Document:

scrips_s1-ex1005.htm

 EXHIBIT 10.5

    

SCRIPSAMERICA, INC.

RESTRICTIVE COVENANTS AGREEMENT

THIS RESTRICTIVE COVENANTS AGREEMENT (hereinafter referred to as this “Agreement”), is made and entered into this 1st day of April, 2011, by and between ______________________  (hereafter referred to as “Recipient”) and SCRIPSAMERICA, INC., a Delaware corporation (hereafter referred to as the “Company”).

A.   The Company provides a system of broad base US marketing, sales and distribution of generic and branded prescriptions and over-the-counter pharmaceuticals (the “Business”).

B.   The Company desires to disclose its Confidential Information (as hereinafter defined) to Recipient in accordance with the terms, conditions and covenants set forth in this Agreement.

Accordingly, in consideration of the mutual covenants and undertakings set forth herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows:

1.   Non-Competition.  From the date hereof and continuing for a period of five (5) years following Recipient’s termination of employment, association or affiliation with the Company (the “Restriction Period”), Recipient, directly or indirectly, in association with or as a stockholder, director, officer, consultant, employee, partner, joint venturer, member or otherwise of or through any person, firm, corporation, partnership, association or other entity, shall not compete with the Company or any of its affiliates in any line of business which is competitive with the business of the Company; provided, however, the foregoing shall not prevent Recipient from accepting employment with an enterprise engaged in two or more “lines of business,” one of which is the same or similar to the Company's business (the “Prohibited Business”) and provided further that Recipient's intended employment is in the “line” totally unrelated to the Prohibited Business.  Notwithstanding the foregoing, in the event that Recipient’s termination of employment, association or affiliation with the Company was made by the Company without cause, then the Restriction Period for this Section 1 shall only be two (2) years from such termination.  The foregoing shall not prohibit Recipient from owning up to five percent (5%) of the securities of any publicly-traded enterprise, which is engaged in the Prohibited Business and which may be in direct competition with Company, provided that Recipient is not an executive, director, officer, consultant to such enterprise or otherwise reimbursed for services rendered to such enterprise.

2.   Non-Solicitation. During the Restriction Period, Recipient shall not in any manner directly or indirectly solicit nor accept any business from any Customer or any sources or such sources’ affiliates that are directly or indirectly introduced to Recipient by the Company or as a result of its relationship with the Company at any time without the express written permission of the Company.  For purposes of this Agreement, the term “Customer” means any person, firm, corporation, partnership, association or other entity to which the Company or any of its affiliates sold or provided goods or services during the Restriction Period or who was approached by or who approached an employee of the Company for the purpose of soliciting business from the Company.

3.   Non-Use/Non-Disclosure of Confidential Information.

   

A.   Confidential Information. “Confidential Information” includes, but is not limited to, trade secrets as defined by the common law and any applicable statute, processes, policies, procedures, techniques, designs, drawings, know-how, show-how, customer lists, suppliers, technical information, financial/financing contacts, investors, subcontractors, marketing agents, specifications, information and data relating to the development, research, any economic analysis relating to the Business, budgets and strategic plans, and the identity and special needs of customers, databases, data, all technology relating to the Company’s businesses, systems, methods of operation, client or customer lists, customer information, solicitation leads, marketing and advertising materials, methods and manuals and forms, all of which pertain to the activities or operations of the Business, names, home addresses and all telephone numbers and e-mail addresses of the Company’s executives, former executives, clients and former clients. In addition, Confidential Information shall include Customers and the identity of and telephone numbers, e-mail addresses and other addresses of executives or agents of customers who are the persons with whom the Company’s executives and agents communicate in the ordinary course of business. Confidential Information also includes, without limitation, Confidential Information received from the Company’s subsidiaries and affiliates.1

   

1 For purposes of this Agreement, the following will not constitute Confidential Information: (i) information which is or subsequently becomes generally available to the public through no act or omission of the Recipient; (ii) information set forth in the written records of Recipient prior to disclosure to Recipient by or on behalf of the Company, which information is given to the Company in writing as of or prior to the date of this Agreement; and (iii) information which is lawfully obtained by Recipient in writing from a third party (excluding any affiliates of Recipient) who did not acquire such confidential information or trade secret, directly or indirectly, from either party hereto.

  

  

  

  

     

B.   Legitimate Business Interests. Recipient recognizes that the Company has legitimate business interests to protect and, as a consequence, Recipient agrees to the restrictions contained in this Agreement because they further legitimate business interests.  These legitimate business interests include, but are not limited to: (i) trade secrets as defined by the Delaware Uniform Trade Secrets Act; (ii) valuable confidential business or professional information that otherwise does not qualify as trade secrets, including all Confidential Information; (iii) substantial relationships with specific prospective or existing clients; (iv) goodwill associated with the Company’s business; and (v) specialized training relating to the Company’s technology, methods and procedures.

