Exhibit 10.24

 

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

CONFIDENTIAL

 

DEVELOPMENT, COMMERCIALIZATION AND EXCLUSIVE DISTRIBUTION AGREEMENT

 

THIS DEVELOPMENT, COMMERCIALIZATION AND EXCLUSIVE DISTRIBUTION AGREEMENT is made
as of May 10, 2018 (the "Effective Date"), between Seraph Biosciences, Inc., a
Delaware corporation with its principal place of business at 1449 Woodward
Avenue, #2-108, Detroit, Michigan 48226 ("Seraph") and Zomedica Pharmaceuticals
Corp., a corporation organized pursuant to the laws of Alberta, Canada, having
offices at 100 Phoenix Drive, Suite 190, Ann Arbor, Michigan 48108 ("Zomedica").

 

Background

 

WHEREAS, Seraph has developed certain technology and owns or controls certain
intellectual property relating to its Seraspec® hardware platform and associated
software (the "Seraspec Platform"), and the consumables developed by Seraph and
used in conjunction with the Seraspec Platform (the "Seraspec Consumables"); and

 

WHEREAS, Seraph has received a license from Wayne State University to certain
patents and technology related to the detection and identification of certain
protein based compounds which are included in the Seraspec Technology (as
hereinafter defined); and

 

WHEREAS, Zomedica is a veterinary pharmaceutical and health care solutions
company creating innovative products for companion animals (canine, feline and
equine) including veterinary-approved drugs, novel drug-delivery technologies
and diagnostics, and which has expertise and know-how in developing products for
applications in the veterinary field; and

 

WHEREAS, the Parties desire to establish a collaboration for the development and
validation of a Seraspec® Platform device and Seraspec Consumables carrying a
Zomedica brand (the "Product"), for use in the Zomedica Field of Use (as defined
below) in the Territory (as defined below), upon the terms and conditions set
forth in this Agreement.

 

NOW THEREFORE, in consideration of the foregoing and the covenants and promises
contained herein, the Parties agree as follows:

 

Terms and Conditions

 

1.                  Definitions.

 

(a)               "Affiliate" means, with respect to a Person, any Person that
controls, is controlled by or is under common control with such first Person.
For the purposes of this definition only, "control" means (i) to possess,
directly or indirectly, the power to direct the management or policies of a
Person, whether through ownership of voting securities, by contract relating to
voting rights or corporate governance or otherwise; or (ii) to own, directly or
indirectly, fifty percent (50%) or more of the outstanding securities or other
ownership interest of such Person.

 

 

(b)               "Agreement" means this Development, Commercialization and
Exclusive Distribution Agreement.

 

(c)                "Bankrupt Party" has the meaning set forth in Section 11(f)
of this Agreement.

 

(d)               "Basic Purchase Order Terms" means, collectively, any one or
more of the following terms specified by Zomedica in a Purchase Order pursuant
to Section 4(d): (i) an itemized list of the Seraspec Platforms and Seraspec
Consumables to be purchased; (ii) the quantity of each ordered; (iii) the
requested delivery date; (iv) the Supply Price for each item to be purchased;
(v) the billing address; and (vi) the delivery location. For the avoidance of
doubt, the term "Basic Purchase Order Terms" does not include any general terms
or conditions of any Purchase Order.

 

(e)                "Change in Control" means: (i) any merger, amalgamation,
consolidation or other similar business combination transaction of a Party with
or into any third party Person (other than for the purpose of changing the name
or the jurisdiction of organization of the Party) in which the shareholders of
the Party immediately prior to the transaction cease to own at least 50% of the
outstanding voting power of the Party or the Person surviving such transaction;
(ii) the acquisition, directly or indirectly, by any Person and such Person's
Affiliates (other than, in the case of Zomedica, Gerald A. Solensky, Jr., his
Affiliates, and his heirs and legal representatives) of the power to direct or
cause the direction of the management and policies of a Party, whether through
the ownership of voting securities, by contract or otherwise, including, without
limitation, the direct or indirect acquisition of 50% or more of the outstanding
voting power of a Party; and (iii) the sale, lease, exclusive license or other
transfer by a Party of all or substantially all of the assets of a Party to any
third party Person, in one or a series of related transactions. "Change in
Control" shall not include any Change in Control required by a government or the
requirements of applicable law, or a transaction or series of transactions
principally undertaken for bona fide equity financing purposes.

 

(f)                "Commercially Reasonable Efforts" of a Party means, with
respect to an obligation of a Party to accomplish an objective under this
Agreement, the efforts and resources comparable to those undertaken by a
veterinary pharmaceutical company of comparable size and resources in the case
of Zomedica or a biotechnology company of comparable size and resources in the
case of Seraph, in either case, relating to the research, development or
commercialization of a similar product owned by such company, or to which such
company has exclusive rights, with comparable market potential and is at a
similar stage in its lifecycle. For this purpose, all relevant factors, as
measured by the facts and circumstances at the time such efforts are due, shall
be taken into account, including, as applicable and without limitation, stage of
development; efficacy and safety relative to competitive products in the
marketplace; actual or anticipated regulatory approval; labeling; the nature and
extent of market exclusivity (including patent coverage, proprietary position
and regulatory exclusivity), product pricing and reimbursement; and the cost and
time required for and likelihood of obtaining regulatory approval and
commercializing a product.

 

2

 

(g)               "Competitor" means an entity primarily engaged in the same or
similar business as a Party.

 

(h)               "Confidential Information" means information, materials, data
and results, in whatever form, that the disclosing Party (the "Disclosing
Party") considers secret and/or valuable proprietary information, including,
without limitation, proprietary technical, process, operational, business,
financial and other trade secret information and know-how and sample materials
related to their respective businesses. Confidential Information shall not,
however, include any information which the receiving Party (the "Receiving
Party") can demonstrate with competent proof: (i) was publicly known and made
generally available in the public domain prior to the time of disclosure by the
Disclosing Party; (ii) becomes publicly known and made generally available after
disclosure by the Disclosing Party to the Receiving Party through no misconduct
of the Receiving Party; (iii) is already in the possession of the Receiving
Party without confidentiality obligations at the time of disclosure by the
Disclosing Party as shown by the Receiving Party’s contemporaneous records; (iv)
is obtained by the Receiving Party from a third party without a breach of such
third party’s obligations of confidentiality; or (v) is independently developed
by the Receiving Party without use of or reference to the Confidential
Information of the Disclosing Party.

 

(i)                 "Cost of Purchase" means Seraph's actual cost to purchase
the Seraspec Platform or the Seraspec Consumables, as the case may be, from its
suppliers.

 

(j)                 "Development Costs" means all development, validation and
other pre-market costs incurred in connection with the execution of the
Development Plan and as set forth in the Statements of Work, including without
limitation, the costs of the proof of concept studies and clinical validation
studies, and the research and validation costs incurred by Seraph identified in
the Statements of Work. Development Costs shall be based on a full accounting of
development and validation costs described in the applicable Statement of Work,
including reimbursements and payments made by Zomedica to Seraph, and shall be
agreed upon by the Parties prior to commercialization.

 

(k)               "Development Data and Documentation" means all data and
documentation produced in the course of the Parties' activities under this
Agreement, but excluding Veterinary-Specific Data and Documentation, including
without limitation, data and documentation relating to the following items: (i)
verification and validation protocols and data collection standards; (ii)
Pathogen-Specific Data and Documentation; (iii) limits of detection verification
results; and (iv) negative control verification results (confounding
pathogens/pseudo pathogens).

 

(l)                 "Development Plan" has the meaning set forth in Section 3(a)
of this Agreement.

 

(m)               "Effective Date" has the meaning set forth in the introductory
paragraph of this Agreement.

 

(n)               "Event of Bankruptcy" means (i) the filing, with any court or
agency pursuant to any statute or regulation of any state or country of, (1) a
petition in bankruptcy or insolvency, (2) for reorganization or (3) for the
appointment of (or for an arrangement for the appointment of) a receiver or
trustee of the Bankrupt Party or of its asset; (ii) with respect to the Bankrupt
Party, being served with an involuntary petition filed in any insolvency
proceeding, which such petition is not dismissed within sixty (60) days after
the filing thereof; (iii) proposing or being party to any dissolution or
liquidation when insolvent; or (iv) making an assignment for the benefit of
creditors.

 

3

 

(o)               "Excess Gross Profit" has the meaning set forth in Section
5(g) of this Agreement.

 

(p)               "Extended Service Plans" has the meaning set forth in Section
4(f)(ii) of this Agreement.

 

(q)               "Fecal Test" means veterinary fecal specimen testing.

 

(r)                "Final Period" has the meaning set forth in Section 5(e)(iv)
of this Agreement.

 

(s)                "First Commercial Shipment" means the first commercial
shipment of either the Seraspec Platform or the Seraspec Consumables under this
Agreement to an unrelated third party in the Territory for end use or
consumption, excluding shipments, transfers or dispositions of the Seraspec
Platform or Seraspec Consumables without consideration for (i) charitable or
promotional purposes; (ii) for preclinical or clinical validation studies; (iii)
for test marketing or pre-launch field testing with veterinarians or other
potential customers; or (iv) for use in any tests or studies reasonably
necessary to comply with applicable laws, regulations or requests from any
regulatory authorities.

 

(t)                 "First Milestone Shares" has the meaning set forth in
Section 5(b) of this Agreement.

 

(u)               "First Tier Customer Support" means selling, installation,
user training, software use support, lab support, interface questions, operation
of equipment, billing, collections and similar activities relating primarily to
the customer.

 

(v)               "GAAP" means generally accepted accounting principles in the
United States set forth in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or
such other principles as may be approved by a significant segment of the
accounting profession in the United States, that are applicable to the
circumstances as of the date of determination, consistently applied.

 

(w)             "Grace Period" has the meaning set forth in Section 5(h) of this
Agreement.

 

(x)               "Initial Payment" has the meaning set forth in Section 5(a) of
this Agreement.

 

(y)               "Initial Period" has the meaning set forth in Section 5(e)(i)
of this Agreement.

 

(z)               "Initial Shares" has the meaning set forth in Section 5(a) of
this Agreement.

 

(aa)             "Initial Tests" means the Urine Test and the Fecal Test.

 

4

 

(bb)          "Initial Warranty Period" has the meaning set forth in Section
4(f)(i) of this Agreement.

 

(cc)            "Intellectual Property" means any and all rights in, arising out
of, or associated with any of the following in any jurisdiction throughout the
world: (i) issued patents and patent applications (whether provisional or
non-provisional), including divisionals, continuations, continuations-in-part,
substitutions, reissues, reexaminations, extensions, or restorations of any of
the foregoing, and other governmental authority-issued indicia of invention
ownership (including certificates of invention, petty patents, and patent
utility models); (ii) trademarks, service marks, brands, certification marks,
logos, trade dress, trade names, and other similar indicia of source or origin,
together with the goodwill connected with the use of and symbolized by, and all
registrations, applications for registration, and renewals of, any of the
foregoing; (iii) copyrights and works of authorship, whether or not
copyrightable, and all registrations, applications for registration, and
renewals of any of the foregoing; (iv) trade secrets, know-how, inventions
(whether or not patentable), discoveries, improvements, technology, business and
technical information, databases, data compilations and collections, tools,
methods, processes, techniques, and other confidential and proprietary
information and all rights therein; and (v) all other intellectual or industrial
property and proprietary rights.

 

(dd)          "Joint Intellectual Property" has the meaning set forth in Section
7(a)(ii) of this Agreement.

 

(ee)            "Joint Patents" has the meaning set forth in Section 7(b) of
this Agreement.

 

(ff)            "Know-How" means any and all technical information, trade
secrets, formulas, prototypes, specifications, directions, instructions, test
protocols, procedures, results, studies, analyses, raw material sources, data,
manufacturing data, formulation or production technology, conceptions, ideas,
innovations, discoveries, inventions, processes, methods, materials, machines,
devices, formulae, equipment, enhancements, modifications, technological
developments, techniques, systems, tools, designs, drawings, plans, software,
documentation, data, programs and other knowledge, information, skills and
materials

 

(gg)           "License Fees" has the meaning set forth in Section 5(e) of this
Agreement.

 

(hh)           "Licensed Know-How" means any and all Know-How that is controlled
by Seraph and necessary for the commercialization, use, practice, marketing,
sale and distribution of the Product.

 

(ii)            "Licensed Patents" means the patents and patent applications
listed on Exhibit A, attached hereto, together with all patents that issue
therefrom, and all continuations, continuations-in-part, divisionals,
extensions, substitutions, re-issues, re-examinations, and renewals of any of
the foregoing.

 

(jj)             "Milestone Payments" has the meaning set forth in Section 5(b)
of this Agreement.

 

(kk)           "Minimum Performance Level" has the meaning set forth in Section
6(b) of this Agreement.

 

5

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

 

(ll)              "Non-Bankrupt Party" has the meaning set forth in Section
11(f) of this Agreement.

