Document:

Exhibit 10.28

 

Confidential Materials omitted and filed separately with the

Securities and Exchange Commission. Asterisks denote omissions.

 

AMENDMENT TO DECEMBER 5, 1997 EXCLUSIVE

LICENSE AGREEMENT BETWEEN SCHERING AND SEPRACOR

 

This amendment to the December 5,
1997 Exclusive License Agreement between Schering and Sepracor (“the Amendment”)
is made as of this 7th day of November, 2008 by Schering-Plough Ltd., a Swiss
corporation having a place of business at Topferstrasse 5, 6004 Lucerne,
Switzerland (“Schering”), and Sepracor Inc., a Delaware corporation having a
place of business at 84 Waterford Drive, Marlborough, Massachusetts 01752 (“Sepracor”)
(collectively, “the Parties”).

 

WHEREAS, the Parties mutually
desire to amend their December 5, 1997 Exclusive License Agreement (“the
Agreement”) as set forth herein; and

 

WHEREAS, the Parties
acknowledge that this Amendment conforms to Article IX, Section 9.6  of
the Agreement and is a permitted amendment to that Agreement.

 

NOW THEREFORE, in consideration
of the rights and obligations set forth herein, the sufficiency of which is
hereby acknowledged, Schering and Sepracor agree as follows.

 

1.             All capitalized terms not otherwise
defined herein shall have the meaning ascribed to same in the Agreement.

 

(a)           Schering and Sepracor
agree that the term “Sepracor Actions” shall include any action for
infringement of certain patents listed in Schedule 1.18 of the Agreement or
otherwise included in the definition of “Patent Rights” in Article I, Section 1.18
of the Agreement (the “Sepracor Patents”) brought by Sepracor against certain
Abbreviated New Drug Application (“ANDA”) filers with respect to one or more of
New Drug Application (“NDA”) Nos. 021300, 021312, 021313, 021605, and/or
021165, several of which are currently pending in the United States District
Court for the District of New Jersey.

 

(b)           Schering and Sepracor
agree that the term “Exempted Sublicensee” shall mean any Sublicensee
where:  [**].

 

(c)           Schering and Sepracor
agree that the term “NDA Product” shall mean a Licensed Product under the
Agreement approved for marketing in the United States pursuant to a New Drug
Application.

 

(d)           Schering and Sepracor
agree that the term “Prescription NDA Product” shall mean a NDA Product, as
defined above, that requires a prescription to be sold in the United States.

 

(e)           Schering and Sepracor
agree that the term “[**] NDA Product” shall mean a NDA Product, as defined
above, that does [**] in the United States.

 

(f)            Schering and Sepracor
agree that the term “Generic Equivalent” shall mean a pharmaceutical product
that has received U.S. Food and Drug Administration (“FDA”) 

 

1

 

approval for marketing in the United States
pursuant to an ANDA as a generic equivalent to a specific NDA Product.

 

(g)           Schering and Sepracor
agree that the term “Launch” shall mean the commercial launch of a Generic
Equivalent of a NDA Product by one or more third parties other than an Exempted
Sublicensee or Sublicensee while Schering and/or Sepracor is preparing for or
involved in litigation regarding such Generic Equivalent.

 

(h)           Schering and Sepracor
agree that the term “Final FDA Approval” shall mean approval from the FDA that
would allow a party to market and sell a Generic Equivalent.

 

(i)            Schering and Sepracor
agree that the term “Final Court Decision” shall mean a decision of a court
from which no appeal has been or can be taken, excluding any writ of certiorari
or other proceedings before the United States Supreme Court.

 

2.             Schering and Sepracor agree that Schering
may grant a sublicense under the Sepracor Patents to any Exempted
Sublicensee.  The granting of any such
sublicense shall be without any further obligation or responsibility by
Schering to Sepracor under the Agreement with respect to such sublicense other
than as set forth in this Amendment.

 

3.             Schering and Sepracor agree that the
payment of royalties pursuant to the Agreement shall be as follows:

 

(a)           Prescription NDA
Products

 

(1)           Schering
agrees, on a product-by-product basis, to pay a royalty of [**] percent ([**]%)
on Net Sales of each Prescription NDA Product until the earlier of:  (i) the expiration of U.S. Patent Nos.
[**]; or (ii) a Final Court Decision finding that all claims of U.S.
Patent Nos. [**] in dispute are invalid, unenforceable or not infringed by a
Generic Equivalent of such Prescription NDA product; or (iii) a Launch of
a Generic Equivalent of such Prescription NDA Product before [**]; or (iv) the
date that sales by an Exempted Sublicensee or Exempted Sublicensees of a [**]
of such Prescription NDA Product achieve a market share of [**] percent ([**]%)
or more of [**] such Prescription NDA Product in the United States; or (v) the
date that sales by one or more third parties that is not an Exempted
Sublicensee or Sublicensee of [**] of such Prescription NDA Product achieve a
market share of [**] percent ([**]%) or more of [**] such Prescription NDA
Product in the United States.