 

C.   Confidentiality. Confidential Information shall be held by Recipient in the strictest confidence and shall not, without the prior written consent of the Company, be disclosed to any person other than as authorized in conjunction with such engagement. Recipient further acknowledges that such Confidential Information as is acquired and used by Recipient or its affiliates is a special, valuable and unique asset. Recipient shall exercise all due and diligent precautions to protect the integrity of the received Confidential Information and to keep it confidential whether it is in written form, on electronic media or oral. Recipient shall not copy any Confidential Information except to the extent necessary to Recipient’s relationship with the Company nor remove any Confidential Information or copies thereof from the Company’s premises except to the extent necessary to Recipient’s relationship with the Company and then only with the authorization of an officer of the Company. All records, files, materials and other Confidential Information obtained by Recipient in the course of Recipient’s relationship with the Company are confidential and proprietary and shall remain the exclusive property of the Company or its customers, as the case may be.  Recipient shall not, except in connection with and as required by the performance of its duties, for any reason use for its own benefit or the benefit of any person or entity with which it may be associated or disclose any such Confidential Information to any person, firm, corporation, association or other entity for any reason or purpose whatsoever without the prior written consent of an authorized representative of the Company.

 

4.   Non-Circumvention.  Notwithstanding anything to the contrary in this Agreement, Recipient agrees for itself and its affiliates and related parties that it will not engage in any transaction or disclose any Confidential Information that will interfere with, or deprive the Company of any business opportunities disclosed pursuant to this Agreement or its relationship with the Company.

    

5.   Stipulations; Reformation; Severability; Injunctive Relief.

A.   Stipulations. The parties hereto stipulate and agree that: (i) adequate consideration exists for the restrictive covenants set forth in Paragraphs 1, 2, 3 and 4 of this Agreement (the “Restrictive Covenants”); (ii) the Restrictive Covenants are necessary to insure the preservation and continuity of each of the parties’ business and goodwill; (iii) the time period(s) of the respective Restrictive Covenants are reasonable temporal restraints; (iv) the scope of the activities restricted by the Restrictive Covenants is reasonable; and (v) the enforcement of any of the Restrictive Covenants will not interfere with Recipient’s livelihood.

 

B.   Reformation. The Parties hereto intend all provisions of the Restrictive Covenants to be enforced to the fullest extent permitted by law. Accordingly, should a court of competent jurisdiction determine that the scope of any provision of the Restrictive Covenants is too broad to be enforced as written, based on their duration, geographic limitations, scope of activities, or otherwise, the Parties intend that the court reform the provision to such narrower scope as it determines to be reasonable and enforceable.  The Parties agree that each of the agreements set forth in the Restrictive Covenants constitutes a separate agreement independently supported by good and adequate consideration, shall be severable from the other provisions of this Agreement, and (with this Paragraph 5) shall survive the expiration or termination of this Agreement or Employee’s employment under this Agreement.

   

  

2

  

  

C.   Severability. If any provision of this Agreement is held to be illegal, invalid, or unenforceable under present or future laws, (i) such provision shall be fully severable, (ii) this Agreement shall be construed and enforced as if such illegal, invalid, or unenforceable provision never constituted a part of this Agreement, and (iii) the remaining provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid, or unenforceable provision or by its severance from this Agreement. Furthermore, in lieu of such illegal, invalid, or unenforceable provision, there shall be added as part of this Agreement a provision as similar in its terms to such illegal, invalid, or unenforceable provision as may be possible and be legal, valid, and enforceable.

 

D.   Injunctive Relief. The Company and Recipient recognize that the obligations of the parties under this Agreement are special, unique and of extraordinary character and each acknowledges the difficulty in forecasting damages arising from the breach of any of the Restrictive Covenants and that the non-breaching may be irreparably harmed thereby. Therefore, the parties agree that the non-breaching party shall be entitled to elect to enforce each of the Restrictive Covenants by means of injunctive relief or an order of specific performance and that such remedy shall be available in addition to all other remedies available at law or in equity to the non-breaching party, including the recovery of damages from the breaching party’s agents or affiliates involved in such breach.  In such action, the non-breaching party shall not be required to plead or prove irreparable harm or lack of an adequate remedy at law or post a bond or any security.

 

6.   Proprietary Rights.  All ideas, inventions, developments and improvements (“Developments”) made by Recipient, alone or jointly with others, whether or not during normal business hours or on Company premises, that are within the scope of the Company's Business, which result from or are suggested by any work Recipient or others may do on behalf of the Company, shall be and are the property of the Company. Recipient agrees to assign and does hereby assign to the Company all Recipient’s rights to such Developments in all countries. Recipient agrees to promptly disclose to the Company all Developments covered by this Agreement and will, at the request of the Company at any time, including after the termination of the relationship with the Company, cooperate in all lawful acts which may be necessary or desirable in the judgment of the Company to protect for the benefit of the Company all such Developments, including executing any patent application, or any application for registration or assignment relating to any such Development, without charge to the Company.

