EXHIBIT
10.2
DISTRIBUTION
AGREEMENT
This Exclusive
License Agreement (hereinafter called the Agreement”) to be
effective as of the 20th day of November, 2001 (hereinafter called
“Agreement Date”) is by and between Syntho
Pharmaceuticals, Inc. (the “MAKER”), a profit
corporation having its principal place of business at 230 Sherwood
Avenue, Farmingdale, NY 11735 and Medi-Hut Co., Inc., a corporation
organized under the laws of Delaware and having a principal place
of business at 1935 Swarthmore Avenue, Lakewood, New Jersey 08701,
and its Affiliates (hereinafter, collectively referred to as the
“DISTRIBUTOR.”)
WITNESSETH:
WHEREAS, MAKER
shall manufacture the Subject Technology as defined in paragraph
1.1 below and incorporated herein by reference; and
WHEREAS, MAKER
is willing to grant exclusive distribution rights to the Subject
Technology to DISTRIBUTOR on the terms set forth herein;
and
WHEREAS,
DISTRIBUTOR desires to obtain said exclusive distribution rights
for the Subject Technology.
NOW, THEREFORE,
for and in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties hereto expressly agree as
follows:
1. DEFINITIONS
AS USED HEREIN
1.1. The term
“Subject Technology” shall mean know-how, methods,
documents, materials, tests, all improvements thereto, and all
confidential information pertaining to a Generic Hormone Therapy
Replacement Drug which is being developed and manufactured by
Maker.
1.2. The term
“Product(s)” shall mean all products that incorporate.
utilize or are made with the use of the Subject
Technology.
1.3. The term
“Territory” shall mean the United States of America.
including the District of Columbia.
1.4. The term
“Affiliates” shall mean any corporation, partnership,
joint venture or other entity of which the common stock or other
equity ownership thereof is ten percent (10%) or more owned by
DISTRIBUTOR.
1.5. The term
“the Parties” shall mean MAKER and
DISTRIBUTOR.
2. GRANT OF
EXCLUSIVE DISTRIBUTION RIGHTS
2.1. MAKER hereby
grants to DISTRIBUTOR an exclusive right to use, market, sell and
offer for sale the Products in the Territory.
2.2. The grant in
Section 2.1 shall be further subject to, restricted by and
non-exclusive with respect to:
(i) the use of
the Products by MAKER for non-commercial research: and
(ii)
the use of the Products by the MAKER
thereof for non-commercial research purposes at academic or
research institutions.
DISTRIBUTOR
shall use reasonable efforts, as defined herein, to effect the sale
of Products in commercial markets in the Territory as soon as
practicable. Such efforts shall include and be conditioned upon,
but not be limited to, the successful conclusion of stability
studies by MAKER for the subject technology. DISTRIBUTOR shall
commence sales of the Products In December 2001. DISTRIBUTOR
estimates that net sales of the Products from initiation of sales
through the end of a 12 month period should total twenty five
million dollars ($25,000,000). The parties shall adjust this
projection and modify the provisions herein accordingly to be
determined by market conditions (i.e. competition, brand
aggressiveness).
4.1. As partial
consideration for the rights conveyed by MAKER under this
Agreement, DISTRIBUTOR shall pay to MAKER a fee of Nine Hundred
Thousand Dollars ($900,000.00).
4.2. In addition
to the foregoing fees, DISTRIBUTOR agrees to purchase from MAKER
the Products for a price and schedule to be determined by the
parties.
4.3. Should
DISTRIBUTOR fail to make any payment whatsoever due and payable to
MAKER hereunder, MAKER may, at its sole option, terminate this
Agreement as provided in Paragraph 7.2.
4.4. All payments
due hereunder are expressed in and shall be paid by check or bank
wire payable in United States of America currency, without
deduction of exchange, collection or other charges, to MAKER or to
the account of MAKER at such other bank as MAKER may from time to
time designate by notice to DISTRIBUTOR.
