Exhibit
10.62


 


GILEAD
WORLD MARKETS, LTD. and PPG

TENOFOVIR DF MANUFACTURING SUPPLY AGREEMENT


 


THE PARTIES HEREBY ACKNOWLEDGE
THE FOLLOWING:


 


THIS
SUPPLY AGREEMENT (“Agreement”) is entered into as January 1, 2003 (the
“Effective Date”), by and between  PPG-Sipsy
S.A.S., a French company having a place of business at Z.I. la Croix Cadeau,
B.P. 79, 49242 Avrille Cedex, France (“PPG”) and Gilead World Markets, Ltd., a
company operating under the laws of the Cayman Islands, having its principal
place of business at Queensgate House, South Church Street, PO Box 1234GT,
Grand Cayman (“GWM”).   PPG and GWM may
be referred to singly as “Party” and collectively as “Parties” in this
Agreement.


 


                WHEREAS, PPG is a known
manufacturer of active pharmaceutical ingredients with expertise in “cGMP”
manufacturing, and GWM and its designees manufacture and market pharmaceutical
products for human use, including tenofovir disoproxil fumarate 300 mg  (“Viread®”);


 


                WHEREAS, PPG and GWM desire to
establish mutually agreeable terms for the commercial supply of tenofovir
disoproxil fumarate (“Product”) as an active pharmaceutical ingredient by PPG
to GWM.


 


                NOW, THEREFORE, in consideration
of (i) PPG’s agreement to manufacture Product and supply to GWM for the
monetary amounts set forth in this Agreement; (ii) the promises, covenants,
agreements and other valuable consideration hereinafter set forth, and
intending to be legally bound, the Parties hereby agree as follows:


 


1.               AGREEMENT
ACCEPTANCE: PPG has read and
understands this Agreement and understands that it will govern PPG’s written
acceptance of any order for or delivery of any Product.  All terms and conditions with respect to an
order for Product proposed by PPG which are different from or in addition
to this Agreement and are not agreed to in writing by GWM are expressly
rejected by GWM, and shall not become a part of this Agreement or such
order.  GWM has read and understands
this Agreement and shall purchase the Product manufactured by PPG and pay for
the supply of the Product in accordance with the terms and provisions of this
Agreement.  With the exception of any
Product delivery pursuant to the ***, and the                        ***         , any delivery of Product after the
Effective Date of this Agreement shall be governed by the terms of this Agreement.  Any modifications to this Agreement shall,
prior to their implementation, be mutually agreed upon by the parties hereto
and shall be made in accordance with Section 28.


 


Neither
the General Sales Conditions of PPG nor the General Purchase Conditions of GWM
shall apply to the supply of the Product by PPG to GWM.


 


2.               TERM:  The term of this
Agreement shall begin as of January 1, 2003, and shall remain in effect until
December 31, ***        (the “Initial
Term”), and thereafter for subsequent     ***         renewal terms (each a
“Renewal Term”), unless terminated at the end of the Initial Term or any
Renewal Term by either Party with at least       ***         prior written notice or
unless otherwise terminated according to Section 12 “Termination” of this
Agreement.


3.               SUPPLY:  During the term of this Agreement, PPG shall manufacture Product for
GWM for use in Viread®.  During the term of this Agreement, PPG is
obligated to manufacture Product at the location and in the quantities set
forth herein.


a)              PPG will
manufacture the Product for GWM only from its facility located at            ***                         , or such other facilities as the Parties
agree to in writing.


 












***
Portions of this page have been omitted pursuant to a request for Confidential
Treatment and filed separately with the Commission.


Page 1

















 


b)             During the Initial
Term and any Renewal Term GWM will purchase and PPG shall deliver at least the
quantities set forth in Exhibit A.            ***          will result in          ***                         
to the     ***         
for such                ***          the         ***         
the invoice for which will be issued in the calendar year for which the                          ***         
of the     ***         
as described in Section 12, then         ***  will be  ***           to
the quantities of Product ordered                    ***       such    ***           
in addition to       ***         as
described in Section 12.


c)              Forecasting:  
On the first day of each            ***          GWM shall provide to PPG
the projected need for Product for  ***          the                 ***         
period commencing            ***          from the date of
forecast.  The quantities indicated in
the first   ***         
period of the         ***         projection
will be an affirmative obligation for GWM to purchase, and an affirmative
obligation for PPG to supply Product within the limits of              ***           The quantities indicated in the second  *** 
period of the        ***         
projection will be considered as a forecast only.   With the exception of calendar year 2003 for which               ***         ,
notwithstanding anything in this Agreement, PPG’s    ***          in any given
        ***         
period shall be ***             
indicated in                 ***          in which the         ***         
period falls.