 

A.   Recipient understands and acknowledges that this Agreement is not intended to require assignment of any rights in an invention that Recipient develops entirely on its own time without using the Company's equipment, supplies, facilities or trade secret information except for those inventions that either: (1) relate at the time of conception or reduction to practice of the invention to the Company's Business, or actual or demonstrably anticipated research or development of the Company; or (2) result from any work performed by Recipient for the Company. Recipient further understands that the Company has the right to review, in confidence, all inventions Recipient conceives solely or jointly with others during the term of Recipient’s relationship with the Company to determine questions of rights to Developments falling within the scope of this Agreement.

 

B.   During Recipient’s relationship with the Company, Recipient shall not, without the advance written approval of the Company, engage in any activity which may constitute a conflict with the Company's interests regarding Confidential Information or Developments. Any question whether a particular activity may constitute a conflict of interest shall be resolved by obtaining the Company's written approval before engaging in that activity.  All written materials and other tangible objects, including copies, made or compiled by me or made available to me in the course of my employment, shall be the property of the Company and shall be delivered to the Company upon termination of my employment or at any other time upon request.

 

7.   Counterparts:  This Agreement may be executed in any number of counterparts (including facsimile or scanned versions), each of which shall be an original but all of which together will constitute one instrument, binding upon all parties hereto, and notwithstanding that all of such parties may not have executed the same counterpart.

   

  

3

  

   

8.   Governing Law, Jurisdiction, Venue and Waiver of Jury Trial: This Agreement will be governed by and construed under the laws of the State of Delaware, without regard to the conflict of laws provisions thereof.  Any suit involving any dispute or matter arising under this Agreement may only be brought in the state courts of Delaware or the United States District Court for the District of Delaware which shall have jurisdiction over the subject matter of the dispute or matter.  Recipient and the Company irrevocably and unconditionally submit to the personal jurisdiction of such courts and agree to take any and all future action necessary to submit to the jurisdiction of such courts. Recipient and the Company irrevocably waive any objection that they now have or hereafter irrevocably waive any objection that they now have or hereafter may have to the laying of venue of any suit, action or proceeding brought in any such court and further irrevocably waive any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. Final judgment against Recipient or the Company in any such suit shall be conclusive and may be enforced in other jurisdictions by suit on the judgment, a certified or true copy of which shall be conclusive evidence of the fact and the amount of any liability of Recipient or the Company therein described, or by appropriate proceedings under any applicable treaty or otherwise.  EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER AGREEMENT OR INSTRUMENT DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

 

9.   Payment of Costs and Legal Fees Upon Breach: In the event of a breach by Recipient of the terms of this Agreement, Recipient shall be responsible to pay all costs, fees and expenses (including reasonable attorney fees) incurred in connection with the exercise or enforcement of any of the Company’s rights, powers or remedies pursuant to this Agreement, (including in all trial, bankruptcy and appellate proceedings) regardless of whether or not suit is filed.  In the event suit is filed, Recipient shall be required to pay the Company’s costs and legal fees for breach if the Company’s claim and/or claims is/are upheld by an Order of the Court prior or subsequent to trial or by stipulation or other settlement document whereby the Company prevails on any and/or all of its claims against Recipient.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date and year first hereinabove written.

   

   

	SCRIPSAMERICA, INC.	 	RECIPIENT
	 	 	 	 	 
	 	 	 	 	 
	By:	/s/ Robert Schneiderman	 	 	 
	Name:	Robert Schneiderman	 	Name:	 
	Title:	Chief Executive Officer	 	Address:	 
	Address:	77 McCullough Drive, Suite XXX	 	 	 
	 	New Castle, DE	 	 	 
	 	 	 	 	 
	 	 	 	 	 

 

 

4scrips_s1-ex1006.htm

 EXHIBIT 10.6

    

PRODUCT DEVELOPMENT , MANUFACTURING AND SUPPLY

AGREEMENT

ACETAMINOPHEN ORALLY DISINTEGRATING TABLETS

RAPID DISSOLVING TABLETS

(IMMEDIATE RELEASE 80MG)

This PRODUCT DEVELOPMENT, MANUFACTURING AND SUPPLY AGREEMENT (“Agreement”) entered into as of this 1st day of March 2010 (“Effective Date”), between ScripsAmerica, Inc., a Delaware corporation located at 843 Persimmon Lane Langhorne PA 19047, (“ScripsAmerica”), and Marlex Pharmaceuticals, Inc., a Delaware Corporation, located at 50 McCullough Dr., New Castle, DE 19720(“Marlex”).

RECITALS

WHEREAS, ScripsAmerica and Marlex (collectively the “Parties”) represent and warrant to each other that the recitals herein are true and correct.