4.5. In the event
that any payment due is not made when due, the payment shall accrue
interest beginning on the tenth day following the due date thereof,
calculated at the annual rate of the sum of (a) three percent (3%)
plus (b) the prime interest rate quoted by The Wall Street Journal
on the date said payment is due, the interest being compounded on
the last day of each calendar quarter, provided, however, that in
no event shall said annual interest rate exceed the maximum legal
interest rate for corporations. Each such payment when made shall
be accompanied by all interest so accrued. Said interest and the
payment and acceptance thereof shall not negate or waive the right
of MAKER to seek any other remedy, legal or equitable, to which it
may be entitled because of the delinquency of any
payment.
5. PATENTS AND
INFRINGEMENT
5.1. MAKER agrees
to keep DISTRIBUTOR fully informed, at MAKER’s expense, of
prosecutions pursuant to this Section 5 including submitting to
DISTRIBUTOR copies of all official actions and responses thereto;
provided, however, DISTRIBUTOR shall be responsible for any of its
expenses including attorney’s fees that DISTRIBUTOR incurs in
reviewing and commenting on the information DISTRIBUTOR received
from the MAKER. MAKER shall consult DISTRIBUTOR regarding any
abandonment of the prosecution of the patents.
5.2. DISTRIBUTOR
agrees to reasonably cooperate with MAKER to whatever extent is
reasonably necessary to procure patent protection of any rights,
including fully agreeing to execute any and all documents to
provide MAKER the full benefit of the licenses granted
herein.
5.3. Neither
DISTRIBUTOR nor MAKER shall settle any action covered by Paragraph
5.2 without first obtaining the consent of the other Party, which
consent will not be unreasonably withheld.
5.4. MAKER shall
not be liable for any losses incurred as the result of an action
for Infringement brought against DISTRIBUTOR as the result of
DISTRIBUTOR’s exercise of any right granted under this
Agreement. The decision to defend or not defend shall be in
MAKER’s sole discretion.
6. PROPRIETARY
INFORMATION
“Proprietary Information” as used
herein shall mean all or any portion of only the: (a) written,
recorded, graphical or other information in tangible form disclosed
during the term of this Agreement, by one party to the other party
which is labeled
“Proprietary,”“Confidential,” or with a
similar legend denoting the proprietary interest therein of the
disclosing party; (b) oral information which is disclosed by one
party to the other party to the extent it is identified as
“Proprietary” or “Confidential” at the time
of oral disclosure, is reduced to written or other tangible form
within thirty (30) days of oral disclosure, and such written or
tangible form is labeled
“Propriety,”“Confidential,” or with a
similar legend denoting the proprietary interest therein of the
disclosing party; and (c) models and other devices delivered or
disclosed, during the Term of this Agreement, by one party to the
other party which have been identified in writing at the time of
disclosure as being proprietary to the disclosing party; and
provided further, however, Proprietary Information shall not
include any data, information or device that is: (i) in the
possession of the receiving party prior to its disclosure by the
disclosing party and not subject to other restrictions on
disclosure; (ii) independently developed by the receiving party;
(iii) publicly disclosed by the disclosing party; (iv) rightfully
received by the receiving party from a third party without
restrictions on disclosure; (v) approved for unrestricted release
or unrestricted disclosure by the disclosing party; or (vi)
produced or disclosed pursuant to applicable laws, regulations or
court order, provided the receiving party has given the disclosing
party prompt notice of such request so that the disclosing party
has an opportunity to defend, limit or protect such production or
disclosure. DISTRIBUTOR shall have no technological access to
MAKER’S original formula and/or manufacturing operational
technique.
DISTRIBUTOR may
use MAKER’S trademarks only in accordance with MAKER’S
then current published specifications relating to the use thereof
on products of equivalent product quality to those normally bearing
MAKER’S trademarks. DISTRIBUTOR reserves the right to, at its
sole discretion, periodically review and monitor
DISTRIBUTOR’S use of MAKER’S marks for proper trademark
usage, quality of goods, and other criteria as may be required by
law to preserve DISTRIBUTOR’S rights, good will,