d)             Acceptance:  PPG shall respond to each order received from GWM
within              ***         
calendar days of receipt.  The response
shall include PPG’s inability to comply with, or confirmation of the delivery
dates and quantities set forth in the order.


e)              Each shipment of
Product hereunder will be delivered to a facility of GWM, or a GWM designee,
and in such quantities as designated by GWM on its purchase order (the “GWM
Purchase Order”), material transfer request, or by subsequent written
instruction given by GWM and in accordance with the instructions for shipping
and packaging included in such GWM Purchase Order (each facility so designated
shall be a “GWM Location”). Any other additional terms and conditions provided
on such GWM Purchase Orders shall not apply as the terms and conditions of this
Agreement shall apply alone.


f)                If PPG is unable to
supply sufficient quantities of the Product to meet either its minimum
obligations under Section 3(b), or any GWM Purchase Order (whether or not
accepted by PPG), or should either Party perceive that a shortfall in delivery
of Product by PPG is likely to occur for any reason, the Parties shall discuss
appropriate steps to alleviate such a shortfall                   ***         .  GWM shall have the right  ***         .  Any quantities  ***          to meet such
a shortfall shall be       ***          and        ***          in which the
shortfall occurs.  If GWM must       ***         
a             ***         
any costs beyond the Base Price, as agreed by the Parties and as described in
Exhibit B, for the shortfall quantity, but limited to a total cost of not more
than   ***         
of the Base Price. Repeated shortfalls may be considered a material breach of
this Agreement, as described in section 12 of this Agreement.


g)             If release and/or
shipment of any quantity is delayed after PPG has accepted an order, through
the fault of PPG, by more than   ***                 the quantity shall
be considered a shortfall, and treated as above in Section 3(f).  If such delay is caused by GWM, GWM shall
make              ***         to
remediate the fault as soon as reasonably practicable.


 


 


Page 2

















 


4.               GOOD MANUFACTURING PRACTICES: PPG expressly warrants that all goods covered by this
Agreement will be manufactured in accordance with current good manufacturing
practices (“cGMP”) as established by the United States Food and Drug
Administration (the “FDA”), and the European Agency for Evaluation of Medicinal
Products (“EMEA”) for the manufacture of pharmaceutical materials, as well as
other applicable rules and regulations of the FDA, EMEA, and other governmental
or regulatory agencies of the United States or the European Union.  Each Party shall promptly notify the other
of any new instructions or specifications required by the FDA, the Federal
Food, Drug and Cosmetic Act, the Federal Public Health Service Act or other
applicable rules and regulations of the United States or the European Union,
and shall confer with each other with respect to the best means to comply with
such requirements and shall allocate any costs of implementing such changes on
an equitable basis.  Upon written
request of GWM, PPG will permit representatives of GWM to observe such
manufacture, or any government inspection of PPG’s manufacturing process for
the Product, at mutually agreeable times and PPG shall permit GWM to inspect
copies of PPG’s manufacturing records, including its batch records, for the
purposes of assuring Product quality and compliance with agreed-upon
manufacturing procedures.


 


5.               MANUFACTURING PROCESS AND BATCH RELEASE TESTING: GWM shall make available to PPG, free of
charge, all such know-how, information, and technical assistance if needed by
PPG so as to allow PPG to manufacture TENOFOVIR DF (the “Product”) to the
standard of GWM as will be more precisely described by GWM in writing to PPG
before the start of manufacturing of the Product.  PPG shall manufacture the Product in conformance with the
specifications (the “Specifications”) set forth in the Gilead Sciences
Tenofovir DF Contract Manufacturing Manual which is in effect on the Effective
Date of this Agreement, and as thereafter amended (the “Contract Manufacturing
Manual”), and according to the manufacturing process description as set forth
in the Contract Manufacturing Manual. 
PPG shall test each batch of Product for conformance to the
specifications according to the Standard Test Methods as set forth in the
Contract Manufacturing Manual.


 


6.               RAW MATERIALS: Raw materials used in the manufacture of Product will
conform to the specifications set forth in the Contract Manufacturing Manual
(the “Raw Material Specifications”) and such conformance will be verified in
accordance with the testing standards and procedures specified therein.  PPG agrees that it will facilitate changes
to the Raw Material Specifications that are necessary or appropriate in light
of FDA or other regulatory requirements. 
PPG shall not be liable hereunder if the raw materials meet the Raw
Material Specifications and the Product fails to meet the Specifications
because the raw material specifications are inadequate.


