Document:

Exhibit 10.21

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

ELAN PHARMA INTERNATIONAL LIMITED

 

AND

 

ACORDA THERAPEUTICS, INC,

 

 

 

ZANAFLEX SUPPLY AGREEMENT

 

 

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

THIS SUPPLY AGREEMENT
(this “Agreement”) is made on July 21,
2004 (the “Effective Date”)

 

BETWEEN:

 

(1)           ELAN PHARMA INTERNATIONAL LIMITED, a company incorporated in
Ireland (registered no. 222276) (“Elan”); and

 

(2)           ACORDA THERAPEUTICS, INC., a Delaware corporation whose
registered office is at 15 Skyline Drive, Hawthorne, NY 10532 (“Buyer”).

 

RECITALS:

 

(A)          Pursuant
to that certain Asset Purchase Agreement between Buyer and Elan Pharmaceuticals, Inc.
(“EPI”), dated July 21, 2004 (the “Purchase Agreement”), Buyer acquired (among other assets)
the rights and authorisations necessary to market and sell the Products (as
defined below) in the Territory (as defined in the Asset Purchase Agreement).

 

(B)           Elan
has agreed to manufacture and supply the Products to Buyer, and Buyer has
agreed to purchase the Products for onward commercial supply on the terms and
conditions set out in this Agreement.

 

NOW IT IS HEREBY AGREED AS
FOLLOWS:

 

1.             INTERPRETATION

 

1.1           In this
Agreement:

 

“Affected
Item” shall have the meaning given to such term in Clause 10.3;

 

“Affected
Obligation” shall have the meaning given to such term in Clause
20.1;

 

“Affected
Party” shall have the meaning given to such term in Clause 20.1;

 

“Affiliate”
shall mean, with respect to any person or entity, any other person or entity
which Controls, is Controlled by or is under common Control with such person or
entity;

 

“Alternate
Manufacturer” shall have the meaning given to such term in Clause
11.4;

 

“Beneficiary”
shall have the meaning given to such term in Clause 13.8.2;

 

“Business Day”
shall mean a day other than a Saturday or Sunday or public holiday in England
and Wales, and Ireland;

 

“cGMP”
shall mean current Good Manufacturing Practice under the applicable laws and
regulations in the United States, Ireland and the European Union;

 

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

“Confidential
Information” shall have the meaning given to such term in Clause
15.1;

 

“Control”
means (a) ownership (directly or indirectly) of at least fifty percent
(50%) of the shares of stock entitled to vote for the election of directors in
the case of a company or corporation; or (b) the ability (directly or
indirectly) otherwise to direct and control the actions of a person or entity.

 

“Covenantor”
shall have the meaning given to such term in Clause 13.8.2;

 

“Disclosing
Party” shall have the meaning given to such term in Clause 17.1;

 

“Due Date”
shall have the meaning given to such term in Clause 9.4;

 

“Elan’s
Facility” shall mean Elan’s manufacturing facility located at
Monksland, Athlone, Co. Westmeath, Ireland or Elan’s Affiliate’s manufacturing
facility located at Gainesville, Georgia, U.S.A., or such other manufacturing
facility as Elan may from time to time specify (provided that any facility so
specified has received all required Facility Licences and Elan has provided
Buyer with advance notice sufficient to amend its NDA to include such facility
if Elan intends to use a facility other than the one located at Monksland,
Athlone, described above);

 

“Ex Works”
and “EXW” shall have the meaning as such
term is defined in the ICC Incoterms, 2000, International Rules for the
Interpretation of Trade Terms, ICC Publication No. 560;

 

“Facility
Licences” means all required licenses, approvals, permits and
authorizations required by any Governmental Authority or law or regulation to
manufacture, package or store Products, or, to the extent required for Elan to
perform under this Agreement, to ship or export Products;

 

“Force
Majeure Event” means an event beyond the control of the Affected
Party which makes the Affected Party’s performance of an obligation impossible
(or such an event that makes such performance so impractical as to be
reasonably to be considered impossible) including, without limitation, strike,
lock-out, labour dispute, act of God, war, armed conflict, terrorism, riot,
civil commotion, malicious damage, explosion, earthquake, fire, flood, storm or
other extraordinary adverse weather conditions.

 

“Governmental
Authority” shall mean each governmental and regulatory body, agency,
department or entity, whether or not located in the Territory, which regulates,
directs or controls commerce in or with any territory or location;

 

“Index”
shall mean the Irish consumer price index or such other index as may replace it
from time to time; or if there is no replacement, such published Irish index as
Elan in its discretion considers to be the closest comparator to the same;

 

“Initial Term”
shall have the meaning given to such term in Clause 11.1;

 

2

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

“Knowledge”
of a particular fact or other matter means: 
(i) with respect to any individual; (A) the actual knowledge
of such individual concerning such fact or other matter; and (B) the
knowledge that a prudent individual would be expected to discover or otherwise
become aware of in the course of conducting a reasonable investigation
concerning the existence of such fact or other matter; and (ii) with
respect to Elan or Buyer, the Knowledge concerning such fact or other matter of
(1) the officers of such party, (2) the directors of such party, and (3) the
senior managers of such party with responsibility for, or supervision of, the
relevant matters; provided that under no circumstances shall Knowledge of Elan
include any knowledge not actually known to such persons but imputed to such
persons or Elan due to its or its Affiliates’ relationship with Novartis Pharma
AG (“Novartis”) or its representatives; and
provided, further, that none of such persons shall have any obligation as a
result of entering into (or any provision of) this Agreement, the Purchase
Agreement or any related Agreement to make any inquiries of Novartis or its
representatives regarding any matter.

 

“Loss”
shall mean any loss, liability, or cost (including reasonable attorneys’ fees
and expenses) which is incurred by a party;

 

“Medical
Claim” shall have the meaning given to such term in Clause 13.7;

 

“Minor
Deficiencies and Delays” shall mean (i) shortfalls that are
consistent with industry accepted standards, but not to exceed 10% of the
amount ordered (ii) delays in delivery of the Products not exceeding 30
days from the delivery date or such other period of delay as may be agreed
between the Parties;

 

“Monthly
Forecast Report” shall have the meaning given to such term in Clause
4.1.1;

 

“Production
Licence” shall have the meaning given to such term in Clause 11.4;

 

“Products”
means pharmaceutical products containing tizanidine as their active
pharmaceutical ingredients and having a multi-particulate capsule formulation
currently approved by the FDA pursuant to NDA No. 21-447 to be marketed in
the Territory.

 

“Product
Specifications” shall mean the specifications for the Products
contained in the relevant Regulatory Approvals issued by the authorities in the
Territory, and such additional or amended specifications for such Products as
may be effected under the terms of this Agreement;

 

“Regulatory
Application” shall mean any application for a Regulatory Approval,
which is filed in the Territory following the Effective Date, including any
supplements or amendments thereto;

 

“Regulatory
Approval” shall mean the final approval required from a governmental
regulatory authority to market a Product in the Territory, and any other
approval which is required to market or sell such Product or otherwise
necessary for Buyer to perform under this Agreement or otherwise handle the
Products;

 

3

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

“Relevant
Claim” shall have the meaning given to such term in Clause 13.8;

 

“Renewal Term”
shall have the meaning given to such term in Clause 11.1;

 

“Serious
Failure to Supply” shall mean that in a period of a calendar year,
for reasons other than Force Majeure, a shortage of tizanidine caused by events
or third parties not under the control of Elan, or the default of Buyer, Elan
fails on at least two consecutive occasions to supply Buyer’s properly
forecasted and ordered requirements of the Products in accordance with the
terms of this Agreement, except for Minor Deficiencies and Delays, and the
cumulative shortfall for such calendar year attributable to such failure(s) is
at least 35% of the aggregate amount properly forecasted and ordered from Elan
for delivery in such calendar year; provided that, for purposes of this
definition the timely supply of Products that breach the representations and
warranties made in Clause 13.2 (excluding such Products with nonlatent defects)
will be deemed not to be a failure to supply Buyer’s properly forecasted and
ordered requirements of the Products in accordance with the terms of this
Agreement;

 

“Specified
Delivery Date” shall have the meaning given to such term in Clause
4.3;

 

“Technical
Agreement” shall have the meaning given to such term in Clause 3.9;

 

“Technological
Competitors” shall mean those entities, including any entities that
are subsidiaries or successors in interest to such entities, set out in Schedule 3;

 

“Term”
shall mean the Initial Term plus any applicable Renewal Term;

 

“Territory”
means the United States of America, its territories and possessions and the
Commonwealth of Puerto Rico;

 

“VAT”
means;  (a) any tax imposed in
compliance with the Sixth Directive of the Council of the European Economic
Communities (77/388/EEC); and (b) any other tax of a similar fiscal
nature, whether imposed in a member state of the European Union in substitution
for or in addition to such tax, or imposed elsewhere;

 

“VAT Amount” shall have
the meaning given to such term in Clause 10.2; and

 

“$”
and “US$” shall mean United States Dollars.

 

1.2           In this
Agreement a reference to:

 

1.2.1        the
singular includes the plural and vice versa;

 

1.2.2        a
“person” includes a reference to a
corporation, corporate body, association or partnership;

 

1.2.3        any
reference to a “Clause” or “Schedule”,
unless the context otherwise requires, is a reference to a clause or schedule of
this Agreement; and

 

4

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

1.2.4        any
person shall (where appropriate), in respect of any provisions relating to VAT,
be deemed at any time when such person is a member of a group for the purposes
of section 43 to 43C of the Value Added Tax Act 1994 (or in relation to a
jurisdiction other than the United Kingdom, such legal term or concept as most
closely corresponds to it) to include a reference to the representative member
(or in relation to a jurisdiction other than the United Kingdom, such legal
term or concept as most closely corresponds to it) of such group at such time.

 

1.3           The
headings of this Agreement are for ease of reference only and shall not affect
its construction or interpretation.

 

1.4           In this
Agreement, the expressions “include”, “includes” and “including”
shall be construed without limitation.

 

2.             EXCLUSIVE SUPPLY

 

2.1           During the
Term, subject to Clause 11.4, (Buyer shall purchase all of its (and its
Affiliates) requirements of the Products in the Territory exclusively from
Elan, and Elan shall supply all such Products under the terms of this
Agreement.