 

(mm)          "Offer" has the meaning set forth in Section 2(f) of this
Agreement.

 

(nn)           "Party" means each of Seraph or Zomedica, and "Parties" means
Seraph and Zomedica collectively.

 

(oo)           "Patent Proceedings" means any opposition, re-issue, and
re-examination, and any contested case, including inter-partes review,
post-grant review, interference, derivation or similar proceedings.

 

(pp)           "Pathogen-Specific Data and Documentation" means data and
documentation produced in the course of the Parties' activities under this
Agreement relating to: (i) pathogen specific spectral signatures in isolation;
and (ii) pathogen specific spectral signatures in confounded sample.

 

(qq)          "Person" means an individual, sole proprietorship, partnership,
limited partnership, limited liability partnership, corporation, limited
liability company, business trust, joint stock company, trust unincorporated
association, joint venture or other similar entity or organization, including a
government or political subdivision, department or agency of a government.

 

(rr)            "Post Term Period" has the meaning set forth in Section 11(g).

 

(ss)             "Product" has the meaning set forth in the Background Section
of this Agreement.

 

(tt)             "Production Unit" means a Seraspec Platform with applicable UL
(or other) certification as appropriate or required by applicable laws for use
or sale to companion animal veterinarians to validate the proficiency of
production manufacturing capabilities.

 

(uu)          "Project Intellectual Property" has the meaning set forth in
Section 7(a)(iii) of this Agreement.

 

(vv)           "Purchase Order" has the meaning set forth in Section 4(d)(ii) of
this Agreement.

 

(ww)          "Quarterly Forecast" has the meaning set forth in Section 4(d)(i)
of this Agreement.

 

(xx)            [*]

 

(yy)            "Sales Forecast" has the meaning set forth in Section 6(a) of
this Agreement.

 

6

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

 

(zz)            "Second Milestone Shares" has the meaning set forth in Section
5(b) of this Agreement.

 

(aaa)          "Second Period" has the meaning set forth in Section 5(e)(ii) of
this Agreement.

 

(bbb)         "Second Tier Customer Support" means addressing technical
questions that were not able to be addressed by Zomedica in First Tier Customer
Support, product warranty, hardware calibration and similar activities relating
primarily to the Seraspec Technology and not included in First Tier Customer
Support.

 

(ccc)           "Seraspec Consumables" has the meaning set forth in the
Background Section of this Agreement.

 

(ddd)         "Seraspec Platform" has the meaning set forth in the Background
Section of this Agreement.

 

(eee)           "Seraspec Technology" means the Seraspec Platform, the Seraspec
Consumables, Licensed Patents and the Licensed Know-How. In the interest of
clarity, except to the extent such technology is Joint Intellectual Property,
the Seraspec Technology includes (i) methods for detecting pathogens using
Ramen-based spectroscopic analysis; and (ii) any spectral signatures which are
developed under this Agreement.

 

(fff)              [*]

 

(ggg)           "Supply Interruption" has the meaning set forth in Section 6(c).

 

(hhh)           "Supply Price" has the meaning set forth in Section 4(c).

 

(iii)             "Statement of Work" means a document executed by the Parties
establishing the Parties' specific duties and responsibilities, and associated
deliverables, timelines and milestones, with respect to the development and
validation of the Product for use in the Zomedica Field of Use.

 

(jjj)             "Term" has the meaning set forth in Section 11(a) of this
Agreement.

 

(kkk)          "Territory" means the entire world.

 

(lll)             "Third Milestone Shares" has the meaning set forth in Section
5(b) of this Agreement.

 

(mmm)       "Third Period" has the meaning set forth in Section 5(e)(iii) of
this Agreement.

 

(nnn)           "Urine Test" means veterinary urine specimen testing.

 

(ooo)           "Veterinary Market" means the practice of veterinary medicine
for the health and wellbeing of pets and other animals. In the interest of
clarity, the Veterinary Market does not include (i) food safety or animal
product or byproduct applications; (ii) animal import/export control
applications; or (iii) any human health applications.

 

7

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

 

(ppp)      "Veterinary-Specific Data and Documentation" means data and
documentation produced in the course of the Parties' activities under this
Agreement relating to the following items: (i) veterinary clinical validation of
Seraspec® results from third party laboratories; (ii) veterinary clinical
validation gold standard reference laboratory diagnostic results; (iii)
veterinary clinical validation veterinary personal health information for
patients; and (iv) veterinary clinical validation reports.

 

(qqq)      "Warehousing Location" means for the period of [*] following the
First Commercial Shipment, the manufacturer's onsite warehouse, and for all
periods thereafter, a warehouse selected by Zomedica.

 

(rrr)         "WSU License Agreement" has the meaning set forth in Section 2(b)
of this Agreement.

 

(sss)          "Zomedica Field of Use" means the following applications within
the Veterinary Market: (i) the Urine Test; (ii) the Fecal Test; [*].

 

(ttt)           "Zomedica Gross Profit" means with respect to any Statement of
Work, an amount equal to the Zomedica Net Sales of the Seraspec Platforms and
Seraspec Consumables under such Statement of Work, less the total Supply Price
for the Seraspec Platforms and Seraspec Consumables under such Statement of
Work. Notwithstanding the foregoing, Zomedica Gross Profits shall not be deemed
to be less than zero (i.e., in the event Zomedica sells any Seraspec Platform or
Seraspec Consumable at a loss to Zomedica, the Zomedica Gross Profits
attributable to such sale will be deemed to be zero).

 

(lll)            "Zomedica Net Sales" means the gross amount invoiced for sales
or other dispositions of the Seraspec Platforms and Seraspec Consumables by
Zomedica, less the following deductions actually incurred, allowed, paid,
accrued or otherwise specifically allocated to the Seraspec Platforms and
Seraspec Consumables by Zomedica, all in compliance with GAAP, consistently
applied by Zomedica:

 

(a)       normal and customary trade discounts, including trade, cash and
quantity discounts or rebates credits or refunds, actually allowed or taken;

 

(b)       credits or allowances actually granted or made for rejection of or
return of previously sold Seraspec Platforms and Seraspec Consumables, including
recalls, or for retroactive price reductions and billing errors or for stocking
allowances;

 

(c)       other rebates (or credits or other equivalents thereof) actually
granted to trade customers;

 

(d)      reasonable fees paid to wholesalers, distributors, selling agents
(excluding sales representatives of Zomedica), in each case with respect to the
Seraspec Platforms and Seraspec Consumables;

 

8

 

(e)       charges separately invoiced for freight, insurance, transportation,
postage and handling;

 

(f)       bad debts or provision for bad debt deductions actually written off
during the applicable accounting period following the applicable accounting
standards used by Zomedica; and

 

(g)       taxes, custom duties or other governmental charges (including any tax,
such as a value added or similar tax or government charge, but excluding what is
commonly known as income tax) levied on or measured by the billing amount for
Seraspec Platforms and Seraspec Consumables, as adjusted for rebates and
refunds.

 

2.                  License.

 

(a)               License Grant. Subject to the terms and conditions set forth
in this Agreement, Seraph hereby grants to Zomedica during the Term and Post
Term Period, an exclusive (other than during the Post Term Period or as
otherwise expressly set forth herein) license to the Seraspec Technology, with
the right to sublicense solely as provided in Section 2(c), to use, practice,
commercialize, market, sell and distribute the Product for use in the Zomedica
Field of Use in the Territory. Zomedica shall not, and shall not permit any of
its Affiliates to, use or practice any Seraspec Technology outside the scope of
the license granted to it in this Section 2(a). Seraph hereby expressly retains
for itself and others exclusive rights under the Seraspec Technology to
manufacture the Seraspec Platform and the Seraspec Consumables.

 

(b)               Wayne State University Sublicense Terms. Certain of the
Seraspec Technology is licensed to Seraph by Wayne State University ("WSU")
pursuant to that certain License Agreement between Seraph and WSU dated July 2,
2015, as amended (the "WSU License Agreement"), and the rights granted to
Zomedica in this Agreement includes sublicenses under the rights licensed to
Seraph under the WSU License Agreement. As such, Zomedica agrees to be bound by
those certain provisions from the WSU License Agreement, a copy of which has
previously been provided by Seraph.

 

(c)                Sublicensing. Zomedica shall have the right to grant
sublicenses of the licenses set forth in Section 2(a), subject to the terms of
this Section 2(c) and with the prior written approval of Seraph, which will not
be unreasonably withheld or delayed; provided that (i) Zomedica remains fully
liable for the performance of its obligations in this Agreement; (ii) Zomedica
remains fully liable for the performance of its sublicensees under any
sublicense agreement; and (iii) each sublicense agreement is consistent with the
terms and conditions of this Agreement. Zomedica shall notify Seraph in writing
of every sublicense agreement and amendment thereto within thirty (30) days
after their execution.

 

9

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

 

(d)               Seraph Retained Rights. The licenses granted by Seraph under
this Agreement are limited to those grants specifically set forth in Sections
2(a), 3(d)(ii) and 7(a)(ii). Nothing in this Agreement will be construed to
grant any rights or licenses to any other intellectual property rights of Seraph
other than as provided herein. All rights, licenses, benefits and privileges not
expressly granted to Zomedica hereunder are reserved by Seraph. For the
avoidance of doubt, Seraph shall retain all ownership rights in the Seraspec
Technology subject to the terms of this Agreement.

 

(e)                Exclusivity. As partial consideration for the grant of rights
set forth in Section 2(a) and provided that Seraph is not in breach of its
material obligations under this Agreement, Zomedica agrees that during the Term
of this Agreement, it and its Affiliates shall not, in any country in the
Territory which the Product has been commercialized, directly or indirectly
market, distribute or sell any in-clinic or point of care technology or product
that directly competes with the Product actually developed and commercialized by
Zomedica hereunder in the Zomedica Field of Use.

 

(f)                Right of First Offer. If at any time during the Term of this
Agreement Seraph intends to offer the right to market, distribute or sell the
Seraspec Technology for use outside the Zomedica Field of Use but within the
Veterinary Market or Seraph intends to engage in a Change in Control, Seraph
must first make a written offer to Zomedica to negotiate and enter into a
business relationship or Change in Control upon the substantially the same terms
that Seraph intends to offer to a third party (the "Offer"). With the Offer,
Seraph will provide Zomedica all information available to Seraph with respect to
the Offer. Within [*] of Zomedica's receipt of the Offer from Seraph, Zomedica
shall notify Seraph that it either accepts the terms of the Offer or that it
rejects the Offer. In the case of acceptance of the Offer, the contract for the
business relationship or Change in Control shall be closed within [*] following
such acceptance, or such other period as the Parties may mutually agree.

 

3.                  Development and Validation.

 

(a)               Development Plan. The Parties shall jointly undertake
activities to develop and validate the Seraspec Technology for use in the
Zomedica Field of Use pursuant to the activities set forth in the Statements of
Work (the "Development Plan"). Each Statement of Work under this Agreement will
be issued in writing and will be effective when signed by an authorized
representative of each of the Parties. No Statement of Work may be amended,
modified, changed or supplemented except by a writing signed by an authorized
representative of each of the Parties. Each Statement of Work will reference and
incorporate the terms of this Agreement. The terms and conditions of this
Agreement apply to any and all Statements of Work executed by the Parties that
reference this Agreement, and all such Statements of Work will be governed by
the terms and conditions of this Agreement. The initial Statement of Work,
addressing the development and validation activities related to the Initial
Tests is attached hereto as Exhibit B. One or more subsequent Statements of Work
will address the development and validation activities related to [*], and will
be established by the Parties following the Effective Date.

 

10

 

(b)               Efforts. Each Party will use its Commercially Reasonable
Efforts, including devoting sufficient time, attention and qualified personnel,
to meet the delivery dates for any deliverables and complete other matters
agreed to in the Development Plan. The Parties will provide each other with such
technical support relating to the development and validation of the Product for
use in the Zomedica Field of Use in accordance with the Development Plan as
reasonably necessary for the Parties to execute the Development Plan. The
Parties acknowledge that in connection with the Development Plan, each of the
Parties may need access to certain Confidential Information of the other Party
and that such Confidential Information will be subject to the confidentiality
provisions set forth in Section 8 hereof. Each Party agrees to notify the other
promptly of any factor, occurrence, or event coming to its attention that may
have a material negative effect on that Party’s ability to meet the requirements
of the Development Plan generally, or that is likely to cause any material delay
in the delivery of deliverables. Upon receipt of such notice the parties shall
discuss in good faith the responsibility for such delays and determine who shall
bear the cost of such delay of failure to meet the requirements of the
Development Plan.

 

(c)                Development Costs. Zomedica will be responsible for and bear
all Development Costs, and shall compensate Seraph for any of its Development
Costs in accordance with the amounts set forth in the applicable Statement of
Work. With respect to Development Costs incurred by Seraph under a Statement of
Work, Seraph shall invoice Zomedica on a monthly basis for such costs, and
Zomedica will pay such invoices within forty-five (45) days of receipt. Zomedica
shall promptly notify Seraph if the Development Costs exceed or are reasonably
likely to exceed the budgeted costs set forth in the applicable Statement of
Work.