 


7.               CHANGE IN MANUFACTURING PROCESS: PPG shall obtain GWM’s prior written
approval before implementing any planned change in the materials, equipment,
process, or procedures used to manufacture the Product that would constitute a
change under cGMP, would impact the validation status of the process, or would
constitute noncompliance with the manufacturing process set forth in the
Contract Manufacturing Manual.  PPG
shall disclose all proposed changes in such manufacturing materials, equipment,
process, or procedure to GWM at a level sufficient to allow GWM to practice such
changed manufacturing process.  GWM shall
notify PPG in writing with reasonable notice of any change in the materials,
equipment, process, analytical methods, specifications, or procedures to be
used in the manufacture of the Product whether such changes are to be reflected
as updates to the Contract Manufacturing Manual or otherwise.  PPG shall provide GWM with an authentic copy
of the current Master Batch Record for the preparation of the Product.


 


The cost of implementing
any amendment or change of whatever nature to the procedures or specifications
described in the Contract Manufacturing Manual as it exists on the Effective
Date of this Agreement, as well as any extra costs resulting from the
implementation of such change, shall be borne by            ***         through
an            ***         which the Parties shall negotiate
in good faith.


 


 


Page 3

















 


8.               PROCESS IMPROVEMENTS: ***        agrees to communicate promptly to ***          any
idea and substantial improvement (patented or unpatented) made or developed
solely or jointly by ***  arising from its activities under this Agreement and
relating to the processing or manufacture of the Product (“Improvement”).  All rights and title to Improvements that
have no foreseeable uses other than those related to the processing or
manufacture of the Product shall be assigned to              ***, which shall have
only the right to utilize such Improvements in the manufacture of the
Product.  All rights and title to
Improvements (patented or unpatentable) that have applications other than those
related to the processing or manufacture of the Product and that do not contain
specific know-how of ***        developed prior to the Effective Date, shall be
assigned to         ***,
which shall have only the right to utilize such improvements in the processing
and manufacture of the Product and any structurally related Gilead
pharmaceutical compound.      *** grants to ***        a royalty-free worldwide exclusive license limited
to processing or manufacture of the Product and any structurally related Gilead
pharmaceutical compound for Improvements that have applications other than
those related to the processing or manufacture of the Product, but do not
contain specific        *** know-how developed prior to the Effective
Date. If              *** contracts
out the processing or manufacture of the Product, or structurally related
Gilead pharmaceutical compounds to any third party, any Improvement may be
disclosed to such contract manufacturer but rights to use the same shall be
restricted to the processing and manufacture of the Product, or structurally
related Gilead pharmaceutical compounds, and the Parties hereto will discuss in
good faith an appropriate remuneration to            ***          before
implementing any such disclosure to said third party.


 


9.               QUALITY CONTROL SAMPLE AND DOCUMENTATION: Manufacture of the Product shall at all
times be in strict conformance with the Specifications and such conformance
will be verified in accordance with the testing procedures specified
therein.  Prior to the delivery of any
batch of Product, PPG shall provide GWM with (i) a quality control sample of
such to be held by GWM for analytical reference, (ii) written confirmation that
the batch records for such batch have been reviewed and approved by PPG’s
quality assurance unit (Certificate of Compliance), and (iii) a Certificate of
Analysis confirming that such batch meets Specifications.  Quality control sampling, unless otherwise
specified by GWM in writing, shall be in accordance with the most current Drug
Substance Sampling/Testing Plan contained in the Contract Manufacturing Manual.


 


10.         QUANTITY
AND PRICE: Subject to adjustment as
provided in this Agreement, GWM shall pay to PPG the prices in Exhibit B.  Using Exhibit B, “Invoice” price is set on
*** of each calendar year for the subsequent calendar year using the                ***         
plus the forecast given by GWM for the second  ***          in accordance with Section
3.c.    Adjustment will be made         ***         
based on         ***         
such year, with a corresponding      ***          of that calendar year based
on the   ***         .


 


PPG
agrees that if process improvements are discovered and mutually agreed upon in
accordance with Sections 7 and 8, and which have a material effect on Product
manufacturing cost, the Parties will negotiate in good faith               ***.