 

3.             REGULATORY MATTERS

 

3.1           Following
the transfer of the Regulatory Approvals to Buyer pursuant to the terms of the
Purchase Agreement, Buyer shall (at its own expense) be responsible for
obtaining and maintaining all Regulatory Approvals for the Products with the
appropriate Governmental Authority. 
Subject and pursuant to the provisions of the Purchase Agreement and
Interim Services Agreement between EPI and Buyer, Elan shall provide all information
and assistance reasonably requested by Buyer needed to transfer and obtain such
Regulatory Approvals.

 

3.2           Each of
Elan and Buyer shall, without delay, provide to the other party such copies of
all Regulatory Approvals, Regulatory Applications, Facility Licenses and
communications with any Governmental Authority to the extent necessary for such
other party to comply with its obligations under this Agreement.

 

3.3           Elan
shall, at Elan’s expense, be responsible for obtaining and maintaining any and
all export or import licences or clearances relating to the raw materials and
any other intermediary products contained in the Products, together with any
and all Facility Licenses.  Elan shall
provide Buyer copies of all such Facility Licenses at Buyer’s request.  Elan shall ensure that each Elan Facility
complies with all laws, regulations and licensing requirements applicable to
the manufacture of Products in compliance with the Product Specifications and
cGMP.  At the request of Buyer, Elan
shall take the steps necessary to qualify its Affiliate’s Gainesville, Georgia,
U.S.A. facility to manufacture the Product, including but not limited to
obtaining all required Facility Licenses; provided that

 

5

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

all reasonable costs of Elan, its Affiliates or its consultants
actually incurred in connection with such qualifications shall be borne by
Buyer (as long as such costs are approved by Buyer in advance, such approval
not to be unreasonably withheld or delayed).

 

3.4           Buyer
shall promptly provide to Elan the packaging and related artwork for the
Products, which packaging and artwork must comply with the relevant Regulatory
Approvals.  Buyer shall be responsible
for granting final approval of the pre-press proofs of such artwork.

 

3.5           Buyer
shall be responsible for obtaining and maintaining any necessary export or
import licences or clearances in respect of the Products.  Elan shall provide to Buyer reasonable
assistance and any documents in its possession which are reasonably necessary
for that purpose.

 

3.6           Each party
shall notify the other party as soon as possible (and in no event later than 48
hours) of any notification received by it from a Governmental Authority to
conduct an inspection of the facilities used hereunder in the development,
manufacturing, packaging, storage or handling of the Products.  Each party shall promptly provide to the
other party copies of all correspondence with a Governmental Authority relating
to any such notification or inspection received or sent by it to the extent
that such correspondence relates to the Products.  Each party shall have a duty to reasonably
cooperate with the other party with respect to such inspections at such other
party’s facilities.

 

3.7           Upon
reasonable request, Elan shall make that portion of its facility where the
Products are manufactured, tested or stored, including all record and reference
samples, available for inspection:

 

3.7.1        upon
reasonable notice and during normal business hours, by Buyer’s duly qualified
employee or, with the consent of Elan (not to be unreasonably withheld or delayed),
by Buyer’s duly qualified agent or contractor; or

 

3.7.2        by
a relevant Governmental Authority.

 

An inspection under Clause 3.7.1 shall be limited to determining
whether there is compliance with cGMP and other requirements of applicable law.

 

3.8           To the
extent that any or all of the raw materials or intermediary products contained
in the Products are not produced by Elan, Elan shall ensure that such materials
or products are suitable for manufacturing the Products in compliance with
applicable Regulatory Approvals, Facility Licenses and the Product
Specifications and meet all other applicable legal and regulatory requirements.

 

3.9           As soon as
is practicable after the Effective Date. 
Elan and Buyer shall enter into a mutually-agreeable technical agreement
(the “Technical Agreement”) relating

 

6

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

to quality assurance, acceptance testing and other requirements to be
agreed by the parties.

 

4.             FORECASTS AND ORDERS

 

4.1           In order
to permit Elan to allocate its manufacturing capacity and to assist Buyer with
its sales and marketing, Buyer shall provide Elan with bona fide written
forecasts of its requirements for each of the Products as follows:

 

4.1.1        By
thirty (30) days after the Effective Date, and thereafter each calendar month
not later than the 23rd of the month, an 18-month forecast (commencing at the
beginning of the following month), broken down by month (each, a “Monthly Forecast Report”); and

 

4.1.2        not
later than 1 July in each year, a two-year forecast, broken down by year.

 

4.2           The
aggregate amount of Products forecasted to be required in the first twelve (12)
months of each Monthly Forecast Report shall, unless otherwise agreed by Elan,
not increase or decrease by more than twenty-five percent (25%) as compared to
the first twelve (12) months of the forecast three months prior; provided,
however, that until there exists a Monthly Forecast Report from three months
prior to the then-current Monthly Forecast Report, the initial Monthly Forecast
Report shall be used for purposes of such comparison.

 

4.3           Buyer
shall be bound to order one hundred percent (100%) of the forecast required
quantities of the Products in each respective month of the period of five (5) months
immediately following each Monthly Forecast Report, but otherwise forecasts
shall not be binding.  With respect to
such orders, Buyer shall submit to Elan a written purchase order for such
required quantities of Products, specifying the order quantity and the date on
which delivery of the order is required (the “Specified Delivery
Date,” which shall in no event be earlier than one hundred fifty
(150) days after the date of Elan’s receipt of such written purchase
order).  For the avoidance of doubt, the
parties acknowledge and agree that, notwithstanding anything to the contrary
contained in this Agreement, other than pursuant to the preceding two sentences
Buyer shall not be obligated to place any minimum number of orders under this
Agreement.

 

4.4           Elan shall
not be obligated to supply Products in excess of Buyer’s requirements as
forecast in accordance Clauses 4.1, 4.2 and 4.3.

 

4.5           Notwithstanding
Clauses 4.1, 4.2, 4.3 and 4.4, Elan will use its commercially reasonable
efforts to fulfill Buyer’s requirements in excess of forecasted amounts.

 

4.6           The order
quantity shall be in whole number multiples of the minimum batch size of the
Products, which minimum batch size shall be as set out in Schedule 1;

 

7

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

provided, however, that upon the request of Buyer, Elan will discuss
with Buyer in good faith the reduction of minimum batch sizes set out in Schedule 1
(and any related amendment to Schedule 1); and provided, further, that all
reasonable costs of Elan, its Affiliates or its consultants actually incurred
in connection with the reduction of such minimum batch sizes shall be paid by
Buyer (as long as such costs are approved by Buyer in advance, such approval
not to be unreasonably withheld or delayed). 
Elan shall have the right to refuse to fulfil any amount of an order
which does not conform with the provisions of this Clause 4.6.  Where Elan in its sole discretion fulfils any
order which does not conform with the provisions of this Clause 4.6, the
fulfilment of such order by Elan shall not affect Elan’s right to refuse to
fulfil any subsequent order which does not conform with the provisions hereof.

 

4.7           Buyer
hereby agrees that it shall not use Products delivered to Buyer in bulk capsule
form for packaging into finished Products for commercial sale.

 

4.8           To the
extent that at any time during the Term Buyer notifies Elan of its intention to
sell finished Products that Buyer is then holding in inventory as “safety
stock”, (a) all then current purchase orders shall remain in place, and (b) Elan
agrees to discuss in good faith with Buyer the modification of the Monthly
Forecast Report most recently submitted by Buyer (including disregarding the
provisions of Clause 4.2 with respect thereto).

 

4.9           The terms
of this Agreement are hereby incorporated by reference into each written
purchase order for Products submitted by Buyer and accepted by Elan.  In the event of any conflict between an order
or other written instructions and this Agreement, the terms of this Agreement
shall prevail.

 

5.             SUPPLY OF THE
PRODUCTS

 

5.1           Elan shall
supply the Products requested in each written purchase order by the Specified
Delivery Date (subject to the 30-day cure period specified in Clause 11.2.1).

 

5.2           Each
Product supplied by Elan to Buyer shall:

 

5.2.1        be
in final market packaging in accordance with written standards agreed by the
parties from time to time;

 

5.2.2        be
Ex Works Elan’s Facility;

 

5.2.3        be
free from any liens or encumbrances;

 

5.2.4        conform
to, and be manufactured in accordance with, the relevant Product Specifications
and all applicable laws and regulations, including applicable cGMP;

 

8

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

5.2.5        be
in suitable packaging in a sealed tamper-evident container and labelled in
accordance with Buyer’s reasonable requirements communicated to Elan, in
particular as required pursuant to any Regulatory Approval and so as to permit
safe storage and transport; and

 

5.2.6        be
accompanied by a certificate of analysis and a certificate of release, in each
case in a form conforming to industry standards as mutually agreed between Elan
and Buyer.

 

6.             CHANGES TO PRODUCT
SPECIFICATIONS

 

6.1          If:

 

6.1.1        changes
to the Product Specifications are required by law or by any Governmental
Authority; or

 

6.1.2        Buyer
reasonably requests changes to the Product Specifications;

 

Elan shall promptly implement any such changes at Buyer’s sole cost (such
cost to include but not be limited to Elan’s internal and external costs
relating to changes to artwork and labeling and changes to raw materials,
intermediary products and components, in each case whether such costs are
out-of-pocket costs or write-off charges (to the extent such write-off charges
are actually incurred by Elan and Elan has attempted in good faith to avoid
such write-off charges by making other use of the applicable materials,
products or components); provided, that Elan shall provide Buyer with advance
notice of such changes and the estimated costs thereof and Buyer shall have the
opportunity to discuss with Elan any of such changes or costs prior to such
changes being implemented for up to two (2) weeks after Buyer receives
such notice; and, provided, further, that with respect to then-outstanding
purchase orders submitted by Buyer pursuant to Clause 4.3, to the extent that
applicable law or any Governmental or Regulatory Authority does not allow Elan
to manufacture and deliver to Buyer, or Buyer to sell, Products ordered under
such purchase orders, Elan shall be permitted to delay delivery of Products
ordered thereunder for an amount of time equal to the actual delay in making
the changes required by changes in Product Specifications caused by compliance
with this Clause 6.1 (it being understood and agreed by Buyer that it shall
accept Products ordered under such purchase orders despite such Products being
manufactured to Product Specifications that do not reflect the changes required
by this Clause 6.1, to the extent that applicable law or any Governmental or
Regulatory Authority allows Elan to manufacture and deliver to Buyer, and Buyer
to sell, such Products).  Otherwise,
changes shall only be made to the Product Specifications by agreement between
the parties.

