Document:

TherapeuticsMD,
Inc. 10-Q

Exhibit
10.7

 

CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED
FROM THIS EXHIBIT BECAUSE IT

IS NOT MATERIAL AND WOULD LIKELY CAUSE COMPETITIVE HARM TO THE REGISTRANT IF

PUBLICLY DISCLOSED. [***]
INDICATES THAT INFORMATION HAS BEEN REDACTED.

 

EXECUTION VERSION

 

AMENDMENT NO. 2 TO THE SOFTGEL COMMERCIAL
SUPPLY AGREEMENT

BETWEEN THERAPEUTCSMD, INC. AND CATALENT PHARMA SOLUTIONS, LLC

(Estradiol and Progesterone softgel
capsules)

This Amendment No. 2 to the Softgel Commercial
Supply Agreement (“Second Amendment”) is made as of this 29th day of September, 2020 (“Second
Amendment Effective Date”) by and between TherapeuticsMD, Inc., a Nevada corporation, with a place of business at 951
Yamato Road, Suite 220, Boca Raton, Florida 33431 (“Client”), and Catalent Pharma Solutions, LLC, a Delaware
limited liability company, having a place of business at 14 Schoolhouse Road, Somerset, New Jersey 08873 (“Catalent”).

WHEREAS, Client and
Catalent entered into that certain Softgel Commercial Supply Agreement dated June 24, 2016, as amended (the “Agreement”).

WHEREAS, Client and
Catalent desire to amend the Agreement as more fully set forth herein.

NOW, THEREFORE, in
consideration of the mutual covenants, terms and conditions set forth below, the parties agree as follows:

1.              Capitalized
Terms. All capitalized terms used in this Second Amendment and not otherwise defined herein shall
have the meanings given to them in the Agreement. For clarity, the term “Agreement” as used in the Agreement and herein
shall mean the Agreement as amended hereby.

 

2.              Section 1.53 of the Agreement, is hereby deleted and replaced with the following:

 

“Territory” means
worldwide, except shall not include countries that are targeted by the comprehensive sanctions, restrictions or embargoes administered
by the United Nations, European Union, United Kingdom, or the United States. Catalent shall not be obliged to Process Products
for sale in any of such countries if it is prevented from doing so, or would be required to obtain or apply for special permission
to do so, due to any restrictions (such as embargoes) imposed on it by any governmental authorities, including without limitation,
those imposed by the U.S. Office of Foreign Asset Control.

3.              The following definitions shall be added to Section 1 of the Agreement:

 

    	 

    	 

    

 

EXECUTION VERSION

 

 

“Authorized Generic(s)”
means any drug sold, licensed, or marketed under the Product’s New Drug Application that is marketed, sold or distributed
under a different labeler code, product code, trade name, trademark, or packaging (other than repackaging the listed drug for use
in institutions) than the Product.

“ROW” means any
country in the Territory excluding the United States.

4.              Section 2.1 of the Agreement is hereby amended by adding the following to the end of the Section:

 

“Client
and its Affiliates shall purchase from Catalent: (1) at least [***] percent ([***]%) of Client’s and its Affiliates’
requirements of Product in the United States, and (2) at least [***] percent ([***]%) of Client’s and its Affiliates’
requirements of Product in the ROW as supplied by, through, or on behalf of Client. In the event Client or its Affiliate(s), alone
or in partnership with a third party, launches an Authorized Generic, then Client and its Affiliates shall purchase exclusively
from Catalent all of Client’s and its Affiliates’ requirements of the Authorized Generic in the Territory so long as
Catalent’s pricing for the Authorized Generic is competitive with the pricing requirements for the Authorized Generic.”

5.              Article 2 of the Agreement is hereby amended by adding the following as a new Section 2.5:

Stability Studies. During the
Term, Catalent shall have the right, but not the obligation, to perform all annual stability studies (including testing and storage)
for Product to be sold in the United States at the pricing set forth on Attachment D. If Catalent is unable to perform the annual
stability studies, Client may contract with a Third Party for the performance of the annual stability studies. Price increases
for such stability services shall not exceed [***] percent ([***]%) per year.

6.             Section 7.1 of the Agreement is hereby amended by including the following as a new subsection D:

 

Beginning January 1, 2021, Client shall
pay Catalent the annual Hormone Suite Occupancy fees as set forth on Attachment B. Catalent shall submit an invoice to Client for
such fees on January 1, 2021 and each January 1st thereafter during the Term.