 


 


 


Page
4

















 


11.         SHIPPING,
BILLING AND PAYMENT:
Unless otherwise agreed by the Parties in writing, all shipments shall be
shipped  ***         
(Incoterms 2000), pursuant to written instructions provided by GWM to PPG.  However,             ***          shall be responsible for
the     ***.  PPG will package and ship the Products in
accordance with PPG’s customary practices for pharmaceutical compounds, unless
otherwise specified by GWM.  Within     ***         
calendar days of receipt of such shipping instructions from GWM, PPG shall ship
the invoiced amount of Product to its destination.  All invoices from PPG to GWM covering Product shipped to GWM
shall be stated, and all payments to PPG by GWM shall be made in      ***.  Payments due to PPG shall be made by wire
transfer to the bank account of PPG of which PPG shall advise GWM from time to time.  The invoices will be issued upon completion
of the batches and issuance of the applicable quality control sample/s in
accordance with Section 9.  PPG’s
invoice shall be paid by GWM not later than *** calendar days following the later of
(i) the receipt of the applicable invoice, or (ii) receipt of the Certificate
of Analysis and Certificate of Compliance. 
Any invoiced amount which is not paid within      ***          of its due
date shall be assessed a late payment fee at the rate of             ***    
or the maximum rate permitted by applicable law with respect to such
obligations, whichever is less.  At             ***         
credit terms can be adjusted            ***          as justified by      ***.


 


12.         TERMINATION:  Either Party may terminate this Agreement
for a material breach by the other Party. A material breach may be encountered
if either Party: (a) repudiates or breaches a      ***          of this Agreement; or (b)
fails to perform services or deliver goods as provided in this Agreement.  Termination under this section must be
performed by giving the breaching Party written Notice, specifying the
circumstances of the breach, including the provisions of this Agreement that
are breached. The breaching Party, if such a breach has indeed occurred, has               ***         
calendar days to cure such breach of this Agreement.


 


If
the breach has not been cured at the end of the                    ***      calendar day period or if the
breaching Party is not making diligent, good faith efforts to cure such breach,
then, upon immediate Notice to the breaching Party, the breaching Party shall
be in default and the non-breaching Party may terminate this Agreement.  If the breaching Party is making diligent,
good faith efforts to cure such breach, the breaching Party shall be granted an
additional     ***    
calendar day period to cure said breach. Unless the termination is on the
grounds of a material breach resulting     ***         , GWM shall purchase raw
material and intermediates at PPG’s actual cost and inventories of the Product
at the purchase price then in effect according to provisions of Appendix B
hereto as amended during the performance of this Agreement.  Otherwise, GWM shall have the right, but not
the obligation, to purchase such raw materials, intermediates and inventories
of the Product pursuant to Section 10 as GWM may determine in its sole
discretion.


 


In
the event that either Party becomes bankrupt, the other Party may, with
immediate Notice to the first Party, terminate the Agreement with no
liabilities whatsoever, subject to relevant legislation and provisions herein
contained.


GWM may terminate this Agreement
in whole or in part at any time by giving *** days written
notice to PPG, if GWM, in its sole discretion, determines that         ***         
or if any   ***      
a             ***         
on          ***         
or  
***  of the     ***          or           ***        
of           ***.  GWM may terminate this Agreement if any ***  that         ***         
any ***                 the result of which
is          ***        
the         ***         
or to       ***         on
the ***.  Should GWM terminate this Agreement due to
the reasons contained in this Article, PPG shall take reasonable measures to
cease any ongoing production and limit further expenses associated with such
ongoing production.  GWM shall
purchase raw material and intermediates at PPG’s actual cost and inventories of
the Product at the purchase price then in effect according to provisions of
Appendix B hereto as amended during the performance of this Agreement, and will reimburse PPG for reasonable expenses
incurred by PPG with respect to the remainder of said GWM Purchase Order prior
to the effective date of the termination.


Except
as otherwise set forth in this Agreement, termination of this Agreement shall
not release any Party hereto from any payment, liability or other obligation
existing at the date of termination.


 


 


Page
5

















 


