Exhibit 10.1

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

 
 
DEVELOPMENT AND LICENSE AGREEMENT
 
 

 
 
between
 
 

 
 
M & P Patent AG, c/o Fundationsanstalt, Heiligkreuz 6, 9490 Vaduz, Liechtenstein
 
 
(the "Licensor")
 
 

 
 
and
 
 

 
 
Urigen Pharmaceuticals, Inc., 875 Mahler Road, Suite 235, Burlingame, CA 94010,
USA
 
 
(the "Licensee")
 
 
(each a "Party" and collectively the "Parties")
 
 

 
 
concerning
 
 

 
 
rights pertaining to Licensor's product NASOBOL®
 
 
1

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INDEX
 
1.
DEFINITIONS
2
     
2.
LICENSE
2
     
3.
DEVELOPMENT
2
     
4.
COMMERCIALIZATION
2
     
5.
PAYMENTS AND ROYALTIES
2
     
6.
REPORTS AND RECORDS
2
     
7.
PATENT AND TRADEMARK REGISTRATION AND MAINTENANCE
2
     
8.
INFRINGEMENT, VALIDITY CHALLENGES AND THIRD PARTY RIGHTS
2
     
9.
INDEMNIFICATION
2
     
10.
WARRANTIES, LIABILITY AND DISCLAIMER
2
     
11.
TERM AND TERMINATION
2
     
12.
MISCELLANEOUS
2
     
13.
GOVERNING LAW AND DISPUTE RESOLUTION
2

 
 
 
 
2

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PREAMBLE
 
Licensor is established as a company limited by shares in accordance with the
laws of Liechtenstein.
 
Licensor holds patents, trade marks and other intellectual property rights
pertaining to an intranasal testosterone product (including the device for its
administration) in development for the treatment of male hypogonadism.
 
Licensee is a stock corporation established in accordance with the laws of
Delaware and listed on the OTCBB under the stock symbol URGP. Licensee has an
authorized capital stock of two hundred million (200,000,000) shares of which
one hundred ninety million (190,000,000) shares of a nominal value of zero point
zero zero one United States Dollars (USD 0.001) each are common shares and ten
million (10,000,000) shares of a nominal value of zero point zero zero one
United States Dollars (USD 0.001) each are preferred shares. As of the date
hereof, Licensee has sixty eight million two hundred eighty-nine thousand five
hundred thirty-five (68,289,535) common shares and two hundred ten (210)
preferred shares series B issued and outstanding.
 
Licensee specializes in the design and implementation of medicinal products for
patients with urological ailments.
 
Licensee desires to obtain from Licensor, and Licensor is willing to grant
Licensee, the right to develop the Product in cooperation with Licensor and to
commercialize it on an exclusive basis.
 
Therefore, the Parties have come to the following agreement:
 
1.  
DEFINITIONS

 
Terms used in this Agreement, unless otherwise specified, shall have the
following meanings:
 
 
 
Affiliate
Any corporation or other legal entity controlling, controlled by or under common
control with the respective legal entity, whereby the term "control" shall mean
direct or indirect ownership of at least fifty percent (50%) of the voting
securities having the right to elect directors.

 
 
Agreement
This agreement together with the Annexes.

 
 
Annex
Any annex to this Agreement.

 
 
Claims
The Claims according to Section 9.1.

 
 
3

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Commercial Sale
Any Transfer of the Product by Licensee, an Affiliate or Distributor to a Third
Party following regulatory approval of said Product in the country where such
Transfer took place.

 
Commercially Reasonable Efforts
Those efforts employed by the Parties, equivalent to that level of attention and
care that they devote to their other businesses and products of similar
commercial potential and at a similar stage of progress of development.

 
 
Confidential Information
With respect to a Party, all information (and all tangible and intangible
embodiments thereof), which is owned or controlled by such Party, is disclosed
by such Party to the other Party pursuant to this Agreement and which a
reasonable party would consider as confidential. Notwithstanding the foregoing,
Confidential Information of a Party shall not include information which, and
only to the extent, the receiving Party can establish by written documentation
(i) has been generally known prior to disclosure of such information by the
disclosing Party to the receiving Party, (ii) has become generally known,
without the fault of the receiving Party, subsequent to disclosure of such
information by the disclosing Party to the receiving Party, (iii) has been
received by the receiving Party at any time from a source, other than the
disclosing Party, rightfully having possession of and the right to disclose such
information free of confidentiality obligations, (iv) has been otherwise known
by the receiving Party free of confidentiality obligations prior to disclosure
of such information by the disclosing Party to the receiving Party, (v) is
independently developed without reference to the Confidential Information of the
disclosing Party or (vi) is required to be disclosed by the receiving Party by
applicable law or court order.