    	 

    	 

    

 

EXECUTION VERSION

 

7.             Section 7.2 of the Agreement is hereby deleted in its entirety and replaced with the following:

Unit Pricing Increase. The Unit
Pricing shall be adjusted on an annual basis, effective on each July 1st (with the first Unit Pricing adjustment to
be effective on July 1, 2017), upon sixty (60) days' prior written notice from Catalent to Client, to reflect increases in labor,
utilities and overhead and shall be in an amount equal to the change in the Producer Price Index ("PPI"), "Pharmaceutical
Preparation Manufacturing" (Series ID: PCU325412325412), not seasonally adjusted, as published by the U.S. Department of Labor,
Bureau of Labor Statistics; provided that beginning July 1, 2021 (a) the annual increase to the Unit Pricing for the PPI for Product
to be sold in United States, Canada, and Israel shall be capped at [***] percent ([***]%) per year, and (b) the annual increase
to the Unit Pricing for the PPI for Product to be sold in the ROW shall be capped at [***] percent ([***]%) per year. The initial
base period for comparison shall be the twelve (12) month period ending on the date most closely preceding the effective date of
the first Unit Pricing increase, but which allows enough time for Catalent to provide to Client the notice required by this Section
7.2. In addition, notwithstanding the foregoing, price increases for raw materials, and components shall be passed through to Client
annually.

8.              Section 16.1 of the Agreement is hereby deleted in its entirety and replaced with the following:

Term. This Agreement shall commence
on the Effective Date and shall continue through April 2, 2029, unless earlier terminated in accordance with Section 16.2 (as may
be extended in accordance with this Section, the “Term”). The Term shall automatically be extended for successive
two (2)-year periods unless and until one party gives the other party at least twelve (12) months’ prior written notice of
its desire to terminate as of the end of the then-current Term.

9.              Attachment B of the Agreement, as amended, is hereby deleted in its entirety and replaced with the revised Attachment B, attached
hereto.

 

10.           The Agreement is hereby amended by adding Attachment D, attached hereto.

 

11.           Governing
Law. This Second Amendment shall be governed by and construed under the laws of Delaware, USA, excluding its conflicts of
law provisions. The United Nations Convention on Contracts for the International
Sale of Goods shall not apply to this Second Amendment.

 

    	 

    	 

    

EXECUTION VERSION

 

12.           No
Other Variations. Except as specifically amended herein, all other terms and conditions of the Agreement remain in full force
and effect and shall apply to the construction of this Second Amendment.

 

13.           Counterparts.
This Second Amendment may be executed in one or more counterparts, each of which will be deemed an original but all of which together
will constitute one and the same instrument. Any photocopy, facsimile or electronic reproduction of the executed Second
Amendment shall constitute an original.

 

IN WITNESS WHEREOF,
the parties have caused their respective duly authorized Representatives to execute this Second Amendment effective as of the Second
Amendment Effective Date.

 

	CATALENT
PHARMA SOLUTIONS, LLC	 	THERAPEUTICSMD, INC.
	 	 	 
	 	 	 
	By:	/s/ Louis B. Weiner	 	By:	 /s/ James D’Arecca
	 	 	 
	Name:	 Louis B. Weiner	 	Name:	James D’Arecca
	 	 	 
	Title:	VP Business Development, NA Softgel	 	Title:	 Chief Financial Officer

 

 

    	 

    	 

    
 

EXECUTION VERSION

 

 ATTACHMENT
B

UNIT PRICING, FEES AND MINIMUM REQUIREMENT

	
        UNIT PRICING FOR THE UNITED STATES

        Effective Through June 30, 2021

         

	Product Unit Strength	Product Size	Batch Size	Unit* Pricing for Total Softgels Shipped between July 1, 2020 and June 30, 2021
	First [***] softgels	Between [***] and [***] softgels	Between [***] and [***] softgels	[***] and more softgels
	100mg Progesterone + 1mg Estradiol	[***] oval	[***]	$[***]	$[***]	$[***]	$[***]
	100mg Progesterone + 0.5mg Estradiol	[***] oval	[***]	$[***]	$[***]	$[***]	$[***]

	
         

        UNIT PRICING FOR ROW

        Effective Through June 30, 2021

	Product Unit Strength	Product Size	Batch Size	Unit* Pricing per [***] Softgels 
	100mg Progesterone + 1mg Estradiol	[***] oval	[***]	$[***]
	100mg Progesterone + 0.5mg Estradiol	[***] oval	[***]	$[***]

 

* One unit is [***] softgel capsules.
Unit Pricing includes full API release testing, cost of Processed softgels, Product full release testing and bulk packaging. Unit
Pricing does not include cost of API, tooling or other Product-specific capital items, artwork, shipping, insurance or duty. Unit
Pricing also does not include any testing, retesting or testing supplies other than as expressly set forth in the Specifications.
Unit Pricing is based on certain assumptions as to manufacturing processes, storage conditions, etc. Accordingly, Unit Pricing
is subject to adjustment in the event any such assumptions are subject to revision in connection with the validation of the Product.