13.         LIMITED WARRANTY: PPG warrants that Product delivered hereunder will
(i) be manufactured by PPG in accordance with cGMP and other applicable FDA,
EMEA, and other rules and regulations of the United States or the European
Union, (ii) be manufactured in accordance with the agreed-upon manufacturing
procedures described in the master batch records supplied to GWM in accordance
with the provisions of Section 7, as may be modified and disclosed to GWM in
accordance with the provisions of Section 7, (iii) conform to the  Specifications set forth in the  Contract Manufacturing Manual at the time of
Product manufacture, and (iv) be provided in compliance with all applicable
laws and regulations as more fully set forth in Section 4 above.  GWM’s remedies and PPG’s liability with
respect to these warranties are set forth below.  These are the only
representations or warranties PPG makes and all other express or implied
warranties, under statute or arising otherwise in law from a course of dealing
or usage of trade, including without limitation, any other warranty of fitness
for a particular purpose or use, are disclaimed by PPG.  If any Product fails to conform to the
warranties herein, PPG’s exclusive obligation and GWM’s (or GWM’s affiliates’)
exclusive remedy (subject to SECTIONS 12 and 17) shall be as set forth in Section
14.  Except as provided in the
immediately preceding sentence, in no event will PPG be liable under any theory
of recovery (whether based on negligence of any kind, strict liability or tort)
for any direct, indirect, special, incidental, or consequential damages in any
way related to, arising from or resulting from any use made of the Product.  Nothing in this Section 13 is intended as a
limitation of indemnification obligations of PPG pursuant to Section 15, or the recall obligations of PPG under section
17.


14.         REJECTION:  GWM may
reject Product delivered by PPG for failure to comply with the warranties in
Section 13 by giving PPG written notice, upon which the Parties will cooperate
to determine whether rejection was necessary or justified.  PPG will notify GWM promptly as to whether
it accepts GWM’s basis for any rejection. 
If the Parties disagree whether the Product batch did not comply with
the warranties, they will submit a sample of such Product batch and applicable
documentation to a mutually acceptable independent third party laboratory.  Such third party laboratory shall determine
whether such Product batch conforms with the warranties, and such determination
shall be final, binding and determinative as to whether rejection of such
Product batch was justified.  The Party
against whom the third party tester rules shall bear all costs of the third
party testing.  If GWM has given notice
of rejection, at GWM’s request PPG shall use best efforts to replace such
rejected Product.  If the third party
tester rules that a rejected batch meets the warranties, GWM will purchase such
batch, irrespective of whether PPG has already replaced it.  If PPG accepts GWM’s basis for rejection or
the third party tester rules that a rejected batch did not meet the warranties,
PPG will not charge GWM for such batch or for shipping, insurance or freight
costs therefor, or shall promptly refund any such amounts already paid by
GWM.  At its election, GWM may    ***, until and unless it is finally
determined that the batch complied with the warranties in Section 13.


15.         INDEMNIFICATION BY PPG: PPG agrees to indemnify, hold harmless and defend GWM
and GWM’s directors, officers, employees and agents, and the directors,
officers, employees and agents of any GWM parent, subsidiary, or related
company (the “GWM Indemnitees”) from and against any and all losses,
liabilities, judgments, damages, costs, reasonable fees, and expenses,
including reasonable attorneys’ fees (collectively, “Losses”) resulting from
any third party claim, demand, action, suit or proceeding (collectively, “Third
Party Claim”) arising out of (i) PPG’s manufacture of Product which fails to
comply with PPG’s obligations under this Agreement, (ii) the transportation,
storage or use of the Product by PPG while the Product is in its control, or
(iii) any negligent or wrongful act or omission of PPG or any PPG Indemnitee
relating to this Agreement, including without limiting the generality of the
foregoing any Losses whatsoever with respect to Third Party Claims of death or
injury to person or damage to property, provided that GWM provides PPG with
prompt notice of any such Third Party Claim and the exclusive ability to defend
(with the reasonable cooperation of GWM) or settle any such Third Party Claim, except to the extent
that PPG has a right of indemnification or defense with respect to any such
Loss or Third Party Claim pursuant to Section 16.


 


 


Page 6

















 


16.         INDEMNIFICATION
BY GWM: GWM
agrees to indemnify, hold harmless, and defend PPG and PPG’s directors,
officers, employees and agents, and the directors, officers, employees and
agents of any PPG parent, subsidiary, or related company (the “PPG
Indemnitees”) from and against any and all Losses resulting from Third Party
Claims arising out of (i) the                               ***          relating to the manufacture
of the Product made available by GWM to PPG, (ii) possession, use,
transformation, or sale of the Product by any person other than a PPG
Indemnitee, or (iii) any negligent or wrongful act or omission of GWM or any
GWM Indemnitee relating to this Agreement, including without limiting the
generality of the foregoing any Losses whatsoever with respect to Third Party
Claims of death or injury to person or damage to property, provided that PPG
provides GWM with prompt notice of any such Third Party Claim and the exclusive
ability to defend (with the reasonable cooperation of PPG) or settle any such
Third Party Claim, except
to the extent that GWM has a right of indemnification or defense with respect
to any such Loss or Third Party Claim pursuant to Section 15.


