or information
necessary to receive or maintain Regulatory Approval for a Product in each
Applicable Country of the Applicable Territory for such Product. In order to
permit Jubilant to carry out its obligations under this Section 4.4(a), Cadista
shall consult with Jubilant and provide such technical assistance and oversight
as shall reasonably be requested by Jubilant.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

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(b)           Jubilant shall promptly provide Cadista with copies of all notices
and correspondence received from Agencies relating to the Products in each
Applicable Country of the Applicable Territory and shall provide prompt notice
to Cadista of any proposed calls or meetings with any such Agency relating to a
Drug Approval Application or maintenance of a Regulatory Approval granted with
respect to a Product and permit representatives of Cadista to participate in
such calls or meetings. Cadista will promptly provide Jubilant with any notices,
correspondence or request for information received from an Agency during the
Term with respect to a Product as it relates to an Applicable Country of the
Applicable Territory for such Product.

 

(c)           Jubilant agrees that it will not make any filing or correspond
with, or otherwise contact, any Agency with respect to a Product in any
Applicable Country of the Applicable Territory for such Product, in the absence
of Cadista’s prior written consent.

 

ARTICLE V
COMMERCIALIZATION

 

5.1           General Diligence Obligation. Subject to the terms and conditions
of this Agreement, Jubilant will exercise Commercially Reasonable Efforts to
market and promote each Product to customers in each Applicable Country in the
Applicable Territory for such Product during the Term in accordance with the
terms of this Agreement, and with Applicable Law.

 

5.2           Marketing Plan. Jubilant will be responsible for assessing the
market opportunities for each Product in each Applicable Country in the
Applicable Territory for such Product and preparing and providing to Cadista, a
marketing plan for such Product in each Applicable Country of the Applicable
Territory for such Product (each a “Marketing Plan”) for the current calendar
year within 60 days after the Effective Date of this Agreement. Each Marketing
Plan shall set forth, among other things, Jubilant’s Expected Market Price (as
defined in Section 5.3 below) for a Product in each Applicable Country in the
Applicable Territory for such Product, the estimated Net Sales of such Product
for such calendar year in each Applicable Country in the Applicable Territory
for such Product and Jubilant’s proposed marketing activities, which must be
consistent with efforts appropriate for pharmaceuticals products of similar
market potential to market such Product in each Applicable County in the
Applicable Territory for such Product.

 

Thereafter, Jubilant shall, ninety days prior to the end of each calendar year
during the Term, provide Cadista with a copy of Jubilant’s Marketing Plan for
each Product for each Applicable Country for the next calendar year. Cadista may
communicate comments to Jubilant in respect of such Marketing Plans. Jubilant
agrees to consider such comments in good faith and shall provide a response to
Cadista in respect of such comments, which response may include revisions to the
Marketing Plan. Jubilant shall adopt Cadista’s comments unless commercially
unreasonable.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

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5.3           Product Sale Pricing. The net selling prices at which Jubilant
will market and sell each Product in each Applicable Country of the Applicable
Territory for such Product shall be mutually determined by the Parties promptly
following Cadista’s receipt of Jubilant’s Marketing Plan for such Product in
such Applicable Country (the “Expected Market Price”). In the event Product is
to be sold below the Expected Market Price in a particular Applicable Country,
whether in general or as to a specific customer, Jubilant shall obtain the
approval of Cadista, and the Product Purchase Price for such Product payable by
Jubilant to Cadista pursuant to Section 7.1 shall be adjusted accordingly.
Jubilant may request adjustments to the Expected Market Price for a Product in
an Applicable Country as and when market conditions for such Product in such
Applicable Country require changes to the Expected Market Price of such Product.

 

ARTICLE VI
DELIVERY AND ACCEPTANCE

 

6.1           Forecasts. Within 60 days after the execution of this Agreement
and, not later than 90 days prior to the end of each calendar year during the
Term, Jubilant will provide Cadista with a forecast of its requirements of each
Product for such calendar year which shall separately breakdown such
requirements for each Applicable Country of the Applicable Territory for such
Product. All forecasted requirements of each Product provided by Jubilant to
Cadista pursuant to this Agreement constitute an estimate of Jubilant’s
requirements for such Product in the Applicable Country that is supplied for the
convenience of Cadista only, is non-binding on Jubilant, and will not itself be
deemed an order of such Product.

 

6.2           Orders. On a quarterly basis during the Term of this Agreement,
Jubilant shall submit to Cadista purchase orders as needed for each Product to
be delivered no sooner than ninety (90) calendar days after the date of the
purchase order to be sold within the Applicable Country set forth in such
Purchase Order, consistent with its forecast and as required by Jubilant.
Cadista shall use Commercially Reasonable Efforts to supply a quantity of each
Product of up to one-hundred twenty-five percent (125%) of the amount previously
forecasted for such Product by Jubilant in such Applicable Country for such
Product for any such quarter.

 

If Cadista cannot confirm that it will be able to supply at least ninety percent
(90%) of the quantities of any Product estimated by Jubilant for the current
3-month portion of the forecast with respect to any Applicable Country in the
Applicable Territory for such Product, as Jubilant’s sole remedy, Jubilant will
advise Cadista of any service level charges or penalties that may accrue for
such Product in the Applicable Country (i.e. payments by Jubilant to customer
for failure to timely supply) on account of the delay or non-supply and Cadista
shall bear those charges and penalties (“Service Level Charges”). In the event
that the terms and conditions of any purchase order are inconsistent with or
conflict with the terms and conditions of this Agreement, the terms and
conditions of this Agreement shall govern. Cadista shall, within five (5)
Business Days of receiving each purchase order, acknowledge and confirm the
delivery date of such Product described on such purchase order.

