Document:

Exhibit 10.13

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant
to 17 C.F.R. §§200.80(b) and 230.406

 

	
  Confidential treatment
  has been requested for portions of this exhibit. The copy filed herewith
  omits the information subject to the confidentiality request. Omissions are
  designated as [*]. A complete version of this exhibit has been filed
  separately with the Securities and Exchange Commission.

  

 

Commercial Supply Agreement

This Commercial Supply
Agreement is entered into as of June 4 2004 by and between MonoSolRx LLC, a
limited liability company with a principal place of business at 6560 Melton
Road, Portage, Indiana 46368 (together with its affiliates, “MONOSOLRX”) and Dr.
Harold Katz LLC, a limited liability company with a principal place of business
at 370 South Fairfax Ave., Los Angeles, CA 90036 (together with its affiliates,
“THERABREATH” and, together with MONOSOLRX, the “Parties”).

Whereas, THERABREATH is a leading retailer and marketer of
oral care products with a specific concentration in the mouthwash and breathe
categories;

Whereas, MONOSOLRX is a manufacturer of film-based oral
fast-dissolve OTC, nutraceutical and confection products;

Whereas, the Parties wish to enter into an arrangement
wherein THERABREATH and MONOSOLRX jointly market certain film-based oral care
products containing stabilized C102, to be manufactured exclusively by
MONOSOLRX;

For good and valuable
consideration, the sufficiency of which is hereby acknowledged, the Parties
agree as follows:

1.             The Product.  The “Product” is defined as any oral
dissolvable film-based mouthwash and/or bad breath product that contains
stabilized C102 (or any close variant thereof) as an active ingredient whether
alone or in combination with other active ingredients.

2.             Joint  exclusivity.  MONOSOLRX covenants to manufacture, supply
and/or market the Product exclusively for THERABREATH.  THERABREATH covenants to market the Product
exclusively in conjunction with MONOSOLRX, The geographical area for the
exclusivity stated herein will be worldwide.

3.             Agreement  to  Market  the  Product.
 THERABREATH covenants that it will make
reasonable and good-faith efforts to market the Product.  In particular:

A.                                    THERABREATH will market the Product on
its web-site (www.thereabreath.com).

B.                                    Therabreath will use reasonable efforts
to market the Product to retail chains and wholesale distributors, and it will
bear its own costs in so doing.

4.             Fulfillment  of  Orders  by MonoSolRx.
 MONOSOLRX will accept orders for the
Product from Therabreath, subject to both (a) the minimum lot requirements of
Section 5 and (b) MONOSOLRX’s good faith appraisals of its then current
production capacity and production schedule.

CONFIDENTIAL TREATMENT REQUESTED

Pursuant
to 17 C.F.R. §§200.80(b) and 230.406

 

5.             Minimum  Lot  Requirements.  The Parties recognize the certain production
lot-specific costs make small production lots impractical.  Accordingly, MonoSolRx will not be required
to accept Product orders in amounts lower than [*] Units
(defined as a container holding 24 individual strips, as the case may be)
provided that the Parties recognize that such lot sizes are substantially below
MONOSOLRX’s standard lot sizes and the Parties will attempt in good faith to
coordinate supply issues so that production lot sizes can be increased.  THERABREATH agrees to place its initial
product order within sixty days of the execution of this Agreement.

6.             Supply  Cost.  The initial Product price shall be [*] per packaged 24 count box, inclusive of secondary
packaging which shall be reasonably agreed upon between the Parties with
Product similar and/or identical to the Product samples previously supplied to
THERABREATH.  Freight is EXW (Ex Works)
and the Product price is subject to commercially reasonable increases linked to
MONOSOLRX’ s production energy, raw material and packaging costs.  MONOSOLRX will notify THERABREATH of any
price changes 30 days prior to increases or decreases being implemented.  Payment shall be due in full 60 days
following delivery of Product to THERABREATH.

7.             Trade  dress.  The Product will be sold under the THERABREATH
name, using standard THERABREATH trade dress, and the packaging shall contain a
reference to MONOSOLRX as manufacturer and a small marketing indicia.

8.             Intellectual  Property.  MONOSOLRX shall have the right, but not the duty,
to take commercially reasonable steps to secure intellectual property rights in
inventions relating to the Product in film form and in this event THERABREATH
will assign all inventions to MONOSOLRX that relate to the Product.  To the extent necessary, MONOSOLRX will
provide a royalty-free license to THERABREATH for its existing product
portfolio.  Additionally, THERABREATH
represents that it has a valid license to use any applicable third-party
intellectual property in connection with the Product and shall be solely
responsible for any royalties related to such license.