 
 
Development Plan
The Development Plan attached hereto as Annex 1.

 
 
 
4

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Distributor(s)
Any Third Party who buys Products from Licensee or its Affiliates for Transfer,
including Exclusive and Non-Exclusive Distributor(s).

 
 
Effective Date
The date when both Parties have signed this Agreement.

 
 
Exclusive Distributor(s)
Any Distributor who has been granted any exclusivity (e.g. sole-exclusive,
semi-exclusive or co-exclusive) to sell the Product with respect to one or
several countries in the License Territory.

 
 
FDA
The United States Food and Drug Administration.

 
 
FDA Approval
The formal and final approval of the NDA by FDA.

 
 
Gross Sales
Gross amount invoiced by:

 
(i)  
Licensee or its Affiliates for Transfer of Product(s), including Transfer to
Non-Exclusive Distributors, but excluding Transfer to Exclusive Distributors;
and

 
(ii)  
the Exclusive Distributors or their Affiliates for Transfer of Product(s).

 
In the case of a transfer of the Product between Licensee or an Exclusive
Distributor, respectively, and any of its Affiliate(s), Gross Sales shall be
based on the further Transfer of such Product by such transferee.
 
 
Holopack
HOLOPACK Verpackungstechnik GmbH, Bahnhofstrasse 20, D-73453
Abtsgmünd-Untergröningen.

 
 
Improvements
Any and all developments, inventions or discoveries of the Product in the
License Field made by Licensor or its Affiliates, at any time during the term of
this Agreement and shall include, but not be limited to, developments intended
to enhance the safety and/or efficacy of the Product.

 
 
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IND
The investigational new drug application, as defined in the United States
Federal Food, Drug and Cosmetic Act, filed by Licensor for the Product with the
FDA (ref. no. 70,512), and any amendments or supplement thereto.

 
 
Initial Milestone Payment
The Initial Milestone Payment according to Section 5.1(ii).

 
Joint Development Steering Committee
 The Joint Development Steering Committee according to Section 3.5.

 
 
Joint Marketing Committee
The Joint Marketing Committee according to Section 4.3.

 
 
Joint Patent
A Joint Patent according to Section 7.6.

 
 
Know-How
Preclinical data which are in Licensor's possession or control and required for
Licensee to conduct the clinical trials and other development activities as
provided by the Development Plan.

 
 
Licensee Indemnitee
A Licensee Indemnitee according to Section 9.2.

 
 
License Field
Nasal delivery of testosterone to males (excluding females).

 
 
License Territory
World-wide.

 
 
Licensor Indemnitee
A Licensor Indemnitee according to Section 9.1.

 
 
Marketing Authorization(s)
With respect to a country within the License Territory, the regulatory and other
authorizations required to market and sell the Product in such country.

 
 
NDA
A new drug application, as defined in the United States Federal Food, Drug and
Cosmetic Act, which covers the Product for the treatment of hypogonadism.

 
 
Net Sales
Gross Sales of the Product less applicable Sales Returns and Allowances. Net
Sales and its components shall be determined in accordance with US GAAP,
consistently applied.

 
 
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Non-Exclusive Distributor(s)
Any Distributor who is not an Exclusive Distributor.

 
 
Party
Each party to this Agreement.

 
 
Patent Right(s)
Any right in or deriving from the patents and patent applications or the
equivalent of such patents or applications including but not limited to any
division, continuation, continuation-in-part (CIP), including any foreign patent
application or letters patent or the equivalent thereof, issuing thereon or
reissue, re-examination or extension thereof, which claim the priority of or
claim substantially the same subject matter as disclosed in the patents and
patent applications listed in Annex 2.

 
 
Product(s)
Licensor's intranasal testosterone product, referred to as NASOBOL® and
identified by Licensor's product ref. no. 291007, composed of (i) Licensor's
proprietary device 3319F-B03B60 specified in Annex 3 filled with (ii) Licensor's
proprietary testosterone-preparation ref. no. 291007 specified in Annex 4, and
any Improvements thereto. For the sake of clarity, the term "Product" always
means the combination product of Licensor's device and Licensor's testosterone
preparation and not each of these components separately.

 
 
Reporting Period
Each three (3) month period ending March 31, June 30, September 30 and
December 31 in each calendar year.

 
 
Reports
The Reports according to Section 6.3.

 
 
Revenue-Independent Fees
Any payments from a Distributor to Licensee which are (i) attributable to the
Product or any right granted in connection with the Product and (ii) not
identified as Gross Sales; provided that such payments have actually been
received by Licensee.