WHEREAS, ScripsAmerica is interested in developing for sales by ScripsAmerica in the United States the follow generic drug products (“Products”):

ACETAMINOPHEN 80MG ORALLY DISINTEGRATING RAPID DISSOLVE TABLETS (IMMEDIATE RELEASE TABLETS)

WHEREAS Marlex is in the business of developing and manufacturing generic drug products and desires to develop and to manufacture and supply the Products exclusively for ScripsAmerica as further described herein;

NOW, THEREFORE, for the consideration and covenants set forth herein, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree to develop, manufacture and distribute the Products in accordance with the terms and conditions further specified herein and in the Exhibits hereto.

    

  

  

  

 

ARTICLE 1

DEFINITIONS

The following terms as used In this Agreement have the following respective meanings:

1.1 FDA:   The term ‘FDA” means the United States Food and Drug Administration

1.2 Milestones:   The term “milestones” means the project activities and performance descriptions set forth on Exhibit A.

1.3 NDC:   The term “NDC” means National Drug Code

     

1.4 Products:   The term “Products” means Acetaminophen 80mg Orally Disintegrating Rapid Dissolving Tablets 80mg (immediate release tablets).

1.5 Proprietary Rights: The term “ Proprietary Rights” means the Product and all intellectual and physical work product having value to ScripsAmerica and Marlex related to the development or manufacture of the Product, including without limitation inventions, whether or not patentable and whether or not tested or reduced to practice, any and all data, techniques, discoveries, developments, designs, trade secrets, confidential business information, know-how and tangible expressions, tests, reports, processes, formulae, specification, improvements, result, experiments, samples, statistics and test analyses relating to the product.

    

ARTICLE II

DEVELOPMENT OF PRODUCT; PROPRIETARY RIGHTS

2.1 Product Development. Marlex shall develop the products according to the activity descriptions set forth in Exhibit A. Marlex acknowledges and agrees to develop the Products in accordance with the budget, milestones, and delivery date assumptions set forth in Exhibit A.

ScripsAmerica shall be responsible for 100 percent of the costs associated with development of the Product as set forth in Section 6.1 below and in Exhibit A hereto.

    

  

2

  

    

2.2 Disclosure to ScripsAmerica. Marlex agrees to disclose fully and promptly to ScripsAmerica all information regarding all Proprietary Rights developed or conceived by Marlex or its employees or agents solely or Jointly with others relating to the development of the Products contemplated by this Agreement, or result from, or are suggested by, work which Marlex or its personnel have performed or will perform during the Term hereof: (I) as of the date if this Agreement; (ii) during the Term of this Agreement (with Proprietary Rights developed or conceived during any development phase on Exhibit A to be disclosed to ScripsAmerica no later than the end of that development phase); and (iii) for a period of six (6) months thereafter, Marlex shall cause its personnel to agree to make and maintain written records of the Proprietary Rights and to submit promptly the same and to provide supplemental oral disclosure to ScripsAmerica. For the purpose of this Agreement the term personnel shall include employees, directors, officers, managers, agents, consultants and advisor of ScripsAmerica and Marlex.

2.3 Ownership and Assignment of Proprietary Rights. Except as otherwise provided herein, Marlex and their respective personnel hereby agree to assign the entire right title and Interest in the NDC developed under this  Agreement to ScripsAmerica provided that the Article V and VI are satisfactory. Marlex further agrees to ensure that its personnel execute all necessary agreements to assure that the provisions of this Section 2.3 are complied with, including any required assignment of intellectual property developed by said personnel.

   

ARTICLE III

CONFIDENTIALITY

3.1 Confidentiality Obligation. ScripsAmerica and Marlex shall keep in strictest confidence all materials and information, in whatever form provided, identified by any party to be confidential or proprietary in nature, relating to each party’s business, operations and technology. Such proprietary information includes information and technology relating to each party’s marketing plans, research and development activities, marketing trends, products, designs, technical specifications and data for the Products, Proprietary Rights, flowcharts, logic diagrams, notes, memoranda, know-how, information presently available in the public domain, information received bya party who is not bound in a confidential relationship to either ScripsAmerica or Marlex, trade secrets and products, as well as any materials and information that, from the circumstances in which they are made available to the other party, in good faith ought to be treated as confidential or proprietary. Except as necessary in carrying out its obligations under this Agreement no party shall use or disclose nor permit its employees, suppliers, customers or agents to use or disclose, any such confidential or proprietary information without the prior written consent of the disclosing party. The confidentiality obligation contained in this Section3.1 shall remain binding on the Parties for ten (10) years after any termination of this Agreement, regardless of the cause of such termination.

3.2 Exception to Confidentiality Obligation. The obligations of a party under this Article III shall not apply to information which is: (a) required to be disclosed as a matter of law in legal proceedings, or by regulation or under government authority. In which event the party so required to disclose the information shall forthwith give notice to the party whose confidential information is at issue and duly allow that party to appeal or litigate the required disclosure.