9.             Ongoing Condition.  It shall be an ongoing condition precedent for
all duties and obligations created hereby for MONOSOLRX that MONOSOLRX should
be reasonably satisfied that (a) the manufacturing, distribution and sale of
the Product meets all applicable regulatory requirements, (b) the Product is
technically feasible and that the Product is sufficiently stable, and (c) that
any third-party intellectual property is available thru a valid, paid-up
license through THERABREATH.

10.          Minimum  Total  Product
Orders.  The number of Product
units ordered, including orders by third parties as well as by THERABREATH,
will meet or exceed a minimum of [*] total Units
(defined as a container holding 16 or 24 individual strips, as the case may be)
in year one, a minimum of [*] Units
during the second year, and a minimum of [*] Units
during each year thereafter for the duration of the Agreement.

11.          Sole  Remedies  for
Breach  of  Minimums. 
If aggregate Product orders fail to meet or exceed the yearly product
order requirement, MONOSOLRX will have the right to terminate the Agreement.  This termination right shall be the sole remedy
of MonoSolRx in connection with the failure of the Product orders to meet or exceed
the yearly minimums.

2

CONFIDENTIAL TREATMENT REQUESTED

Pursuant
to 17 C.F.R. §§200.80(b) and 230.406

 

12.          Confidentiality.  The terms of this Agreement shall be kept
confidential, provided that either Party may issue a press release concerning
the existence of a business relationship with the other party.

13.          Sub-Licensing.  THERABREATH and MONOSOLRX may sell the
Product under brands or trade-names other than THERABREATH, provided tile
Parties jointly agree to do so,

14.          Other  Products.  Nothing in this Agreement shall prevent
MONOSOLRX from distributing any products other than the Product.

15.          Quarterly  Estimates.  MONOSOLRX and THERABREATH will communicate
quarterly, providing each other with information pertinent to future planning
that will best allow the Parties to meet their obligations under this Agreement.  These estimates will be covered by this confidentiality
agreement between the Parties.

16.          Damages.  IN NO EVENT SHALL MONOSOLRX OR THERABREATH BE
LIABLE FOR LOST PROFITS, INJURY FOR LOST PROFITS, INJURY TO GOOD WILL OR ANY
OTHER SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES.

17.          Acts of God.  Neither Party shall not be responsible for
delays in delivery or any failure to deliver due to causes beyond such Party’s
control, including but not limited to acts of God, war, mobilization, civil
commotion, riots, embargoes, domestic or foreign governmental regulations or
orders, fires, floods, strikes, lockouts, and other labor difficulties, or
shortages of or inability to obtain materials, shipping space or
transportation.

18.          Term.  This Agreement shall be in effect for a term
of four (4) years, with automatic one-year extensions unless a Party notifies
the other of an intention to cancel within three months of the extension.

19.          Applicable  Law.  This Agreement shall be governed by,
construed, and enforced in accordance with tile laws of tile State of Illinois.

20.          Arbitration.  All controversies and claims arising out of or
relating to this Agreement, or the breach thereof, shall be settled solely by
arbitration held in Chicago, Illinois in accordance with the rules then
obtaining of the American Arbitration Association, and judgment upon any award
thereon, may be entered in any court having jurisdiction thereof, any demand
for arbitration hereunder shall be made not later than one hundred and twenty
(120) days after delivery of the goods.

21.          Amendment.  This Agreement may be amended, modified or
supplemented only by a writing signed by the Parties.

22.          Waivers.  The failure of a Party at any time or times to
require performance of any provision of this Agreement shall in no manner
affect its right at a later time to enforce the same provision.  No waiver by a Party shall be effective
unless in writing.

23.          Successors and Assigns.  This Agreement shall be binding on and shall
inure to the benefit of the Parties and their respective permitted successors
and assigns.

3

CONFIDENTIAL TREATMENT REQUESTED

Pursuant
to 17 C.F.R. §§200.80(b) and 230.406

 

24.          Severability and Reform.  If any provision of this Agreement shall be
held invalid, illegal or unenforceable, the validity, legality or
enforceability of the other provisions of this Agreement shall not be affected
by that holding, and there shall be deemed substituted for the provision at
issue a valid, legal and enforceable provision as similar as possible to the provision
at issue.

25.          Entire Understanding.  This Agreement (including schedules) sets
forth the entire agreement and understanding of the Parties with respect to the
transactions described in this Agreement supersedes any and all prior
agreements, arrangements and understandings among the Parties relating to the
subject matter of this Agreement.