 

6.3           Delivery of Products. Delivery of Products shall be FOB place of
manufacture, freight prepaid with full insurance, no later than the delivery
date specified by Jubilant and no later than 60 days from the date of
manufacture. A Certificate of Analysis, signed by a qualified representative of
Cadista and reasonably acceptable to Jubilant, shall accompany each shipment to
Jubilant. Title and risk of loss shall pass upon the loading of Product upon the
ship at port of embarkation (or if not being transported by ship, then upon
loading of carrier at place of manufacture).

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

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6.4          Acceptance and Rejection of Products.

 

(a)            Jubilant shall notify Cadista in writing of its rejection of any
Product supplied to it pursuant to this Agreement (“Rejection Notice”) as
follows: (i) in the case of defects that are readily discoverable upon a
physical inspection of a Product shipment, Jubilant shall deliver a Rejection
Notice within thirty (30) calendar days after Jubilant or its designated
facility has received such Product shipment, or (ii) in the case of a latent
defect or any defect that was not obvious and could not be readily discovered
from a physical inspection of the Product supplied (“Latent Defect”), Jubilant
shall deliver a Rejection Notice within thirty (30) calendar days of the date
that Jubilant discovers such defect. The notification by customer or a returns
processor of a defect to Jubilant shall be treated as the date of discovery and
such defect shall be deemed a Latent Defect. In the event the Failure to provide
a Rejection Notice to Cadista within the applicable 30-day period shall
constitute acceptance by Jubilant of the shipment, unless mutually agreed
between the two parties. (“Accepted Product”). Rejection Notices that are
provided by Jubilant shall state in reasonable detail (sufficient to enable
Cadista to identify the nature of the problem for tests or studies to be
conducted by or on its behalf or to dispute the same) the reason why Jubilant
believes the Product does not conform to its Specifications and/or the Product
warranties contained in Section 8.1. Jubilant shall, within fifteen (15)
Business Days of the delivery by Jubilant of any such Rejection Notice, provide
samples of the Product being rejected, if appropriate, and copies of written
reports relating to tests, studies or investigations performed to date by or on
behalf of Jubilant on the Product being rejected.

 

(b)           Jubilant’s test results or basis for rejection shall be conclusive
unless Cadista notifies Jubilant within fifteen (15) Business Days of receipt by
Cadista of receipt of the above mentioned samples that it disagrees with such
test results or basis for rejection. Cadista may only assert a disagreement if
it alleges that the defects were introduced by Jubilant. If Cadista and Jubilant
fail to agree within fifteen (15) Business Days after Cadista’s notice to
Jubilant as to whether any Product identified in the Rejection Notice deviates
from the applicable Product Specifications for such Product or fails to comply
fully with the Product warranties contained in Section 8.1, representative
samples of the batch of the Product in question, together with mutually agreed
upon questions, shall be submitted to a mutually acceptable independent
laboratory or consultant (if not a laboratory analysis issue) for analysis or
review. The results of such applicable independent evaluation shall be binding
upon the Parties. If Jubilant and Cadista determine by agreement, or if such
evaluation certifies that the Product was properly rejected by Jubilant,
Jubilant may reject the Product in the manner contemplated by Section 6.4(d).
The Party that is determined to have been incorrect in its determination of
whether the Product complies fully with the applicable Product Specifications
and the Product warranties contained in Section 8.1 shall pay all of the costs
of such independent evaluation, including, without limitation, laboratory fees
and additional shipping and transportation costs. Should the fees associated
with the work conducted by the independent laboratory or consultant be due up
front, Cadista and Jubilant shall each pay fifty percent (50%) of such upfront
fees; provided, that if it is determined by the independent laboratory or
consultant that either Party shall have been incorrect in its determination as
to whether the Product complies fully with the applicable Product Specifications
and the Product warranties contained in Section 8.1, such incorrect Party shall
reimburse the other Party for such fifty percent (50%) of such fees within ten
(10) Business Days of such determination by the independent laboratory or
consultant, as the case may be.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

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(c)           If any order of a Product is rejected by Jubilant, Jubilant’s
obligation to pay Cadista in respect of the rejected Product shall be suspended
until such time as the rejection is determined or otherwise agreed to be
incorrect per Section 6.4(b). If only a portion of an order is rejected, only
the duty to pay the amount allocable to such rejected portion shall be
suspended.

 

(d)           In the event an order or partial order is rejected by Jubilant
pursuant to the provisions of this Section 6.4, the non-conforming shipment of a
Product, or the non-conforming portion thereof, shall be held for Cadista’s
disposition, or shall be returned to Cadista, in each case at Cadista’s expense,
as directed by Cadista. Cadista shall use its Commercially Reasonable Efforts to
replace the non-conforming shipment of such Product, or the non-conforming
portion thereof, with conforming Product as soon as reasonably practicable after
receipt of notice of rejection thereof, and in any event will do so within the
later of forty-five (45) calendar days after receipt of notice of rejection
thereof or thirty (30) calendar days of an independent testing decision in favor
of Jubilant, at no cost to Jubilant. Cadista shall make arrangements with
Jubilant for the return or destruction, at Cadista’s option and cost, of any
rejected Product. All such return shipping charges or costs of destruction shall
be paid by Cadista. In the event that Jubilant has paid for rejected Product,
and such Product has not been satisfactorily replaced, Cadista shall promptly
extend a credit to Jubilant for the full amount paid by Jubilant for such
Product, together with related costs, or dispute such claim and, if necessary,
initiate dispute resolution in accordance with Section 6.4(b) of this Agreement.