 

(d)               Records and Reports.

 

(i)                 Each Party shall maintain complete, current and accurate
records of all activities undertaken by such Party pursuant to the Development
Plan, including without limitation, all data, Know-How and patents resulting
from such work, and all Development Costs incurred in connection therewith. The
Parties will report the results of the Development Plan to each other informally
on a regular basis. In addition, by the end of calendar months December and June
of each year, Zomedica shall provide written reports to Seraph on its activities
under the Development Plan in a form reasonably acceptable to the Parties,
detailing (i) all of the work conducted by Zomedica during the previous six (6)
months; (ii) all data, Know-How and patents resulting from such work during the
previous six (6) months; and (iii) all Development Costs incurred in connection
therewith during the previous six (6) months.

 

(ii)               All rights, title and interest in and to all Development Data
and Documentation shall be owned by Seraph. Zomedica hereby assigns all rights,
title and interest in and to such Development Data and Documentation to Seraph,
and Zomedica shall execute such documents and perform such acts as may be
necessary to vest title thereto in Seraph. Seraph shall provide Zomedica a copy
of all such Development Data and Documentation, and hereby grants Zomedica a
perpetual, irrevocable, royalty-free, worldwide exclusive license to use the
Development Data and Documentation, but excluding the Pathogen-Specific Data and
Documentation, in the Zomedica Field of Use. Seraph hereby grants Zomedica
during the Term and Post Term Period a royalty-free, worldwide exclusive license
to use the Pathogen-Specific Data and Documentation in the Zomedica Field of
Use. The Development Data and Documentation shall constitute Seraph's
Confidential Information, and Seraph shall be deemed to be the Disclosing Party
with respect thereto.

 

11

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

 

(iii)             All rights, title and interest in and to all
Veterinary-Specific Data and Documentation shall be owned by Zomedica. Seraph
hereby assigns all rights, title and interest in and to such Veterinary-Specific
Data and Documentation to Zomedica, and Seraph shall execute such documents and
perform such acts as may be necessary to vest title thereto in Zomedica.
Zomedica shall provide Seraph a copy of all such Veterinary-Specific Data and
Documentation, and hereby grants Seraph a perpetual, irrevocable, royalty-free,
worldwide exclusive license to use such Veterinary-Specific Data and
Documentation outside the Zomedica Field of Use. Veterinary-Specific Data and
Documentation shall constitute Zomedica's Confidential Information, and Zomedica
shall be deemed to be the Disclosing Party with respect thereto.

 

4.Commercial Activities.

 

(a)               Distribution Rights. Subject to the terms and conditions set
forth in this Agreement, including without limitation the minimum performance
objectives set forth in Section 6, Seraph hereby appoints Zomedica as its
exclusive (even as to Seraph, and other than during the Post Term Period or
otherwise as expressly set forth herein) distributor to market and promote sales
of the Product for use in the Zomedica Field of Use in the Territory, and
Zomedica hereby accepts such appointment and agrees to act as such distributor.
Zomedica may appoint dealers or sub-distributors to distribute, market and sell
the Product for use in the Zomedica Field of Use in the Territory.

 

(b)               Manufacture and Supply. Seraph shall manufacture or have
manufactured, and shall supply the Seraspec Platforms and Seraspec Consumables
to Zomedica and its customers according to the terms and conditions of this
Agreement, and on an exclusive basis in the Zomedica Field of Use. Seraph shall
at all times maintain and cause any third party manufacturers or suppliers to
maintain sufficient capacity to meet the Quarterly Forecast provided by
Zomedica. In the interest of clarity, Seraph shall have the exclusive right and
obligation to manufacture and package the Seraspec Platforms and Seraspec
Consumables for all purposes both inside and outside the Zomedica Field of Use.

 

(c)                Prices.

 

(i)                 Zomedica shall purchase the Seraspec Platforms and Seraspec
Consumables from Seraph at the following prices (the "Supply Price"):

 

(1)               Zomedica shall purchase the Seraspec Platforms from Seraph at
a price equal to the Cost of Purchase for such Seraspec Platform, plus [*]; and

 

12

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

 

(ii)               Zomedica shall purchase the Seraspec Consumables from Seraph
at a price equal to the Cost of Purchase for such Seraspec Consumables, plus
[*]. During the Term, on a calendar quarter basis, Seraph shall provide Zomedica
with an accounting of its Cost of Purchase for the Seraspec Platforms and
Seraspec Consumables (broken out by Statement of Work) at the beginning of each
calendar quarter, which accounting shall be used in the calculation of the
Supply Price for the quarter.

 

(d)               Forecasts; Ordering.

 

(i)                 During the Term and the Post Term Period, on a
calendar-quarter basis, Zomedica shall submit to Seraph a rolling twelve-month
forecast for the purchase of the Seraspec Platform and the Seraspec Consumables
(the "Quarterly Forecast"). The Quarterly Forecast shall be non-binding and
shall reflect Zomedica's good faith estimates of expected orders of the Seraspec
Platform and the Seraspec Consumables. The Quarterly Forecasts are for
informational purposes only and do not create any binding obligations on behalf
of either Party; provided, however, that Seraph shall not be required to
manufacture and sell to Zomedica any quantity of Seraspec Platforms or Seraspec
Consumables that is greater than [*] of any Quarterly Forecast for the period
covered by such Quarterly Forecast.

 

(ii)               Zomedica shall issue purchase orders containing applicable
terms that are consistent with the terms of this Agreement to Seraph ("Purchase
Orders"), in written form via e-mail or US mail. By issuing a Purchase Order to
Seraph, Zomedica makes an offer to purchase Seraspec Platforms and/or Seraspec
Consumables pursuant to the terms and conditions of this Agreement and the Basic
Purchase Order Terms contained in such Purchase Order, and on no other terms.
For the avoidance of doubt, any variations made to the terms and conditions of
this Agreement by Zomedica in any Purchase Order are void and have no effect.
Upon receipt of the Purchase Order, Seraph shall issue Zomedica an invoice
setting forth the Supply Price for the Seraspec Platforms and Seraspec
Consumables subject to such Purchase Order. Zomedica shall pay each invoice
within [*] following delivery of the Seraspec Platforms and/or Seraspec
Consumables and receipt of an invoice.

 

(iii)             Seraph shall deliver the Seraspec Platforms and Seraspec
Consumables specified in each Purchase Order, EX Works (Incoterms 2010)
Warehousing Location within [*] from Seraph's receipt of the Purchase Order;
provided, however, that the quantity of Seraspec Platforms and Seraspec
Consumables specified in such Purchase Agreement are not greater than [*] of the
Quarterly Forecast. In all other cases, Seraph shall deliver the Seraspec
Platforms and Seraspec Consumables as promptly as reasonably possible following
Seraph's receipt of the Purchase Order. In the interest of clarity, Zomedica
shall be responsible for shipment of all Seraspec Platforms and Seraspec
Consumables from the Warehousing Location to the end customers at its own
expense.

 

(iv)             Until the first anniversary of the First Commercial Shipment,
all costs associated with the warehousing of the Seraspec Platforms and Seraspec
Consumables at the Warehousing Location shall be borne by Seraph. Following the
first anniversary of the First Commercial Shipment, all costs associated with
the warehousing of the Seraspec Platforms and Seraspec Consumables at the
Warehousing Location shall be borne by Zomedica.

 

13

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

 

(e)                Quality Audit.

 

(i)                 Seraph shall use Commercially Reasonable Efforts to ensure
the quality of the Seraspec Platforms and Seraspec Consumables prior to
shipment. Seraph represents and warrants that all Seraspec Platforms and
Seraspec Consumables shipped under this Agreement shall be manufactured to
quality standards at least as exacting as those required for Seraph's sales into
markets outside the Zomedica Field of Use and in compliance with all applicable
laws, rules and regulations; provided, however, that Zomedica shall inform
Seraph of any applicable laws, rules and regulations that are specific to the
Zomedica Field of Use. In addition, the Parties shall mutually agree upon
specific manufacturing quality requirements on an as-needed basis for specific
regions in the Territory, or as required by applicable regulatory or market
requirements in the Zomedica Field of Use.

 

(ii)               Seraph or its manufacturer shall maintain inspection and
other relevant manufacturing records with respect to the Seraspec Platforms and
Seraspec Consumables ordered and shipped under this Agreement. The relevant
types of records to be maintained shall be listed in Exhibit F, as amended from
time to time. Seraph shall provide, or shall cause its manufacturer to provide,
Zomedica with such inspection reports and records upon Zomedica's request.
Zomedica shall have the right to carry out, not more than once per calendar
year, and upon reasonable prior notice quality, capacity and manufacturing
audits of Seraph and its manufacturers used for the manufacture of the Seraspec
Platforms and Seraspec Consumables subject to this Agreement.

 

(f)                Warranty.

 

(i)                 Seraph warrants to Zomedica and its end customers that, for
a period of [*] following Zomedica's acceptance of a Seraspec Platform (the
"Initial Warranty Period"), that the Seraspec Platform will be free from
material defects in material and workmanship. The limited warranty in this
Section 4(f) does not apply where the Seraspec Platform has:

 

(1)               been subjected to abuse, misuse, neglect, negligence,
accident, improper testing, improper installation, improper storage, improper
handling, abnormal physical stress, abnormal environmental conditions or use
contrary to any instructions issued by Seraph;

 

14

 

(2)               been reconstructed, repaired or altered by persons other than
Seraph or its authorized representatives; or

 

(3)               been used with any third-party product, hardware or product
that has not been previously approved in writing by Seraph.

 

(ii)               Zomedica and Seraph may mutually agree to offer extended
service plans for the Seraspec Platforms beyond the Initial Warranty Period to
Zomedica customers for purchase (the "Extended Service Plans"). The Extended
Service Plans will include warranty, repair and customer service levels
substantially similar to those afforded during the Initial Warranty Period. At
least 45 days prior to the anticipated date of First Commercial Shipment, the
parties will negotiate in good faith the terms under which Seraph shall sell to
Zomedica the Extended Service Plan, in accordance with the Customer Service
Requirements and Warranty Guidelines attached hereto as Exhibit E, which
Zomedica can then resell to Zomedica’s customers at such price determined by
Zomedica in its sole and absolute discretion. In the event such Extended Service
Plans are instituted and purchased by a Zomedica customer, the provisions of
this Section 4(f) shall apply to any Seraspec Platforms subject to such Extended
Service Plans.

 

(iii)             During the Initial Warranty Period, or during term of the
Extended Service Plan, if applicable, and after conducting all applicable First
Tier Customer Support related to such alleged claim or defect, Zomedica shall
promptly notify Seraph, in writing, of any alleged claim or defect in the
Seraspec Platform. Seraph shall then provide all applicable Second Tier Customer
Support related to such alleged claim or defect.

 

(iv)             In the event Seraph is not able to rectify the alleged claim or
defect through the Second Tier Customer Support, Seraph shall ship, at its
expense and risk of loss, a new or refurbished Seraspec Platform directly to
such customer, and the customer shall, at its expense and risk of loss, send
such allegedly defective Seraspec Platform to Seraph's facility.

 

(v)               Neither Zomedica nor its customers have any right to return
for repair, replacement, credit or refund any Seraspec Platforms except as set
forth in this Section 4(f). In no event shall Zomedica reconstruct, repair,
alter or replace any Seraspec Platforms, in whole or in part, either itself or
by or through any third party.

 

(vi)             EXCEPT FOR THE WARRANTY SET FORTH IN THIS SECTION 4(F), SERAPH
MAKES NO WARRANTY WHATSOEVER WITH RESPECT TO THE SERASPEC PLATFORMS OR SERASPEC
CONSUMABLES, INCLUDING ANY (A) WARRANTY OF MERCHANTABILITY; (B) WARRANTY OF
FITNESS FOR A PARTICULAR PURPOSE; (C) WARRANTY OF TITLE; OR (D) WARRANTY AGAINST
INFRINGEMENT OF INTELLECTUAL PROPERTY RIGHTS OF A THIRD PARTY; WHETHER EXPRESS
OR IMPLIED BY LAW, COURSE OF DEALING, COURSE OF PERFORMANCE, USAGE OF TRADE OR
OTHERWISE. THIS SECTION SETS FORTH ZOMEDICA'S AND ITS CUSTOMERS' SOLE REMEDY AND
SERAPH'S ENTIRE LIABILITY FOR ANY BREACH OF THE LIMITED WARRANTY SET FORTH IN
SECTION 4(F).

 

15

 

(g)               Branding. Zomedica shall provide branding for the Seraspec
Platforms and Seraspec Consumables to be provided under this Agreement and shall
bear all costs related to Zomedica branding of the Product. The Seraspec
Platforms and Seraspec Consumables will also display Seraph's brand, and
Zomedica will not alter or remove such branding.

 

(h)               Marketing, Sales & Customer Support.