IN WITNESS WHEREOF, the
Parties have executed and delivered this Agreement on the date first above
written.

	
  MONOSOLRX LLC

  	
   

  	
  Dr. Harold Katz LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   /s/ P. Scott Bening

  	
   

  	
  /s/ Harold Katz

  
	
  By: P. Scott Bening

  	
   

  	
  By: Harold Katz

  
	
   

  	
   

  	
   

  
	
  Title: CEO

  	
   

  	
  Title:

  

 

4Exhibit 10.14

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

	
  Confidential treatment has been requested for
  portions of this exhibit. The copy herewith omits the information subject to
  the confidentiality request. Omissions are designated as [*]. A complete
  version of this exhibit has been filed separately with the Securities and
  Exchange Commission.

  

 

 

DEVELOPMENT
AND SUPPLY AGREEMENT

Parties:                   MonoSol RX LLC (“MONOSOL”)
and Vita Health Products Inc. (“VITA”)

Dated on June 29, 2006

WHEREAS, MONOSOL desires
to sell to VITA, and VITA desires to purchase from MONOSOL all of its
requirements of the Product as defined below;

The parties further agree
as follows:

1)            Definitions.
For the purposes of this Agreement unless the context otherwise requires, the
following terms shall have the respective meanings set out below and
grammatical variations of such terms shall have corresponding meanings:

a)            “DIN” means a drug identification
number (within the meaning of the Food and Drug Regulations) issued by the TPD,
as defined below, representing the market authorization in respect of the Products.

b)            “Drug Establishment
License” means a drug establishment license issued by the HBFBI, as defined
below, and required for all businesses in Canada engaged in activities related
to the manufacture, packaging, labeling, distribution, importation, wholesale
and testing of drugs as outlined in the Food and Drug Regulations.

c)             “Effective Date”
means the date that this Agreement is executed by the parties.

d)            “FDA” means the
United States Food and Drug Administration or any successor agency from time to
time, or such other agency having regulatory jurisdiction over the manufacture,
distribution and sale of drugs in the United States.

e)             “Formulary” means a
compendium of formulae used in the preparation of medicinal drugs.

f)             “GMP” means good
manufacturing practices as defined by Health Products and Food Branch
Inspectorate of Health Canada, as amended from time to time.

g)             “HPFBI” means the
Health Products and Food Branch Inspectorate of Health Canada or any successor
agency from time to time having jurisdiction over compliance monitoring activities
related to the activities outlined on a firm’s Drug Establishment License.

h)            “Patent” means
pending patent application as per Appendix C.

 

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

i)              “Person” means an
individual, corporation, partnership, trust, unincorporated organization, the
government of a country or any political subdivision thereof, or any agency or
department of any such government, and the executors, administrators or other
legal representatives of an individual in such capacity.

j)             “Product
Information” means all information and data developed, generated or compiled by
MONOSOL for submission to Health Canada in support of a DIN application.  This includes but is not limited to, the file
specification, test method and method validation documents, ingredient listing,
mater batch record, packaging specifications, process validation summary
report, and allergen/animal tissue forms.

k)            “Products” means
those products described in Appendix A.

l)              “Regulatory
Approvals” means the issuance of a DIN by Health Canada and/or the
issuance/maintenance of licenses, approvals, authorizations, consents,
Formulary listings, licenses and registrations by municipalities, provinces and
territories required to sell Products in a given jurisdiction.

m)           “Regulatory Authority”
means the TPD and/or any provincial government ministry, department or agency,
the regulatory body or other Person responsible in the province or territory in
Canada in question for issuing Regulatory Approvals or licenses and/or for
enacting, monitoring and/or enforcing the applicable laws relating to the sale
of pharmaceutical Products in such market or jurisdiction, the designation or
listing of any pharmaceutical product as interchangeable with one or more
pharmaceutical Products or the listing or acceptance of a pharmaceutical
product for listing in the Formulary published in that jurisdiction.

n)            “Initial Term” means
the initial term of five (5) years from the Effective Date.

o)            “Renewal Term” means
any successive one (1) year term of this Agreement subsequent to the Initial
Term.

p)            “Territory” means
Canada.

q)            “TPD” means the
Therapeutic Products Directorate of Health Canada (or whatever such agency
might be called from time to time), or any successor agency having regulatory
jurisdiction over the manufacture, distribution and sale of drugs in Canada.

2)            Ownership Product
Information and Patent.  MONOSOL is
or is entitled to be the owner of the Product Information and the Patent.

3)            Batch Size.  Orders of the Products by VITA from MONOSOL
may be in partial or full batch quantities as may be agreed to by the parties
from time to time.