 

6.5         Product Recall. In the event that either Party believes it may be
necessary to conduct a recall, field correction, market withdrawal, stock
recovery, or other similar action with respect to any Product which was sold
under this Agreement (a “Recall”), Cadista and Jubilant shall promptly consult
with each other in good faith as to how best to proceed, it being understood and
agreed that the final decision as to any Recall of any Product sold by Jubilant
shall be made by Jubilant; provided, however, that neither Party shall be
prohibited hereunder from taking any action that it is required to take by
Applicable Law. Each of Jubilant and Cadista shall make a permanent, complete
and accurate record of all costs incurred by it in connection with any Product
recall.

 

(a)           With respect to any Recall or seizure of any Product sold by
Jubilant and caused by the negligence, mistake or omission of Cadista, Cadista
shall (i) reimburse (or at Jubilant’s option, credit) Jubilant for all
out-of-pocket costs and expenses reasonably incurred by Jubilant in connection
with the Recall or seizure, replacing the Product subject to the Recall or
seizure in accordance with the provisions of Section 6.5; and (ii) as provided
in Section 12.1(b), indemnify and save Jubilant harmless from and against any
and all damages to or claims by Third Parties associated with or resulting from
any such Recall.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

11

 

 

(b)           With respect to any Recall or seizure caused by the negligence,
mistake or omission of Jubilant, Jubilant shall: (i) reimburse (or at Cadista’s
option, credit) Cadista for all out-of-pocket costs and expenses reasonably
incurred by Cadista in connection with the Recall or seizure; and (ii) as
provided in Section 12.1(a), indemnify and save Cadista and its Affiliates
harmless from and against any and all damages to or claims by Third Parties
associated with or resulting from any such Recall.

 

(c)           With respect to any Recall of a Product sold by Jubilant and not
caused by the negligence, mistake, fault, error or omission of either Party, the
expenses shall be for the account of Cadista.

 

(d)           If Jubilant and Cadista cannot agree which Party is at fault or
whether a Recall or seizure was reasonably beyond the control of the Parties,
then an independent technical expert, acceptable to both Parties, shall be
designated to make such determination. The so designated technical expert shall
not be an employee, consultant, officer, director or shareholder of, or
otherwise associated with, Jubilant, Cadista or their respective Affiliates. The
technical expert’s determination will be, in the absence of fraud or manifest
error, binding and conclusive upon the Parties.

 

(e)           Each Party shall keep the other fully informed of any notification
or other information, whether received directly or indirectly, which might
affect the marketability, safety or effectiveness of a Product, or which might
result in liability issues or otherwise necessitate action on the part of either
party, or which might result in Recall or seizure of such Product. Each Party
shall reasonably cooperate with the other in the implementation of a Recall.

 

(f)           Prior to any reimbursement pursuant to this Section 6.5 the Party
claiming reimbursement shall provide the other party with all available
documentation of all reimbursable costs and expenses.

 

6.6         Approved Manufacturer.

 

For each Product, Cadista may, at any time during the Term, direct that a
Product be manufactured by a Third Party manufacturer (an “Approved
Manufacturer”). In such event, Jubilant shall purchase its requirements of such
Product exclusively from such Approved Manufacturer under the same terms of this
Agreement, so long as the Third Party manufacturer complies with all applicable
regulations, including cGMP’s.

 

ARTICLE VII – PAYMENT OF PURCHASE PRICE;

ACCOUNTING

 

7.1        Product Purchase Price. The purchase price payable by Jubilant to
Cadista for each Product with respect to each Applicable Country in the
Applicable Territory for such Product shall be ninety percent (90%) of the Net
Sales of such Product in such Applicable Country (the “Product Purchase Price”).
At the time of delivery of a shipment of a Product to Jubilant for sale in an
Applicable Country, Cadista shall issue to Jubilant an invoice for such shipment
which will contain the estimated Product Purchase Price calculated based on the
then current Expected Market Price for such Product in such Applicable Country.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

12

 

 

7.2         Sales Reports. Within ten (10) days after each calendar quarter,
Jubilant shall provide Cadista a quarterly sales report for each Product. The
quarterly report shall show Product sales during each quarter by customer and
Applicable Country, including the calculation of the Net Sales for such Product
in each Applicable Country for such quarter. Jubilant shall provide such other
information relating to the sales of the Product as may reasonably be requested
by Cadista, from time to time.

 

7.3           Quarterly Adjustment. Within thirty (30) days after each calendar
quarter, Jubilant shall calculate the actual Product Purchase Price of a Product
in each Applicable Country of the Applicable Territory for such Product for Net
Sales in each such Applicable Country occurring during such quarter giving
effect to the actual Net Sales price for such Product during such quarter and
the Destination Charges incurred in such quarter. To the extent the estimated
Product Purchase Price paid by Jubilant to Cadista for such Product during such
quarter with respect to any Applicable Country exceeds ninety percent (90%) of
the Net Sales price for such Product in such Applicable Country, Cadista shall
issue to Jubilant a credit for such overpayment which shall be applied against
future Product purchases. To the extent the estimated Product Purchase Price
paid by Jubilant to Cadista for such Product during such quarter with respect to
any Applicable Country is less than ninety percent (90%) of the Net Sales price
for such Product in such Applicable Country, such shortfall shall be added to
the next Product invoice from Cadista. Cadista shall also credit Jubilant for
Destination Charges incurred in a quarter by crediting such amount against
future Product purchases. Any amounts remaining to be credited by Cadista to
Jubilant or to be included in a future invoice to Jubilant at the termination or
expiration of the Agreement shall be settled in cash at the termination or
expiration of this Agreement.