 

(i)                Zomedica shall be solely responsible for commercialization
and marketing of the Seraspec Technology in the Zomedica Field of Use, and in
furtherance thereof, shall be solely responsible for providing First-Tier
Customer Support related to the Seraspec Technology in the Zomedica Field of
Use.

 

(ii)               Seraph shall be solely responsible for all Second-Tier
Customer Support related to the Seraspec Technology in the Zomedica Field of
Use.

 

(iii)             The Parties shall share responsibility for post-market
surveillance of the Seraspec Technology in the Zomedica Field of Use, including
without limitation gathering call data, repair and replacement data, customer
feedback and other relevant information in the course of providing the
First-Tier Customer Support and the Second-Tier Customer Support. Each Party
will share with the other Party all such information and data gathered from such
surveillance.

 

(i)                 Regulatory. Zomedica shall, at its own expense, be solely
responsible for all regulatory activities, including without limitation, any
required regulatory approvals, if any, related to the use of the Seraspec
Technology solely within the Zomedica Field of Use, or related to Zomedica's
activities under this Agreement. Seraph shall, at its own expense, be solely
responsible for all regulatory activities related to the manufacture and use of
the Seraspec Technology that relate to uses both inside and outside the Zomedica
Field of Use.

 

5.Compensation.

 

(a)               Upfront Payment. As partial consideration for the rights
granted to Zomedica herein, Zomedica shall pay to Seraph, on the Effective Date,
an initial payment of One Million Seven Hundred Fifty Thousand Dollars
($1,750,000) (the "Initial Payment"). The Initial Payment shall be paid as
follows: (i) Five Hundred Thousand Dollars ($500,000) in cash in immediately
available funds; and (ii) the issuance, in accordance with Section 5(c), of that
number of shares of Zomedica's common stock determined by dividing One Million
Two Hundred Fifty Thousand Dollars ($1,250,000) by the volume-weighted average
price of Zomedica's shares of common stock on the NYSE American exchange over
the ten (10) trading days prior to the Effective Date (the "Initial Shares").

 

16

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

 

(b)               Milestone Payments. As partial consideration for the rights
granted to Zomedica herein, Zomedica shall make the following payments to Seraph
upon the achievement of the following milestone events (the "Milestone
Payments"):

 

Milestone Event Milestone Amount Form of Payment [*] $500,000 Cash in
immediately available funds [*] $500,000 Cash in immediately available funds [*]
$2,000,000 The issuance in accordance with Section 5(c) of that number of shares
of Zomedica common stock determined by dividing $2,000,000 by the
volume-weighted average price of Zomedica stock on the NYSE American exchange
over the ten (10) trading days prior to achievement of the milestone event (the
"First Milestone Shares").   [*] $1,250,000 Cash in immediately available funds
[*] $750,000 The issuance in accordance with Section 5(c) of that number of
shares of Zomedica common stock determined by dividing $750,000 by the
volume-weighted average price of Zomedica stock on the NYSE American exchange
over the ten (10) trading days prior to achievement of the milestone event (the
"Second Milestone Shares").   [*] $1,250,000 Cash in immediately available funds
[*] $750,000 The issuance in accordance with Section 5(c) of that number of
shares of Zomedica common stock determined by dividing $750,000 by the
volume-weighted average price of Zomedica stock on the NYSE American exchange
over the ten (10) trading days prior to achievement of the milestone event (the
"Third Milestone Shares").

 

17

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

 

(c)                Registration of Securities. The securities to be issued
pursuant to this Agreement have not been registered under the Securities Act of
1933, as amended, or state securities laws and may not be offered or sold in the
United States absent registration with the Securities and Exchange Commission or
an applicable exemption from such registration requirements. Notwithstanding the
foregoing, Zomedica shall file a registration statement to register the
securities issued pursuant to this Agreement for resale in the United States,
including the Initial Shares, the First Milestone Shares, the Second Milestone
Shares and the Third Milestone Shares, in the time and manner as set forth in
Exhibit D attached hereto and incorporated herein by this reference and perform
certain other covenants as set forth in such Exhibit D.

 

(d)               Calculation and Payment of License Fees. Following the First
Commercial Shipment, on a calendar quarter basis, Zomedica shall provide Seraph
with an accounting of the Zomedica Gross Profit for the Seraspec Platforms and
Seraspec Consumables (broken out by test) at the end of each calendar quarter,
which accounting shall be used in the calculation of the License Fee for such
quarter. Zomedica shall pay Seraph the License Fees within [*] following the end
of the calendar quarter in which such License Fees were earned.

 

(e)                License Fees. As partial consideration for the rights granted
to Zomedica herein, Zomedica shall pay Seraph the license fees identified in
this Section 5(e) (the "License Fees") with respect to each Statement of Work.

 

(i)                 For the first [*] months following the First Commercial
Shipment under such Statement of Work (the "Initial Period"), Zomedica shall pay
Seraph a License Fee equal to [*] of the Zomedica Gross Profit on the sale of
the Seraspec Consumables and Seraspec Platforms under such Statement of Work.
The following sections notwithstanding, the Initial Period shall last for no
less than 12 months;

 

(ii)               Beginning in the [*] month following the First Commercial
Shipment under such Statement of Work and until the beginning of the Third
Period (the "Second Period"), Zomedica shall pay Seraph a License Fee equal to
[*] of the Zomedica Gross Profit on the sale of the Seraspec Consumables and
Seraspec Platforms under such Statement of Work;

 

(iii)             Beginning in the first month after Zomedica has recouped the
entirety of the Development Costs associated with such Statement of Work (as
contemplated in Section 5(g)) and until the beginning of the Final Period (the
"Third Period") but not less than [*] months following the First Commercial
Shipment, Zomedica shall pay Seraph a License Fee equal to [*] of the Zomedica
Gross Profit on the sale of the Seraspec Consumables and Seraspec Platforms
under such Statement of Work; and

 

18

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

 

(iv)             Beginning in the first month following the [*] year anniversary
of the First Commercial Shipment under each Statement of Work (the "Final
Period"), Zomedica shall pay Seraph a License Fee equal to [*] of the Zomedica
Gross Profit on the sale of the Seraspec Consumables and Seraspec Platforms
under such Statement of Work.

 

(f)                Sublicense Fees under WSU Agreement. Seraph shall be
responsible for paying the Sublicense Fees (as defined in the WSU Agreement)
owed to WSU under the WSU Agreement during the Term of the WSU Agreement.

 

(g)               Zomedica Recovery of Development Costs. The graduated schedule
of License Fees set forth in Section 5(e) is intended to allow Zomedica to
recover its Development Costs relating to each Statement of Work. During the
Initial Period and the Second Period, any Zomedica Gross Profit retained by
Zomedica, which is in excess of the amount would be retained by Zomedica if the
License Fee from the Final Period were applied to the Zomedica Gross Profit
during that period, (the "Excess Gross Profit") shall be applied toward recovery
of the Development Costs attributable to such Statement of Work.

 

(i)                 By way of example, and not limitation, with respect to any
specific Statement of Work, if Zomedica Gross Profit during the Initial Period
were $2,000,000, the application of such Zomedica Gross Profit to the recovery
of the Development Costs shall be calculated as follows:

 

Zomedica Gross Profit actually retained by Zomedica during the Initial Period =
($2,000,000 * [*]%) = [*]

 

Zomedica Gross Profit that would be retained by Zomedica if License Fees from
Final Period were applied = ($2,000,000 * [*]%) = [*]

 

Excess Gross Profit applied to recoupment of Development Costs = [*]

 

(ii)               In the interest of clarity, the Initial Payment and the
Milestone Payments are not subject to any recovery by Zomedica of the
Development Costs and the application of Excess Gross Profit toward the recovery
of Development Costs shall be specific to each Statement of Work (i.e., Zomedica
Gross Profit relating to the sale of Seraspec Consumables for the Initial Tests
will not be subject to cost recovery by Zomedica of Development Costs
attributable to subsequent Statements of Work).

 

(h)               Licensee Fee Reduction for Supply Interruption. In the event
of a Supply Interruption, as that term is defined in Section 6(c), Seraph shall
have 60 days to cure the Supply Interruption without penalty by completing final
delivery of all then-ordered Products according to Section 4(d)(iii) (the "Grace
Period"). If a Supply Interruption occurs and is not wholly cured and all such
Products delivered within 60 days, then for any Seraspec Platforms or Seraspec
Consumables which were the subject of the Supply Interruption, and which have
not been delivered within the 60 days, the License Fees payable to Seraph under
Section 5(e) with respect to those Seraspec Platform and Seraspec Consumable
units will be reduced by [*]. Any additional Zomedica Gross Profit retained by
Zomedica as a result of Supply Interruptions that extend beyond the Grace Period
shall not apply toward the recovery of Zomedica’s Development Costs under
Section 5(g).

 

19

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

 

(i)                 True-Up. Within ninety (90) days of the end of each year,
Zomedica shall provide an accounting of Zomedica Net Sales for that year,
inclusive of any delayed or volume based rebates not reflected on the date of
sale. If the License Fees which would be payable under this end-year accounting
differ from the Licensee Fees actually paid during that year, the Party which
has benefited from any such discrepancy shall remit the cash amount of the
License Fee discrepancy to the other Party within ninety (90) days.

 

(j)                 Records and Audit. Each Party shall maintain the usual books
of account and records accounting for its activities under this Agreement.
During the Term and the Post Term Period and for one (1) year thereafter, upon
reasonable notice and at the sole expense of the requesting party, but no more
than once per calendar year, such books and records shall be open to inspection
and copying by an independent certified public account acceptable to the other
party, for the purpose of verifying the accuracy of the amounts paid under this
Agreement. In the event that such review shows an error of five percent (5%) or
more in either Party's favor, the difference, together with interest on past due
amounts at a rate of [*] per annum, and reimbursement for the expense of such
audit, if applicable, shall be paid to the deficient Party.

 

6.Performance Metrics; Competitors; Claw-Back of Rights.

 

(a)               Zomedica shall use its Commercially Reasonable Efforts to
market, distribute and sell the Seraspec Technology in the Zomedica Field of
Use, including without limitation, timely invoicing customers and collecting
revenues for such sales, and purchasing Product in accordance with the following
sales forecast (the "Sales Forecast"):

 

  Months [*] following First Commercial Shipment Months [*] following First
Commercial Shipment Months [*] following First Commercial Shipment Seraspec
Platform [*] [*] [*] Seraspec Consumables [*] [*] [*]

 

20

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

 

(b)               In the event that Zomedica fails to purchase at least [*]% of
the Sales Forecast for any period referenced in the table above (the "Minimum
Performance Level"), and provided that Seraph is not in default of any of its
material commercial obligations under this Agreement, including but not limited
to the obligation to supply such quantities of Seraspec Platform and Seraspec
Consumables set forth in the Purchase Orders, [*]

 

(i)                [*]

 

(ii)               [*]

 

(c)                In the event that Seraph materially fails to meet its supply
obligations – including those enumerated in Section 4(d)(iii) – at any time when
the Minimum Performance Levels apply (a "Supply Interruption"), then in such
case the Minimum Performance Levels shall be suspended during the Supply
Interruption and for an additional period equal to twice the length of the
Supply Interruption (the "Interruption Period"). To that end, both the period
referenced in the table in Section 6(a) during which such Supply Interruption
occurred and the Term shall each be extended by an amount of time commensurate
with the Interruption Period.

 

By way of example, and not limitation, if a Supply Interruption lasts 1 month,
the Interruption Period would be equal to 3 months (1 month plus 2 months (i.e.,
twice the length of the Supply Interruption)) and the Period in which the Supply
Interruption occurred and the Term would each be extended by 3 months.
Consequently Zomedica would have 3 additional months to meet the Minimum
Performance Level for the relevant Period, and the Term would be extended to
account for such additional 3 months (e.g., from 7 years to 7 years and 3
months, assuming this was the first Supply Interruption).

 

(d)               Notwithstanding the foregoing, in the event that Seraph and
Zomedica mutually agree that a competitive Raman spectroscopy solution is
brought to market in the Zomedica Field of Use, and the pricing of the Seraspec
Technology to Zomedica customers must be adjusted as a direct response, the
Minimum Performance Level shall be [*]% of the Sales Forecast.

 

(e)                In the event that Zomedica fails to have a reasonable
commercial sales force in place at least [*] prior to the anticipated First
Commercial Shipment, Seraph may, in its sole discretion, [*].

 

(f)                The Parties understand and agree that the forecasts herein
are based on launch of a commercial Product that is capable of detecting the
pathogens identified in the first Statement of Work to this agreement. If,
during the course of the development activities outlined in the Statement of
Work, Zomedica determines that the first commercial Product will differ in its
capabilities from these original expectations, the Parties agree to meet in good
faith and amend the forecasts to account for these differences.

 

7.Intellectual Property.

 

(a)               Ownership.