 
 
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Royalties
The Royalties according to Section 5.2.

 
 
Royalty Ceiling
The Royalty Ceiling according to Section 5.4.

 
 
Royalty Period
With respect to (i) the first Royalty Period, the period beginning on the date
of the first Marketing Authorization and ending at the end of the Reporting
Period in effect twelve (12) months thereafter and (ii) each subsequent Royalty
Period, the twelve (12) month period beginning on the day following the end of
the first Royalty Period and each succeeding twelve (12) month period
thereafter.

 
 
Sales Returns and Allowances
Sum of (a) and (b), where (a) is a provision, determined by Licensee or an
Exclusive Distributor, respectively, under US GAAP for Transfer of the Product
in the License Territory for (i) trade, cash and quantity discounts on the
Product (other than price discounts granted at the time of invoicing and which
are already included in the determination of Gross Sales), (ii) credits or
allowances given or made for rejection or return of previously sold Products or
for rebates or retroactive price reductions (including rebates and chargebacks
based upon statutory or governmental regulations), (iii) taxes, duties or other
governmental charges levied on or measured by the billing amount for the
Product, as adjusted for rebates and refunds (excluding income and franchise
taxes), (iv) charges for freight and insurance directly related to the
distribution of the Product, to the extent included in Gross Sales, and (v)
credits for allowances given or made for wastage replacement, promotional
samples, indigent patient and any other sales programs for the Product to the
extent the sale of the Product was included in Gross Sales and the credit is
applied against such Gross Sales and (b) is a periodic adjustment of the
provision determined in (a) to reflect amounts actually incurred by Licensee or
an Exclusive Distributor, respectively, in the License Territory for items (i),
(ii), (iii), (iv) and (v) in clause (a) in a calendar year.

 
 
8

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Section
Any section of this Agreement.

 
 
Sublicensee(s)
Holopack and/or any other contract manufacturer determined in accordance with
the terms and conditions of this Agreement which is granted a sublicense by
Licensee to manufacture the Product for Licensee in accordance with the terms
and conditions of this Agreement.

 
 
Third Party
Any entity other than Licensor, Licensee, or their Affiliates.

 
 
Trademark(s)
Licensor's trademark NASOBOL® or any other trademark that is both (a) determined
by the Joint Marketing Committee and (b) registered and owned by Licensor.

 
 
Transfer
Any sale, for value in the form of cash or otherwise, of the Product to a Third
Party.

 
 
USA
The United States of America.

 
 
US GAAP
United States Generally Accepted Accounting Principles, consistently applied.

 
 
Valid Claim
A claim of an unexpired, issued patent included in the Patent Rights that has
not been held to be invalid by a final judgment of a court of competent
jurisdiction or decision of a governmental agency from which no appeal can be
taken.

 
2.  
LICENSE

 
2.1  
Grant of License

 
(i)  
Subject to the terms and conditions set forth by this Agreement, Licensor hereby
grants to Licensee in the License Field in the License Territory an exclusive
and royalty-bearing license to any and all of the Patent Rights, Know-How and
Trademarks to:

 
(a)  
develop the Product in accordance with the Development Plan;

 
 
9

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(b)  
manufacture and have manufactured the Product by Sublicensee(s); and

 
(c)  
commercialize and sell the Product.

 
(ii)  
Unless stated otherwise by this Agreement, the exclusivity granted by Licensor
to Licensee in Section 2.1(i) shall be effective also with regard to Licensor
and its Affiliates.

 
(iii)  
The license grant pursuant to Section 2.1(i) shall include the grant of said
license to any Affiliate of Licensee, provided that such Affiliate shall assume
the same obligations as those of Licensee and be subject to the same terms and
conditions hereunder and further provided that Licensee, jointly with said
Affiliate, shall be responsible to Licensor for the proper performance by said
Affiliate of any and all terms and conditions and obligations set forth by this
Agreement.

 
(iv)  
The license grant pursuant to Section 2.1(i) shall include Licensee's right to
sell the Products to Distributors; provided, however, that so long as the
Royalty Ceiling is not achieved in accordance with Section 5.4 or 11.5 (a) any
Exclusive Distributors are determined by the Joint Marketing Committee and
(b) the agreement between Licensee and the respective Distributor is (aa) made
in writing, (bb) is concluded at arms-length conditions, (cc) requires the
Distributor to sell the Product under the Trademark(s), (dd) requires the
Distributor to deliver to Licensee commercial sales reports with respect to the
Product at the end of each Reporting Period, (ee) is consistent with the terms
of this Agreement and (ff) incorporates terms and conditions sufficient to
enable Licensee to comply with this Agreement. Licensee may not delegate to any
Distributor its responsibility to file and maintain the applications for
Marketing Authorizations pursuant to the terms and conditions of this Agreement
unless (a) the Joint Marketing Committee approves such delegation and (b)
Licensee procures by written agreement that such delegee holds any Marketing
Authorization only on a trust basis, i.e., in the name and on behalf of
Licensee. Licensee shall, promptly upon execution thereof, submit to Licensor a
copy of any agreement entered into with any Distributor. Upon termination of
this Agreement for any reason, any agreements with any Distributor shall be
addressed in accordance with Section 11.7.