 

2

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

4)            Product
Information.  MONOSOL shall promptly
provide to VITA all Product Information and relevant information which MONOSOL
shall from time to time have available to it regarding changes or additions to
the Product Information.

5)            License.  MONOSOL hereby grants to VITA, for the Term,
and VITA hereby accepts, a license to use the Product Information for the
purposes related to this Agreement, including obtaining the required Regulatory
Approvals and manufacturing, distributing and selling the Products within the
Territory.  VITA shall use the Product
Information only as set forth in this Agreement, and for no other purpose.  VITA further consents to protect, and keep
confidential, the Product Information, and shall not disclose the Product
Information to any Person who is not an employee of VITA, without having said
Person agree to keep the Product Information confidential and not to utilize
the Product Information for any purpose other than facilitating VITA’s
performance under this Agreement.  VITA
shall use commercially reasonable efforts to obtain and maintain a DIN to
market, sell and distribute the Products.

6)            Sub-License.  Vita may request written permission to
sub-license its rights under this Agreement in whole or in part to a specified
third party, which may not be unreasonably withheld.

7)            No Infringement.  MONOSOL warrants that to the best of its
knowledge and belief the Product Information and Patent do not infringe the
valid rights of any Person and that it is not aware of any pending or potential
claim by a Person with respect to any of MONOSOL’s rights to the Product
Information and Patent.

8)            Product
Development/Trade-mark Litigation.  MONOSOL shall use commercially reasonable
efforts to complete the development of the Products, and provide the Product Information
to VITA.  VITA, at its cost is
responsible to satisfy the requirements such that a Product does not infringe
trade-mark rights of any Person.  In the
event that a claim arises, based upon an allegation that a Product infringes
trade-mark rights of any Person, the party receiving notice of such claim
shall, promptly after becoming aware of same, give written notice to the other
party of the existence of such claim and, thereafter, VITA shall defend and pay
all costs related to such claim using its own counsel and if required co-counsel
with MONOSOL.

9)            Patent Litigation.  MONOSOL, at its cost, will take all
reasonable and customary steps to produce Product which does not infringe the
patent rights of any Person.  In the
event that a claim arises, based upon an allegation that a Product infringes
patent rights of any Person, the party receiving notice of such claim shall,
promptly after becoming aware of same, give written notice to the other party
of the existence of such claim and, thereafter, MONOSOL shall defend and pay
all costs related to such claim using its own counsel and if required
co-counsel with VITA.

10)          General Communication
with Regulatory Authorities.  VITA
shall promptly deal with any request by the TPD or other Regulatory Authority
and forward to MONOSOL a copy of such request, any reply thereto and any other
correspondence (and otherwise notify the other party of any other
communication) with or reports from the TPD or other

 

3

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

Regulatory Authority.  MONOSOL shall strive to provide all necessary
information within the time specified in support of responses required by the
Regulatory Authority.

11)          Funding of Product
Registration Costs.  VITA, at its
cost, shall be responsible for preparing and filing (including fees) for
obtaining, maintaining and renewing all Regulatory Approvals for the Products
and all other costs and expenses incurred in connection with obtaining Regulatory
Approvals.

12)          Mutual Disclosure
of Adverse Effects.  Each party shall
inform the other of all information that comes into its control and is not
otherwise public knowledge concerning side effects, injury, toxicity or
sensitivity reactions and incidents and severity thereof associated with
commercial and clinical uses, studies, investigations or tests (animal and human)
directly relating to the Products, whether or not determined to be attributable
to the Products.

13)          Pricing and
Payment.  The prices paid by VITA to
MONOSOL for the PRODUCTS shall be as per the attached Appendix B.  The net invoiced amount shall be due and
payable by VITA to MONOSOL forty-five (45) days after delivery of the Products
to VITA.  [*]

14)          Labeling.  VITA shall supply label copy and artwork to
comply with the DIN and applicable law.

15)          Expiry.  MONOSOL agrees to deliver to VITA Products
that shall have no less than 21 months expiry dating upon receipt by VITA.

16)          Packaging and Transportation.  MONOSOL shall package the Products in bulk in
containers suitable for cross border transport. 
The containers shall be non-returnable and shall be disposed of by VITA
in accordance with applicable policy.  MONOSOL
shall be responsible for delivery of the Products in accordance with INCOTERMS
2000 as specified in Section 16 below.