 

(i)                 The Parties hereby acknowledge and agree that each Party
retains all right, title and interest in and to the Intellectual Property of
such Party owned or independently developed by such Party prior to the Effective
Date. Except as expressly set forth herein, neither Party grants to the other
Party pursuant to this Agreement, any rights or licenses under the Intellectual
Property owned by such Party or its Affiliates.

 

21

 

(ii)               All Intellectual Property that is jointly made, discovered,
conceived, reduced to practice or developed by Seraph and Zomedica under this
Agreement and which relates only to veterinary patient care ("Joint Intellectual
Property") shall be jointly owned by Seraph and Zomedica. Seraph hereby grants
to Zomedica an irrevocable royalty-free, worldwide exclusive right and license
to Seraph's interest in such Joint Intellectual Property to use such Joint
Intellectual Property in the Zomedica Field of Use. Zomedica hereby grants to
Seraph an irrevocable, royalty-free, worldwide exclusive right and license to
Zomedica's interest in such Joint Intellectual Property to use such Joint
Intellectual Property for all purposes outside the Zomedica Field of Use. The
licenses granted in this Section 7(a)(ii) shall survive the termination or
expiration of this Agreement.

 

(iii)             The Parties hereby agree that all Intellectual Property made,
discovered, conceived, reduced to practice or developed under this Agreement
that is not Joint Intellectual Property ("Project Intellectual Property") shall
be owned solely by Seraph. Zomedica agrees to assign and hereby does assign all
of its right, title and interest in and to all Project Intellectual Property to
Seraph. Any such Intellectual Property shall be considered Seraspec Technology
and shall be subject to the license granted to Zomedica under this Agreement.
The Parties agree to execute all necessary documents in a reasonable and prompt
manner to effectuate the foregoing assignment.

 

(b)               Prosecution and Maintenance of Joint Intellectual Property.

 

(i)                 Zomedica shall have the exclusive right and (subject to
Zomedica's election not to file, prosecute, or maintain or conduct Patent
Proceedings pursuant to this Section 7(b)) at Zomedica's cost, obligation to
diligently file, prosecute and maintain patents relating to Joint Intellectual
Property ("Joint Patents"), and to conduct any Patent Proceedings with respect
thereto. Zomedica may elect not to file, prosecute or maintain the Joint
Patents, or conduct any Patent Proceedings with respect thereto, and may cease
prosecution or maintenance thereof or any Patent Proceeding with respect
thereto, in each case on a country-by-country basis, by providing Seraph with
advance written notice. If Zomedica so elects by advance written notice, Seraph,
at its sole discretion and expense, may take such actions to the extent Seraph
so elects, but Seraph shall notify Zomedica in writing at least ten (10) days
before taking any such action. If Seraph elects to take such actions as
permitted pursuant to this Section 7(b), Zomedica shall execute such documents
and perform such acts as may be reasonably necessary to allow Seraph to file,
initiate or continue such prosecution or maintenance in any such country.

 

(ii)               During the Term:

 

(1)               Zomedica shall keep Seraph advised on at least a quarterly
basis of the status of all actual and prospective Joint Patents;

 

22

 

(2)               Zomedica shall provide advance copies of any material papers
related to the filing, prosecution and maintenance of Joint Patents;

 

(3)               Zomedica shall promptly, but in any case within thirty (30)
days of learning of such event, give notice to Seraph of the grant, lapse,
revocation, surrender, invalidation or abandonment of any Joint Patents; and

 

(4)               Zomedica shall solicit Seraph's advice and review of the
nature and text of such patent applications and important prosecution matters
related thereto in reasonably sufficient time prior to filing thereof, provided
Zomedica shall not have any obligation with respect to Seraph's comments related
thereto.

 

(iii)             If Seraph notifies Zomedica that it wishes Zomedica to file
and prosecute a Joint Patent, or to conduct any Patent Proceeding with respect
thereto, Zomedica shall undertake such activities in such countries and/or
conduct such proceedings at Seraph's expense.

 

(c)                Interference, Opposition, Re-examination and Re-issue.

 

(i)                 During the Term, Zomedica shall promptly, but in any case
within thirty (30) days of learning of such event, inform Seraph of any request
for or declaration of any interference, opposition or re-examination relating to
a Joint Patent. Zomedica shall provide Seraph with written notice as soon as
practicable prior to initiating any re-examination, interference or re-issue
proceeding relating to the Joint Patents. The Parties shall thereafter consult
and cooperate fully to determine a course of action with respect to any such
proceeding. Seraph shall have the right to review any submission to be made in
connection with such proceeding.

 

(ii)               In connection with any Patent Proceeding relating to Joint
Patents, the Parties shall cooperate fully and shall provide each other with any
information or assistance that either may reasonably request, each at its own
expense. Zomedica shall keep Seraph informed of developments in any such action
or proceeding, including, to the extent permissible by law, consultation
regarding any settlement, the status of any settlement negotiations and the
terms of any offer related thereto.

 

(iii)             Zomedica shall be responsible for any out-of-pocket expenses
related to any Patent Proceeding with respect to any Joint Patent.

 

(d)               Enforcement. Each Party shall promptly advise the other in
writing of any known acts of actual or potential infringement of the Seraspec
Technology in the Zomedica Field of Use. Zomedica shall use Commercially
Reasonable Efforts to identify actual or potential infringing activities within
the Zomedica Field of Use. Zomedica shall use Commercially Reasonable Efforts to
cause any infringing party to cease and desist infringing activities at
Zomedica's sole expense; provided that Zomedica shall not initiate or defend any
formal action, except as contemplated by Section 7(d)(ii).

 

23

 

(i)                 Enforcement by Seraph.

 

(1)               To the extent that an issued, unexpired claim in the Licensed
Patents covers the Seraspec Technology, Seraph has the first option to police
the Licensed Patents against infringement by other parties in the Zomedica Field
of Use, but Seraph shall notify Zomedica in writing at least ten (10) days
before filing any suit. The right to police includes defending any action for
declaratory judgment of non-infringement or invalidity; and prosecuting,
defending or settling all infringement and declaratory judgment actions at its
expense and through counsel of its selection. Zomedica shall provide reasonable
assistance to Seraph with respect to such actions, and Seraph shall reimburse
Zomedica for the reasonable out of pocket expenses incurred in connection with
any such assistance rendered at Seraph's request or reasonably required by
Seraph. Zomedica retains the right to participate, with counsel of its own
choosing and at its own expense, in any action under this Section 7(d)(i).

 

(2)               Seraph shall defend, indemnify and hold harmless Zomedica with
respect to any counterclaims asserted by an alleged infringer reasonably related
to the enforcement of the Licensed Patents under this Section 7(d)(i),
including, without limitation, antitrust counterclaims; provided, however that
Seraph shall have no obligation to defend, indemnify or hold Zomedica harmless
with respect to any such counterclaim that arises from Zomedica's gross
negligence or willful misconduct. If Seraph undertakes to enforce and/or defend
the Licensed Patents by litigation, Seraph shall pay all costs thereof and shall
be entitled to all damages recovered in any such litigation; provided, however,
that if Zomedica exercises its right to participate in such action with counsel
of its own choosing and at its own expense, the recovery of any such action
shall be shared by the Parties proportionately, relative to their respective
costs and expenses with respect to the action.

 

(3)               For any action relating to any infringement of Licensed
Patents under this Section 7(d)(i), if Seraph is unable to initiate or prosecute
such action solely in its own name, Zomedica shall, at Seraph's expense, join
such action voluntarily and shall execute all documents necessary for Seraph to
initiate litigation to prosecute and maintain such action. In connection with
any action, the Parties shall cooperate fully and shall provide each other with
any information or assistance that either may reasonably request. Each Party
shall keep the other informed of developments in any action or proceeding,
including, to the extent permissible by law, the consultation and approval of
any settlement negotiations and the terms of any offer related thereto.

 

(ii)             Enforcement by Zomedica. If Zomedica notifies Seraph of a
material infringement in the Zomedica Field of Use, and Seraph fails to take
action to abate any such infringement within ninety (90) days of a request by
Zomedica to do so (or within a shorter period if required to preserve the legal
rights of Zomedica under any applicable laws) then Zomedica has the right to
take such action (including, without limitation, prosecution of a suit) and
Seraph shall use reasonable efforts to cooperate in such action, including
without limitation, being named in such action if necessary for the purposes of
standing. If Zomedica undertakes to enforce and/or defend the Licensed Patents
by litigation, Zomedica shall pay all costs thereof (including reimbursement of
any costs to Seraph for its participation in the action) and shall be entitled
to all damages recovered in any such litigation; provided, however, that if
Seraph exercises its right to participate in such action with counsel of its own
choosing and at its own expense, the recovery of any such action shall be shared
by the Parties proportionately, relative to their respective costs and expenses
with respect to the action. With respect to any action by Zomedica under this
Section 7(d)(ii), Zomedica shall act in good faith to preserve the validity of
and Seraph's right, title and interest in and to the Licensed Patents, shall
keep Seraph advised as to the status of the action, and shall not enter into a
settlement without first allowing Seraph the option of either approving the
settlement or continuing the lawsuit at Seraph's expense and for Seraph's
benefit (after payment to Zomedica of its out-of-pocket and expenses of the
action incurred after the settlement is rejected).

 

24

 

8.                  Confidential Treatment. The Parties agree to maintain in
confidence and use the Confidential Information of each other Party solely for
the purpose of conducting the activities contemplated by this Agreement. Neither
Party may make any copies of the Confidential Information (whether in tangible,
intangible or electronic format) of the other Party except to the extent
required in connection with its activities under this Agreement. The Receiving
Party may not (a) use the Confidential Information of the Disclosing Party for
any commercial or non-commercial purpose or gain, other than for the purposes
set forth in this Agreement, (b) reverse engineer any of the Confidential
Information of the other Party, or (c) disclose the Confidential Information of
the other Party except to the extent reasonably necessary or appropriate to
fulfill the receiving Party’s obligations or exercise its rights under this
Agreement, under circumstances that reasonably ensure the confidentiality
thereof. Nothing contained in this Section 8 shall prevent either Party from
disclosing any Confidential Information of the other Party to the extent
reasonably necessary to comply with applicable laws, regulations or orders
(including to the extent required for the submission of regulatory filings
related to the activities contemplated by this Agreement); provided that if a
Party is required by law to make any such disclosure of the other Party’s
Confidential Information other than pursuant to a confidentiality agreement, it
will, to the extent legally permissible, give reasonable advance notice to the
other Party of such disclosure and will use its reasonable efforts to secure
confidential treatment of such Confidential Information.

 

9.                  Representations and Warranties.

 

(a)               Each Party represents and warrants that, as of the Effective
Date:

 

(i)                 it has the corporate and legal right, authority and power to
enter into this Agreement, and to extend the rights granted to the other Party
in this Agreement;

 

(ii)               it has taken all necessary action to authorize the execution,
delivery and performance of this Agreement;

 

25

 

(iii)             the performance of such Party under this Agreement will not
conflict with its charter documents or result in a breach of any agreements,
contracts or other arrangements to which it is a party; and

 

(iv)             neither Party nor any of such Party’s Affiliates has been
disbarred or is subject to debarment and neither Party nor any of such Party’s
Affiliates shall use in any capacity in connection with the services to be
performed under this agreement any person who has been debarred pursuant to
Section 306 of the Food Drug and Cosmetic Act (21 U.S.C. 335a) (the "Act") or
who is subject of a conviction described in such section. Each Party agrees to
inform the other Party in writing immediately if any person who is performing
services on behalf of such Party under this Agreement is debarred or is the
subject of a conviction described in Section 306 of the Act or if any action,
suit, claim, investigation or legal or administrative proceeding or to the
knowledge of such Party is threatened relating to the debarment or conviction of
such Party or any person performing services on behalf of such Party under this
Agreement.

 

(b)               Seraph Representations, Warranties and Covenants. In addition
to the representations and warranties made by Seraph above and elsewhere in this
Agreement, Seraph hereby represents, warrants, and covenants to Zomedica that:

 

(i)                As of the Effective Date, it has, or will have during the
Term of this Agreement, the full right, power and authority to grant to Zomedica
the licenses hereunder granted in this Agreement;

 

(ii)              As of the Effective Date, there is no suit or legal proceeding
pending or threatened in writing with respect to the Seraspec Technology and it
is has no actual knowledge or notice of any infringement of any third party
intellectual property by it that would arise in conducting the activities
contemplated by this Agreement;

 

(iii)             To the knowledge of Seraph, all Licensed Patents that have
issued are valid and enforceable.