 
(v)  
So long as the Royalty Ceiling is not achieved in accordance with Section 5.4 or
11.5, the license grant pursuant to Section 2.1(i) shall exclude Licensee's
right to make any modifications or alterations of the Product without the prior
approval of the Joint Development Steering Committee.

 
(vi)  
Subject to this Section 2 and so long as the Royalty Ceiling is not achieved in
accordance with Section 5.4 or 11.5, the license grant pursuant to
Section 2.1(i) shall exclude Licensee's right to grant sublicenses of the rights
under Section 2.1(i).

 
 
2.2  
Sublicenses. The Parties agree that the Product shall be manufactured by
Holopack and/or any other Sublicense(s) determined by the Joint Marketing
Committee. Licensee shall use Commercially Reasonable Efforts to enter into
respective agreement(s) with such Sublicensee(s) and Licensor shall use
Commercially Reasonable Efforts to support Licensee in entering into such
agreement(s).

 
 
 
10

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3.  
DEVELOPMENT

 
3.1  
Development Plan. The Product shall be developed in accordance with the
Development Plan attached hereto as Annex 1.

 
3.2  
Licensor's Responsibilities. Licensor shall have the following responsibilities
in connection with the development of the Product:

 
(i)  
make Commercially Reasonable Efforts to assist and support Licensee in
conducting the development work under the Development Plan;

 
(ii)  
make accessible to Licensee within thirty (30) days after payment of the Initial
Milestone Payment the Know-How in a form reasonably usable by Licensee;

 
(iii)  
authorize Licensee, including without limitation by providing the required
declarations and powers of attorney, as the case may be, to use the IND to
conduct the development work under the Development Plan; and

 
(iv)  
transfer the IND to Licensee upon receipt of the Initial Payment and (a) Urigen
issues a purchase order for the validation study, phase II PK study and the
safety study listed in Annex 1 or (b) pays the costs incurred by the Licensor in
with accordance Section 3.6(ii)..

 
3.3  
Licensee's Responsibilities. Licensee shall have the following responsibilities
in connection with the development of the Product:

 
(i)  
make Commercially Reasonable Efforts to perform the development work provided by
the Development Plan, including, without limitation, to conduct all clinical
trials required for the filing of the NDA;

 
 
(ii)  
make Commercially Reasonable Efforts to get any and all information and data
relating to the Product which are required to get Marketing Authorizations
others than the FDA Approval;

 
 
(iii)  
keep Licensor informed about the activities under the Development Plan and make
Licensee accessible any and all results derived from the work under the
Development Plan;

 
 
(iv)  
copy Licensor on all correspondence with regulatory authorities and invite the
Licensor members of the Joint Development Steering Committee to attend the
meetings with such regulatory authorities; and

 
 
(v)  
subject to the approval of the Joint Development Steering Committee pursuant to
Section 3.5(iii)(f), refrain from using (a) the Product, (b) the Know-How and
(c) any Product-related data generated under this Agreement for any activity
other than the activities foreseen by the Development Plan.

 
 
11

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3.4  
Development Work Prior to Initial Milestone Payment. Notwithstanding anything to
the contrary in this Section 3, Licensor shall have final decision authority on
and be responsible for any development work in relation to the Product conducted
in accordance with the Development Plan and performed prior to the payment of
the Initial Milestone Payment. With respect to costs incurred by Licensor in
connection with such development work, Section 3.6(ii) applies.

 
3.5  
Joint Development Steering Committee. Licensor and Licensee shall establish a
joint committee to coordinate and oversee the execution of the Development Plan.

 
(i)  
Members. The Joint Development Steering Committee shall consist of four (4)
members, two (2) members from each Party. Licensee shall designate one (1) of
its members as chairperson of the Joint Development Steering Committee.

 
(ii)  
Responsibilities of the Chairperson. The chairperson of the Joint Development
Steering Committee shall:

 
(a)  
call meetings of the Joint Development Steering Committee;

 
(b)  
establish the agenda for each meeting of the Joint Development Steering
Committee; and

 
(c)  
inform the members on progress made on the development of the Product upon
request of any member and at each meeting of the Joint Development Steering
Committee.