 

7.4           Payment Terms. Jubilant will pay to Cadista the invoiced Product
Purchase Price for each Product shipment within sixty (60) days from the date of
receipt of invoice. All payments hereunder shall be paid in United States
dollars, by wire transfer to a bank account designated by Jubilant.

 

7.5           Cadista’s Audit Rights. Jubilant shall maintain and Jubilant shall
require its Affiliates to maintain, at their respective offices, accurate and
complete books and records of the Jubilant Net Sales of each of the Products and
in such form and in such reasonable detail as to enable Jubilant to verify the
Net Sales of each of the Products. Upon the written request of Cadista, and not
more than once per calendar year, Jubilant shall permit an independent certified
public accounting firm selected by Cadista and reasonably acceptable to Jubilant
to have access during normal business hours to such of the records of Jubilant
as may be reasonably necessary to verify the accuracy of the Net Sales and any
deductions used to calculate Net Sales for each Product for any calendar year
ending not more than three full years prior to the date of such request. If such
accounting firm concludes that there are discrepancies in the reporting or
calculation of the Net Sales for a Product, such accounting firm shall
recalculate such amounts and: (a) Jubilant shall pay any additional sums
underpaid to Cadista within thirty (30) calendar days of such re-determination;
or (b) Cadista shall credit Jubilant for any overpaid amounts. The fees and
expenses charged by such accounting firm shall be paid by Cadista. However, if
the audit discloses that the aggregate payments relating to all Products to
Cadista was underpaid during the audit period by more than $25,000, then
Jubilant shall pay the reasonable fees and expenses charged by the accounting
firm. The results of such audit shall be final and binding on the Parties.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

13

 

 

7.6           Sales and Use Taxes.  Jubilant shall be responsible for the
payment of all federal, state or local taxes, use or value added taxes, excise
or similar charges, or other tax assessments (other than that assessed against
income), assessed or charged on the sale of the Products in the Applicable
Territory by Jubilant pursuant to this Agreement.

 

7.7           Confidential Financial Information. The Parties shall treat all
financial information subject to review under Section 7.5 hereof as Confidential
Information.

 

7.8           Unsold Product and Product Returned by Customer. Jubilant may
return for a full refund Product which it was not able to sell, when the
Product’s remaining shelf life reaches twelve months or less (even though when
received shelf life was longer), or when it reasonably determines that it will
not be able to sell Product within three (3) months. In lieu of adjusting Net
Sales, Jubilant may return for a full refund any Product returned by a customer.
All refunds shall include Destination Charges, in addition to Product Purchase
Price. Cadista shall bear all expenses of any returns under this Section 7.8,
including without limitation, transportation, customs and taxes. In the event
Cadista requests the destruction of Product in lieu of return, Cadista shall
bear all expenses of such destruction and refund amounts paid for such Product
and any Destination Charges.

 

ARTICLE VIII

MANUFACTURING STANDARDS AND QUALITY ASSURANCE

 

8.1        Cadista Product Warranties. Cadista hereby represents, warrants,
covenants and agrees that:

 

(a)           All Products supplied to Jubilant by Cadista under this Agreement
(i) will meet the applicable Product Specification for such Product as of the
date that title to such Product is delivered to Jubilant and during the shelf
life of such Product, (ii) will satisfy Applicable Laws and cGMP with respect to
the manufacture, packaging, storage and shipment of such Product, and (iii) will
not be adulterated or misbranded pursuant to Sections 501 and 502 of the FD&C
Act (21 U.S.C. §§ 351 & 352).

 

(b)          All Products supplied by Cadista hereunder will be transferred to
Jubilant free and clear of any liens, claims, encumbrances and security
interests.

 

(c)          The Product supplied by Cadista shall have a shelf life of at least
21 months at the time it is received by Jubilant.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

14

 

 

8.2        Cadista General Warranties.

 

(a)           Cadista is not debarred and will not to its knowledge use in any
capacity the services of any Person debarred under Section 335(a) of the FD&C
Act; and

 

(b)           Except as otherwise provided in, and subject to the terms and
provisions of, this Agreement, Cadista shall obtain and maintain all necessary
licenses, permits or approvals required by the FDA or other relevant
Governmental Authority in connection with the manufacture, filling, packaging,
storage, and shipment to Jubilant in the Applicable Countries in the Applicable
Territory for a Product, including, without limitation, all material permits
related to its manufacturing facility.

 

8.3         Product Testing. Cadista shall conduct, or cause to be conducted,
all physical parameters and in-process testing with respect to each batch of a
Product to be supplied pursuant hereto prior to delivery thereof to Jubilant.
Cadista shall retain a sample of each batch tested for at least the shelf life
of such batch, or such longer period as may be required by cGMP.

 

8.4          Disclaimer. CADISTA HEREBY DISCLAIMS ALL WARRANTIES NOT EXPRESSLY
PROVIDED IN THIS AGREEMENT, INCLUDING ANY IMPLIED WARRANTIES, INCLUDING
WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE AND WARRANTIES OF
MERCHANTABILITY.