 

(iv)             As of the Effective Date, Seraph has not entered, and during
the Term, will not enter, into any written agreement with a third party that
conflicts with the rights granted to Zomedica hereunder or Seraph’s ability to
fully perform its obligations herein;

 

(v)              Seraph has not entered into any written agreement with a third
party to conduct research with respect to the Seraspec Technology in the
Zomedica Field of Use, other than Zomedica, and Seraph is not collaborating with
any third parties, other than Zomedica, for the development of the Product in
the Zomedica Field of Use;

 

(vi)             Exhibit A accurately lists all Licensed Patents as of the
Effective Date;

 

(vii)            That other than with respect to an obligation to assign rights
to Wayne State University, its representatives contributing and conducting
activities under this Agreement on behalf of Seraph, including with respect to
the Development Plan, all have assigned and have a duty to assign their rights
and contributions with respect to any Intellectual Property developed pursuant
to this agreement to Seraph and to no other party;

 

26

 

(viii)         The WSU Agreement is valid, binding and in full force and effect
and is enforceable by Seraph in accordance with its terms. Seraph has performed
all material obligations required to be performed by it to date under the WSU
Agreement and Seraph has not received any written notice of breach under the WSU
Agreement, whether or not cured or disputed, and to Seraph's knowledge, no event
has occurred which with the passage of time or giving of notice or both would
constitute such a breach or default. There is no existing breach or default by
WSU and no event has occurred which with the passage of time or giving notice of
or both would constitute such a breach or default by WSU.

 

(ix)            Seraph will throughout the Term comply with the terms and
provisions of the WSU Agreement in all material respects, and will not knowingly
take any action that it knows or should know, will result in a breach of the WSU
Agreement. Seraph will not at any time during the Term terminate the WSU
Agreement without the prior written consent of Zomedica. Seraph will not agree
to any amendment, waiver of rights, or modification of the WSU Agreement that
would reasonably be expected to result in, or would reasonably be expected to
have, any other material negative effect or other material adverse impact on (A)
any financial or reporting obligation of Zomedica or (B) on the rights granted
to Zomedica under this Agreement or the material obligations imposed on Zomedica
under this Agreement, without the prior written consent of Zomedica. Seraph
shall pay all Sublicense Fees (as defined in the WSU Agreement) when due under
the WSU Agreement.

 

(x)             Upon Seraph's receipt of notification from WSU of Seraph's
breach of the WSU Agreement, or Seraph's notification to WSU of WSU's breach of
the WSU Agreement, and upon expiration or termination of the WSU Agreement,
Seraph shall provide notice of such breach, expiration or termination to
Zomedica within ten (10) business days in accordance with the notice provisions
set forth in this Agreement. Seraph shall further obligate its counsel to
likewise provide notice to Zomedica of any such breach, expiration or
termination of the WSU Agreement within ten (10) business days in accordance
with the notice provision set forth in this Agreement.

 

10.              Injunctive Relief. The Parties acknowledge that the
Confidential Information is both highly confidential and proprietary and have
been developed by the Parties with substantial effort and at substantial cost,
and, therefore, have value to the Parties; and that the breach of any of the
provisions of this Agreement may cause the Disclosing Party irreparable injury
for which there may be no adequate remedy at law. Accordingly, each Disclosing
Party shall have the right, in addition to any other rights it may have, to seek
specific performance or other injunctive relief to prevent or restrain the
breach of this Agreement by each Receiving Party without the necessity for the
securing or posting of any bond in connection with such remedy.

 

27

 

11.              Term and Termination.

 

(a)               Term. This Agreement shall be effective on the Effective Date
and shall extend until the seven (7) year anniversary of the First Commercial
Shipment, subject to adjustment pursuant to Sections 6(b) and 6(c) (the "Term").
The Term shall automatically renew for additional one (1) year periods, until
(i) either Party delivers written notice of such Party's intent not to renew
this Agreement provided no later than ninety (90) days prior to the end of the
then-current Term; or (ii) this Agreement is terminated pursuant to this Article
11, whichever occurs first.

 

(b)               Termination by Mutual Agreement. The Parties may terminate
this Agreement, in whole or in part, and at such time and with such effect, as
may be mutually agreed upon in writing.

 

(c)               Termination for Material Breach. Either Party may terminate
this Agreement in its entirety upon written notice to the other Party if the
other Party materially breaches its obligations under this Agreement and, after
receiving written notice identifying such material breach in reasonable detail,
fails to cure such material breach within thirty (30) days after receipt of such
notice.

 

(d)               Termination by Seraph for Patent Challenge. Seraph may
terminate this Agreement in its entirety immediately upon written notice to
Zomedica if Zomedica or its Affiliates (directly or indirectly, individually or
in association with any other person or entity) challenges the validity,
enforceability or scope of any Licensed Patent or trade secret of Seraph
anywhere in the world.

 

(e)               Termination for Change of Control. In the event either Party
undergoes a Change in Control pursuant to which the resulting entity is a
Competitor of the other Party, then such other Party may elect to terminate this
Agreement with thirty (30) days’ written notice to the Party undergoing the
Change in Control. Each Party will promptly notify the other Party in writing in
the event of a Change in Control during the Term or the Post Term Period.

 

(f)                Termination for Bankruptcy. To the extent permitted under
applicable law, if at any time during the Term of this Agreement, an Event of
Bankruptcy relating to either Party (the "Bankrupt Party") occurs, the other
Party (the "Non-Bankrupt Party") shall have, in addition to all other legal and
equitable rights and remedies available hereunder, (i) the exclusive option,
exercisable on written notice to the Bankrupt Party, to negotiate a fully
paid-up license to any intellectual property owned by the Bankrupt Party and
necessary to independently continue commercialization of the Seraspec Technology
in the Zomedica Field of Use; or (ii) the option to terminate this Agreement
upon sixty (60) days written notice to the Bankrupt Party.

 

28

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

 

(g)               Non-Exclusive Distribution Rights for the Post-Term Period.
Notwithstanding anything to the contrary, in the event of any expiration or
termination of this Agreement, Zomedica may continue to distribute, market and
promote sales of the Seraspec Consumables for use in the Zomedica Field of Use
in the Territory on a non-exclusive basis for a period of [*] from the effective
date of such expiration or termination (the "Post Term Period”). Seraph will
continue to supply the Seraspec Consumables to Zomedica during the Post Term
Period at the pricing set forth in this Agreement; in each case, subject to the
terms and conditions of this Section 11(g). All provisions of this Agreement
will continue to apply during the Post Term Period, including without limitation
the applicable License Fees set forth in Section 5(e), with the following
exceptions:

 

(i)               the license granted to Zomedica pursuant to Section 2(a) shall
automatically convert to non-exclusive during the Post Term Period;

 

(ii)              Section 2(e) ("Exclusivity") shall not apply during the Post
Term Period;

 

(iii)             Section 2(f) ("Right of First Offer") shall not apply during
the Post Term Period;

 

(iv)             the rights granted to Zomedica pursuant to Section 4(a)
("Distribution Rights") shall automatically convert to non-exclusive during the
Post Term Period, and such non-exclusive rights shall no longer be subject to
minimum performance objectives set forth in Section 6;

 

(v)               Section 6 ("Performance Metrics; Competitors, Claw-Back of
Rights") shall not apply during the Post Term Period;

 

(vi)             Section 7(d)(ii) ("Enforcement by Zomedica") shall not apply
during the Post Term Period; and

 

(vii)            Section 11(d)(ii) shall not apply during the Post Term Period.

 

(h)               Survival. Notwithstanding the foregoing, Sections 1, 3(d)(ii),
3(d)(iii), 4(e)(ii), 4(f), 4(h)(but only with respect to the obligation to
provide First Tier Customer Support and Second Tier Customer Support), 5(i),
5(j), 7, 8, 10, 11, 12, and 14-19 shall survive expiration or termination of
this Agreement. In addition, except as provided in Section 11(g), all provisions
of this Agreement shall survive the expiration or termination of this Agreement
until the end of the Post Term Period.

 

29

 

12.              Indemnification.

 

(a)               Each Party agrees to defend, indemnify and hold harmless the
other Party, their directors, officers, employees and agents from any loss,
claim, damage or liability of any kind whatsoever arising from a third party
claim, demand or cause of action against such Party seeking indemnification,
which may arise from the indemnifying Party’s breach of this Agreement or gross
negligence or willful misconduct in its performance hereunder, except to the
extent such loss, claim, damage or liability arises due to the gross negligence,
willful misconduct, or breach of this Agreement by the indemnified Party;
provided, in each case, that (i) the indemnifying Party receives prompt notice
of any such claim, demand or cause of action, (ii) the indemnifying Party shall
not be obligated to indemnify the other Party for any claim, demand or cause of
action in connection with any settlement made by the indemnified Party unless
the indemnifying Party consents in writing to such settlement, such consent not
to be unreasonably withheld, and (iii) the indemnifying Party shall have the
exclusive right to control the defense and settlement any such claim, demand or
cause of action, except that the indemnifying Party shall not settle or consent
to an adverse judgment for such claim, demand or cause of action without the
express written consent of the indemnified Party, such consent not to be
unreasonably withheld. The indemnified Party shall have the right to
participate, at its own expense and with counsel of its choice, in the defense
of any claim or suit that has been assumed by the indemnifying Party.

 

(b)               Except with respect to the willful misconduct OR GROSS
NEGLIGENCE by a Party, BREACH OF A PARTY’S OBLIGATIONS OF CONFIDENTIALITY
HEREUNDER, or FOR AMOUNTS SOUGHT BY THIRD PARTIES IN CLAIMS THAT ARE SUBJECT TO
THE PARTIES’ RESPECTIVE INDEMNITY OBLIGATIONS UNDER THIS SECTION 12, neither
Party will be liable with respect to any matter arising under this Agreement
under any contract, negligence, strict liability or other legal or equitable
theory for any punitive, exEmplAry, incidental, indirect or consequential
damages, including but not limited to, loss of business or good will, loss of
revenue or lost profits.

 

13.              Scope of Agreement. This Agreement does not constitute or
create a joint venture, partnership or agency or other cooperative relationship
between the Parties, but merely defines the rights, duties and obligations of
the Parties with respect to the activities contemplated hereby, as independent
contractors.

 

14.              Severability. If any term or provision of this Agreement, or
the application thereof to any circumstances shall, to any extent and for any
reason, be held to be invalid or unenforceable, the remainder of this Agreement,
or the application of such term or provision to circumstance other than those to
which it is held invalid or unenforceable, shall not be affected thereby and
shall be construed as if such invalid or unenforceable term or provision had
never been contained herein, and each term and provision shall be valid and
enforceable to the fullest extent permitted by law.

 

15.              Notices. Any notice required or permitted hereunder shall be
given in writing and delivered (a) personally, (b) by express courier, or (c) by
telex, facsimile or electronic mail, followed by registered or certified mail,
return receipt requested, postage prepaid, to the Party entitled thereto at the
address for such Party shown in the introductory paragraph of this Agreement.
Either Party may change such address by giving notice to the other of such
change in the manner contemplated by this Section. The return receipt, the
delivery receipt, electronic confirmation of receipt, or the affidavit of
messenger will be deemed conclusive but not exclusive evidence of delivery;
delivery will also be presumed at such time as delivery is refused by the
addressee upon presentation.

 

30

 

16.              Binding Effect. This Agreement shall inure to the benefit of
and be binding on the Parties hereto and their respective legal representatives,
successors and permitted assignees.

 

17.              Modification. This Agreement may not be modified by any Party
except by a writing executed by both Parties.

 

18.              Governing Law. This Agreement shall be governed and construed
in accordance with the laws of the State of Michigan, without giving effect to
its conflict of laws principles or rules.

 

19.              Assignment. Neither Party may assign this Agreement or its
rights and/or obligations hereunder to another party without the prior written
consent of the other Party, which consent shall not be unreasonably withheld;
provided, however that either Party may, without the prior written consent of
the other Party, assign this Agreement and its rights and/or obligations
hereunder to an Affiliate or to any successors to substantially all of its
business to which this Agreement pertains or in the event of a merger or
consolidation with another company provided that such successor is not a
Competitor of the other Party.

 

20.              Entire Agreement. This Agreement represents the entire
agreement between the Parties with respect to the subject matter hereof and
incorporates all previous agreements between the Parties, whether written or
oral, with respect to such subject matter.

 

21.              Counterparts. This Agreement may be executed in two or more
counterparts, each of which counterpart shall be deemed an original, but all of
which counterparts taken together shall be one and the same document.

 

22.              Facsimile Signatures. Facsimile or electronic copies of
signatures to this Agreement shall be considered originals hereof, with any
Party executing this Agreement by facsimile or pdf signature agreeing to provide
promptly to the other Party an original signature evidencing the same.

 

Signatures on the Following Page

 

 

31

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
on the day and year first above written.

 

 

Seraph Biosciences, Inc. Zomedica Pharmaceuticals Corp.             By:     By:
    Name:     Name:     Title:     Title:    

 

 

 

 

 

Signature Page to Commercialization and Exclusive Distribution Agreement

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

EXHIBIT A

 

LICENSED PATENTS

 

The Licensed Patents under this Agreement shall include at least the following
patent assets. The Parties understand and acknowledge that additional patents
may be added to this Exhibit from time to time.