 
(iii)  
Responsibilities. The Joint Development Steering Committee shall:

 
(a)  
review and oversee the development of the Product as provided by the Development
Plan;

 
(b)  
plan, schedule, review and evaluate the clinical trials as provided by the
Development Plan;

 
(c)  
decide on any amendment or alteration of the Development Plan;

 
(d)  
approve any extension of the period for the filing of the NDA;

 
(e)  
decide on any modifications or alterations of the Product;

 
(f)  
approve uses of the Product, the Know-How and the Product-related data generated
in connection with the development of the Product in accordance with the
Development Plan for any activity other than the activities foreseen by the
Development Plan; and

 
(g)  
decide on any other subject matter within the scope of the Development Plan.

 
 
12

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(iv)  
Meetings. The Joint Development Steering Committee shall meet on an as needed
basis on such dates and at such times as the Parties shall agree; provided,
however, that Licensor shall have the right to request up to two such meetings
in every calendar year. The meetings shall alternate between the offices of the
Parties unless the Parties otherwise agree.

 
(v)  
Decisions. All decisions of the Joint Development Steering Committee on matters
pursuant to Section 3.5(iii) shall be made unanimously by the members (or their
designees) present at any meeting. Such decisions shall require at least one (1)
member of each Party being present at such meeting. However, with respect to
development matters in dispute between the Parties which are (a) not referred to
in Section 3.5(iii) and (b) outside the scope of the Development Plan, Licensee
shall have final decision authority after due consultation with Licensor.

 
(vi)  
Expenses. Licensee shall be responsible for all travel (business class or
equivalent) and related costs and expenses for all members, designees and
invitees to attend meetings of, and otherwise participate on, the Joint
Development Steering Committee.

 
3.6  
Costs

 
(i)  
Costs. Licensee shall fund the work to be performed pursuant to the Development
Plan as provided thereby and bear all costs in connection with the execution of
the Development Plan.

 
(ii)  
Costs Incurred Prior to Initial Milestone Payment. Costs incurred by Licensor in
connection with the execution of the Development Plan prior to the payment of
the Initial Milestone Payment shall be reimbursed by Licensee at the time of the
payment of the Initial Milestone Payment together [***] to compensate for
Licensor's risk.

 
4.  
COMMERCIALIZATION

 
4.1  
Licensor's Responsibilities

 
(i)  
Upon payment of the Initial Milestone Payment, subject to strict confidentiality
pursuant to the terms set forth herein, Licensee may use all equipment listed in
Annex 5 hereto free of charge at the premises of Holopack. For the avoidance of
doubt, Licensee is responsible to procure the equipment required for scaling-up
the manufacture of the Product. Licensee's aforementioned right may not impede
the development and/or production by Licensor of products other than the
Product.

______________
 
 
[***]CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO SUCH OMITTED PORTIONS.

 
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(ii)  
Licensor has no obligation to fulfill production contracts for Licensee.

 
4.2  
Licensee's Responsibilities. Licensee shall have the following responsibilities
in connection with the commercialization of the Product:

 
(i)  
file the NDA [***]; however, in the event the FDA requires, instead of the PK
study provided by the Development Plan, a clinical end point study (i.e., a
study including primary parameters on efficacy), such period is automatically
extended [***] and, thereafter, such period may only be extended by the Joint
Development Steering Committee pursuant to Section 3.5(iii)(d), whereby it is
understood that the grant of such extension is subject to the Joint Development
Steering Committee's unanimous decision;

 
(ii)  
file and maintain with the European Medicines Agency (EMEA) within [***] after
the filing date of the NDA the application for European Marketing Authorization;

 
(iii)  
file and maintain within [***] after the filing date of the NDA all applications
for Marketing Authorizations in such other countries where Licensee wishes to
exercise the license rights granted under this Agreement;

 
(iv)  
manufacture and, as the case may be, have manufactured the Product in accordance
with the terms and conditions of this Agreement;

 
(v)  
sell the Product under one or several Trademark(s);

 
(vi)  
make Commercially Reasonable Efforts to perform the required marketing
activities (such as quarterly plans of action, continuing medical education
programs, direct-to consumer advertising and public relations campaigns in
relation to the Product); and

 
(vii)  
subject to the approval of the Joint Marketing Committee pursuant to
Section 4.3(iii)(e), refrain from using (a) the Product, (b) the Know-How, (c)
any Product-related data generated in connection with the development of the
Product in accordance with the Development Plan and (d) any Product-related data
generated in connection with the commercialization of the Product for any other
activity than the commercialization of the Product in accordance with the terms
and conditions of this Agreement.