 

9

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

7.             DISPUTES AS TO
SPECIFICATIONS

 

7.1           All claims
for failure of any Product to conform to the Product Specifications must be
made by Buyer in writing within sixty (60) days following delivery, except in
the case of latent defects.  Claims for
latent defects, not discovered during the routine testing protocol (which is to
be agreed between the parties reasonably and in good faith), shall be made in
writing within forty-five (45) days of discovery.  Except as described in the preceding
sentence, failure to make timely claims in the manner prescribed in this Clause
7.1 shall constitute acceptance of the delivery.

 

7.2           Where
Products which have been delivered breach the representations and warranties
made in Clause 13.2 (and Clause 7.1 has been complied with) and such
non-conformity is attributable to acts or omissions of Elan:

 

7.2.1        they
shall be reworked (to the extent permitted by applicable law) or replaced at
Elan’s cost within ninety (90) days of the receipt by Elan of the
non-conforming Products; and

 

7.2.2        Elan
shall reimburse Buyer in respect of the costs incurred by Buyer in relation to
any testing, handling, destruction or return of the Products.

 

Notwithstanding Clause 11.2.1, no cure period shall apply with respect
to Products described in Clause 7.2 other than that set forth in Clause
7.2.1.  Other than as expressly set forth
elsewhere in this Agreement in Clause 13.6, and with respect to Serious
Failures to Supply and Product recalls, Buyer shall have no remedies in respect
of Elan having supplied Products that breach the representations and warranties
made in Clause 13.2 other than as set out in this Clause 7.2.

 

7.3           In the
event of an unresolved dispute:

 

7.3.1        as
to conformity of a Product with the relevant Product Specifications pursuant to
Clause 7.1 or 8.3; or

 

7.3.2        pursuant
to clauses 8.5 or 13.4,

 

the parties shall appoint an independent first-class laboratory or
other appropriate, independent expert to undertake the relevant testing, and
its findings shall be conclusive and binding upon the parties.  If the parties fail to agree on the
appointment of an independent first-class laboratory or expert, as appropriate,
within thirty (30) days after the parties first discuss such appointment, the
parties agree that an independent party designated by Elan and an independent
party designated by Buyer shall together select a mutually-acceptable,
appropriate, independent expert.  Such
independent expert shall undertake the relevant analysis and/or testing and
report its findings within a reasonable time of

 

10

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

appointment, which findings shall be conclusive and binding upon the
parties.  All costs relating to this
process shall be borne solely by the unsuccessful party.

 

8.             ADVERSE EVENTS AND PRODUCT
RECALL

 

8.1           Each party
shall, without delay, give notice to the other of any occurrence that involves:

 

8.1.1        any
complaint about the safety, quality, packaging or effectiveness of a Product
manufactured or supplied under this Agreement, including a claim for death or
injury following administration of such Product (that is allegedly related to
the administration of such Product); and

 

8.1.2        any
other matter in connection with a Product manufactured or supplied under this
Agreement or arising out of this Agreement that must be reported to a
Governmental Authority.

 

8.2           The
parties agree that within sixty (60) days following the Effective Date,
representatives of each party with responsibility for the safety, surveillance
and pharmacovigilance of the Products shall meet to develop detailed procedures
regarding the format, timing and content of the safety information to be
exchanged between the parties, and shall meet periodically thereafter to update
the procedures.

 

8.3           If a
party:

 

8.3.1        is
notified by a Governmental Authority that a recall of a Product is required,
requested or otherwise advisable; or

 

8.3.2        establishes
a need to recall a Product for non-conformity with the Product Specifications,

 

it shall promptly give to the other party notice of the same with full
details.  Notwithstanding any dispute
between the parties as to whether the Product complies with the Product
Specifications, the recall shall commence but such dispute shall be resolved in
accordance with Clause 7.3.

 

8.4           Unless
otherwise agreed or unless Elan elects to take over and perform the recall of
the Product pursuant to Clause 8.6.2, Buyer shall take the lead/coordinating
role in any recall of the Product in a commercially reasonable manner, and Elan
shall afford all reasonable assistance to Buyer in respect of such recall.  A joint recall administration team shall be
established to support Buyer in such role with an equal number of nominated
individuals from each party participating. 
A final report shall be completed by the recall administration team and
delivered promptly to both parties.

 

11

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

8.5           The costs
of a recall of the Product, including the cost of replacement quantities of
such Product, shall be borne by Buyer unless (a) the recall arises from
Elan’s supply of Product that breach the representations and warranties made in
Clause 13.2 or from the negligent acts or omissions of Elan in manufacturing
the Product, and (b) subject to Clause 13.6, Buyer could not have
discovered such failure or acts or omissions prior to the sale of the Product
by exercising reasonable diligence in conducting acceptance testing pursuant to
the Technical Agreement, in which case Elan shall bear the actual costs of the
recall; provided that each party hereby agrees to use commercially reasonable
efforts to minimize any costs relating to any recall of the Product that may be
borne by the other party.  If the parties
are unable to agree who should bear the cost of the recall, the dispute shall be
settled in the manner set forth in Clause 7.3.

 

8.6           In the
event that Elan is required to bear the costs of any recall of the Product in
accordance with Clause 8.5, Elan shall:

 

8.6.1        reimburse
Buyer for all reasonable and actual costs and expenses which Buyer incurs in
connection with such recall; and

 

8.6.2        be
entitled (but not obliged) to take over and perform the recall of such Product.

 

9.             PRICE AND PAYMENT

 

9.1           The price
of the Products shall be:

 

9.1.1        until
the first anniversary of the Effective Date, the price set out in Schedule 1;

 

9.1.2        thereafter,
(and subject to Clause 9.2) at such price as Elan notifies to Buyer from time
to time, provided that during the Term (including the Initial Term and any
Renewal Term(s)) price increases for the Products shall be limited to the
percentage increase in the Index, as compared to the most recent price
adjustment.

 

9.2           In
addition to any price increases pursuant to Clause 9.1.2, if:

 

9.2.1        the
price which Elan must pay for the active ingredient of, or other raw material
used to produce, a Product increases by a percentage in excess of the
percentage increase in the Index (as compared to the later of the Effective
Date or the most recent price adjustment pursuant to this Clause 9.2);

 

9.2.2        additional
regulatory obligations are imposed on Elan by law or a Governmental Authority;
or

 

12

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

9.2.3        any
other price increase is required or agreed in accordance with Clause 6,

 

Elan may increase the price of the Products by such amount as is
necessary to recover the additional costs of supplying the Products.  Elan shall ensure that, where the costs of
active ingredients or other raw materials used to produce the Products increase
by a percentage in excess of the percentage increase in the Index (as compared
to the Effective Date), Elan and Buyer will meet to discuss potential
alternative suppliers of such materials.

 

9.3           Payment
for supply of all Products shall be made by Buyer in US$ within ninety (90)
days of receipt of the relevant invoice. 
Payment shall be by means of:

 

9.3.1        wire
transfer to an account designated in writing by Elan from time to time; or

 

9.3.2        a
letter of credit issued by or drawn on by a bank acceptable to Elan.

 

9.4           Buyer
shall pay interest to Elan on sums not paid to Elan on the date on which
payment should have been made pursuant to the applicable provisions of this
Agreement (“Due Date”) over the period from
the Due Date until the date of actual payment (both before and after judgement)
at the prime rate publicly announced by Morgan Guaranty Trust Company of New
York at its principal office from time to time plus [***] (or, if less, the
maximum rate allowed to be charged under applicable laws), such interest to be
payable on demand and compounded monthly.

 

9.5           Buyer may
demand, no more than once per year, an audit of the relevant books and records
of Elan in order to verify any price increases proposed by Elan under Clauses
9.1 or 9.2.  Upon no less than sixty (60)
days’ prior written notice, Elan shall grant reasonable access during normal
business hours to members of an independent public accounting firm selected by
Buyer to such relevant books and records of Elan in order to conduct a review
or audit thereof.  The accounting firm
shall report its conclusions and calculations to Buyer and Elan; provided, that
in no event shall the accounting firm disclose to Buyer any information of Elan
except to the extent necessary to verify the price increases; and, at the
request of Elan, such accounting firm will execute appropriate non-disclosure
agreements.  Unless the results of any
such audit indicate that a price increase exceeded the limits provided in
Clauses 9.1 and 9.2 by more than [***], Buyer shall bear the full cost of the
performance of such audit including reasonable administrative costs incurred by
Elan during the performance of the audit. 
If the results of any such audit indicate that a price increase exceeded
the limits provided in Clauses 9.1 and 9.2 by more than [***], (i) Elan
shall bear the full cost of the performance of such audit and (ii) the
price shall be reduced to the amount permitted under Clauses 9.1 and 9.2, and (iii) Elan
shall refund to Buyer the amount attributable to the difference between the
price paid by Buyer and the price allowed by Clause 9.6(ii).

 

13

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

10.          VAT

 

10.1         All sums payable
by Buyer to Elan under the terms of this Agreement shall be deemed to be
exclusive of any VAT chargeable on the supply for which that sum is the
consideration (in whole or in part) for VAT purposes.

 

10.2         If under
this Agreement Elan makes a supply to Buyer for VAT purposes, and VAT is or
becomes chargeable on that supply, Buyer shall pay to Elan a sum equal to the
amount of the VAT chargeable (the “VAT Amount”) in
addition to the consideration payable for the supply.  Buyer shall pay the VAT Amount at the same
time as paying the consideration payable for the supply or, if later, within
five (5) Business Days of the receipt of a valid VAT invoice.