   

  

3

  

   

ARTICLE IV

NDC SPONSORSHIP; OWNERSHIP

4.1 Sponsor of NDC. Marlex shall be the sponsor of the NDC covering the Products.

4.2 Ownership of NDC. ScripsAmerica shall own the product, including all rights and privileges provided by the NDC.

4.3 Assignment, Transfer, Sale or License of Ownership. Should ScripsAmerica desire to assign, transfer, sell or license all or part of its rights to the NDC for this Product, it shall notify Marlex, who shall cooperate fully with the transferee, purchaser or licensor, including but not limited to executing all documents necessary to effectuate the transfer and producing all Proprietary Right information from its files, including a complete copy of the NDC.

   

ARTICLE V

PRODUCT MANUFACTURE, DISTRIBUTION, DELIVERY

5.1 Product Manufacture. (a) Following NDC approval, Marlex shall manufacture the product and shall supply ScripsAmerica with Product, which such Product shall be purchased by ScripsAmerica at the Transfer Price set forth in Exhibit B, all in accordance with this Article V and ScripsAmerica Purchase Orders. Marlex shall be responsible for labeling, packaging, and shipping Products to ScripsAmerica (or ScripsAmerica’s designated repackager/labeler) in a manner that complies with all applicable legal requirements, including but not limited to the laws and regulations enforced by the FDA. It is the intent of this Agreement that Marlex will supply ScripsAmerica with all of ScripsAmerica’s requirements of the Product’s for distribution and sale by ScripsAmerica worldwide. All Parties to this Agreement fully understand the regulatory issues presented and potentially long delays in production when Sponsors of NDCs are required to supplement such applications to name a new contract manufacturing organization or otherwise select a different manufacturing site. In consideration for Marlex being the named manufacturer in the NDC contemplated by this Agreement; Marlex agrees to maintain compliance with this Agreement (including its Exhibits as applicable) and all applicable manufacturing regulations, including but not limited to FDA’s cGMP regulations, and ScripsAmerica’s Quality Standards. This shall expressly include an obligation to continue to manufacture Product for a period of no less than Ten (10) years following approval of the NDC.

5.2 Exclusive Distribution by ScripsAmerica. Marlex herein appoints ScripsAmerica as its exclusive distributor of Product. During the Term of this Agreement, Marlex agrees that unless directed by ScripsAmerica in writing, it will not develop or manufacture the Product for itself or for any other party other than ScripsAmerica. ScripsAmerica agrees not to have the Product or a generic drug product which competes with the Product developed or manufactured for sale by any party other than Marlex.

    

  

4

  

    

5.3 Delivery and Sale

	
(a)     

	
Marlex will ship the Products to ScripsAmerica or its designated repackager/labeler in accordance with this Article V, Exhibit B, ScripsAmerica’s Purchase Orders, and ScripsAmerica’s shipping and delivery instructions. Each shipment shall be made to arrive within one hundred and twenty (120) days of ScripsAmerica’s designated delivery date. Upon shipment, Marlex shall invoice ScripsAmerica in writing for 100% of the Transfer Price of each shipment of  Product and ScripsAmerica shall pay Marlex the Transfer Price within one (1) days of the date of the invoice as in accordance with Section 6.3. ScripsAmerica shall pay the shipping cost and bear all risk of loss until the Products are delivered to ScripsAmerica or ScripsAmerica’s designated distributor.

	
(b)     

	
ScripsAmerica will distribute the Products under a designated ScripsAmerica label or any ScripsAmerica designated private label in commercially prudent manner and in a manner consistent with their status as generic drugs. Marlex shall be responsible for packaging the Product and labeling the Product for commercial sale all in accordance with the ANDA for the product.

	
(c)     

	
ScripsAmerica will provide to Marlex on a monthly basis a forecast of its expected supply needs for the Products for the then following twelve (12) months, along with requested shipment dates for the Products. At the time of each order, the parties will agree on shipment dates for that order, and Marlex will make all shipments in accordance with the agreed dates.

5.4 Status Meetings and Periodic Reports. The parties shall conduct periodic meetings to review and discuss Product development, status of regulatory submissions or approvals, and manufacturing progress. Periodic meetings shall be attended by at least one member or designee of each party and may be held by telephone conference call if mutually agreed by the Parties. At the periodic meetings the parties shall discuss and review the development of the Product and of such other information and topics relating to  Product development, regulatory approval, and manufacturing as each party may reasonably request. The discussions and all information discussed at a periodic meeting shall be briefly summarized on the form of minutes. It will be the responsibility of ScripsAmerica to write said minutes for distribution. Such minutes shall not be considered final until they have been signed and acknowledge by an attending representative of each Party. The time and location of such periodic meetings shall be mutually agreed upon by the Parties.