17)          Delivery Terms.  EXW — Ex-works

18)          Permits &
Licenses.  VITA, at its cost, shall
be responsible for the application and receipt of import licenses required by
the Canadian government for the specific Products (if required).  VITA shall supply a copy of such license to
MONOSOL for the purpose of applying for an export license to the U.S.
government (if required).

a)            For the purposes of
adding MONOSOL to VITA’s Drug Establishment License, MONOSOL shall provide appropriate
evidence of GMP compliance such as MONOSOL’s most recent FDA Exit Inspection Report.

b)            MONOSOL, at its
cost, shall be responsible for preparing, executing, and receiving all required
export permissions and shipping documentation with the exception of 17(a)
above.

19)          Forecasts.  VITA shall provide MONOSOL with non-binding
rolling 2 month forecasts of volume projections.

 

4

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

20)          Purchase Orders.  MONOSOL shall deliver requested Products
ninety (90) days after receipt of VITA’s firm purchase order, [*].

21)          Certificate of
Analysis.  MONOSOL shall provide VITA
with a certificate of analysis for each batch of Product, that shall confirm
the Product meets the specifications identified in Appendix D attached hereto.

22)          Certificate of
Manufacture.  MONOSOL shall provide
VITA with a certificate of manufacture for each batch of Product, that shall
confirm the Product was manufactured in accordance with its master production
document and GMP as identified in Appendix E attached hereto.

23)          Ownership of Trade
Dress.  VITA owns all trade-marks and
trade dress used by VITA to market the Product.

24)          Insurance.  MONOSOL and VITA shall carry (for the Term and
three (3) years thereafter), commercial general liability insurance including
product liability coverage of at least five million ($5,000,000.00) dollars.  Each party shall provide a copy of its
insurance certificate to the other party upon request.

25)          Indemnification.  The parties shall be responsible for
indemnifying each other in accordance with the terms of the indemnification attached
as Appendix F.

26)          Audit.  VITA and MONOSOL shall each have the right, at
its sole expense, and during normal business hours and upon at least seven (7)
days’ written notice, to audit the others’ facilities where the Products are
manufactured, packaged or stored for compliance with applicable law and this Agreement,
not more than once in each calendar year.  Each such party hereby agrees that they shall
take all reasonable steps, at their own expense, as may be necessary to comply
with applicable law.

27)          Representations
and Warranties of MONOSOL.  MONOSOL makes
the Representations and Warranties to VITA, as are set forth in Appendix G-1 to
this Agreement.

28)          Representations
and Warranties of VITA.  VITA makes
the Representations and Warranties to MONOSOL as are set forth in Appendix G-2
to this Agreement.

29)          Renewal.  Unless otherwise terminated in accordance with
this Agreement, this Agreement shall be automatically renewed for successive
terms of one (1) year each.

30)          Termination.  This Agreement may be terminated by either
party, as the case may be: (i) if either party commits a material breach
of this Agreement which has not been remedied within sixty (60) days of receipt
of written notice of the breach; (ii) if either party commits a violation of
law which materially impacts performance of this Agreement and is not cured
within sixty (60) days; (iii) if MONOSOL receives a Form 483 from the FDA
regarding the Products, and has not complied within a commercially reasonable time
thereafter; (iv) if MONOSOL has entered into a consent agreement with the FDA,
or a similar event has occurred, which significantly impairs its ability to
perform its obligations under this contract, (v) if either party becomes
insolvent, makes or

 

5

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

has made an
assignment for the benefit of creditors, is the subject of proceedings in
voluntary or involuntary bankruptcy instituted on behalf of or it (except for
involuntary bankruptcies which are dismissed within ninety (90) days), or has a
receiver or trustee appointed for substantially all of its property; (vi) if VITA
is unable to obtain Regulatory Approvals for a Product, in which case this
Agreement shall be terminated with respect to that Product only; (vii) if the
parties mutually agree in writing to terminate this Agreement upon terms and
conditions satisfactory to both, (viii) in the event of a claim against either
party to this agreement for patent infringement based on Product, MONOSOL is
free to stop the manufacture of PRODUCT and terminate this Agreement; or (ix)
upon either party providing written notice to the other party at least six (6)
months prior to the then current term of this Agreement.

31)          Assignment.  This Agreement shall inure to the benefit of,
and shall be binding upon each of, the parties hereto and their respective
successors and assigns.  This Agreement
may, without the prior written consent of the other party, be assigned, in
whole or in part, to an affiliate or to any third party acquiring all or
substantially all of the assets of a party, provided that such party remains
fully responsible for performance of the obligations of its affiliates under
this Agreement.