 

10.3         If any VAT
Amount is paid by Buyer in respect of any supply made to it by Elan, and it
subsequently transpires that such supply (or any part thereof) (the “Affected Item”) in relation to which such VAT Amount was
paid by Buyer to Elan is not taxable at a positive rate (or the same positive
rate), and, as a result, Buyer is required to repay an amount in respect of VAT
that it has previously recovered from the relevant tax authority, Elan shall
repay to Buyer an amount equal to the difference between the VAT.  Amount actually paid and the amount of VAT
actually chargeable on the Affected Item within fifteen (15) Business Days of
Elan becoming aware of the error.

 

10.4         Where Buyer
is required by the terms of this Agreement to reimburse Elan for any cost or
expense, Buyer shall reimburse Elan for the full amount of such cost or
expense, including any part of such amount as represents VAT, save to the
extent that Elan obtains credit or repayment in respect of such VAT from a tax
authority.

 

10.5         Where an
amount payable by Buyer to Elan is to be determined or calculated by reference
to any amount incurred or to be incurred by Elan, any part of such latter
amount as represents VAT shall be included in such calculation or
determination.

 

11.          DURATION AND TERMINATION

 

11.1         This
Agreement shall be deemed to have come into force on the Effective Date and
will expire upon the date that is five (5) years from the Effective Date
(the “Initial Term”); provided, however, that
the term of this Agreement shall be extended automatically for additional two (2) year
periods (each, a “Renewal Term”)
unless sooner terminated by any party by notifying the other party at least
twelve (12) months prior to the expiration of the Initial Term or any Renewal
Term.

 

11.2         In addition
to the rights of termination provided for elsewhere in this Agreement, either
party will be entitled forthwith to terminate this Agreement by written notice
to the other party if:

 

14

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

11.2.1      the
other party commits any material breach of any of the provisions of this
Agreement, and in the case of a breach capable of cure, fails to cure the same
within sixty (60) days after receipt of a written notice giving full details of
the breach and requiring it to be remedied (which period shall be thirty (30)
days for any failure by Elan to timely deliver properly ordered Product);
provided, that if the breaching party has proposed a course of action to cure
the breach and is acting in good faith to cure same but has not cured the
breach by the sixtieth (60th) (or, if applicable thirtieth (30th))
day, such period shall be extended by such period as is reasonably necessary to
permit the breach to be cured, provided that such period shall not be extended
by more than sixty (60) days unless otherwise agreed in writing by the parties;
and, provided further, that in the event of a Serious Failure to Supply, Buyer
may terminate the Agreement immediately thereafter, with no cure period being
applicable;

 

11.2.2      the
other party goes into liquidation (except for the purposes of amalgamation or
reconstruction and in such manner that the company resulting therefrom effectively
agrees to be bound by or assume the obligations imposed on such other party
under this Agreement);

 

11.2.3      an
encumbrancer takes possession or a receiver is appointed over any of the
property or assets of the other party;

 

11.2.4      any
proceedings are filed or commenced by the other party under bankruptcy,
insolvency or debtor relief laws or anything analogous to any of the foregoing
occurs under the laws of any jurisdiction in relation to such other party; or

 

11.2.5      all
or substantially all of the assets of Elan are sold in one or a series of
related transactions and this Agreement is not assumed by the purchaser of such
assets (and Elan hereby agrees to notify Buyer as soon as is practicable, but
in no event later than five (5) business days, after the consummation of
such (or, as applicable, the last of such) transaction(s).

 

11.3         For the
purposes of Clause 11.2, a breach will be considered capable of cure if the
party in breach can comply with the provision in question in all respects other
than as to the time of performance.

 

11.4         The parties
hereby acknowledge that Buyer may, at any time and at its sole expense, take
such steps as are appropriate to manufacture the Products through itself or a
third party as an alternate site of manufacture in the event of (a) a
Serious Failure to Supply, or (b) Elan’s receipt from Buyer of a notice of
termination of this Agreement by Buyer pursuant to Clause 11.2.  In such event, Elan shall use commercially
reasonable efforts to cooperate in and provide assistance to Buyer in any
technology transfer necessary to allow Buyer or a third party (an “Alternate Manufacturer”) to manufacture the Products from
and after the occurrence of any of the foregoing events, provided that such
Alternate Manufacturer does not constitute a Technological Competitor. If Buyer
notifies Elan of its intention to secure Product from an Alternate Manufacturer
in compliance with this Clause 11.4, as promptly as is practicable Elan

 

15

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

shall grant to Buyer a royalty-free, fully paid-up licence (a “Production Licence”), with
the right, if the Alternate Manufacturer is other than Buyer, to sublicence to
such Alternate Manufacturer (other than any Technological Competitor), under
all of its right, title and interest in all technical know-how and information
related to the composition, production, packaging and quality control of the
applicable Product (including, without limitation, practical performance
advice, shop practice, specifications as to materials to be used and control methods
related thereto), and access and a right of reference to relevant regulatory
filings, which licence shall be made in a written agreement containing the
provisions contained in Schedule 2 hereto, solely to procure the
production of the Product (including securing required Regulatory Approvals
and/or Facility Licenses in connection therewith) from an Alternate
Manufacturer other than a Technological Competitor. The Production License will
include an exclusive, perpetual, fully-paid-up, royalty free license for Buyer
to use the Excluded Intellectual Property (as such term is defined in the
Purchase Agreement) solely to the extent needed to make Products and
improvements thereto and reformulations thereof (to the extent that any such
improvements or reformulations are developed by the Buyer). The parties shall
negotiate in good faith with respect to other provisions that will be
applicable to any Production Licence.

 

11.5         Upon Elan’s
receipt from Buyer of a notice of termination pursuant to Clause 20.2, Buyer
and Elan shall enter into good faith negotiations to preserve continuity of
supply of Product to Buyer, including the possibility of transfer of
manufacture to Buyer or an Alternate Manufacturer.

 

12.          CONSEQUENCES OF
TERMINATION

 

12.1         Upon
termination of this Agreement, this Agreement shall, subject to (a) Clause
12.2, (b) the provisions of the Agreement which by their terms are
reasonably intended to survive the termination of the Agreement and (c) the
provisions of the Agreement that are required to survive in order for the
parties to comply with Clause 12.2, automatically terminate forthwith and be of
no further legal force or effect.

 

12.2         Upon
expiration or termination of this Agreement:

 

12.2.1      any
sums that were due from Buyer to Elan under this Agreement prior to the
exercise of the right to terminate this Agreement, shall be paid in full,
subject to setoffs for any amounts or credits owed to Buyer by Elan under this
Agreement;

 

12.2.2      all
representations and warranties contained in Clause 13 shall, insofar as
appropriate, remain in full force and effect;

 

12.2.3      Subject
to subclause 12.2.6, Buyer shall be permitted to cancel any outstanding
purchase order with respect to which there is no work-in-process, with no
payments owed to Elan with respect thereto;

 

16

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

12.2.4      Elan
shall deliver to Buyer the Products requested in each written purchase order
that is not cancelled pursuant to subclause 12.2.3;

 

12.2.5      immediately
upon delivery of Products pursuant to such written purchase orders, Buyer shall
pay in full all sums due in relation to such delivery; and

 

12.2.6      by
Buyer, Buyer shall reimburse Elan for its costs for raw materials, intermediary
products and components purchased in reliance on any Monthly Forecast Report,
including but not limited to Elan’s costs relating to disposal of such items,
but not including costs that are cancellable or costs for such materials,
products and components that are otherwise useable by Elan; provided that the
provisions of this subclause 12.2.6 shall not apply in the event of an
expiration of this Agreement or termination by Buyer pursuant to subclauses
11.2.1 or 11.2.5.  Elan shall take
commercially reasonable steps to mitigate any costs that Buyer should otherwise
reimburse under this subclause 12.2.6.

 

12.3         Clauses 1,
7.3, 8, 9, 10 and 12 through 28 (inclusive) shall survive any expiration or
termination of this Agreement.

 

13.          WARRANTIES AND
INDEMNITIES

 

13.1         Each party
represents and warrants to the other as of the Effective Date, that:

 

13.1.1      it
has the right, power and authority, and has taken all action necessary, to
execute, deliver and exercise its rights, and perform its obligations, under
this Agreement; and

 

13.1.2      neither
the execution of nor performance under this Agreement by it will result in a
breach of any agreement or arrangement to which it is a party.

 

13.2         Elan
represents and warrants to Buyer that, at the time of delivery pursuant to
Clause 5.2, the Product delivered to Buyer under this Agreement:  (i) will not be adulterated or misbranded
under the Federal Food, Drug, and Cosmetic Act, as amended (the “FFDCA”); (ii) will fully conform to the Product
Specifications; (iii) will have been manufactured, packaged, labeled,
held, tested and shipped in accordance with the Product Specifications, cGMPs,
all other applicable laws and regulations and requirements of all applicable
Governmental Authorities and this Agreement; (iv) may be introduced into
interstate commerce in the United States pursuant to the FFDCA; and (v) will
have a remaining shelf life of not less than the maximum permitted shelf life
for Finished Product under applicable law less six (6) months.

 

13.3         Elan further
represents and warrants to Buyer that (i) neither it nor any of its
Affiliates nor any member of their respective staffs that will be involved in
Elan’s

 

17

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

performance under this Agreement has been disqualified or debarred for
any purpose by any Governmental or Regulatory Authority with jurisdiction over
the granting of Regulatory Approvals or Facility Licenses, and (ii) to the
Knowledge of Elan, the processes used to manufacture the Products do not
presently and will not infringe, misappropriate or otherwise violate, as
applicable, the intellectual property or proprietary rights of any person or entity.

 

13.4         Buyer
represents and warrants to Elan that (i) provided the Products do not
breach the representations and warranties of Elan in Clause 13.2, Buyer’s sale
(and other handling) of the Products will be in compliance with all applicable
laws and regulations and requirements of all applicable Governmental
Authorities, and (ii) the packaging and related artwork for the Products
as approved by Buyer and provided to Elan will fully comply with all applicable
laws and regulations and requirements of all applicable Governmental
Authorities.

 

13.5         Buyer shall
indemnify Elan and its directors, officers, employees, Affiliates, agents
successors and assigns, and keep such persons indemnified, on demand, against
each Loss which such persons incur to the extent such Loss arises out of any
actual (or, in connection with a claim made by a third party, alleged):

 

13.5.1      breach
by Buyer of any of its representations or warranties under this Clause 13 or
any of its covenants, obligations or undertakings elsewhere in this Agreement;
or

 

13.5.2      claim
(other than a Medical Claim) against such persons in relation to any Product
sold in the Territory after the Effective Date.