 

 

 

[*]

 

 

 

Exhibit A - 1

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

EXHIBIT B

 

STATEMENT OF WORK: VERIFICATION AND VALIDATION WORK FOR FECAL AND URINE MATRICES
ONLY

 

 

 

[*]

 

 

 

Exhibit B -1

 

EXHIBIT C

 

 

 

[Intentionally omitted]

 

 

 

Exhibit C -1

 

EXHIBIT D

 

PRIVATE PLACEMENT AND REGISTRATION RIGHTS RIDER

 

(a)                In connection with the issuance of Zomedica shares to Seraph,
Seraph makes the following representations and warranties to Zomedica set forth
in subsection (b) below, and Zomedica makes the following covenants to Seraph,
set forth in subsections (c) – (t) below.

 

(b)               Seraph hereby represents and warrants to Zomedica as follows:

 

(i)                 On the date hereof and on each date on which it receives
Zomedica common shares hereunder (collectively, the “Securities”), Seraph is and
will be an “accredited investor” as defined in Rule 501(a) under the Securities
Act of 1933, as amended (the “Securities Act”). Seraph maintains its principal
executive office at the location specified in the introductory paragraph of this
Agreement.

 

(ii)               The Securities to be received by Seraph hereunder will be
acquired for Seraph’s own account, not as nominee or agent, and not with a view
to the resale or distribution of any part thereof in violation of the Securities
Act, and Seraph has no present intention of selling, granting any participation
in, or otherwise distributing the same in violation of the Securities Act
without prejudice, however, to Seraph’s right at all times to sell or otherwise
dispose of all or any part of such Securities in compliance with applicable
federal and state securities laws. Nothing contained herein shall be deemed a
representation or warranty by Seraph to hold the Securities for any period of
time. Seraph is not a broker-dealer registered with the Securities and Exchange
Commission (the “Commission”) under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), or an entity engaged in a business that would
require it to be so registered.

 

(iii)             Seraph acknowledges that it can bear the economic risk and
complete loss of its investment in the Securities and has such knowledge and
experience in financial or business matters that it is capable of evaluating the
merits and risks of the investment contemplated hereby.

 

(iv)             Seraph has had an opportunity to receive all information
related to Zomedica requested by it and to ask questions of and receive answers
from Zomedica regarding Zomedica, its business and the terms and conditions of
the Securities. Seraph acknowledges that it has had access to Zomedica’s filings
with the Commission as well as filings made by Zomedica with applicable Canadian
securities regulators.

 

(v)               Seraph understands that the Securities are characterized as
“restricted securities” under the U.S. federal securities laws inasmuch as they
are being acquired from Zomedica in a transaction not involving a public
offering and that under such laws and applicable regulations such securities may
be resold without registration under the Securities Act only in certain limited
circumstances.

 

Exhibit D -1

 

(vi)             Seraph did not learn of the investment in the Securities as a
result of any general solicitation or general advertising.

 

(vii)           Seraph acknowledges and understands that because Zomedica was
previously a “shell company” as defined in Rule 405 under the Securities Act,
the provisions of Rule 144(i) under the Securities Act will apply with respect
to any resale of the Securities pursuant to such Rule 144.

 

(viii)         Seraph acknowledges and understands that certificates evidencing
the Securities will bear the following or any similar legend:

 

“The securities represented hereby have not been registered with the Securities
and Exchange Commission or the securities commission of any state in reliance
upon an exemption from registration under the Securities Act of 1933, as
amended, and, accordingly, may not be transferred unless (i) such securities
have been registered for sale pursuant to the Securities Act of 1933, as
amended, (ii) such securities are sold pursuant to Rule 144, or (iii) the
Company has received an opinion of counsel reasonably satisfactory to it that
such transfer may lawfully be made without registration under the Securities Act
of 1933, as amended.”

 

(c)                Following the issuance of any Securities to Seraph under the
Agreement, Zomedica shall use its commercially reasonable efforts to register
such Securities for resale or other disposition by Seraph within 90 days of the
date of such receipt. Zomedica shall notify Seraph promptly upon effecting such
registration. Subject to any permitted “Black-Out Periods” (as described below),
Zomedica shall use its commercially reasonable efforts to maintain the
effectiveness of any such registration until the earlier of (i) the date on
which all of the Securities so registered have been sold by Seraph or its
transferees or (ii) the date on which such Securities may be sold under Rule 144
(the period of such registration being referred to herein as the “Registration
Period”). Subject to any comments from the staff of the Commission, such
Registration Statement shall include the plan of distribution attached hereto as
Exhibit A;

 

Exhibit D -2

 

(d)               Zomedica shall have the right to suspend its obligation to
register the Securities as provided in clause (c) above or to maintain the
registration of such Securities during the Registration Period and the use of
any prospectus during the Registration Period as follows: (i) (A) if the
registration statement registering the Securities is on Form S-1, for a period
commencing on the earlier of (I) the public announcement by Zomedica of its
financial results for any fiscal year or (II) the filing by Zomedica of its
Annual Report on Form 10-K for such fiscal year, until in either case a
post-effective amendment to such registration statement containing audited
financial statements for such fiscal year is declared effective by the
Commission, or (B) if the registration statement registering the Securities is
on Form S-3, for a period, if any, commencing on the public announcement by
Zomedica of its financial results for any fiscal year until the filing by
Zomedica of its Annual Report on Form 10-K for such fiscal year, (ii) for such
period of time as determined by Zomedica in the good faith exercise of its
business judgment if Zomedica furnishes to Seraph a certificate signed by
Zomedica’s chief executive officer or chief financial officer stating that in
his or her good faith judgment it would be materially detrimental to Zomedica
and its shareholders for such registration statement to either become effective
or remain effective because such action would (A) materially delay, hinder or
otherwise interfere with a material acquisition, corporate reorganization,
collaboration, joint venture or other similar transaction involving Zomedica;
(B) require the disclosure of material non-public information that Zomedica has
a bona fide business purpose for preserving as confidential; (C) render Zomedica
unable to comply with requirements under the Securities Act or Exchange Act,
then Zomedica shall have the right to defer taking action with respect to such
filing; or (D) interfere in any material respect with a proposed capital raise
by Zomedica; or (iii) for such period of time as determined by Zomedica to amend
or supplement the registration statement or prospectus covering such Securities
so that registration statement or prospectus shall not include an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the case of the
prospectus in light of the circumstances under which they were made, not
misleading. Each of such periods is referred to herein as a “Black-Out Period.”
Except for any Black-Out Period arising pursuant to clause (i) above, no
Black-Out Period shall continue for more than 60 days and the total Black-Out
Periods in any 12-month period shall not exceed a total of 120 days. During any
Black-Out Period (other than a Black-Out Period covered by clause (ii)(D)
above), Zomedica shall not effect the registration of securities for its own
account or the account of another selling shareholder. Zomedica shall promptly
(i) notify Seraph in writing of the commencement of a Black-Out Period, but
shall not (without the prior written consent of Seraph) disclose to Seraph any
material non-public information giving rise to a Black-Out Period, (ii) advise
Seraph in writing to cease all sales of the Securities under the related
registration statement and prospectus until the end of the Black-Out Period and
(iii) use its commercially reasonable efforts to terminate a Black-Out Period as
promptly as practicable.

 

(e)                Except during a Black-Out Period, Zomedica shall promptly
notify Seraph, at any time prior to the end of the Registration Period, upon
discovery that, or upon the happening of any event as a result of which, the
registration statement or prospectus covering the Securities includes an untrue
statement of a material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein, in the case of the
prospectus in light of the circumstances under which they were made, not
misleading, and promptly (but in any event within thirty (30) days) prepare,
file with the Commission and furnish to Seraph (including delivery pursuant to
Rule 172 under the Securities Act) a supplement to or an amendment of such
registration statement or prospectus as may be necessary to correct such
misstatement or omission.

 

(f)                Seraph shall furnish in writing to Zomedica the information
set forth in the selling shareholder’s questionnaire attached hereto as Exhibit
B to effect the registration of such Securities and shall execute such documents
in connection with such registration as Zomedica may reasonably request. Seraph
shall provide such information to Zomedica at least two (2) business days prior
to the first anticipated filing date of the related registration statement. In
the event that Seraph fails to provide a completed questionnaire on a timely
basis and such failure continues for a period of seven (7) business days after
Zomedica provides Seraph with written notice of such failure, Zomedica’s
obligation to register such Securities shall terminate with respect to such
Securities; provided, however that such failure shall not affect Zomedica’s
registration obligations with respect to any other Securities issued to Seraph.

 

Exhibit D -3

 

(g)               Seraph agrees to cooperate with Zomedica as reasonably
requested by Zomedica in connection with the preparation and filing of a
registration statement hereunder, unless Seraph has notified Zomedica in writing
of its election to exclude its Securities from such registration statement

 

(h)               Seraph agrees that, upon receipt of any notice from Zomedica
(i) during any permitted Black-Out Period or (ii) the happening of an event
pursuant to clause (e) above, Seraph will immediately discontinue disposition of
Securities pursuant to the registration statement covering such Securities,
until such permitted Black-Out Period has ended or Seraph is advised by Zomedica
that such dispositions may again be made.

 

(i)                 If at any time following the date of this Agreement that any
Securities are not eligible for sale under Rule 144 (i) there is not one or more
effective registration statements covering the Securities and (ii) Zomedica
proposes for any reason to register any Common Shares under the Securities Act
(other than pursuant to a registration statement on Form S-4 or Form S-8 (or a
similar or successor form)) with respect to an offering of Common Shares by
Zomedica for its own account or for the account of any of its shareholders, it
shall at each such time promptly give written notice to Seraph of its intention
to do so (but in no event less than twenty (20) days before the anticipated
filing date) and, to the extent permitted under the provisions of Rule 415 under
the Securities Act (if the registration is a shelf registration) and pari passu
with the terms of any registration rights granted to other shareholders, include
in such registration all Securities with respect to which Seraph requests in
writing be included therein within ten (10) days after receipt of Zomedica’s
notice. Such notice shall offer Seraph the opportunity to register such number
of Securities as Seraph may request and shall indicate the intended method of
distribution of securities covered by such registration statement.

 

(j)                 Notwithstanding the foregoing, (i) if Seraph has exercised
its option to include some or all of its Securities in an offering under (i)
above, and such registration involves an underwritten public offering, (A)
Seraph must sell its Securities to, if applicable, the underwriter(s) at the
same price and subject to the same underwriting discounts and commissions that
apply to the other securities sold in such offering and subject to Seraph
entering into customary underwriting documentation for selling shareholders in
an underwritten public offering, and (B) Seraph’s right to include Securities in
such registration shall be subject to cut-back (pro rata with any other selling
shareholders seeking to include their securities in such registration) in the
event that the managing underwriter of such offering determines that the
inclusion of all or some of such Securities would be impracticable or
inadvisable, and (ii) if, at any time after giving written notice of its
intention to register any Securities pursuant to clause (i) above and prior to
the effective date of the registration statement filed in connection with such
registration, Zomedica shall determine for any reason not to cause such
registration statement to become effective under the Securities Act, Zomedica
shall deliver written notice to Seraph and, thereupon, shall be relieved of its
obligation to register any Securities in connection with such registration.

 

Exhibit D -4

 

(k)               In connection with the registration of Securities hereunder,
Zomedica shall:

 

(i)                Except during any Black-Out Period, prepare and file with the
Commission such amendments and supplements to such registration statement, and
the prospectus used in connection with such registration statement, as may be
necessary to comply with the Securities Act in order to enable the disposition
of all securities covered by such registration statement;

 

(ii)               make available to Seraph an electronic copy of the
preliminary and final prospectus in accordance with Rule 173, or in the
alternative, furnish such numbers of hard copies of a prospectus, including a
preliminary prospectus, as required by the Securities Act, and such other
documents as Seraph may reasonably request in order to facilitate their
disposition of their Securities;

 

(iii)             promptly notify Seraph of the happening of any event as a
result of which the prospectus included in such registration statement, as then
in effect, includes an untrue statement of material fact or omits to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing;

 

(iv)             use its commercially reasonable efforts to cause all such
Securities covered by such registration statement to be listed on each
securities exchange and trading system (if any) on which similar securities
issued by Zomedica are then listed;

 

(v)               provide a transfer agent and registrar for all Securities
registered pursuant to this Agreement and provide a CUSIP number for all such
Securities, in each case not later than the effective date of such registration;

 

(vi)             notify Seraph promptly after Zomedica receives notice thereof,
of the time when such registration statement has been declared effective or a
supplement to any prospectus forming a part of such registration statement has
been filed;

 

(vii)           after such registration statement becomes effective, notify
Seraph of any request by the Commission that Zomedica amend or supplement such
registration statement or prospectus; and,

 

(viii)         in connection with any sale or other disposition of Securities
pursuant to Rule 144, cooperate with Seraph to effect the removal of any
restrictive legend in connection with such sale or other disposition and, in
connection therewith, cause its counsel to provide to the transfer agent for the
Securities a customary opinion of counsel that such legend may be removed in
connection with such sale or other disposition provided Seraph has provided to
Zomedica such documentation, including a customary broker’s letter, as
Zomedica’s counsel may reasonably request in connection with such opinion.