   

  

5

  

   

ARTICLE VI

DEVELOPMENT COSTS, MANUFACTURING COSTS AND SALES

6.1 Product Development Costs.

	
(a)     

	
The Parties have met and have developed an agreed-upon budget setting forth the projected costs, by activity, for the development of the Product. The agreed upon budget with projected costs is included herein as Exhibit A to this Agreement.

	
(b)     

	
Marlex shall issue invoices for development costs of the Product, including the costs of the validation batches, on an activity basis. ScripsAmerica shall make payment to Marlex for each invoice within one (1) day after receipts of such invoice.

	
(c)     

	
It is understood and agreed that ScripsAmerica shall be responsible for the costs associated with the performance of the studies described on Exhibit A. Such fees shall be paid by ScripsAmerica to Marlex.

6.2 Manufacturing Costs and Sales.  These provisions shall apply upon NDC approval for the Product.

	
(a)     

	
Marlex and ScripsAmerica have agreed upon a projected cost and Transfer Price for the Product which will be set forth in Exhibit B hereto. ScripsAmerica shall pay Marlex 100% of the Transfer Price for a given shipment of Product within one (1) day of the date of the invoice. So long as this Agreement has not been earlier terminated, on a quarterly basis, ScripsAmerica shall pay to Marlex seven percent (7%) of gross profits (as defined in Exhibit C) for a period of one year following the first delivery of the Product. ScripsAmerica shall pay to Marlex five percent (5%) of gross profits (as defined in Exhibit C) for the subsequent term of the agreement. All costs of manufacture, marketing, sales and distribution hereunder shall be calculated according to generally accepted accounting principles (“GAAP”) and shall be accompanied by an accounting of underlying costs and sales receipts of the Products during the relevant quarter.

    

  

6

  

   

ARTICLE VII

GUARANTEE, REPRESENTATIONS AND WARRANTIES, INDEMNICATION

7.1 Guarantee. Marlex guarantees that the Products delivered to ScripsAmerica will not be, on the date of delivery, adulterated or misbranded within the meaning of the Federal Food, Drug and Cosmetic Act or an article which may not, under the Sections 404, 505 or 512 of such Act, be introduced into interstate commerce. Marlex further guarantees that the Products will be manufactured in all respects in accordance with the NDC and will conform in all respects to cGMPs, as published and amended from time to time by the FDA. Marlex herein expressly aggress to comply with and be bound by its duties and obligations under the ScripsAmerica Quality Standards that are appended hereto as Exhibit D.

7.2 Representations and Warranties.

	
(a)     

	
Marlex represents and warrants that it (i) possesses the requisite skill, experience, knowledge, personnel and facilities necessary to perform its obligations hereunder, (ii) possesses and is in compliance with all necessary licenses, permits, and approvals required to execute, deliver, and perform its obligations under this Agreement; and (iii) shall perform its obligations in a professional manner in accordance with accepted professional practices and the highest standards appropriate within the time and under the circumstances of the obligations performed under this Agreement.

	
(b)     

	
Marlex further represents and warrants that (i) neither Marlex nor any of its affiliated companies or subsidiary companies, nor its officers, employees or agents have been debarred by FDA, and that Marlex has not and shall not, employ, subcontract with, retain as a consultant or otherwise use the services of any person who has been debarred by the FDA in carrying out any of its obligations hereunder, (ii) it shall not engage in any behavior on ScripsAmerica’s premises or with respect to ScripsAmerica’s employees that would violate any of ScripsAmerica’s policies or would result in ScripsAmerica being in violation of the law; and (iii) that this Agreement and Marlex’s obligations hereunder do not conflict with any of its other agreements, working relationships, or undertakings, and that none of the same will preclude Marlex from performing its obligations hereunder.

	
(c)     

	
Marlex herein represents and warrants that all data that it shall generate and/or compile in connection with development of the Products in connection with the ANDA for the Products shall not be incomplete, false or misleading in any regard, but shall be complete, true and correct.

	
(d)     

	
Marlex herein represents and warrants that any third party utilized to perform studies shall be qualified to do so by requisite training and experience, and shall perform such studies in accordance with all applicable law, including but not limited to current Good Laboratory Practices (“GLPs”)

	
(e)     

	
Marlex herein represents and warrants that any supplier of Active Pharmaceutical Ingredient (“API”) utilized in development of the products shall have an active Drug Master File (“DMF”) that has been referred to and used by other companies with respect to other NDC’s.

	
(f)     

	
Marlex shall perform its obligations hereunder in accordance with all applicable law, including but not limited to cGMPs, as published and amended from time to time by the FDA.