 

ARTICLE IX
TERM, EXCLUSIVITY AND TERMINATION

 

9.1        Term. This Agreement shall commence on the Effective Date and, unless
sooner terminated pursuant to Section 9.2, shall continue in full force and
effect on a Product-by-Product and Applicable Country-by-Applicable Country
basis for a term of five (5) years from the date of the first commercial sale of
such Product in each Applicable Country for such Product (the “Initial Term”);
provided, however, that the Initial Term in each Applicable Country shall be
extended automatically for additional terms of one (1) year each thereafter
(each a “Renewal Period”) in the absence of either Party providing written
notice to the other electing not to renew the Term of this Agreement with
respect to a Product in such Applicable Country, which written notice shall be
provided by such Party to the other not later than one hundred and eighty (180)
days prior to the expiration of the Initial Term or any Renewal Period (the
Initial Term and any Renewal Period for a Product in an Applicable Country for
such Product are referred to collectively as the “Term” and shall be determined
on a Product-by-Product and Applicable Country-by-Applicable Country basis).

 

9.2         Termination. (a) Prior to the expiration of the Term, this Agreement
may be terminated in its entirety for all Products and all Applicable
Territories:

 

(i)          immediately upon the mutual written consent of Cadista and
Jubilant;

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

15

 

 

(ii)         by either Party upon the other Party’s material breach of its
obligations under this Agreement, which material breach remains uncured sixty
(60) calendar days after the terminating Party has provided written notice of
same; or

 

(iii)        in the event either Party ceases conducting business in a normal
course, becomes insolvent, makes a general assignment for the benefit of
creditors, suffers or permits the appointment of a receiver for its business or
assets, or avails itself of, or becomes subject to, any case or proceeding under
the Bankruptcy Code or any other statute of any state or country relating to
insolvency or the protection of creditor rights, or otherwise rejects this
Agreement in any case or proceeding under the Bankruptcy Code, the other Party
shall have a right to terminate this Agreement, provided that in the case of an
involuntary bankruptcy proceeding such right to terminate shall only become
effective if the other Party consents thereto or such proceeding is not
dismissed within ninety (90) calendar days after the filing thereof. The Parties
agree that each party may fully exercise all of its rights and elections under
the Bankruptcy Code.

 

(b)         This Agreement may be terminated with respect to a Product or
Products or an Applicable Country or Applicable Countries with respect to one or
more Products upon the mutual written consent of the Parties with respect to
such Product or Products or Applicable Countries.

 

9.3         Rights and Remedies upon Termination of Agreement. (a) In the event
this Agreement is terminated under Section 9.2(a): (1) the marketing,
distribution and sales rights granted to Jubilant for the Products in all
Applicable Territories shall terminate; (2) Cadista’s obligations to manufacture
and supply the Products to Jubilant, and Jubilant’s obligation to source the
Products for sale in the Applicable Territories exclusively from Cadista, shall
terminate; (3) Jubilant may sell all of the Products in its possession or
ordered prior to the effective date of such termination, provided that Jubilant
remits to Cadista, the Product Purchase Price for such Products in accordance
with Sections 7.1 and 7.3; and (4) any Regulatory Approvals relating to Products
and any Intellectual Property Rights belonging to Cadista will remain the sole
and exclusive property of Cadista and upon the written request of Cadista,
Jubilant shall promptly execute and deliver to Cadista or the applicable
Agencies designated by Cadista such letters and other documentation as Cadista
shall request in order to terminate Jubilant’s authority to act as regulatory
agent of Cadista pursuant to Section 4.4.

 

(b)          In the event this Agreement is terminated under Section 9.2(b), (1)
the marketing, distribution and sales rights granted to Jubilant for the
affected Products and/or the affected Applicable Countries shall terminate; (2)
Cadista’s obligations to manufacture and supply the affected Products to
Jubilant for sale in the affected Applicable Countries, and Jubilant’s
obligation to source the affected Products for sale in the affected Applicable
Countries exclusively from Cadista, shall terminate; (3) Jubilant may sell in
the affected Applicable Countries all of the affected Products in its possession
or ordered prior to the effective date of such termination for sale in the
affected Applicable Countries, provided that Jubilant remits to Cadista the
Product Purchase Price for such affected Products in accordance with Sections
7.1 and 7.3; and (4) any Regulatory Approvals relating to the affected Products
and any Intellectual Property Rights in the affected Applicable Countries
belonging to Cadista will remain the sole and exclusive property of Cadista and
upon the written request of Cadista, Jubilant shall promptly execute and deliver
to Cadista or the applicable Agencies designated by Cadista such letters and
other documentation as Cadista shall request in order to terminate Jubilant’s
authority to act as regulatory agent of Cadista pursuant to Section 4.4 with
respect to the affected Products or affected Applicable Countries.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

16

 

 

(c)          In the event the Term expires for an Applicable Country for a
Product: (1) the marketing, distribution and sales rights granted to Jubilant
for such Product in such Applicable Country shall terminate; (2) Cadista’s
obligations to manufacture and supply such Product to Jubilant, and Jubilant’s
obligation to source such Products for sale in such Applicable Country
exclusively from Cadista, shall terminate; (3) Jubilant may sell in such
Applicable Country all of the inventory of such Product in its possession or
ordered for sale in such Applicable Country prior to the expiration of the Term
for such Product in such Applicable Country, provided that Jubilant remits to
Cadista the Product Purchase Price for such Product in accordance with Sections
7.1 and 7.3, and (4) any Regulatory Approval relating to such Product in such
Applicable Country and any Intellectual Property Rights belonging to Cadista
will remain the sole and exclusive property of Cadista and upon the written
request of Cadista, Jubilant shall promptly execute and deliver to Cadista or
the applicable Agencies designated by Cadista such letters and other
documentation as Cadista shall request in order to terminate Jubilant’s
authority to act as regulatory agent of Cadista pursuant to Section 4.4 with
respect to such Product in such Applicable Country.