 


17.         RECALLS
AND ADVERSE EVENTS:
If there is a recall or there are adverse events for Product that may be
related to the processing or manufacture of Product by PPG, PPG shall provide
at GWM’s cost any assistance reasonably requested by GWM in connection with
such recall or adverse events. If Product is recalled due to a breach of the
warranty in Section 13, PPG shall be responsible for reasonable out-of-pocket expenses incurred in connection with such
recall or seizure including loss of Viread®, notification, transportation, destruction expenses and replacement
costs              ***.


 


18.         NO IMPLIED
LICENSES: No
right, express or implied, is granted by this Agreement to either Party to use
in any manner the name of the other or any other trade name or trademark or
other intellectual property rights of the other in connection with the
performance of the work covered by this Agreement.


 


19.         INDEPENDENT
CONTRACTORS: Each
Party hereto shall act as an independent contractor and nothing in this
Agreement shall be construed as to give either Party the authority to act for,
bind, or commit the other Party in any way whatsoever.


 


20.         FORCE
MAJEURE: Neither
Party shall be liable for failure to perform or for delay in performing any of
its obligations under this Agreement, if such failure or delay is caused by
lack of supply of materials through no fault of such Party, an act of God,
riot, fire, explosion, flood, hostilities of war, executive legislation or administrative
order, or other conditions reasonably beyond the control of such Party,
provided that the Party experiencing the delay promptly notifies the other
Party of the delay and uses and continues to use best efforts to overcome such
cause.  If such cause shall continue for
a period of         ***         
and is not overcome by the Party whose performance is affected, the Party not
subject to the force majeure may           ***          without liability from the
date of expiration of such period, except as provided in           ***. Specifically excluded from this
provision is any interference, caused by         ***
or    ***, of the ability of PPG to perform any
of its obligations.  PPG shall inform
GWM of such interference, its extent and duration, without delay.  Any interference, caused by         *** or    ***,
of the ability of PPG to perform its obligations for more than             *** shall constitute a shortfall, as per
Sections 3(f) and 3(g) of this Agreement.


 


 


Page 7

















 


21.         NONASSIGNABILITY: Neither Party may assign or transfer
this Agreement or any rights or obligations hereunder without the prior written
consent of the other Party, except that: (a) GWM may make such an assignment or
transfer without the other Party’s consent if such assignment or transfer is to
a successor to substantially all of the business of GWM relating to the
Product, whether in a merger, sale of stock, sale of assets, or other similar
transaction, and (b) PPG may make such an assignment or transfer without prior
written consent, provided that in such event GWM shall have the option to                                ***         , with a minimum of ***
written notice         ***.        ***        shall leave GWM without liability
beyond the               ***.  Any assignment or transfer or attempted
assignment or transfer by either Party in violation of the terms of this
Section 21 shall be null and void and of no legal effect.  In the case of any permitted assignment or
transfer of or under this Agreement, this Agreement shall be binding upon, and
inure to the benefit of, the successors, executors, heirs, representatives,
administrators, and assigns of the Parties hereto.


 


22.         GOVERNING
LAW: This
Agreement are made in accordance with and shall be governed by and construed,
interpreted, enforced, and applied under the laws of           ***, excluding its choice of law rules and
excluding the United Nations’ Convention on Contracts for the Sale of
Goods.  Should any part of this
Agreement be in conflict with any applicable law, all other provisions of this
order shall remain in force and the Parties hereto shall mutually and in good
faith modify the invalid or unenforceable provisions so as to maintain
essentially the spirit hereof and the original will of the Parties.


 


23.         SEVERABILITY: In the event any term of this Agreement
is held to be invalid or unenforceable under any statute, regulation,
ordinance, executive order or other rule of law, such term shall be deemed
modified or deleted, but only to the extent necessary to comply with such
statute, regulation, ordinance, order or rule, and the valid or enforceable
portion thereof and the remaining terms of this Agreement will remain in full
force and effect, unless the invalid or unenforceable provisions are of such
essential importance to this Agreement that it is reasonably assumed that the
Parties would not have entered into this Agreement without the invalid terms.


 


24.         WAREHOUSING: After ownership of the Product has
transferred to GWM and upon agreement by both Parties, PPG agrees to hold
supplies of the Product at PPG’s facility  ***,
until further shipping instructions are available from GWM.  Storage of the Product shall be in
accordance with cGMP and other applicable FDA, EMEA, and other rules and
regulations of the United States, and the European Union.  *** shall bear the cost of any insurance
against loss of the Product while it is maintained at PPG’s facility. GWM will
make all appropriate efforts to move the Product from PPG’s facility in a
reasonable period of time.