________________________
 
 
 
[***]CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO SUCH OMITTED PORTIONS.

 
 
 
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4.3  
Joint Marketing Committee. Licensor and Licensee shall establish a joint
committee to approve, coordinate and oversee the commercialization of the
Product (the "Joint Marketing Committee").

 
(i)  
Members. The Joint Marketing Committee shall consist of four (4) members, two
(2) members from each Party. Licensee shall designate one (1) of its members as
the chairperson of the Joint Marketing Committee.

 
(ii)  
Responsibilities of the Chairperson. The chairperson of the Joint Marketing
Committee shall:

 
(a)  
call meetings of the Joint Marketing Committee;

 
(b)  
establish the agenda for each meeting of the Joint Marketing Committee; and

 
(c)  
inform the members on progress made on the commercialization of the Product upon
request of any member and at each meeting of the Joint Marketing Committee.

 
(iii)  
Responsibilities. The Joint Marketing Committee shall:

 
(a)  
determine the Trademark(s) under which the Product shall be sold;

 
(b)  
determine the Exclusive Distributor(s) pursuant to Section  2.1(iv);

 
(c)  
approve the delegation of Licensee's responsibility to file and maintain an
application for Marketing Authorization to a Distributor pursuant to
Section 2.1(iv);

 
(d)  
determine the Sublicensee(s) pursuant to Section 2.2; and

 
(e)  
approve uses of the Product, the Know-How, the Product-related data generated in
connection with the development of the Product in accordance with the
Development Plan and the Product-related data generated in connection with the
commercialization of the Product for any activity other than the
commercialization of the Product in accordance with the terms and conditions of
this Agreement.

 
(iv)  
Meetings. The Joint Marketing Committee shall meet on an as needed basis on such
dates and at such times as the Parties shall agree; provided, however, that
Licensor shall have the right to request up to two such meetings in every
calendar year. The meetings shall alternate between the offices of the Parties
unless the Parties otherwise agree.

 
(v)  
Decisions. All decisions of the Joint Marketing Committee, including without
limitation on matters pursuant to Section 4.3(iii), shall be made unanimously by
the members (or their designees) present at any meeting. Such decisions shall
require at least one (1) member of each Party being present at such meeting.
However, with respect to marketing matters not addressed in Section 4.3(iii)
which are in dispute between the Parties, Licensee shall have final decision
authority after due consultation with Licensor.

 
 
15

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(vi)  
Expenses. Licensee shall be responsible for all travel (business class or
equivalent) and related costs and expenses for all members, designees and
invitees to attend meetings of, and otherwise participate on, the Joint
Marketing Committee.

 
4.4  
Marketing Authorizations. Subject to Section 11.6(iii), all Marketing
Authorizations (and applications therefore and rights thereto) for the Product
shall be applied for in the name of, and shall be owned exclusively, by
Licensee.

 
4.5  
Costs. Licensee shall bear all costs in connection with the commercialization of
the Product.

 
5.  
PAYMENTS AND ROYALTIES

 
5.1  
Milestone Payments. Licensee shall pay Licensor the following non-refundable
milestone payments to be paid or transferred, respectively, only once
irrespective of the number of times a milestone has been achieved:

 
(i)  
[***]of restricted common shares of Licensee upon the execution of this
Agreement, to be transferred within ten (10) working days after the Effective
Date and to be freely disposable by Licensor in accordance with the Securities
Act of 1933 and Securities and Exchange Commission rules and regulations;

 
(ii)  
[***];

 
(iii)  
[***]; and

 
(iv)  
[***].

 
5.2  
Royalty. Licensee shall pay Licensor within sixty (60) days after the end of
each Royalty Period the following royalties on the Net Sales of all Products
which are manufactured or Transferred in any country in the License Territory
during the respective Royalty Period based on cumulated Net Sales in such
Royalty Period (the "Royalties"):

_________________
 
[***]CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO SUCH OMITTED PORTIONS.

 
 
 
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(i)  
zero percent (0%) on the cumulated Net Sales from zero United States Dollars
(USD 0) to thirty million United States Dollars (USD 30,000,000);

 
(ii)  
five percent (5%) on the cumulated Net Sales from thirty million one United
States Dollars (USD 30,000,001) to sixty million United States Dollars
(USD 60,000,000);

 
(iii)  
twelve percent (12%) on the cumulated Net Sales from sixty million one United
States Dollars (USD 60,000,001) to one hundred million United States Dollars
(USD 100,000,000);

 
(iv)  
sixteen percent (16%) on the cumulated Net Sales from one hundred million one
United States Dollars (USD 100,000,001) to two hundred million United States
Dollars (USD 200,000,000);

 
(v)  
twenty percent (20%) on the cumulated Net Sales from two hundred million one
United States Dollars (USD 200,000,001) to three hundred million United States
Dollars (USD 300,000,000); and

 
(vi)  
twenty-five percent (25%) on the cumulated Net Sales above three hundred million
United States Dollars (USD 300,000,00).