 

9.4         Survival. (a) Upon termination of this Agreement, it shall forthwith
become void and of no further force or effect, except for the following
provisions, which shall remain in full force and effect: (a) Section 6.5
(Product Recall); (b) Article VII (Payment of Marketing Commission; Product
Purchase Price; Accounting); (c) Article XII (Indemnification); (d) Article X
(Confidentiality), (e) Section 9.3 (Rights and Remedies Upon Termination); (f)
this Section 9.4 and (g) Article XIII. The rights and remedies provided in this
Article IX shall be cumulative and not exclusive of any rights or remedies
provided by Applicable Law.

 

(b)         Any termination of this Agreement shall not affect any right or
claim hereunder that arises prior to such termination, which claims and rights
shall survive any such termination, including, without limitation, any claim for
indemnification under Article XII. In addition, at Cadista’s option, Jubilant
all take delivery and pay for all Product subject to outstanding purchase orders
at the time of termination.

 

ARTICLE X – CONFIDENTIALITY

 

10.1         Confidentiality and Non-Use Obligations. (a) During the Term of
this Agreement and for five (5) years thereafter without regard to the means of
termination, neither Cadista nor Jubilant shall use, for any purpose other than
the purpose of this Agreement, reveal or disclose to any Third-Party information
and materials disclosed by the other Party (whether prior to or during the Term
of this Agreement), and marked as confidential or for which the receiving Party
knows or has reason to know are or contain trade secrets or other proprietary
information of the other Party (the “Confidential Information”) without first
obtaining the written consent of the other Party.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

17

 

 

(b)          The Parties shall take all reasonable precautions to prevent the
use or disclosure of such Confidential Information without first obtaining the
written consent of the other Party, except (i) as may be required for securing
Regulatory Approval, or as may otherwise be required to be disclosed to an
Agency in an Applicable Territory; or (ii) as required in connection with any
filings made by the Securities and Exchange Commission or similar non-U.S.
regulatory authorities or by the disclosure policies of a major stock exchange.

 

(c)          These restrictions upon disclosure and use of Confidential
Information shall not apply to any specific portion of Confidential Information
which:

 

(i)is Confidential Information which can be demonstrated by the recipient’s
documentary evidence to have already been in the possession of the recipient at
the time of disclosure by the other Party;

 

(ii)is or later becomes available to the public, as evidenced by documents which
were generally published, other than by a breach by the Party;

 

(iii)is received from a Third Party having legitimate possession thereof and the
independent legal right to make such disclosure;

 

(iv)is information developed by the Party entirely without reference or use of
Confidential Information, as established by probative documentary evidence; or

 

(v)is required to be disclosed by law or government regulation.

 

ARTICLE XI – REPRESENTATIONS, WARRANTIES AND COVENANTS

 

11.1          Legal and Governmental Compliance. Each Party shall comply with
all Applicable Laws, relating to the activities undertaken by such Party
hereunder.

 

11.2         Cadista Representations, Warranties and Covenants. Cadista
represents, warrants and covenants to Jubilant that the following are true and
correct as of the date stated therein, or if none is specified then as of the
date hereof:

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

18

 

 

(a)          Cadista is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Delaware and has full corporate
power to own its properties and conduct the business presently being conducted
by it, and is duly qualified to do business in, and is in good standing under,
the laws of all states in which its activities or assets require such status,
except in any case where the failure to be so qualified and in good standing
would not be material.

 

(b)          Cadista has full corporate right, power and authority to perform
its obligations pursuant to this Agreement, and this Agreement and the
transactions contemplated hereby have been duly and validly authorized by all
necessary corporate action on the part of Cadista. This Agreement has been duly
and validly executed by Cadista.

 

(c)          To the best of Cadista’s knowledge, it has not and will not use the
services of any persons debarred under 21 U.S.C. § 335(a) or (b) in any capacity
associated with or related to the manufacture of the Products including those of
its contract manufacturers.

 

11.3        Representations, Warranties and Covenants of Jubilant.

 

Jubilant represents, warrants and covenants to Cadista that the following are
true and correct as of the date stated therein, or if none is specified then as
of the date hereof:

 

(a)          Jubilant is a corporation duly organized, validly existing and in
good standing under the applicable laws of incorporation and has full corporate
power to own its properties and conduct the business presently being conducted
by it, and is duly qualified to do business in, and is in good standing under,
the laws of all states and nations in which its activities or assets require
such status, except in any case where the failure to be so qualified and in good
standing would not be material.

 

(b)          Jubilant has full corporate right, power and authority to perform
its obligations pursuant to this Agreement, and this Agreement and the
transactions contemplated hereby have been duly and validly authorized by all
necessary corporate action on the part of Jubilant. This Agreement has been duly
and validly executed by Jubilant.

 

(c)          Without limiting anything herein, Jubilant shall comply with all
Applicable Laws in performing this Agreement, including all marketing,
promotional or advertising activities.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

19

 

 

(d)          Jubilant is not debarred and will not to its knowledge use in any
capacity the services of any Person debarred under Section 335(a) of the FD&C
Act or that is subject to debarment or has otherwise been disqualified or
suspended from performing scientific or clinical investigations or otherwise
subject to any restrictions by any Governmental Authority or professional body
in the Applicable Territory for any Product with respect to the performance of
scientific or clinical investigations or other activities in the pharmaceutical
industry.

 

(e)          Except as otherwise provided in this Agreement, Jubilant shall
obtain and maintain all necessary licenses, permits or approvals required by any
relevant Governmental Authority in connection with the marketing, distribution
and sale of the Products in their respective Applicable Territory.