 

Exhibit D -5

 

(l)                Zomedica will pay all of its expenses associated with
effecting the registration of the Securities or removal of any Rule 144 legend,
including filing and printing fees, Zomedica’s counsel and accounting fees and
expenses, costs associated with clearing the Securities for sale under
applicable state securities laws and listing and transfer agent fees. Seraph
shall be responsible for its own fees and expenses in connection with any such
registration, including its counsel and accounting fees, discounts, commissions,
fees of underwriters, selling brokers, dealer managers or similar securities
industry professionals with respect to the Securities being sold.

 

(m)             To the extent permitted by law, Zomedica will indemnify and hold
harmless Seraph and its officers and directors and each person, if any, who
controls Seraph within the meaning of the Securities Act (collectively, “Seraph
Indemnified Parties”), against any Damages (defined below), and Zomedica will
promptly reimburse such Seraph Indemnified Parties for all reasonable
out-of-pocket costs and expenses (including the reasonable fees and
disbursements of counsel) in connection with investigating or defending any
claim or proceeding for Damages as such costs and expenses are incurred;
provided, however, that the indemnity agreement contained in this subsection (m)
shall not apply to amounts paid in settlement of any such claim or proceeding if
such settlement is effected without the consent of Zomedica, which consent shall
not be unreasonably withheld, nor shall Zomedica be liable for any Damages to
the extent that they arise out of or are based upon actions or omissions made in
reliance upon and in conformity with written information furnished by or on
behalf of Seraph expressly for use in connection with such registration.

 

(n)               To the extent permitted by law, Seraph will indemnify and hold
harmless Zomedica, and each of its directors, each of its officers who has
signed the registration statement and each person, if any, who controls Zomedica
within the meaning of the Securities Act (collectively, “Zomedica Indemnified
Party”) against any Damages, in each case only to the extent that such Damages
arise out of or are based upon actions or omissions made in reliance upon and in
conformity with written information furnished by or on behalf of Seraph
expressly for use in connection with such registration; and Seraph will promptly
reimburse such Zomedica Indemnified Parties for all reasonable out-of-pocket
costs and expenses (including the reasonable fees and disbursements of counsel)
in connection with investigating or defending any claim or proceeding for
Damages as such costs and expenses are incurred; provided, however, that the
indemnity agreement contained in this subsection (n) shall not apply to amounts
paid in settlement of any such claim or proceeding if such settlement is
effected without the consent of Seraph, which consent shall not be unreasonably
withheld; and provided, further, that in no event shall the aggregate amounts
payable by Seraph by way of indemnity or contribution under this subsection (m)
exceed the gross proceeds received by Seraph from the sale of Securities
pursuant to such registration.

 

(o)               As used herein, the term “Damages” shall mean any loss,
damage, or liability (joint or several) to which a party hereto may become
subject under the Securities Act, the Exchange Act, or other federal or state
law, insofar as such loss, damage, or liability (or any action in respect
thereof) arises out of or is based upon (i) any untrue statement or alleged
untrue statement of a material fact contained in any registration statement,
prospectus, “blue sky” application or other document or amendment or supplement
thereto; or (ii) an omission or alleged omission to state therein a material
fact required to be stated therein, or necessary to make the statements therein,
in the case of a registration statement, not misleading, and, in any other case,
in light of the circumstances under which they were made, not misleading.

 

Exhibit D -6

 

(p)               Any person entitled to indemnification hereunder shall (i)
give prompt notice to the indemnifying party of any claim with respect to which
it seeks indemnification and (ii) permit such indemnifying party to assume the
defense of such claim with counsel reasonably satisfactory to the indemnified
party; provided that any person entitled to indemnification hereunder shall have
the right to employ separate counsel and to participate in the defense of such
claim, but the fees and expenses of such counsel shall be at the expense of such
person unless (a) the indemnifying party has agreed to pay such fees or
expenses, or (b) the indemnifying party shall have failed to assume the defense
of such claim and employ counsel reasonably satisfactory to such person or (c)
in the reasonable judgment of any such person, based upon written advice of its
outside counsel, a conflict of interest exists between such person and the
indemnifying party with respect to such claims (in which case, if the person
notifies the indemnifying party in writing that such person elects to employ
separate counsel at the expense of the indemnifying party, the indemnifying
party shall not have the right to assume the defense of such claim on behalf of
such person but shall have the right to participate therein at its sole expense
with counsel of its choice); and provided, further, that the failure of any
indemnified party to give notice as provided herein shall not relieve the
indemnifying party of its obligations hereunder, except to the extent that such
failure to give notice shall materially adversely affect the indemnifying party
in the defense of any such claim or litigation. It is understood that the
indemnifying party shall not, in connection with any proceeding in the same
jurisdiction, be liable for fees or expenses of more than one separate firm of
attorneys at any time for all such indemnified parties. No indemnifying party
will, except with the consent of the indemnified party, consent to entry of any
judgment or enter into any settlement that does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such indemnified party
of a release from all liability in respect of such claim or litigation.

 

(q)               To provide for just and equitable contribution to joint
liability under the Securities Act in any case in which either (i) any party
otherwise entitled to indemnification hereunder makes a claim for
indemnification pursuant to this Agreement but it is judicially determined that
such indemnification may not be enforced in such case, or (ii) contribution
under the Securities Act may be required on the part of any party hereto for
which indemnification is provided under this Agreement, then, and in each such
case, then the indemnifying party shall contribute to the amount paid or payable
by the indemnified party as a result of such Damages in such proportion as is
appropriate to reflect the relative fault of the indemnified party and the
indemnifying party, as well as any other relevant equitable considerations. No
person guilty of fraudulent misrepresentation within the meaning of Section
11(f) of the Securities Act shall be entitled to contribution from any person
not guilty of such fraudulent misrepresentation. In no event shall Seraph’s
liability pursuant to this section (q), when combined with the amounts paid or
payable by Seraph pursuant to section (n), exceed the gross proceeds received by
Seraph from the sale of Securities pursuant to such registration.

 

(r)                 Seraph’s registration rights as contained herein are
personal to Seraph and may not be assigned or otherwise transferred by Seraph,
whether in connection with the sale or other disposition of Securities or
otherwise. Any purported assignment or other transfer shall be null and void ab
initio.

 

Exhibit D -7

 

(s)                Zomedica shall, at all times while Zomedica is subject to
Sections 13(a) or 15(d) under the Exchange Act, use commercially reasonable
efforts to (i) make and keep public information available, as those terms are
understood and defined in Rule 144; and (ii) file with the Commission in a
timely manner all reports and other documents required of Zomedica under the
Securities Act and the Exchange Act.

 

(t)                 To the extent applicable, Zomedica shall use commercially
reasonable efforts to register or qualify Securities under U.S. state securities
or “blue sky” laws as Seraph may reasonably request; provided, however, that
Zomedica shall not be required in connection therewith or as a condition thereto
to (i) qualify to do business in any jurisdiction, (ii) subject itself to
general taxation, or (iii) file a general consent to service of process in any
such jurisdiction.

 

 

Exhibit D -8

 

Exhibit A

Plan of Distribution

 

The selling shareholders, which as used herein includes donees, pledgees,
transferees or other successors-in-interest selling common shares or interests
in common shares received after the date of this prospectus from a selling
shareholder as a gift, pledge, partnership distribution or other transfer, may,
from time to time, sell, transfer or otherwise dispose of any or all of their
common shares or interests in common shares on any stock exchange, market or
trading facility on which the common shares are traded or in private
transactions. These dispositions may be at fixed prices, at prevailing market
prices at the time of sale, at prices related to the prevailing market price, at
varying prices determined at the time of sale, or at negotiated prices.

 

The selling shareholders may use any one or more of the following methods when
disposing of common shares or interests therein:

 

·   ordinary brokerage transactions and transactions in which the broker-dealer
solicits purchasers;

 

·   block trades in which the broker-dealer will attempt to sell the common
shares as agent, but may position and resell a portion of the block as principal
to facilitate the transaction;

 

·   purchases by a broker-dealer as principal and resale by the broker-dealer
for its account;

 

·    an exchange distribution in accordance with the rules of the applicable
exchange;

 

·    privately negotiated transactions;

 

·    short sales effected after the date the registration statement of which
this Prospectus is a part is declared effective by the SEC;

 

·    through the writing or settlement of options or other hedging transactions,
whether through an options exchange or otherwise;

 

·    broker-dealers may agree with the selling shareholders to sell a specified
number of common shares at a stipulated price per share;

 

·    a combination of any such methods of sale; and

 

·    any other method permitted by applicable law.

 

The selling shareholders may, from time to time, pledge or grant a security
interest in some or all of the common shares owned by them and, if they default
in the performance of their secured obligations, the pledgees or secured parties
may offer and sell the common shares, from time to time, under this prospectus,
or under an amendment to this prospectus under Rule 424(b)(3) or other
applicable provision of the Securities Act amending the list of selling
shareholders to include the pledgee, transferee or other successors in interest
as selling shareholders under this prospectus. The selling shareholders also may
transfer the common shares in other circumstances, in which case the
transferees, pledgees or other successors in interest will be the selling
beneficial owners for purposes of this prospectus.

 

Exhibit D -9

 

In connection with the sale of our common shares or interests therein, the
selling shareholders may enter into hedging transactions with broker-dealers or
other financial institutions, which may in turn engage in short sales of the
common shares in the course of hedging the positions they assume. The selling
shareholders may also sell common shares short and deliver these common shares
to close out their short positions, or loan or pledge the common shares to
broker-dealers that in turn may sell these common shares. The selling
shareholders may also enter into option or other transactions with
broker-dealers or other financial institutions or the creation of one or more
derivative securities which require the delivery to such broker-dealer or other
financial institution of common shares offered by this prospectus, which common
shares such broker-dealer or other financial institution may resell pursuant to
this prospectus (as supplemented or amended to reflect such transaction).

 

The aggregate proceeds to the selling shareholders from the sale of the common
shares offered by them will be the purchase price of the common shares less
discounts or commissions, if any. Each of the selling shareholders reserves the
right to accept and, together with their agents from time to time, to reject, in
whole or in part, any proposed purchase of common shares to be made directly or
through agents. We will not receive any of the proceeds from this offering.

 

The selling shareholders also may resell all or a portion of the common shares
in open market transactions in reliance upon Rule 144 under the Securities Act,
provided that they meet the criteria and conform to the requirements of that
rule.

 

The selling shareholders and any underwriters, broker-dealers or agents that
participate in the sale of the common shares or interests therein may be
"underwriters" within the meaning of Section 2(11) of the Securities Act. Any
discounts, commissions, concessions or profit they earn on any resale of the
common shares may be underwriting discounts and commissions under the Securities
Act. Selling shareholders who are "underwriters" within the meaning of Section
2(11) of the Securities Act will be subject to the prospectus delivery
requirements of the Securities Act.

 

To the extent required, the common shares to be sold, the names of the selling
shareholders, the respective purchase prices and public offering prices, the
names of any agent, dealer or underwriter and any applicable commissions or
discounts with respect to a particular offer will be set forth in an
accompanying prospectus supplement or, if appropriate, a post-effective
amendment to the registration statement that includes this prospectus.

 

In order to comply with the securities laws of some states, if applicable, the
common shares may be sold in these jurisdictions only through registered or
licensed brokers or dealers. In addition, in some states the common shares may
not be sold unless it has been registered or qualified for sale or an exemption
from registration or qualification requirements is available and is complied
with.

 

Exhibit D -10

 

We have advised the selling shareholders that the anti-manipulation rules of
Regulation M under the Exchange Act may apply to sales of common shares in the
market and to the activities of the selling shareholders and their affiliates.
In addition, to the extent applicable we will make copies of this prospectus (as
it may be supplemented or amended from time to time) available to the selling
shareholders for the purpose of satisfying the prospectus delivery requirements
of the Securities Act. The selling shareholders may indemnify any broker-dealer
that participates in transactions involving the sale of the common shares
against certain liabilities, including liabilities arising under the Securities
Act.

 

We have agreed to indemnify the selling shareholders against liabilities under
the Securities Act relating to the registration of the common shares offered by
this prospectus.

 

We have agreed with the selling shareholders to keep the registration statement
of which this prospectus constitutes a part effective until the earlier of (i)
the date on which all of the common shares have been sold by the selling
shareholders or (ii) the date on which the common shares may be sold under Rule
144.

 

Exhibit D -11

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

 

EXHIBIT E

 

CUSTOMER SERVICE REQUIREMENTS AND WARRANTY GUIDELINES

 

 

 

[*]

 

 

 

Exhibit E - 1

[*Confidential Treatment has been requested as to certain portions of this
document. Each such portion, which has been omitted herein and replaced with an
asterisk [*], has been filed separately with the Securities and Exchange
Commission.]

 

EXHIBIT F

 

MANUFACTURING DOCUMENTATION AND RECORDKEEPING REQUIREMENTS

 

 

 

[*]

 

 

 

Exhibit F - 1