 

13.5.3      Notwithstanding
the foregoing, Buyer shall not be required to indemnify Elan with respect to
any Loss to the extent the same is covered by Elan’s indemnification
obligations in Clauses 13.6.1 and 13.6.2.

 

13.6         Elan shall
indemnify Buyer and its directors, officers, employees, Affiliates, agents
successors and assigns, and keep such persons or entities indemnified, on
demand, against each Loss which such persons incur to the extent such Loss
arises out of any actual (or, in connection with a claim made by a third party,
alleged):

 

13.6.1      breach
by Elan of any of its representations or warranties under this Clause 13 or any
of its covenants, obligations or undertakings elsewhere in this Agreement; or

 

13.6.2      Medical
Claim against such persons in relation to any Product sold in the Territory
after the Effective Date.

 

18

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

13.6.3      Notwithstanding
the foregoing, Elan shall not be required to indemnify Buyer with respect to
any Loss to the extent the same is covered by Buyer’s indemnification
obligations in Clauses 13.5.1 and 13.5.2.

 

13.7         A “Medical Claim” means a claim for personal injury (including
death) and/or for costs of medical treatment to the extent caused by a Product
that failed to conform with the Product Specifications at the time of dispatch
from Elan’s Facility.  If the parties are
unable to agree whether a claim constitutes a Medical Claim, the dispute shall
be settled in the manner set forth in Clause 7.3.

 

13.8         If a party
becomes aware of a matter which constitutes or which would or might give rise
to an indemnity claim pursuant to Clause 13.5 or 13.6 (a “Relevant
Claim”):

 

13.8.1      party
shall immediately give notice to the other party of the matter and shall
consult with such other party with respect to the matter;

 

13.8.2      the
party claiming under an indemnity (the “Beneficiary”)
shall, and shall ensure that each of its Affiliates will, provide to the
indemnifying party (the “Covenantor”)
and its advisers reasonable access to premises and personnel and to relevant
assets, documents and records within the power or control of the Beneficiary
(and its Affiliates) for the purposes of investigating the matter and enabling
the Covenantor to take the action referred to in this Clause 13.8;

 

13.8.3      the
Covenantor (at its cost) may take copies of the documents or records, and
photograph the premises or assets, referred to in Clause 13.8.2;

 

13.8.4      the
Beneficiary shall, and shall ensure that each of its Affiliates will:

 

(a)           take any
action and institute any proceedings, and give any information and assistance,
as the Covenantor may reasonably request to:

 

(i)            dispute,
resist, appeal, compromise, defend, remedy or mitigate the matter; or

 

(ii)           enforce
against a person (other than the Covenantor (or any of its Affiliates)) the
rights of the Beneficiary (and any of its Affiliates) in relation to the
matter; and

 

(b)           in
connection with proceedings related to the matter (other than against the
Covenantor (or its Affiliates)) use advisers nominated by the Covenantor and,
if the Covenantor requests, allow the Covenantor the exclusive conduct of the
proceedings;

 

19

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

and in
each case on the basis that the Covenantor shall indemnify the Beneficiary, and
keep the Beneficiary indemnified, on demand against all reasonable costs
incurred as a result of a request or nomination by the Covenantor;

 

13.8.5      the
Beneficiary shall not, and shall ensure that none of its Affiliates will, admit
liability in respect of, or compromise or settle, the matter without the prior
written consent of the Covenantor, which shall not be unreasonably withheld or
delayed; and

 

13.8.6      the
Beneficiary shall take all reasonable action to mitigate any loss suffered by
it (or any of its Affiliates) in respect of the matter.

 

13.9         Notwithstanding
anything to the contrary contained herein, other than with respect to claims
made by any third party, neither of Elan and Buyer shall be liable to the other
(or any other person to be indemnified hereunder) by reason of any
representation or warranty, condition or other term or any duty of common law,
or under the express terms of this Agreement, for any loss of profit, loss of
enterprise value, indirect, consequential, special or incidental loss or
damage, and whether occasioned by the negligence of the respective parties,
their employees or agents or otherwise.

 

13.10       Each
of Elan and Buyer shall maintain their own comprehensive general liability
insurance and shall note the interest of the other on such policies.

 

14.          RELATIONSHIP OF THE
PARTIES

 

14.1         Elan and
Buyer shall for all purposes be independent contractors, and this Agreement
and/or the performance of the obligations hereunder shall not create any
relationship in which one party or its employees, agents or representatives,
are to be employees, agents, partners, joint venturers or representatives of
the other party.  Consequently, neither
party nor its employees, agents and representatives has any power or right to
bind the other party, to settle any claim by or against such party, to give any
warranty or make any claim or representation on behalf of such party or to
subject such party to any obligation or liability of any kind, unless expressly
authorised by such party in writing.

 

15.          CONFIDENTIALITY

 

15.1         The parties
agree that it will be necessary, from time to time, to disclose to each other
information that is confidential and/or proprietary to the disclosing party
and/or its Affiliates, including without limitation, inventions, trade secrets,
specifications, designs, data, know-how and other proprietary information
relating to the Products, processes, services and business of the disclosing
party and/or its Affiliates.  The
foregoing, together with the existence, subject matter and terms of this
Agreement, shall be referred to collectively as “Confidential
Information”.

 

20

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

15.2         Any
Confidential Information disclosed by the disclosing party shall be used by the
receiving party exclusively for the purposes of fulfilling the receiving party’s
obligations under this Agreement and for no other purpose.

 

15.3         Save as
otherwise specifically provided herein, and subject to Clauses 16 and 17, each
party shall disclose Confidential Information of the other party only to those
employees, representatives, agents and consultants requiring knowledge thereof
in connection with fulfilling such other party’s obligations under this
Agreement, and not to any other third party.

 

15.4         Each party
further agrees to inform all such employees, representatives, agents and
consultants of the terms and provisions of this Agreement relating to
Confidential Information and their duties hereunder and to obtain their written
agreement hereto (or to ensure that such persons or entities are bound by
similar confidentiality obligations relating to Confidential Information that
are at least as strict as those contained herein) as a condition of receiving
Confidential Information.

 

15.5         Each party
shall exercise the same standard of care as it would itself exercise in
relation to its own confidential information (but in no event less than a
reasonable standard of care) to protect and preserve the proprietary and
confidential nature of the Confidential Information disclosed to it by the
other party.

 

15.6         Upon
termination or expiration of this Agreement, each party shall promptly, upon
request of the other party, return (or if requested by the other party,
destroy) all documents and any copies thereof containing Confidential
Information belonging to, or disclosed by, such other party, save that it may
retain one copy of the same solely for the purposes of ensuring compliance with
this Agreement.

 

15.7         Notwithstanding
anything to the contrary contained herein, Elan and Buyer shall be entitled to
pass to regulatory authorities and other distributors, licensees and potential
licensees of the Products outside of the Territory (and in addition, in the
case of Buyer, inside the Territory), information in relation to:

 

15.7.1      any
material complaint about the safety, quality, packaging or effectiveness of a
Product, including a claim for death or injury following administration of such
Product (that is plausibly related to the administration of such Product); or

 

15.7.2      any
other matter in connection with a Product or arising out of this Agreement that
must be reported to a Governmental Authority.

 

To the extent that such information is Confidential Information, the
disclosing party shall so inform the recipients and use reasonable endeavours
to ensure that they are bound by appropriate restrictions as to
confidentiality.

 

21

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

15.8         Any breach
of this Clause 15 by any person to whom Confidential Information has been
disclosed by one of the parties is considered a breach by the party itself.

 

15.9         The
obligations of confidentiality contained herein shall not apply to Confidential
Information of a disclosing party that the receiving party can demonstrate:

 

15.9.1      is
in the public domain or made public through no breach of this Agreement by the
receiving party;

 

15.9.2      is
independently developed by the receiving party without reference to
Confidential Information disclosed hereunder, as evidenced by such party’s
records; or

 

15.9.3      becomes
available to a receiving party on a non-confidential basis, whether directly or
indirectly, from a source other than the other party hereto, which source did
not acquire this information on a confidential basis.

 

15.10       The
provisions relating to confidentiality in this Clause 15 shall remain in effect
during the term of this Agreement, and for a period of 7 years following the
expiration or earlier termination of this Agreement.

 

15.11       The
parties agree that the obligations of this Clause 15 are necessary and reasonable
in order to protect the parties’ respective businesses, and each party agrees
that monetary damages may be inadequate to compensate a party for any breach by
the other party of its covenants and agreements set forth herein.  The parties agree that any such violation or
threatened violation may cause irreparable injury to a party and that, in
addition to any other remedies that may be available, in law and equity or
otherwise, each party shall be entitled to seek injunctive relief against the
threatened breach of the provisions of this Clause 15, a continuation of any
such breach by the other party and specific performance and other equitable
relief to redress such breach, together with damages and reasonable counsel
fees and expenses to enforce its rights hereunder.

 

16.          ANNOUNCEMENTS

 

16.1         Subject to
Clause 17, no announcement or public statement concerning the specific terms of
this Agreement shall be made by or on behalf of any party hereto without the
prior written approval of the other party (such approval not to be unreasonably
withheld or delayed).

 

17.          PERMITTED DISCLOSURES

 

17.1         A party (the
“Disclosing Party”) will be entitled to
make an announcement or public statement concerning the existence, subject
matter or any term of this

 

22

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

Agreement, or to disclose Confidential Information that the Disclosing
Party is required to make or disclose pursuant to:

 

17.1.1      a
valid order of a court or Governmental Authority; or

 

17.1.2      any
other requirement of law or any securities or stock exchange,

 

provided that if the Disclosing Party becomes legally required to make
such announcement, public statement or disclosure hereunder, the Disclosing
Party shall, to the extent practicable, give the other party prompt notice of
such fact so as to enable the other party to seek a protective order or other
appropriate remedy concerning any such announcement, public statement or
disclosure.  Notwithstanding the
foregoing sentence, the Disclosing Party shall be entitled to make such
announcement, public statement or disclosure regardless of whether the other
party is in the process of seeking a protective order or other remedy, if the
Disclosing Party believes it is required to do so pursuant to subclauses 17.1.1
or 17.1.2.