    	 

    	 

    
 

EXECUTION VERSION

 

	MINIMUM REQUIREMENT
	Contract Year	Product	Minimums Requirement
	[***]	Across all strengths	[***] capsules
	[***]	Across all strengths	[***] capsules 
	[***]	Across all strengths	[***] capsules
	[***]	Across all strengths	[***] capsules
	[***]	Across all strengths	[***] capsules
	[***]	Across all strengths	[***] capsules
	[***]	Across all strengths	[***] capsules
	[***]	Across all strengths	[***] capsules
	[***]	Across all strengths	[***] capsules
	[***]	Across all strengths	[***] capsules

 

	ADDITIONAL FEES
	Type of Fee	Amount	Payable
	Product Maintenance Fee	$[***] for the first Product strength; $[***] for each additional Product strength 	
        [***]

	Hormone Suite Occupancy Fee	$[***]	[***]

 

    	 

    	 

    
 

EXECUTION VERSION

 

ATTACHMENT D

STABILITY STUDIES PRICING

[***]Internal Letter

	Date:	    	November 4, 2020				
	To:		Carl Anderson	          	From:	    	Jay Craig
	CC:		Meghan Pierce				
	Subject:		Special Retention Arrangement				

Dear Carl,

Your past contributions have been key to the success of Meritor. The future holds both significant challenges and opportunities. In order to reach our potential, I consider it essential to retain key contributors. As a result, Meritor has determined that appropriate steps should be taken to reinforce and encourage your continued employment with Meritor and any successor companies (the “Company”). Accordingly, this letter of understanding (“Letter”) to be effective November 4, 2020 (“Effective Date”) outlines a retention payment to which you will be entitled provided that the terms and conditions set forth below are met.

I. Retention Award

Subject to the provisions of Part II of the Letter, an award in the form of a retention payment, shall be made as follows subject to the provisions outlined below:

	Payment Date*	     	Payment
	December 15, 2021		$287,500

*payments will be made on the next possible paycheck following the payment date

II. Terms and Conditions

By this Letter, the Company is by no way offering a permanent contract or guarantee of future employment with the Company. It is our expectation that in order to be eligible to receive this payment you will be employed through the payment date set forth in this Letter. Except as provided in the schedule below, the award described in Part I of this Letter is conditioned upon and subject to your continuous and uninterrupted employment with the Company described above. Should your employment with the Company terminate prior to the payment date, the following rules shall apply:

Voluntary Termination In the event you voluntarily terminate your employment from the Company and/or any of its subsidiaries prior to the payment date, this Letter and associated payment shall be forfeited.

Termination for Cause In the event your employment is terminated for Cause, defined as continued and willful failure to perform duties; gross misconduct which is materially and demonstrably injurious to the Company; or conviction of or pleading guilty or no contest to a (a) felony or (b) other crime which materially and adversely affects the Company, the payment contemplated by this Letter shall be forfeited.

Death In the event of your death prior to the payment date, the retention payment will be paid on a prorated basis based on active time worked.

Involuntary Termination (Layoff) In the event your employment is terminated by the Company for any reason other than for cause, death or disability, your payment will be paid on a prorated basis based on active time worked.

Total and Permanent Disability In the event you suffer a Total and Permanent Disability, as that term is defined in the Company’s Long Term Disability Plan, the payment will be made on a prorated basis based on active time worked.

Change in Control In the event of a Change in Control of the Company, as that term is defined the Company’s By-Laws, this Letter shall continue in full force and effect and shall be binding on any and all successors.

The above payment as well as the terms and conditions were also approved by the Compensation Committee of the Board of Directors on November 4, 2020. Please acknowledge your receipt of this Letter and return a signed copy of this letter to the undersigned.

	MERITOR, INC.			ACKNOWLEDGEMENT:
	 	 	 	 
	 	 	 	 
	By: 	/s/ Jay Craig	11/4/2020	                    	/s/ Carl Anderson	11/4/2020
		Jay Craig
CEO & President	Date		Carl Anderson	Date

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