32)          Dispute Resolution.  In the event of any dispute, including
that regarding a potential recall or compliance issue, the parties agree that
written notice shall be given to the President of the other party and such
officers shall meet in person within thirty (30) days of such notice to use
good faith efforts to resolve such issue.  In the event that the officers of the parties
are unable to resolve such issue, then the same shall be resolved by
arbitration.   Such arbitration shall be
conducted by a single arbitrator, if the parties can agree upon one, failing
which such arbitrator shall be appointed by a judge of the Court of Queen’s
Bench, upon the application of any of the said parties and a judge of the Court
of Queen’s Bench shall be entitled to act as such arbitrator, if he or she so
desires.  The arbitration shall proceed
in accordance with the provisions of The Arbitration Act (Manitoba) (the “Act”).
 The decision arrived at by the
arbitrator shall be final and binding and no appeal shall lie therefrom.  The provisions of this Section 32 shall be
deemed to be a submission to arbitration within the provision of the Act and
any statutory modification or reenactment thereof.

33)          Confidentiality.  Both Parties agree to be subject to the
confidentiality provisions as are set forth in Appendix H hereto.

34)          Entire Agreement.  This is the entire agreement of the
parties regarding the matters set forth herein.  This Agreement nay not be revised, altered or
amended without the written consent of each party and supersedes all
agreements, whether oral or written, and obligations existing among the parties
with respect to the matters set forth herein.

35)          No Special Damages.  In no event shall either party be liable
to the other under this Agreement for punitive, exemplary, consequential, or
special damages including, without limitation, damages related to lost good will,
lost customers, or lost profits, beyond those damages expressly provided herein.

 

6

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

36)          Facility Licensing.  VITA shall apply each calendar year for
MONOSOL to be included as a Foreign Site on VITA’s Drug Establishment License.  MONOSOL shall provide at VITA’s request a copy
of the most recent EIR and all related correspondence required for Health
Canada to assess compliance with GMP for the purposes of inclusion on the Drug
Establishment License.

37)          Quality Agreement.  VITA and MONOSOL shall enter into a quality
agreement for the manufacture of the Product which shall outline each party’s
respective responsibility for the manufacture and compliance with regulatory
matters associated with the Product.

38)          Governing Law and
Consent to Jurisdiction.  This
Agreement shall be governed by and construed in all respects in accordance with
the laws of Toronto and Canada.  The
Toronto and Canadian Courts shall have the jurisdiction to settle any disputes,
which may arise out of or in connection with this Agreement.

39)          Entire Agreement.  This Agreement shall not be modified or
amended except in writing signed by duly authorized representatives of both
parties.

Accepted and agreed as of
the Effective Date set forth above.

	
  MONOSOL RX LLC

  	
   

  	
  VITA HEALTH PRODUCTS INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Alexander M. Schobel

  	
   

  	
  By:

  	
  /s/ Rachel Cahill

  
	
  Name:

  	
  Alexander M. Schobel

  	
   

  	
  Name:

  	
  Rachel Cahill

  
	
  Title:

  	
  President and CEO

  	
   

  	
  Title:

  	
  Sr. Vice-President Finance

  

 

7

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

APPENDIX
A

PRODUCTS

[*]

 

8

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

APPENDIX
B

PRODUCT PRICE LIST

[*]

 

9

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

APPENDIX
C

LIST OF PATENTS PENDING

[*]

 

10

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

APPENDIX
D

CERTIFICATE OF ANALYSIS

*TO
BE PROVIDED BY MONOSOL

 

11

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

APPENDIX
E

CERTIFICATE OF MANUFACTURE

*TO
BE PROVIDED BY MONOSOL

 

12

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

APPENDIX
F

INDEMNIFICATION

“Affiliate” means any
corporation or business entity controlled by, controlling, or under common
control with the applicable Party as the case may be.  For the purpose of this definition, “control
means direct or indirect beneficial ownership of greater than fifty (50%)
percent of the voting stock of such corporation or other business entity, or a
greater than fifty (50%) percent interest in the income of such corporation or
other business entity, or the power to direct or cause the direction of the
management and policies of such corporation or other business entity whether by
ownership of voting securities, by contract or otherwise, or such other
relationship as, in fact, constitutes control.

MONOSOL agrees to
indemnify, defend and hold harmless, and to pay and reimburse VITA, its
Affiliates, and its and their respective employees, agents and representatives,
from and against any and all third party claims and losses, damages and
liabilities (including those relating to personal injury, death or property
damage), including reasonable attorneys’ fees, relating thereto, incurred by
any of them arising out of, relating to or occurring as a result of MONOSOL’s
negligence or willful misconduct or the breach of any representation, warranty
or covenant made by MONOSOL in this Agreement or any defect in any Product
except and to the extent incurred as a result of VITA’s negligence or primarily
incurred as a result of VITA’s breach of any representation, warranty or
covenant made by either of them.