   

  

7

  

    

7.3 Insurance.  (a) Marlex represents and warrants that it has product liability insurance in the amount of at least $1,000,000 aggregate covering drug Products developed and manufactured hereunder. Marlex will have ScripsAmerica added as a named insured to its respective policies for product liability insurance and provide evidence of this coverage to ScripsAmerica on an annual basis or whenever any change is made in such policy of insurance. (b) ScripsAmerica represents and warrants that it will obtain  product liability insurance in the amount of at least $2,000,000 aggregate covering drug Products distributed.

   

7.4 Indemnification. Marlex agrees to indemnify and hold harmless ScripsAmerica, its directors, officers, employees and agents, from any liability or expense, including fees and costs of defense, arising out of personal injury or death resulting from the manufacture or use of a defective Product; Marlex’s negligence any non-fulfillment or breach by Marlex of any provision or warranty made by Marlex under this Agreement (including but not limited to the representations and warranties set forth in Sections 7.1 and 7.2 of this Agreement). ScripsAmerica agrees to indemnify, defend and hold harmless Marlex of and from any liability or expense arising out of any claim, demand or lawsuit relating to the negligence of ScripsAmerica with respect to the distribution or sale of the Products and not related in any way to the negligence, fault or other act or omission which are the fault of Marlex.

  

7.5 Authority. Each person signing on behalf of a party to this Agreement below herein represents and warrants that it has the legal right and authority to enter into this Agreement, and to fully perform its obligations hereunder, and that none has made nor will make any commitments in conflict with its respective obligations hereunder.

    

ARTICLE VIII

ARBITRATION AND DAMAGES

8.1 Arbitration. In event of any dispute between the Parties hereto, ScripsAmerica and Marlex will attempt in good faith to agree on the rights of the respective Parties concerning such dispute. If no such agreement can be reached within ninety(90) days after good faith negotiation, either ScripsAmerica or Marlex may demand mediation of the matter, If no such agreement can be reached within ninety (90) days after good faith mediation, either ScripsAmerica or  Marlex may demand arbitration of the matter. In such event, any disputes with respect to this Agreement shall be settled by binding, final arbitration in Delaware in accordance with the commercial arbitration rules of the American Arbitration Association  then in effect (“AAA Rules”). However, in all events, the following arbitration provisions shall govern over any conflicting rules which may now or hereafter be contained in the AAA Rules. Any judgment upon the award rendered by the arbitrator may be entered in any federal or state court located in any state having jurisdiction over the subject matter thereof. The arbitrator shall have the ability to grant any equitable and legal remedies that would be available. The initial compensation to be paid to the arbitrator in any such arbitration, and the costs of transcripts and other normal and regular expenses of the arbitration shall be born, equally by each Party respectively; provided, however, that the arbitrator or arbitration panel shall have the discretion to grant to the prevailing party in any arbitration an award of attorneys’ fees and costs, and all costs of arbitration. Arbitration shall be the sole and exclusive remedy of the parties for a breach of this Agreement in the absence of fraud.

      

  

8

  

   

8.2 Liquidated Damages for failure to Timely Deliver. If Marlex fails to timely deliver the complete ScripsAmerica order on the ScripsAmerica designated delivery date, Marlex shall pay ScripsAmerica ten percent of the Transfer Price each month that such order remains incomplete. This provision shall not apply if the delay is caused by a Force Majeure Event (defined in Section 9.6 below).

    

ARTICLE IX

TERM AND TERMINATION OF AGREEMENT

9.1 Term. This Agreement shall commence on the Effective Date and shall continue in effect until the Agreement is terminated per this Article IX.

9.2 Termination Without Cause During Development. ScripsAmerica may terminate this Agreement during the product development phase for any reason upon one month’s prior written notice to Marlex. If ScripsAmerica terminates this Agreement in accordance with this Section 9.1, then ScripsAmerica shall pay Marlex any development costs incurred up through the date of the notice.

9.3 Termination Without Cause After Development. ScripsAmerica or Marlex may terminate this Agreement during the manufacturing and sale phase for any reason by twelve (12) months prior written notice to the other party.

9.4 Termination For Cause. ScripsAmerica may terminate this Agreement for cause if Marlex is in material breach of this Agreement, which such breach is not cured within ninety (90) days after receipt of written notice of the breach from ScripsAmerica.

9.5 Acts of Insolvency. Either party to this Agreement may terminate this Agreement for default by written notice if the other party becomes insolvent, makes a general assignment for the benefit of creditors, files a voluntary petition of bankruptcy, suffers or permits the appointment of the receiver for its business assets, or becomes subject to any proceeding under any bankruptcy or insolvency law, whether domestic or foreign, or has wound up or liquidated, voluntarily or otherwise. A party hereto shall immediately notify the other party upon an occurrence of any such event.

9.6 Force Majeure. A party shall be excused from failure to perform of its obligations hereunder to the extent such failure is caused by acts of God, fires, floods, war, sabotage, unavailability of raw materials, governmental laws or regulations, labor disputes, strikes or similar occurrences, where such  party is without fault or negligence (a “Force Majeure Event”), provided such party gives immediate notice of such cause to the other party, and exercises due diligence to remove the cause as soon as practicable.