 
5.3  
Participation in Revenue-Independent Fees. In addition to the payments pursuant
to Section 5.2, Licensee shall pay Licensor within thirty (30) days after the
end of each Reporting Period twenty-five percent (25%) of all
Revenue-Independent Fees in the respective Reporting Period.

 
5.4  
Royalty Ceiling. Licensee's obligation to pay Royalties shall cease if the
cumulative Royalties, excluding (i) the milestone payments pursuant to
Section 5.1 and (ii) the participation in Revenue-Independent Fees pursuant to
Section 5.3 have reached one hundred fifty million United States Dollars
(USD 150,000,000; the "Royalty Ceiling"). Upon achievement of the Royalty
Ceiling, the exclusive licenses granted to Licensee under Section 2 shall be
automatically and without further notice deemed fully paid-up, freely assignable
and sublicensable and shall irrevocably be granted until the date on which all
Valid Claims included in the Patent Rights have expired in all countries of the
License Territory.

 
5.5  
Form of Payment. All payments due to Licensor under this Agreement shall be
payable in United States Dollars and shall be transferred by wire to:

 

  Bank:  Centrum Bank, FL 9490 Vaduz       Account:   072 1100 A 000 U      
IBAN:   LI 610880-8072-1100-A-000-U       Address of holder:   M et P Patent AG,
FL 9490 Vaduz    

                                                                                         
                                        
5.6  
Overdue Payments. The payments due under this Agreement shall, if overdue, bear
interest beginning on the first day following the Royalty Period to which such
payment was incurred and until payment thereof at a per annum rate equal to five
percent (5%). Any such overdue payments when made shall be accompanied by all
interest so accrued.

 
 
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5.7  
Taxes and Withholding. Licensor shall pay any and all taxes levied on account of
all payments it receives under this Agreement. If laws or regulations require
that taxes be withheld, Licensee will (i) deduct those taxes from the remittable
payment (ii) timely pay the taxes to the proper taxing authority and (iii) send
proof of payment to Licensor within thirty (30) days of receipt of confirmation
of payment from the relevant taxing authority. Licensee agrees to make all
lawful and reasonable efforts to minimize such taxes to Licensor. If Licensee is
so required then Licensor and Licensee shall co-operate in all respects and take
all reasonable steps to lawfully avoid payment of any such withholding taxes.
Licensor shall provide Licensee prior to any payments under this Agreement, with
all necessary forms or documentation required to claim the exemption from such
withholding taxes.

 
5.8  
Foreign Exchange. The currency for all accounting to be made under this
Agreement shall be United States Dollars. Except as the Parties otherwise
mutually agree, the Reports shall be translated into United States Dollars using
the currency exchange rates quoted by Bloomberg, a service of Bloomberg L.P., or
in the event Bloomberg is not available, then The Wall Street Journal, on the
last business day of the applicable calendar month or calendar quarter, as
applicable. Payments shall be made in United States Dollars, using the currency
exchange rates quoted by Bloomberg, a service of Bloomberg L.P., or in the event
Bloomberg is not available, then The Wall Street Journal for the average monthly
rate of exchange.

 
6.  
REPORTS AND RECORDS

 
6.1  
Progress Reports. At the end of each Reporting Period, Licensee shall report in
writing to Licensor on progress made on research and development, status of
applications for regulatory approvals, manufacturing and sublicensing.

 
6.2  
Milestone Achievement Notification. Licensee shall report to Licensor the dates
on which it achieves the milestones set forth in Sections 5.1(iii) and 5.1(iv)
within ten (10) days of each such occurrence.

 
6.3  
Commercial Sales and Revenue-Independent Fees Reports. Licensee shall deliver
reports to Licensor within ten (10) days after the end of each Reporting Period
(the "Reports"). Each report shall contain:

 
(i)  
Net Sales for the applicable Reporting Period in each territory;

 
(ii)  
amount of all Revenue-Independent Fees for the applicable Reporting Period;

 
(iii)  
total Royalties payable on Net Sales in United States Dollars; and

 
(iv)  
total participation of Licensor in the Revenue-Independent Fees in United States
Dollars.