 


25.         NOTIFICATION
POLICY: The terms
and conditions of the              ***        shall apply the processing and manufacture
of Product under this Agreement, with GWM to be substituted for      *** for such purposes.


 


26.         NOTICES: All notices under this Agreement shall
be in writing and shall be delivered personally, sent for next day delivery by
internationally recognized courier service or transmitted by facsimile
(transmission confirmed), with confirmation by next day delivery by an
internationally recognized courier service, to the following addresses and
facsimiles of the respective Parties or such other address or facsimile as is
notified pursuant to this Section 26:


 


 


 


Page 8

















 


	
  If to GWM:

  	
   

  	
  With a copy to: 

  
	
   

  	
   

  	
   

  
	
  Gilead World Markets, Ltd.

  	
   

  	
  Gilead Sciences, Inc.

  
	
  Queensgate House

  	
   

  	
  333 Lakeside Drive

  
	
  South Church Street 

  	
   

  	
  Foster City, CA 
  94404 

  
	
  PO Box 1234GT 

  	
   

  	
  USA 

  
	
  Grand Cayman

  	
   

  	
  Attention: 
  Associate Director, Chemical Manufacturing

  
	
  Attention: 
  Gregg H. Alton, Director 

  	
   

  	
  Facsimile:  ***

  
	
  Facsimile:  ***

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  If to PPG:  

  	
   

  	
  With a copy to:

  
	
   

  	
   

  	
   

  
	
  PPG-Sipsy 

  	
   

  	
  PPG Industries, Inc. 

  
	
  Z.I. la Croix Cadeau 

  	
   

  	
  One PPG Place, 36 E 

  
	
  B.P. 79 

  	
   

  	
  Pittsburgh, PA 
  15272 USA 

  
	
  49242 Avrille Cedex, France 

  	
   

  	
  Attention: 
  General Manager, Fine Chemicals

  
	
  Attention: 
  European Operations Manager 

  	
   

  	
  Fax:  ***

  
	
  Fax: ***

  	
   

  	
   

  



 


27.         CONFIDENTIALITY: “Confidential Information” means all
proprietary or confidential information, data, know-how, results, trade
secrets, techniques, inventions, ideas, process, formulas, drawings, or
diagrams disclosed by one Party to the other Party in the course of negotiating
or performing under this Agreement, whether or not marked or identified as
confidential or proprietary, and GWM’s Confidential Information shall include
all “Confidential Information” of Gilead Sciences, Inc. as defined in and
disclosed to PPG’s predecessor in interest pursuant to the Confidential
Disclosure Agreement made and effective as of January 1, 1998 by and between
Gilead Sciences, Inc. and PPG-Sipsy (as successor in interest to Sipsy Chimie
Fine S.C.A.), except for any such information that (i) is now, or hereafter
becomes, through no act or failure to act on the part of the receiving Party,
its employees or contractors in breach hereof, generally known or available;
(ii) is known by the receiving Party at the time of receiving such information,
as evidenced by its contemporaneous written records; (iii) is hereafter
furnished to the receiving Party by a Third Party, as a matter of right and
without restriction on disclosure; or (iv) is independently developed by the
receiving Party without reference to such Confidential Information, as shown by
independent, contemporaneous, written records. 
During the term of this Agreement,           ***         , each Party will maintain
all Confidential Information of the other Party received by it under this
Agreement in confidence and, without prior written permission of the other
Party, shall not disclose any such Confidential Information of the other Party
to any third party or use any such Confidential Information for any purposes or
to an extent other than as necessary or permitted for performance under this
Agreement. The Parties shall disclose Confidential Information of the other
Party only to its employees, agents, consultants, affiliates, or sublicensees
who need such information for performance under this Agreement and who are
subject to binding obligations to hold in confidence and not make use of such
Confidential Information of the other Party for any purpose other than those
permitted by this Agreement, that are at least as restrictive as those of this
Section 27.  Each Party will protect the
confidentiality of the other Party’s Confidential Information using the same
standard of care as it uses to protect its own confidential information of a
similar nature, but no less than reasonable care.  Each Party will notify the other Party promptly upon discovery of
any unauthorized use or disclosure of the Confidential Information of the other
Party.