   

  

9

  

    

ARTICLE X

MISCELLANEOUS

10.1 Assignment. Neither this Agreement nor any interest therein may be assigned, in whole or in part, by any party without the prior written consent of the other party, except that ScripsAmerica may assign its rights and obligations to an affiliate, division, subsidiary, parent company or successor, in which event such assignee shall assume ScripsAmerica’s rights and obligations hereunder. Subject to the foregoing, this Agreement shall be binding upon and inure to the benefit of the Parties hereto, and their respective successors and assigns.

10.2 No Waiver. No delay or omission by a party hereto exercise any right of power occurring upon any noncompliance or default by the other party with respect to any of the terms of this Agreement shall impair any such right or power or be construed to be a waiver thereof. A waiver by any party hereto of any of the covenants, conditions, or agreements to be performed by the other shall not be construed to be a waiver of any succeeding breach thereof of any covenant, condition, or agreement herein contained. Unless stated otherwise, all remedies provided for in this Agreement shall be cumulative and in addition to and not in lieu of any other remedies available to either party at law, in equity, or otherwise.

10.3 Entire Agreement; Modifications to the Agreement.  This Agreement, including all Exhibits attached hereto, constitutes the entire agreement between the Parties. All prior contemporaneous agreements, proposals, understandings, whether oral or written, relating to the subject matter hereto are hereby superseded by this Agreeement. No modification or waiver of any of the provisions of this Agreement shall be valid unless it is provided in writing and signed by the parties.

10.3 Governing Law. This Agreement shall be governed by the laws of the State of Delaware, without regard to its choice of law provisions. The language of this Agreement shall be deemed to be the result of negotiation among the parties and their respective counsel and shall not be construed strictly for or against any party. Each party (i) agrees that any action arising out of or in connection with this Agreement shall be brought solely in courts of the State of Delaware, (ii) hereby consents to the jurisdiction of the courts of the State of Delaware, and (iii) agrees that, whenever a party is requested to execute ne or more documents evidencing such consent, it shall do so immediately.

   

  

10

  

   

10.4 Notices. All communications required or permitted hereunder, shall be in writing, and shall be effective upon delivery or within (14) days after mailing thereof by certified mail, postage prepaid, to the above provided addresses.

10.5 Headings. The headings and subheadings utilized herein are not a part of this Agreement, but are merely guides or labels to assist in location and reading the provisions hereof.

10.6 Survival. The following provisions in this Agreement shall survive termination or expiration of this Agreement for any reason, as shall any other provisions which by their nature are intended to survive: Article III, Article VII, Article VIII, Article IX and

10.7 Severability. It is not the intention of the Parties hereto to violate any public policy statutory or common laws, rules, regulations, treaty, or decisions of any government agency or executive body thereof any country or community or association of countries. Should one or more provisions of this Agreement be or become invalid or unenforceable by reason of such a violation, then the parties hereto shall substitute, by mutual consent, valid provisions, which valid provision in their economic effect come so close to the invalid provisions that it can be reasonably assumed that the parties would have contracted this Agreement with those new provisions. In case such provisions cannot be found, the invalidity of one or more provisions of the Agreement shall not affect the validity for the Agreement as a whole, unless the invalid provisions are of such essential importance for this Agreement that it is to be reasonably assumed that the Parties would not have contracted this Agreement without the invalid provisions.

10.8 Relationship of the Parties. It is expressly understood and agreed that the Parties to this Agreement are independent contractors and that the relationship between them by virtue of this Agreement shall not constitute a partnership or agency of any kind. No party to this Agreement shall have the authority to make any statements, representations or commitments of any kind, or to take any action which shall be binding on another party without the prior written authorization of that other party. It is further understood that ScripsAmerica is not a tenant of Marlex or its lessors and shall not be responsible for any rent or lease expense incurred by Marlex. Marlex shall bear sole responsibility for payment of compensation and the provision of benefits to its employees and agents.

    

  

11

  

     

IN WITNESS WHEREOF, each of Marlex and ScripsAmerica has executed this product Development, Manufacturing, and Distribution Agreement by their duly authorized officers as of the Effective Date.

 

   

	ScripsAmerica, Inc.	 
	 	 	 
	 	 	 
	By:	/s/ Robert Schneiderman	 
	 	Mr. Robert Schneiderman	 
	 	CEO	 
	 	ScripsAmerica, Inc.	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	Marlex Pharmaceutical Inc.	 
	 	 	 
	 	 	 
	By:	/s/ Sarav Patel	 
	 	Mr. Sarav Patel	 
	 	President	 
	 	Marlex Pharmaceutical, Inc.	 

 

 

12

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00190-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00190-of-00352.parquet"}]]