VITA agrees to indemnify,
defend and hold harmless, and to pay and reimburse, MONOSOL, its Affiliates,
and its and their respective employees, agents and representatives, from and
against any and all third party claims and losses, damages and liabilities
(including those relating to personal injury, death or property damage),
including reasonable attorneys’ fees, relating thereto, incurred by any of them
arising out of, relating to or occurring as a result of VITA’s negligence or
willful misconduct or the breach of any representation, warranty or covenant
made by VITA in this Agreement except and to the extent incurred as a result of
the negligence of MONOSOL or primarily incurred as a result of MONOSOL’s breach
of any representation, warranty or covenant made by either of them.

If VITA, MONOSOL or any
other indemnitee (in each case an “Indemnified Party”) receives any claim which
it believes is the subject of indemnity hereunder, the Indemnified Party shall,
as soon as reasonably practicable after forming such belief, give notice thereof
to the indemnifying party, including all particulars of such claim to the extent
known to the Indemnified Party; provided that the failure to give timely notice
to the indemnifying party as contemplated hereby shall not release the indemnifying
party from any liability to the Indemnified Party except to the extent the indemnifying
party is materially prejudiced in defending any claim by such failure.  The indemnifying party shall assume the
defense of such claim with counsel of its choice reasonably satisfactory to the
Indemnified Party, and at the cost of the indemnifying party.  The Indemnified Party may participate in the
action through counsel of its choice, but the cost of such counsel shall be at
the expense of the Indemnified Party (unless (i) the Indemnified Party
determines in good faith that there may be a conflict of interest between the
indemnifying party, and the Indemnified Party or there may be one or more legal
defenses available to the Indemnified Party that are different from or additional
to those available to the

 

13

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

indemnifying party
or (ii) the indemnifying party fails to assume the defense of such action
within fifteen (15) days of receipt of notice of such action).  If the indemnifying party does not so assume
the defense of such claim, or, having assumed such defense fails to vigorously
prosecute such defense, the Indemnified Party may assume such defense, with
counsel of its choice, to be paid or reimbursed by the indemnifying party.

The Party not assuming
the defense of any such claim shall render all reasonable assistance to the
other Party assuming the defense, and all reasonable out-of-pocket costs of
such assistance shall be promptly paid or reimbursed by the Indemnifying Party.

No such claim shall be
settled and no admission may be made other than by the Party defending the
same, and then only with the written consent each other Party, which shall not
be unreasonably withheld; provided that the Indemnified Party shall have no obligation
to consent to any settlement of any such claim which imposes on the Indemnified
Party any liability or obligation which shall not be assumed and performed in
full by the Indemnifying Party.

 

14

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

APPENDIX
G-1

REPRESENTATIONS AND WARRANTIES OF MONOSOL

As of the Effective Date,
there are no actual or threatened enforcement actions by the FDA or other federal,
state or foreign agency which has jurisdiction over MONOSOL’s operations or
products, including, without limitation, any fines, injunctions civil or criminal
penalties, investigations, debarments or suspensions.

MONOSOL shall maintain
all equipment and facilities utilized in the storage of the API and the
development, manufacture and supply of the Products hereunder in good operating
condition and shall maintain such facilities and such equipment in accordance
with all applicable laws.

MONOSOL, at its expense,
shall perform all stability, validation and other raw material and in-process
and finished product tests or checks required by the specifications and
applicable laws in order to assure the conformity of the Products to the
specifications.

MONOSOL shall advise VITA
of any known noncompliance and of the testing or inspection results of batches
of the Product and Products that do not strictly comply with the
specifications, applicable law or this Agreement.

MONOSOL shall have good
and marketable title to each shipment of Products sold to VITA, and all such
Products shall be free from any lien or encumbrances of any third party.

If the Products delivered
to VITA are used according to the Product’s label, the Products shall be safe,
non-injurious and fit for consumption or other use in accordance with the
Product’s label as approved in the Product ANDS.

MONOSOL is not debarred
under the Generic Drug Enforcement Act of 1992 and it does not and shall not
use in any capacity the services of any person debarred under the Generic Drug
Enforcement Act of 1992; neither MONOSOL nor, to the best of its knowledge, any
of its employees, agent or contractors, has engaged in any activity which could
lead to it becoming debarred under the Generic Drug Enforcement Act of 1992.