 

11.4        Limitation on Warranties. Except as expressly provided in this
Agreement, neither Party makes any representation or warranty to the other,
whether express or implied, either in fact or by operation of law, by statute or
otherwise, and both Parties specifically disclaim any and all implied or
statutory warranties, including, without limitation, any warranty of
merchantability or warranty of fitness for a particular purpose. In addition,
each Party understands and agrees that neither Party warrants nor commits that a
Product will be successfully developed, be submitted for applicable Regulatory
Approval, or receive applicable Regulatory Approval.

 

ARTICLE XII - INDEMNIFICATION; INSURANCE

 

12.1        Indemnification. (a)   Jubilant Indemnification. Jubilant agrees to
indemnify and hold forever harmless Cadista and each of its agents, directors,
officers and employees from and against any third-party loss, damage, action,
proceeding, expense or liability (“Losses”) arising from or in connection with
(i) the offer for sale, sale or distribution by Jubilant in the Applicable
Territory of a Product, except for Losses to the extent Cadista has agreed to
indemnify Jubilant pursuant to Section 12.1(b); (ii) infringement or
misappropriation of any copyright or trademark arising out of the marketing
and/or sale of a Product in the Applicable Territory during the Term; (iii) the
breach or inaccuracy of any representations, warranties or covenants made by
Jubilant in this Agreement; and (iv) a Recall described in Section 6.5(b).

 

(b)          Cadista Indemnification. Cadista agrees to indemnify and hold
forever harmless Jubilant and its Affiliates and each of their agents,
directors, officers and employees from and against any Losses arising from or in
connection with: (i) the breach or inaccuracy of any representations, warranties
or covenants made by Cadista in this Agreement; (ii) Cadista’s manufacture and
supply of a Product that does not meet applicable Product Specifications or such
Product Warranties provided in Section 8.1 at the time of delivery and during
the shelf life of such Product; (iii) the infringement or misappropriation of
any patent or trade secret of any Third Party relating to any Product; (iv)
Service Level Charges; (v) Destination Charges; and (vi) a Recall described in
Section 6.5(a) and Section 6.5(c).

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

20

 

 

12.2        Procedure; Limitation of Liability. The indemnities set forth in
this Article XII are subject to the condition that the Party seeking indemnity
shall forthwith notify the other Party on being notified or otherwise made aware
of a suit, action or claim and that the indemnifying Party defend and control
any proceedings, with the other Party being permitted to participate at its own
expense (unless there shall be a conflict of interest which would prevent
representation by joint counsel, in which event the indemnifying Party shall pay
for the reasonable costs of other Party’s counsel, to be selected by the
indemnifying Party upon consent of the other Party, not unreasonably withheld);
provided that the indemnifying Party may not settle the suit or otherwise
consent to any judgment in such suit without the written consent of the
indemnified Party (such consent not to be unreasonably withheld or delayed). The
Parties shall cooperate in the defense of any Third Party claim. The Parties
acknowledge and agree that the indemnity provisions of Section 12.1 shall
comprise the Parties’ sole and exclusive remedy at law or equity for matters
relating to the subject matter of this Agreement. Notwithstanding anything to
the contrary contained herein, Jubilant’s liability to Cadista for
indemnification and/or breach of this Agreement is limited to $250,000 in the
aggregate for each Applicable Country of the Applicable Territory of each
Product.

 

12.3        Other Product Liability Claims. To the extent either party incurs
any Losses arising from or in connection with any claim based on product
liability with respect to the Product to the extent not arising from the actions
set forth in Sections 12.1(a) and 12.1(b), above (“Product Claim”) such Losses
shall be borne by Cadista.

 

12.4        DISCLAIMER. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED
HEREIN, NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY COVER, SPECIAL,
CONSEQUENTIAL, INCIDENTAL OR INDIRECT DAMAGES OR EXPENSES, INCLUDING WITHOUT
LIMITATION DAMAGES FOR LOST PROFITS, LOSS OF OPPORTUNITY OR USE OF ANY KIND,
SUFFERED BY THE OTHER PARTY, WHETHER IN CONTRACT, TORT OR OTHERWISE.

 

12.5        Insurance. During the term of this Agreement and for a period of
five (5) years after its expiration or earlier termination, each Party shall
obtain, at its sole cost and expense, liability insurance applicable to its
performance under this Agreement, which meets the following requirements:

 

(a)          the insurance shall insure such Party against all liability related
to its activities relating to the development, manufacture or sale of a Product
(whether such Party’s liability arises from its own conduct or by virtue of its
participation in this Agreement), including liability for bodily injury,
property damage, wrongful death, and any contractual indemnity obligations
imposed by this Agreement; and

 

(b)          the insurance shall be in amounts that are reasonable and customary
in the United States in the pharmaceutical industry, but in no event shall
liability insurance relating to manufacture, sale or distribution of a marketed
product maintained by such Party cover less than the greater of (i) ten million
U.S. dollars (U.S. $10,000,000) per occurrence (or claim) and an annual
aggregate of ten million U.S. dollars (U.S. $10,000,000) or (ii) such limits
required to be maintained by Jubilant as mandated by Jubilant’s customers. All
such policies shall include a contractual endorsement naming the other Party to
this Agreement as an additional insured and require the insurance carriers to
provide such other Party with no less than thirty (30) days’ written notice of
any change in the terms or coverage of the policies or their cancellation.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

21

 

 

ARTICLE XIII - MISCELLANEOUS

 

13.1         Force Majeure. Neither Party shall lose any rights hereunder or be
liable to the other Party for damages or Losses on account of failure of
performance by the defaulting Party if the failure is occasioned by government
action, war, fire, explosion, flood, strike, lockout, embargo, act of God, or
any other similar cause beyond the reasonable control of the defaulting Party,
provided that the Party claiming force majeure has exerted all reasonable
efforts to avoid or remedy such force majeure and given prompt notice to the
other Party.