 

17.2         The
Disclosing Party shall fully co-operate with the other party in connection with
such other party’s efforts to obtain any such order or other remedy.

 

17.3         If any such
order or other remedy does not fully preclude the announcement, public
statement or disclosure, the Disclosing Party shall make such announcement,
public statement or disclosure only to the extent that the same is legally
required.

 

17.4         Either party
shall notify the other party of any request by a Governmental Authority for
disclosure of any Confidential Information required in connection with a
Regulatory Application, provided that such party shall not disclose the
Confidential Information to such Governmental Authority without the prior
written consent of the other party (such consent not to be unreasonably
withheld or delayed).

 

17.5         Notwithstanding
Clause 15 and this Clause 17, each of the Parties shall be entitled to provide
a copy of this Agreement to a potential assignee in connection with Clause 18,
potential corporate partners, investors, persons having observer rights at its
Board of Director meetings and its consultants; provided that, if such
potential assignee, potential corporate partners, investors, board observers or
consultants are not an Affiliate of the assignor, the proposed assignee has entered
into a confidentiality agreement on terms no less strict than the terms of
Clauses 15, 16 and 17.

 

18.          ASSIGNMENT /
SUB-CONTRACTING

 

18.1         Either party
may assign this Agreement to its Affiliates without the consent of the other
party, provided that:

 

23

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

18.1.1      such
assignment does not have any adverse tax consequences (which shall not include
consequences of an administrative nature only) on the other party; and

 

18.1.2      if
the assignee ceases to be an Affiliate of the assignor, the assignor shall
procure that this Agreement is re-assigned to the assignor or another Affiliate
of the assignor.

 

18.2         Elan shall
additionally be entitled to:

 

18.2.1      assign
this Agreement to a purchaser of all or substantially all of the assets of its
manufacturing facility in Athlone, Ireland without the consent of Buyer
(provided that Elan must provide Buyer with written notice of such assignment
in advance; and provided, further, that at the request of Buyer, Elan shall
confer with Buyer and discuss in good faith any concerns raised by Buyer
relating to such assignment), provided that the same does not have any adverse
tax consequences (which shall not include consequences of an administrative
nature only) on Buyer and provided that such purchaser agrees in writing to
accept and perform all obligations of Elan under this Agreement; and/or

 

18.2.2      delegate
or subcontract the manufacture of the Products to such person(s) as it sees
fit, provided that Elan has received the prior written consent of Buyer to such
delegation or subcontracting, which consent shall not be unreasonably withheld
or delayed.

 

18.3         Buyer shall
additionally be entitled to delegate any of its obligations under this
Agreement to such person(s) as it, in its reasonable discretion, selects, and
Buyer may assign this Agreement to a third party without the consent of Elan to
the extent that such third party is not a Technological Competitor or then in
litigation with Elan or any of its Affiliates.

 

18.4         Except as
otherwise permitted in the foregoing, this Agreement may not be assigned by
either party without the prior written consent of the other party, which
consent shall not be unreasonably withheld or delayed.

 

18.5         Any
assignment or delegation of a party’s rights or obligations under this Agreement
shall not operate to reduce or limit the assigning party’s liabilities and
obligations to the other party under the terms of this Agreement, for which the
assigning party shall remain responsible.

 

19.          SEVERABILITY

 

19.1         If any
provision in this Agreement is deemed to be, or becomes invalid, illegal, void
or unenforceable under applicable laws:

 

24

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

19.1.1      such
provision will be deemed amended to conform to applicable laws so as to be
valid and enforceable; or

 

19.1.2      if
it cannot be so amended without materially altering the intention of the
parties, it will be deleted, and the validity, legality and enforceability of
the remaining provisions of this Agreement shall not be impaired or affected in
any way.

 

20.          FORCE MAJEURE

 

20.1         If a party
(the “Affected Party”) is prevented or
delayed from performing any of its obligations under this Agreement (through no
fault of the Affected Party and other than a payment obligation) (an “Affected Obligation”) by a Force Majeure Event:

 

20.1.1      the
Affected Obligation shall be suspended while the Force Majeure Event continues
to the extent that the Affected Party is prevented or delayed in performing the
Affected Obligation by such Force Majeure Event, and no party shall be in
breach of this Agreement, or otherwise liable, by reason of such suspension of
such Affected Obligation;

 

20.1.2      as
soon as reasonably possible after the start of the Force Majeure Event, the
Affected Party shall notify the other party in writing of the Force Majeure
Event, the date on which the Force Majeure Event started and the effects of the
Force Majeure Event on its ability to perform the Affected Obligation, and the
parties shall meet as soon as is practicable to discuss the matter in good
faith;

 

20.1.3      the
Affected Party shall make all commercially reasonable efforts to mitigate the
effects of the Force Majeure Event on the performance of the Affected
Obligation and to bring the Force Majeure Event to an end; and

 

20.1.4      as
soon as reasonably possible after the end of the Force Majeure Event, the
Affected Party shall notify the other party in writing that the Force Majeure
Event has ended and resume performance of the Affected Obligation.

 

20.2         Where the
Force Majeure Event continues for more than three (3) months, the other
party may terminate this Agreement by giving not less than five (5) Business
Days’ written notice to the Affected Party.

 

25

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

21.          AMENDMENTS

 

No amendment,
modification or addition hereto shall be effective or binding on any party
hereto unless set forth in writing and executed by a duly authorised
representative of each party.

 

22.          WAIVER

 

No waiver of any right
under this Agreement shall be deemed effective unless contained in a written
document signed by the party charged with such waiver, and no waiver of any
breach or failure to perform shall be deemed to be a waiver of any future
breach or failure to perform or of any other right arising under this
Agreement.

 

23.          ENTIRE AGREEMENT

 

23.1         Each of the
parties hereto hereby acknowledges that in entering into this Agreement it has
not relied on any representation or warranty except as expressly set forth
herein or in any document referred to herein.

 

23.2         This
Agreement (together with Schedule 1 and all documents referred to herein)
sets forth all of the agreements and understandings between the parties with
respect to the subject matter hereof, and supersedes and terminates all prior
agreements and understandings between the parties with respect to the subject
matter hereof.  There are no agreements
or understandings with respect to the subject matter hereof, either oral or
written, between the parties other than as set forth in this Agreement
(together with Schedule 1 and all documents referred to herein).

 

23.3         Nothing in
this Clause 23 shall exclude any liability which any party would otherwise have
to the other party or any right which either of them may have to rescind this
Agreement in respect of any statements made fraudulently by the other prior to
the execution of this Agreement or any rights which either of them may have in
respect of fraudulent concealment by the other.

 

24.          GOVERNING LAW AND
JURISDICTION

 

24.1         This
Agreement shall be governed by and construed in accordance with the laws of New
York, excluding its conflict of laws rules.

 

24.2         For the
purposes of this Agreement the parties submit to the exclusive jurisdiction of
the courts of New York.

 

26

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

25.          NOTICES

 

25.1         Any notice
to be given under this Agreement shall be sent in writing in English by
registered or recorded delivery post, internationally recognized overnight
courier or fax to:

 

25.1.1      Elan
at:

 

Address:        Elan
Pharma International Limited

WIL House, Shannon Business Park

Shannon

County Clare

Ireland

Attention:      Counsel

Fax:                 +353
902 92427

 

with a
courtesy copy (receipt of which shall not constitute, notice) to each of:

 

Address:        Elan
Pharma International Limited

WIL House, Shannon Business Park

Shannon

County Clare

Ireland

Attention:      Company
Secretary

Fax:                 +353
902 92427

 

and

 

Address:        Elan
Pharmaceuticals, Inc.

800 Gateway Boulevard

South San Francisco, CA 94080

Attention:      Vice
President, Legal Affairs

Fax:                 (650)
553-7165

 

25.1.2      Buyer
at:

 

Address:        Acorda
Therapeutics

15 Skyline Drive

Hawthorne, NY 10532

Attention:      General
Counsel

Fax:                 (914)
347-4560

 

or to such other address(es) and fax numbers as may from time to time
be notified by either party to the other in conformity herewith.

 

27

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

25.2         Any notice
sent by mail shall be deemed to have been delivered seven (7) Business
Days after dispatch or delivery to the relevant courier; any notice sent by
internationally recognized overnight courier shall be deemed to have been
delivered two (2) Business Days after dispatch or delivery to the relevant
courier; and any notice sent by fax shall be deemed to have been delivered upon
confirmation of receipt.

 

26.          FURTHER ASSURANCES

 

At the request of either
party, the other party shall (and shall use reasonable efforts to procure that
any necessary third parties shall) execute such documents, and do all acts and
things as may reasonably be required subsequent to the signing of this
Agreement for assuring to or vesting in the requesting party the full benefit
of the terms hereof.

 

27.          COUNTERPARTS

 

This Agreement may be
executed by facsimile and in any number of counterparts, each of which when so
executed shall be deemed to be an original and all of which when taken together
shall constitute this Agreement.

 

28.          SET-OFF

 

Any payment due hereunder
from either party may be set off against any payment owed hereunder to such
party.

 

28

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have been
separately filed with the Commission.

 

 

IN WITNESS WHEREOF
the parties have executed this Agreement on the Effective Date.

 

	
  SIGNED

  
	
   

  
	
   

  
	
   

  	
   

  
	
  for and on
  behalf of

  
	
  ELAN
  PHARMA INTERNATIONAL LIMITED

  
	
  Name:   William F. Daniel

  
	
  Position:  Director

  
	
   

  
	
   

  
	
  SIGNED

  
	
   

  
	
   

  
	
   

  	
   

  
	
  for and on
  behalf of

  
	
  ACORDA
  THERAPEUTICS, INC.