MONOSOL owns and shall
maintain all applicable ANDAs for the Product.

MONOSOL shall promptly
inform VITA of any allegation and/or notification of infringement of
third-party intellectual property regarding the manufacture, use or sale of the
Product.

 

15

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

APPENDIX
G-2

REPRESENTATIONS AND WARRANTIES OF VITA

The Products shall be
packaged, labeled, stored, transported, marketed and sold in conformance with
all applicable laws.

As of the Effective Date,
there are no actual or threatened enforcement actions by the Health Canada or
other provincial or territorial agency which has jurisdiction over VITA’s
operations or products, including, without limitation, any fines, injunctions,
civil or criminal penalties, investigations, debarments or suspensions.

VITA shall maintain all
equipment and facilities utilized in the packaging, labeling, storage,
transportation, marketing and sale of the Products hereunder in good operating
condition and shall maintain such facilities and such equipment in accordance
with, or in a manner that shall meet or exceed the requirements of all
applicable laws.

VITA has the physical
ability and financial resources available to package, label, store, transport,
market and sell the Products to be sold to it under this Agreement.

VITA is not debarred
under the Generic Drug Enforcement Act of 1992 and it does not and shall not
use in any capacity the services of any person debarred under the Generic Drug
Enforcement Act of 1992; neither MONOSOL, nor, to the best of its knowledge,
any of its employees, agents or contractors, has engaged in any activity which
could lead to it becoming debarred under the Generic Drug Enforcement Act of
1992.

 

16

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

APPENDIX
H

CONFIDENTIALITY AND NON-USE

During the Term of this
Agreement and any renewal thereof, and for a period of three (3) years
thereafter, each Party shall hold in confidence, and may not use or disclose to
a third party, any and all proprietary information, trade secrets, customer
lists, business strategies, including without limitation, the terms and
conditions of this Agreement, disclosed to it by any other Party (whether
visually, orally or in writing) that is either indicated to be proprietary or
confidential information of the disclosing party or which by its nature the receiving
party would reasonably deem to be confidential or proprietary information of
the disclosing party regardless of marking (“Confidential Information”),
provided by the disclosing party, except with the express prior written consent
of the disclosing party, provided that the non-disclosing party shall not be
prevented from disclosing information which;

at, prior or subsequent
to the time of such disclosure is independently known to or developed by the
receiving party without obligation of secrecy or non-use to a third party;

at, prior or subsequent
to the time of disclosure, becomes part of the public knowledge through no
breach hereof by the receiving party;

subsequent to the time of
such disclosure is the subject of another agreement between the parties hereto
which explicitly permits use or disclosure;

is required by law,
subpoena or other judicial process to be disclosed, after giving the other
party notice of intent to disclose and an opportunity to contest such
disclosure;

at, prior or subsequent
to the time of such disclosure was disclosed to the non-disclosing party by a
third party who had no obligation to the disclosing party not to disclose such
information to others; and/or

is required by applicable
securities laws or securities and exchange commission regulations to be
publicly disclosed.

Without limiting the
generality of the foregoing, each Party shall limit disclosure of the Confidential
Information to its employees who need to receive the Confidential Information
in order to further the activities contemplated in this Agreement.  Each Party shall take sufficient precautions
to safeguard the Confidential Information in the same manner that such Party
protects its own Confidential Information, which in no event shall be less than
commercially reasonable measures.  Each
Party understands and agrees that the wrongful disclosure of Confidential
Information shall result in serious and irreparable damage to the other Party,
that the remedy at law for any breach of this covenant may be inadequate, and
that the Party seeking redress hereunder shall be entitled to injunctive
relief, without prejudice to any other rights and remedies to which such Party
may be entitled.

The above
notwithstanding, each Party shall have the right, with the exercise of
reasonable discretion, to make disclosures of such portions of Confidential
Information to third party consultants, attorneys, contractors, subcontractors,
advisors, Affiliates and Regulatory

 

17

 

CONFIDENTIAL TREATMENT REQUESTED

Pursuant to 17 C.F.R. §§200.80(b) and 230.406

Authorities where in
the recipient’s judgment such disclosure is useful to development, approval or
marketing of a finished product pursuant to this Agreement, and who agree to be
bound by the confidentiality obligations under this Section or who otherwise enter
into written confidentiality agreements having provisions no less stringent than
those contained herein.

Except as otherwise set
forth in this Agreement, upon termination of this Agreement and at the written
request of the disclosing party, the receiving party shall return all the
Confidential Information of the applicable disclosing party (including all
copies thereof) or destroy such Confidential Information at the option of such
disclosing party.

 

18

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