 

13.2         Notices. All notices or other communications given pursuant hereto
by one Party hereto to the other Party shall be in writing and shall be deemed
given (a) when delivered by messenger, (b) when sent by telecopier (with receipt
confirmed), (c) when received by the addressee, if sent by express mail, federal
express or other express delivery service (receipt requested) or (d) three (3)
days after being mailed in the U.S., first-class postage prepaid, registered or
certified, in each case to the appropriate addresses and telecopy number set
forth below (or to such other addresses and telecopy numbers as a Party may
designate as to itself by notice to the other Party):

 

Notices for Jubilant shall be sent to:

 

Jubilant Life Sciences Ltd.

Plot No 1-A, Institutional Area,

Sector 16/A Noida 201 301,

Uttar Pradesh, India

Attn: President

 

Notices for Cadista shall be sent to:

 

Jubilant Cadista Pharmaceuticals Inc.

207 Kiley Drive

Salisbury, Maryland 21801

Attn: President

 

13.3        Governing Law. This Agreement shall be governed by the laws of the
State of New York, as such laws are applied to contracts entered into and to be
performed within such state, as though made and to be fully performed therein
without regard to conflicts of law principles thereof. The United Nations
Convention on Contracts for the International Sale of Goods will not apply to
this Agreement.

 

13.4         Non-waiver of Rights. Except as specifically provided for herein,
the waiver from time to time by any of the Parties of any of their rights or
their failure to exercise any remedy shall not operate or be construed as a
continuing waiver of same or of any other of such Party’s rights or remedies
provided in this Agreement.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

22

 

 

13.5         No Agency. Neither Party shall by virtue of this Agreement have any
power to bind the other to any obligation nor shall this Agreement create any
relationship of agency, partnership or joint venture.

 

13.6         Severability. If any term, covenant, or condition of this Agreement
or the application thereof to any Party or circumstance shall, to any extent, be
held to be invalid or unenforceable, then (i) the remainder of this Agreement,
or the application of such term, covenant or condition other than those as to
which it is held invalid or unenforceable, shall not be affected thereby and
each term, covenant, or condition of this Agreement shall be valid and be
enforced to the fullest extent permitted by law and (ii) the Parties hereto
covenant and agree to renegotiate any such term, covenant, or application
thereof in good faith in order to provide a reasonably acceptable alternative to
the term, covenant, or condition of this Agreement or the application thereof
that is invalid or unenforceable.

 

13.7         Entire Agreement. This Agreement together with the Exhibits and
Schedules hereto sets forth all the covenants, promises, agreements, warranties,
representations, conditions, and understandings between the Parties hereto in
the scope of the collaboration, and supersedes and terminates all prior
agreements and understanding between the Parties under this Agreement. No
subsequent alteration, amendment, change, or addition to this Agreement shall be
binding upon the Parties hereto unless reduced to writing and signed by the
respective authorized officers of the Parties.

 

13.8         Assignment. No Party shall, without the prior written consent (not
to be unreasonably withheld or delayed) of the other Party having been obtained,
assign or transfer this Agreement to any Third-Party, provided, however, that
any Party may assign or transfer this Agreement (in whole or in part) to any
Affiliate, provided that the assigning Party shall guarantee the performance of
that Affiliate, or to any successor by merger of such Party of its
pharmaceutical business, or to the Purchaser of all or substantially all of such
assets of, or stock relating to, its pharmaceutical business, without the prior
written consent of the other Party hereto. This Agreement shall be binding upon
and shall inure to the benefit of the Parties and their successors and permitted
assigns.

 

13.9         Facsimile Execution. This Agreement may be executed in
facsimile-signature counterparts, including PDF/email, each of which is hereby
agreed to have the legal binding effect of an original signature. The Parties
hereto agree to forward the original signatures by overnight mail to the other
Party upon execution, if requested.

 

13.10      Third Party Beneficiaries. This Agreement has no intended third party
beneficiaries.

 

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their duly authorized representatives as of the day and year first indicated
above.

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

23

 

 

JUBILANT LIFE SCIENCES LTD.   JUBILANT CADISTA PHARMACEUTICALS INC.          
By: /s/ Dev Kumar Singh   By: /s/Kamal Mandan   NAME: Dev Kumar Singh     NAME:
Kamal Mandan   TITLE: GU Head     TITLE: Chief Financial Officer

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.

 

24

 

 

SCHEDULE 1

 

Products

 

Product   Innovator Product   Dosage Form   Applicable Territory [***]   [***]  
[***]   [***] [***]   [***]   [***]   [***] [***]   [***]   [***]   [***] [***]
  [***]   [***]   [***] [***]   [***]   [***]   [***] [***]   [***]   [***]  
[***] [***]   [***]   [***]   [***] [***]   [***]   [***]   [***] [***]   [***]
  [***]   [***]

 

Amendments to the foregoing table shall be evidenced by the signatures below.

 

JUBILANT LIFE SCIENCES LTD.   JUBILANT CADISTA PHARMACEUTICALS INC.         BY:
     BY:      NAME :     NAME :   TITLE:     TITLE:   DATE:     DATE:

 

*** Confidential treatment requested pursuant to a request for confidential
treatment filed with the Securities and Exchange Commission. Omitted portions
have been separately filed with the Commission.