 


 


Page 9

















 


                        Notwithstanding any other provision of
this Agreement, each Party (or its affiliate, if applicable) may disclose
Confidential Information if such disclosure: (i) is in response to a valid
order of a court or other governmental body of the United States or a foreign
country, or any political subdivision thereof; provided, however, that the
receiving Party shall first have given notice to the other Party hereto and
shall have made a reasonable effort to obtain a protective order requiring that
the Confidential Information so disclosed be used only for the purposes for which
the order was issued; (ii) is otherwise required by governmental law, rule or
regulation, including without limitation rules or regulations of the U.S.
Securities and Exchange Commission, or by rules of the National Association of
Securities Dealers; provided, however, that the receiving Party shall first
have given notice to the other Party hereto in order to allow such Party the
opportunity to seek confidential treatment of the Confidential Information; or
(iii) is otherwise necessary to prosecute or defend litigation, comply with
applicable governmental regulations, make governmental patent or regulatory
filings, or otherwise enforce obligations under this Agreement, but only to the
extent that any such disclosure is necessary for such enforcement.


 


                        If this Agreement terminates or expires,
each Party will, at the other Party’s election, promptly return or destroy all
Confidential Information received by it from the other Party and shall certify
in writing to such other Party the completion thereof.


 


28.         ENTIRE
AGREEMENT; AMENDMENTS: This Agreement together with the attachments, exhibits, or supplements
specifically referenced in this Agreement constitutes the entire, final,
complete, and exclusive agreement between the Parties and supersedes all
previous agreements or representations, written or oral, with respect to the
subject matter of this Agreement. This Agreement may not be modified, amended,
waived, discharged, or terminated orally, but only by an instrument in writing
signed by a duly authorized representative of each Party. SUBJECT TO SUCH
AMENDMENT, THE TERMS AND CONDITIONS SET FORTH HEREIN CONSTITUTE THE FINAL
COMPLETE, EXCLUSIVE, AND ENTIRE AGREEMENT BETWEEN GWM AND PPG WITH RESPECT TO
THE SUBJECT MATTER HEREOF.  ANY TERM OR
CONDITION IN ANY AGREEMENT, CONFIRMATION, OR OTHER DOCUMENT FURNISHED BY GWM OR
PPG WHICH IS IN ANY WAY INCONSISTENT WITH THE TERMS SET FORTH HEREIN IS HEREBY
EXPRESSLY REJECTED.


 


29.         INSURANCE:
Each party shall maintain at is own cost insurance policies with respect
to its activities and obligations under this Agreement that are commercially
reasonable as to terms, coverage and coverage limits in view of the scope of
such party’s activities and obligations under this Agreement.  At the other party’s request, each party
will supply certificates of insurance evidencing such coverages.


 


30.         SURVIVAL: The provisions of Sections 8, 12 (with
respect to the last sentence only), 13, 14, 15, 16, 17, 18, 19, 22, 23, 26, 27,
28, 29 and 30 shall survive the termination or expiration of this Agreement.


 


 


 


Page 10

















 


	
  GILEAD WORLD
  MARKETS, LTD.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Mark L. Perry

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
  Mark L. Perry

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
  January 2, 2003

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  Managing Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Accepted and
  Acknowledged by:

  	
   

  
	
   

  	
   

  
	
  PPG-SIPSY

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Rene DeVaumas

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
  Rene DeVaumas

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
  December 18, 2002

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  President, PPG-Sipsy

  	
   

  



 


 


 


Page 11

















 


Exhibit
A


Tenofovir DF Purchase Quantities


 


 


	
   

  	
  Calendar Year

  	
   

  	
  ***

  	
   

  
	
   

  	
  2003

  	
   

  	
  ***

  	
   

  
	
   

  	
  2004

  	
   

  	
  ***

  	
   

  
	
   

  	
  ***

  	
   

  	
  ***

  	
   

  



 


 


 


 


Page
12

















 


Exhibit B:


Tenofovir DF Base Prices


 


 


	
   

  	
  ***

  	
   

  	
  Base Price   ***

  	
   

  	
   

  
	
   

  	
  ***

  	
   

  	
  ***

  	
   

  
	
   

  	
  ***

  	
   

  	
  ***

  	
   

  



 


 


Using the above
table “Invoice” price is set on                  ***           of each calendar year for
the subsequent calendar year using the     
***   plus the forecast given by GWM for the
second      ***          
in accordance with Section 3(c).   
Adjustment will be made         ***                        based on                                                             ***           such year, with a
corresponding      ***       of that calendar year based on the   ***.


 


***


 


 


 


 


 


 












***
Portions of this page have been omitted pursuant to a request for Confidential
Treatment and filed separately with the Commission.


 


 


Page
13