 

(2)           Notwithstanding
anything else in Section 3(a) of this Amendment, should Section 3(a)(l)(iii) be
triggered by a Launch of a particular Prescription NDA Product before [**],
Schering agrees to pay a royalty of [**] percent ([**]%) on Net Sales of such
Prescription NDA Product for a [**] period commencing from the Final FDA
Approval of the first Generic Equivalent that had such a Launch; and after such
[**] period, Schering shall have no further obligation to pay any royalty on
such Prescription NDA Product.

 

(3)           Notwithstanding
anything else in Section 3(a) of this Amendment, should Section 3(a)(l)(iv) be
triggered by sales by an Exempted Sublicensee or Exempted 

 

2

 

Sublicensees
of a Generic Equivalent or Generic Equivalents of a particular Prescription NDA
Product, Schering agrees to pay a royalty of [**] percent ([**]%) on Net Sales
of such Prescription NDA Product for a [**] period commencing from the Final
FDA Approval of [**]that contributed to the [**] percent ([**]%) or more market
share described in Section 3(a)(l)(iv); and after such [**] period,
Schering shall pay [**] percent ([**]%) on Net Sales of such Prescription NDA
Product.

 

(4)           Notwithstanding
anything else in Section 3(a) of this Amendment, should Section 3(a)(l)(v) be
triggered by sales by one or more third parties that is not an Exempted
Sublicensee or Sublicensee of a Generic Equivalent or Generic Equivalents of a
particular Prescription NDA Product, Schering agrees to pay a royalty of [**]
percent ([**]%) on Net Sales of such Prescription NDA Product for a [**] period
commencing from the Final FDA Approval of [**] that contributed to the [**]
percent ([**]%) or more market share described in Section 3(a)(l)(v); and
after such [**] period, Schering shall have no further obligation to pay any
royalty on such Prescription NDA Product.

 

(5)           For
the purposes of clarity and the avoidance of doubt, the obligation of Schering
to pay a royalty on Net Sales of each Prescription NDA Product per Section 3(a) of
this Amendment shall apply notwithstanding an Exempted Sublicensee receiving
approval to market a Generic Equivalent from the FDA with or without Schering’s
consent.

 

(b)           [**] NDA Products

 

(1)           Schering
agrees, on a product-by-product basis, to pay a royalty of [**] percent ([**]%)
on Net Sales of each [**] NDA Product until the earlier of:  (i) expiration of U.S. Patent Nos. [**];
or (ii) a Final Court Decision finding that all claims of U.S. Patent Nos.
[**] in dispute are invalid, unenforceable or not infringed by a Generic
Equivalent of such [**] NDA product; or (iii) a Launch of a Generic
Equivalent of such [**] NDA Product before [**].

 

(2)           For
the purposes of clarity and the avoidance of doubt, the obligation of Schering
to pay a royalty on Net Sales of each [**] NDA Product per Section 3(b) of
this Amendment shall apply notwithstanding an Exempted Sublicensee receiving
approval to market a Generic Equivalent from the FDA with or without Schering’s
consent.

 

(c)           For the avoidance of
doubt, the royalties of Section 3(a) and 3(b) above shall be on
a product-by-product basis; for example, the Launch of a Generic Equivalent to
the 2.5 milligram, desloratadine /120 milligram pseudoephedrine tablet shall
not reduce or remove Schering’s royalty obligation(s) to Sepracor on Net
Sales of any prescription or non-prescription desloratadine 5 milligram tablet
product.

 

4.             Sales by an Exempted Sublicensee of a
Generic Equivalent made under a sublicense granted by Schering shall be
excluded from the definition of Net Sales under Article I, Section 1.17
of the Agreement.

 

3

 

5.             In the event of any inconsistency between
this Amendment and the Agreement, the terms of this Amendment shall control and
the Agreement shall be deemed amended so that it is in full compliance with,
and gives effect to, all the terms and conditions of this Amendment.

 

6.             The Parties hereby represent and warrant
that they have approved the execution of this Amendment and have authorized and
directed the signatory officers below to execute and deliver this Amendment.

 

	
  Agreed to and Acknowledged

  	
   

  	
  Agreed to and Acknowledged

  
	
  This 10th day of November, 2008, by:

  	
   

  	
  This 7th day of November, 2008, by:

  
	
   

  	
   

  	
   

  
	
  SCHERING-PLOUGH LTD.

  	
   

  	
  SEPRACOR INC.