  
	
  Name:
      Ron Cohen

  
	
  Position:  President
  and CEO

  

 

29

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

SCHEDULE 1

 

PRODUCTS

 

	
  Product

  	
   

  	
  Strength

  (mg)

  	
   

  	
  Bottle Size

  (capsules)

  	
   

  	
  Price (per

  bottle)

  	
   

  	
  Minimum Batch Size

  (number of capsules)

  	
   

  
	
  Zanaflex
  capsules (finished)

  	
   

  	
  2

  	
   

  	
  150

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Zanaflex
  capsules (finished)

  	
   

  	
  4

  	
   

  	
  150

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  
	
  Zanaflex
  capsules (finished)

  	
   

  	
  6

  	
   

  	
  150

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  

 

	
  Product

  	
   

  	
  Strength

  (mg)

  	
   

  	
  Unit Size

  (capsules)

  	
   

  	
  Price (per unit)

  	
   

  	
  Minimum Batch Size

  (number of capsules)

  	
   

  
	
  Zanaflex
  capsules (bulk)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [***]

  	
   

  	
  [***]

  	
   

  

 

30

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

SCHEDULE 2

 

TERMS OF THE PRODUCTION LICENCE

 

1.             GRANT AND RECORDAL

 

1.1           Elan
hereby grants to Buyer a royalty-free, fully paid-up licence (a “Production License”), with the right to sublicence to an
Alternate Manufacturer (other than any Technological Competitor), under all of
its right, title and interest in all technical know-how and information related
to the composition, production, packaging and quality control of the applicable
Product (including, without limitation, practical performance advice, shop
practice, specifications as to materials to be used and control methods related
thereto), and access and a right of reference to relevant regulatory filings,
solely to procure the production of the Product (including securing required
Regulatory Approvals and/or Facility Licenses in connection therewith) from an
Alternate Manufacturer other than a Technological Competitor.  This Production License includes an
exclusive, perpetual, fully-paid-up, royalty-free license for Buyer to use the
Excluded Intellectual Property (as such term is defined in the Purchase
Agreement) solely to the extent needed to make Products and improvements
thereto and reformulations thereof (to the extent that any such improvements or
reformulations are developed by the Buyer).

 

1.2           If so
requested by Buyer at any time during the continuation of this Production
Licence, and at the sole expense of Buyer, Elan shall provide Buyer with all reasonable
assistance and co-operation that Buyer may reasonably require to record Buyer’s
interest under this Production Licence on any applicable intellectual register.

 

2.             COMPLIANCE AND
INDEMNITY

 

2.1           Buyer
shall comply, and shall be responsible for its sublicensees’ compliance, with
all laws, rules, regulations, orders and codes of practice applicable to the
manufacture, distribution, sale and other handling of the Products under this
Production Licence, including, for the avoidance of doubt and not by way of
limitation, compliance with all such laws, rules, regulations, orders and codes
of practice requiring and regarding product recalls.

 

2.2           All
liability of Elan to Buyer, its officers, directors, employees, agents,
sublicensees or contractors for any product liability or personal injury claim
(including death) or similar claim relating to the Products produced by Buyer
or any person authorised by Buyer during the continuation of this Production
Licence is hereby excluded to the fullest extent permitted by law.  In any event, Elan shall not be liable to
Buyer or its officers, directors, employees, agents, sublicensees or
contractors for any indirect or consequential loss or damage

 

31

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

suffered by Buyer or any of such persons or entities for any such
product liability, personal injury or similar claim.

 

2.3           Buyer
shall indemnify Elan and its directors, officers, employees, Affiliates, agents
successors and assigns, and keep such persons indemnified, on demand, against
each Loss which such persons incur to the extent such Loss arises out of any
actual (or, in connection with a claim made by a third party, alleged) breach
by Buyer of any its obligations under this Production Licence or the use of the
intellectual property licenced from Elan hereunder by Buyer or any person
authorised by Buyer during the continuation of this Production Licence.  Notwithstanding anything to the contrary
contained herein, other than with respect to claims made by any third party,
neither of Elan and Buyer shall be liable to the other (or any other person to
be indemnified hereunder) by reason of any representation or warranty,
condition or other term or any duty of common law, or under the express terms
of this Agreement, for any loss of profit, loss of enterprise, value, indirect,
consequential, special or incidental loss or damage, and whether occasioned by
the negligence of the respective parties, their employees or agents or
otherwise.

 

2.4           Buyer
shall procure and maintain at its own cost and expense appropriate product
liability insurance covering the Products for the full extent of the territory
in which Buyer is selling or authorizing any other person to sell the Products
in a reasonable amount and form.

 

3.             WARRANTIES AND
REPRESENTATIONS

 

3.1           All
warranties and representations, whether express or implied, are excluded from
this Production Licence to the fullest extent permitted by law.

 

4.             RELATIONSHIP OF ELAN
AND BUYER

 

4.1           Nothing in
this Production Licence shall constitute or be deemed to constitute a partnership
between Elan and Buyer or constitute Buyer as agent for Elan for any purpose,
and Buyer shall have no right or authority to and shall not purport to perform
any act enter into any agreement or arrangement, make any representation, give
any warranty, incur any liability or assume any obligation (whether express or
implied) of any kind for or on behalf of Elan or binding on Elan in any way.

 

5.             GENERAL

 

5.1           This
Production Licence and the Supply Agreement constitute the entire agreement
between Elan and Buyer in relation to the intellectual property licensed
hereunder, and supersede any previous agreement between Elan and Buyer relating
thereto.

 

32

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

5.2           No
modification, alteration, variation or waiver of any of the provisions of this
Production Licence shall be effective unless in writing and signed on behalf of
each of Elan and Buyer.

 

5.3           The
failure to exercise or delay in exercising a right or remedy provided by this
Production Licence or by law does not constitute a waiver of the right or
remedy or a waiver of other rights or remedies. 
No single or partial exercise of a right or remedy provided by this
Production Licence or by law prevents further exercise of the right or remedy
or the exercise of another right or remedy.

 

5.4           The rights
and remedies contained in this Production Licence are cumulative and not
exclusive of rights or remedies provided by law.

 

5.5           If at any
time any provision of this Production Licence is or becomes illegal, invalid or
unenforceable in any respect under the laws of any jurisdiction, that shall not
affect the legality, validity or enforceability in that jurisdiction or in any
other jurisdiction of any other provision of this Production Licence.

 

5.6           Elan and
Buyer are each entering into this Production Licence for their own benefit and
not for the benefit of any other person other than any indemnitee or permitted
sublicensee hereunder.

 

5.7           Except
where this Production Licence or the Supply Agreement provides otherwise, Elan
and Buyer shall bear its own costs relating to the negotiation, preparation,
execution and implementation by it of this Production Licence.

 

6.             INCORPORATION OF
TERMS

 

6.1           Clauses 1
(Interpretation), 15-17 (Confidentiality), 20 (Force Majeure),
24 (Governing Law and Jurisdiction) and 25 (Notices) of the Supply Agreement will apply to this
Production Licence.

 

6.2           In this
Production Licence, the term “Supply Agreement”
means the Zanaflex Supply Agreement between Elan Pharma International Limited
and Acorda Therapeutics, Inc. dated July 21, 2004.

 

6.3           Capitalized
terms used in herein and not otherwise defined in this Agreement shall have the
meanings assigned to such terms in the Supply Agreement.

 

33

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

SCHEDULE 3

 

TECHNOLOGICAL COMPETITORS

 

[***]

 

34Exhibit 10.22

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

ASSIGNMENT AND ASSUMPTION AGREEMENT

 

This Assignment and Assumption Agreement (this “Agreement”)
is entered into this 21st day of July 2004, by and among Acorda
Therapeutics, Inc. (“Buyer’’), Elan Pharmaceuticals, Inc. (together
with its affiliates, “Elan”), on behalf of itself and its affiliates, and
Novartis Pharma AG (together with its affiliates, “Novartis”), on behalf of
itself and its affiliates.

 

WHEREAS, Buyer and Elan have entered into that certain
Asset Purchase Agreement dated as of July 21, 2004 (the “Asset Purchase
Agreement”) for the sale by Elan to Buyer of certain assets, including certain
rights of Elan under that certain License Agreement (the “License Agreement”)
dated April 17, as amended, between Athena Neurosciences, Inc., the
predecessor to the interest of Elan in the License Agreement, and Sandoz Pharma
Ltd., the predecessor to the interest of Novartis in the License Agreement;

 

WHEREAS, under the terms of the Asset Purchase
Agreement, Elan has agreed to assign to Buyer certain rights of Elan, and Buyer
has agreed to assume certain liabilities and obligations of Elan, under or
pursuant to the License Agreement, and the parties desire to effect other
arrangements regarding the terms of the License Agreement;

 

WHEREAS, Elan has previously assigned to Medeus UK
Limited (“Medeus”) certain rights under or pursuant to the License Agreement,
and Medeus agreed to assume certain liabilities and obligations of Elan under
or pursuant to the License Agreement (collectively, the “Medeus Assignment”);
and

 

WHEREAS, Novartis desires to consent to such
assignment and assumption, and the parties hereto desire to effect such other
arrangements, in each case on the terms and conditions described herein.

 

NOW, THEREFORE, for good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:

 

1.             For value received
and effective as of, and simultaneously with, the closing of the transactions
contemplated by the Asset Purchase Agreement (the “Closing”), Elan hereby assigns
to Buyer all of Elan’s rights under or pursuant to the License Agreement
relating to Products and Improvements in the Territory (such term to be used
herein as defined in the Asset Purchase Agreement), and Buyer hereby assumes
and agrees to satisfy, perform, pay, discharge and otherwise be responsible for
all liabilities and obligations of Elan to be performed under or pursuant to
the License Agreement following the Closing relating to Products and
Improvements in the Territory, but expressly excluding any such liabilities or
obligations as have resulted or may result from any breach or failure to
perform by Elan prior to the Closing under or pursuant to the license
Agreement.  The parties intend that: (a) the
foregoing assignment and assumption shall be effected upon the terms and
conditions contained herein, (b) all of the terms and conditions of the
License Agreement shall be incorporated by reference herein, subject to any
modifications and agreements made herein, and (c) such modifications to
have no effect on the rights and obligations of Novartis and Medeus resulting
from the Medeus Assignment or the

 

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

rights and obligations of any other person or entity that is not a
party hereto.  Elan hereby represents and
warrants to Buyer that neither Elan nor any of its Affiliates has granted
rights under the License Agreement relating to Products in the Territory to
Medeus or any other third party.