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ David Piacquad

  	
   

  	
  By:

  	
  /s/ Andrew I. Koven

  
	
  Name:

  	
  David Piacquad

  	
   

  	
  Name:

  	
  Andrew I. Koven

  
	
  Title:

  	
  Managing Officer

  	
   

  	
  Title:

  	
  EVP, General Counsel & Corporate Secretary

  

 

4Exhibit 10.51

 

SUMMARY OF
EXECUTIVE OFFICER COMPENSATION

 

Executive Officer Compensation—Payout of 2008 Bonuses

 

On
January 21, 2009, the Compensation Committee (the “Committee”) of the
Board of Directors of Sepracor Inc. (the “Company”) approved bonus payments
to the Company’s executive officers with respect to their performance during
2008. The following table sets forth the bonus payments for 2008 paid to each
of the Company’s executive officers.

 

	
  Executive Officer

  	
   

  	
  2008 Target

  Bonus

  	
   

  	
  2008 Bonus

  Payment

  	
   

  
	
  Adrian Adams

  President and Chief Executive Officer

  	
   

  	
  $

  	
  1,050,000

  	
   

  	
  $

  	
  682,500

  	
   

  
	
  Robert F.
  Scumaci

  Executive Vice President and Chief Financial
  Officer

  	
   

  	
  $

  	
  260,000

  	
   

  	
  $

  	
  195,000

  	
   

  
	
  Mark H.N.
  Corrigan, M.D.

  Executive Vice President, Research and
  Development

  	
   

  	
  $

  	
  272,500

  	
   

  	
  $

  	
  218,000

  	
   

  
	
  Andrew I.
  Koven

  Executive Vice President, General Counsel and
  Corporate Secretary

  	
   

  	
  $

  	
  262,500

  	
   

  	
  $

  	
  236,250

  	
   

  
	
  Mark Iwicki

  Executive Vice President and Chief Commercial
  Officer

  	
   

  	
  $

  	
  300,000

  	
   

  	
  $

  	
  300,000

  	
  (1)

  
	
  Richard
  Ranieri

  Executive Vice President, Human Resources and Administration

  	
   

  	
  $

  	
  202,500

  	
   

  	
  $

  	
  202,500

  	
  (2)

  

 

(1)           Mr. Iwicki was contractually guaranteed
a 2008 bonus of $300,000.

 

(2)           Mr. Ranieri was contractually guaranteed
a 2008 bonus of $202,500.

 

Executive Officer Compensation for 2009—Base Salary and
Target Bonus

 

On
January 21, 2009, the Committee approved the annual base salaries to be
paid to the Company’s executive officers during 2009. In addition, the
Committee established target bonuses for each executive officer as a percentage
of each executive officer’s annual base salary. Each executive officer’s bonus
for 2009 shall be determined based on, among other things, the Company’s
overall performance, as well as such officer’s individual performance, during
2009. The following table sets

 

 

forth
the annual base salary for 2009 and 2009 target bonus for each of the Company’s
executive officers.

 

	
  Executive Officer

  	
   

  	
  Annual Base

  Salary for 2009

  	
   

  	
  2009 Target

  Bonus Percentage

  	
   

  	
  2009

  Target Bonus

  	
   

  
	
  Adrian Adams

  	
   

  	
  $

  	
  1,081,500

  	
   

  	
  100

  	
  %

  	
  $

  	
  1,081,500

  	
   

  
	
  Robert F. Scumaci

  	
   

  	
  $

  	
  536,000

  	
   

  	
  50

  	
  %

  	
  $

  	
  268,000

  	
   

  
	
  Mark H.N. Corrigan, M.D.

  	
   

  	
  $

  	
  561,500

  	
   

  	
  50

  	
  %

  	
  $

  	
  280,750

  	
   

  
	
  Andrew I. Koven

  	
   

  	
  $

  	
  541,000

  	
   

  	
  50

  	
  %

  	
  $

  	
  270,500

  	
   

  
	
  Mark Iwicki

  	
   

  	
  $

  	
  515,000

  	
   

  	
  60

  	
  %

  	
  $

  	
  309,000

  	
   

  
	
  Richard Ranieri

  	
   

  	
  $

  	
  417,500

  	
   

  	
  50

  	
  %

  	
  $

  	
  208,750

  	
   

  

 

Stock Option and Restricted Stock Awards

 

Each
executive officer may also be granted stock options, restricted stock or other
awards pursuant to the Company’s equity incentive plans. The Committee may
approve annual equity awards at its meeting that coincides with the Company’s
annual meeting of stockholders and may approve grants to newly named executive
officers at its first meeting following the executive’s first day of
employment. With the approval of the full Board, additional equity awards may
be granted to executive officers.

 

Other Compensation

 

The
Company has also (1) entered into employment agreements with each of its
executive officers, (2) entered into executive retention agreements with
each of its executive officers, (3) agreed to make gross up payments to
each of its executive officers in the event that any payments received by them
in connection with a change of control constitute parachute payments under Section 280G
of the Internal Revenue Code of 1986, as amended. The Company has previously
filed these employment agreements, executive retention agreements and a summary
of the 280G gross up plan with the Securities and Exchange Commission.

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