 

2.             The parties further
agree as follows:

 

a.                                       Notwithstanding
anything to the contrary contained herein, Elan shall maintain all rights and perform
all obligations under the License Agreement at all times up to and including
the date of the Closing (the “Closing Date”). Further, it is understood and
agreed that, notwithstanding the assignment and assumption to Buyer as of the
Closing, from and after such Closing Date Elan shall maintain all rights
necessary to enforce or perform under, and shall remain responsible for all
obligations and liabilities under, the License Agreement with respect to events
occurring or circumstances existing on or prior to such Closing Date. For the
avoidance of doubt and without limiting the generality of the foregoing, Elan
shall maintain all rights and remain responsible for all obligations and
liabilities under the License Agreement with respect to Products sold by Elan
(or its Affiliates, sublicensees and marketing, promotion or distribution
partners) on or prior to the Closing Date, and Buyer shall have all rights and
be responsible for all obligations and liabilities under the License Agreement
with respect to Products sold by Buyer (or its Affiliates, sublicensees and
marketing, promotion or distribution partners) on or after the Closing Date.
Without limiting the generality of the foregoing, and notwithstanding anything
to the contrary contained herein, Elan shall be responsible for and entitled to
(i) the indemnification provided under Section 9 of the license
Agreement (arising from events occurring or circumstances existing on or prior
to the Closing Date) and (ii) the rights and obligations provided under the
confidentiality provisions in Section 4 of the License Agreement.

 

b.                                      Any
provisions of the License Agreement that (a) are not expressly assigned to
or assumed by Buyer herein and (b) are necessary (as determined by Buyer)
for the exercise of rights assigned to Buyer hereunder or the performance of
obligations assumed by Buyer hereunder shall be deemed to have been assigned to
or assumed by Buyer, as applicable, and to be in full force and effect, in each
case to the extent necessary to exercise or enforce such rights or perform such
obligations.

 

c.                                       The
parties hereby acknowledge and agree that all references in the License
Agreement to “Sandoz Pharma Ltd.” or “Sandoz Pharma” shall be deemed to be
references to Novartis.

 

d.                                      The
parties hereby acknowledge and agree that in connection with the Closing and
the assignment being made hereunder, Elan may transfer to Buyer all Know-How
and other information and materials related to Products and/or

 

2

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

Improvements furnished to
Elan by Novartis under Section 3.1 of the License Agreement or otherwise.

 

e.                                       Section 1.11
of the License Agreement shall be deleted and replaced in its entirety by the
following:

 

“1.11 “Territory”
means the United States of America, its territories and possessions and the
Commonwealth of Puerto Rico.”

 

f.                                         The
parties hereby acknowledge and agree that the five-year period beginning on the
first commercial sale of a Product (as specified in Section 5.1.4 of the License
Agreement) has elapsed, and that as such the royalty payable to Novartis
relating to sales of Product by Buyer (or its affiliates or licensees) pursuant
to Section 5.1.5 of the License Agreement shall be [***] of Net Sales (for
the avoidance of doubt, as such term is defined in the License Agreement as
amended hereby) in the Territory of any formulation of Product, whether now
existing or to be developed in the future, for the term of the License
Agreement.

 

g.                                      The
parties hereby acknowledge and agree that (i) Elan has developed a
microparticulate capsule formulation of Product (the “MPC Formulation”), (ii) for
the avoidance of doubt the term “Purchase Requirements” as used in the License
Agreement does not apply to the supply by Novartis of the MPC Formulation, (iii) Elan
shall have a worldwide, perpetual, royalty-free license, with the right to
sublicense, to use all rights in technology (including without limitation the
Compound and all Improvements) necessary to manufacture the MPC Formulation, to
develop improvements to its processes and methods of manufacturing the MPC
Formulation and to sell the MPC Formulation to Buyer, its sublicensees and
affiliates, (iv) Elan shall have no liability or obligation, contractual
or otherwise, to Novartis as a result of any past development, manufacture or
testing of the MPC Formulation or the sale by Elan to Buyer of its inventory of
MPC Formulation existing as of the Closing Date and (v) notwithstanding
anything to the contrary contained in the License Agreement, Novartis shall not
be entitled to any royalty or other compensation from Elan in connection with
sales of the MPC Formulation by Elan to Buyer from and after the Closing Date;
provided, however, the parties acknowledge and agree that the MPC Formulation
constitutes an Improvement developed by Elan, and nothing in this subclause (g) or
elsewhere in this Agreement is intended to diminish the rights of Novartis to
such Improvement provided under Section 12 of the License Agreement or
elsewhere.

 

h.                                      [***]

 

i.                                          The
parties hereby acknowledge and agree that Elan has fully complied with all of
the obligations contained in Sections 2.2 and 7.1 of the License Agreement and,
as a result, as of the Closing Date the provisions of Sections 2.2 and 7.1 of
the

 

3

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

License Agreement
granting to Novartis certain rights relating to the Product in the Territory
have been fully satisfied and do not apply to Buyer.

 

j.                                          Section 7.6
and 7.7 of the License Agreement shall be deleted and replaced in its entirety
by the following:

 

“7.6
Prior to the execution of the Supply Agreements, Novartis shall supply Zanaflex
Tablets to Buyer and Compound to Elan at the following prices (the “Interim
Supply Prices”):

 

	
  Product

  	
   

  	
  Price (US$)

  	
   

  
	
  2 mg Zanaflex
  Tablet

  	
   

  	
  [***]

  	
   

  
	
  4 mg Zanaflex
  Tablet

  	
   

  	
  [***]

  	
   

  
	
  Compound

  	
   

  	
  [***]

  	
   

  

 

These Interim Supply Prices may be adjusted by
Novartis before the Supply Agreements have been executed; provided that such
adjusted Interim Supply Prices shall not be effective until Buyer (with respect
to Zanaflex Tablets) or Elan (with respect to Compound) have been notified of
such adjustments in writing; and, provided, further, that increases to such
Interim Supply Prices shall be limited to the percentage increase in the Swiss
consumer price index, as compared to the most recent price adjustment. The
Supply Agreements shall stipulate price and price changes, if any, for the
terms of the Supply Agreements.

 

k.                                       Article 8
is amended by the addition of the following Section 8.3:

 

“8.3        The
provisions of Sections 8.1 and 8.2 shall not apply to any materials previously
approved by Novartis that are changed solely to add the name of a sublicensee
and/or delete the name of Licensee.”

 

l.                                          The
parties hereby acknowledge and agree that the term of the License Agreement as
determined pursuant to Section 14.1 shall expire on February 28, 2007.

 

m.                                    Any
notices to be sent to Buyer pursuant to the notice provisions of the License
Agreement shall be sent to Buyer as follows:

 

Acorda Therapeutics

15 Skyline Drive 

Hawthorne, NY 10532 

Facsimile: 914-347-4560 

Attention: General Counsel; and

 

4

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

any notices to be sent to Novartis pursuant to the
notice provisions of the License Agreement shall be sent to Novartis as
follows:

 

Novartis Pharma AG

Lichtstrasse 35

4002 Basel 

Swizerland

Attention: Manager, BD&L Mature Products

Facsimile: 41 61 324 2322.

 

3.             Each party hereto
agrees, upon the reasonable request of any other party hereto, and at the
expense of the requesting party, to make, execute and deliver any or all
documents or instruments of any kind or character, and to perform all such
other actions, that may be necessary or proper and reasonable to effectuate,
confirm, perform or carry out the terms and provisions of this Agreement.

 

4.             By its execution
below, Novartis consents to the assignment to Buyer of the rights and the assumption
by Buyer of the related obligations and liabilities under the License
Agreement, as set forth in Section 1 above, and as provided in Section 18
of the License Agreement, and agrees to the other terms and conditions
contained in this Agreement.

 

5.             Capitalized terms
used herein and not otherwise defined in this Agreement shall have the meanings
assigned to such terms in the License Agreement, as amended herein.

 

6.             This Agreement shall
in all respects be construed in accordance with and governed by the laws of the
State of New York without giving effect to its conflicts-of-laws principles.

 

7.             This Agreement may be
executed in any number of counterparts and by facsimile and by different
parties hereto in separate counterparts, and each of which when so executed
shall be deemed to be an original and all of which taken together shall
constitute one and the same Agreement.

 

[SIGNATURE PAGE TO FOLLOW]

 

5

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

IN WITNESS WHEREOF, the
parties have executed this Agreement as of the day and year first written
above.

 

	
  ACORDA
  THERAPEUTICS, INC. (on behalf of itself and its affiliates)

  
	
  By:

  
	
  Name:

  
	
  Title:

  
	
   

  
	
   

  
	
  ELAN
  PHARMACEUTICALS, INC. (on behalf of itself and its affiliates)

  
	
  By:

  
	
  Name:

  
	
  Title:

  
	
   

  
	
   

  
	
  NOVARTIS PHARMA
  AG (on behalf of itself and its affiliates)

  
	
  By:

  	
  /s/

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
  Peter B. Hewes

  
	
  Title:

  	
  Mature Products
  BU

  
	
   

  	
  WSJ-210.211

  
	
   

  	
  Tel. 47225

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Sheyenne
  Scriven-Jin

  
	
  Title:

  	
  Senior Legal
  Counsel

  
	
   

  	
  Transplantation
  and

  
	
   

  	
  Mature Products

  
						

 

 

Certain portions of this Exhibit have been
omitted pursuant to a request for confidentiality.  Such omitted portions, which are marked with
brackets [   ] and an asterisk*, have
been separately filed with the Commission.

 

 

IN WITNESS WHEREOF, the
parties have executed this Agreement as of the day and year first written
above.

 

	
  ACORDA
  THERAPEUTICS, INC. (on behalf of itself and its affiliates)

  
	
  By:

  
	
  Name:

  
	
  Title:

  
	
   

  
	
   

  
	
  ELAN
  PHARMACEUTICALS, INC. (on behalf of itself and its affiliates)

  
	
  By:

  	
  /s/

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Jack Laflin

  
	
  Title:

  	
  Executive Vice
  President,

  
	
   

  	
  Global Core
  Services

  
	
   

  
	
   

  
	
  NOVARTIS PHARMA
  AG (on behalf of itself and its affiliates)

  
	
  By:

  	
   

  
	
  Name:

  	
   

  
	
  Title:

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