 
 
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If no amounts are due to Licensor for any Reporting Period, the report shall so
state.
 
6.4  
Records Retention; Audit

 
(i)  
Records. Commencing as of the date of the first Commercial Sale, Licensee shall
keep at Licensee's headquarters for at least three (3) years from the end of the
Royalty Period to which they pertain complete and accurate records of sales of
the Product by Licensee, its Affiliates and the Exclusive Distributor(s), in
sufficient detail to allow the accuracy of the Royalties to be confirmed.

 
(ii)  
Audit. Subject to the other terms of this Section 6.4(ii), at the request of
Licensor, upon at least ten (10) business days' prior written notice, and at its
sole expense (except as otherwise provided herein), Licensee shall permit an
independent certified public accountant reasonably selected by Licensor and
reasonably acceptable to Licensee to inspect the relevant records required to be
maintained by Licensee under Section 6.4(i) at the headquarter of the Licensee
during regular business hours. At Licensor's request, the accountant shall be
entitled to audit the then-preceding three (3) years of Licensee's records for
purposes of verifying Licensee's calculations of the Royalties, provided that no
year shall be audited more than once. At Licensee's request, the accountant
shall enter into a confidentiality agreement with both Parties limiting the
disclosure and use of such information by such accountant to authorized
representatives of the Parties and the purposes of this Section 6.4. Results of
any such audit and at a Party's request the working papers for such audit shall
be made available to both Parties and such results shall be binding on both
Parties. If any such audit reveals a deficiency in the calculation of Royalties
resulting from any underpayment by Licensee, Licensee shall promptly pay
Licensor the amount remaining to be paid (plus interest thereon at the rate
provided in Section 5.6), and if such underpayment is by five percent (5%) or
more, Licensee shall pay the costs and expenses of the audit. If such audit
reveals overpayments by Licensee in any year, such amounts shall promptly be
refunded by Licensor to Licensee (plus interest thereon at the rate provided in
Section 5.6).

 
7.  
PATENT AND TRADEMARK REGISTRATION AND MAINTENANCE; OWNERSHIP AND INVENTIONS

 
7.1  
Responsibility. Licensor shall have the sole responsibility to register and
maintain the registrations of the Patent Rights and Trademarks.

 
7.2  
Information. Licensor shall keep Licensee reasonably informed of all filings and
payments in connection with the registrations and maintenance of the Patent
Rights and Trademarks.

 
7.3  
Costs. Licensor shall bear all costs in connection with the registration and
maintenance of the Patent Rights and Trademarks.

 
7.4  
Ownership. Each Party shall remain the sole owner or licensee, as applicable, of
all technology, discoveries, patent applications, patents, trade secrets and
inventions owned or controlled by such Party on the Effective Date and shall
have no rights in or to technology, discoveries, patent applications, patents,
know-how and inventions owned by the other Party except as specifically provided
by this Agreement.

 
 
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7.5  
Product-Related Inventions. The entire right and title in all technology
relating to the Product and arising out of work performed by the Parties in the
course of conducting activities pursuant to this Agreement conceived by
employees or others acting on behalf of Licensor, Licensee or their Affiliates
shall be owned solely by Licensor, subject to Licensee's exclusive rights
hereunder. Licensee hereby assigns to Licensor without further compensation all
of Licensee's right with respect to such Product-related inventions. To ensure
Licensor's ownership of such Product-related inventions, Licensee shall promptly
disclose each such Product-related invention to Licensor and, without disclosing
the same to others, communicate to Licensor all available information relating
to such Product-related inventions.

 
7.6  
Other Inventions. Subject to Section 7.5, the entire right and title in all
technology out of work performed by the Parties in the course of conducting
activities pursuant to this Agreement (i) conceived by employees or others
acting solely on behalf of Licensor or its Affiliates shall be owned solely by
Licensor, subject to Licensee's exclusive rights hereunder (ii) conceived by
employees or others acting solely on behalf of Licensee or its Affiliates shall
be owned solely by Licensee, and (iii) conceived by employees or others acting
jointly on behalf of Licensor and Licensee, or their respective Affiliates,
shall be owned solely by Licensor, subject to Licensee's exclusive rights
hereunder. The Joint Development Steering Committee will determine the Party
responsible for prosecuting patent applications relating to jointly owned
technology. The preparation, filing and prosecution of patent application(s)
relating to any jointly owned technology, and the maintenance and prosecution of
any patent(s) resulting there from (a "Joint Patent"), shall be performed by
counsel mutually acceptable to the Parties and costs for such preparation,
filing, prosecution and maintenance shall be borne equally by the Parties. In
the event either Party becomes aware of any actual or threatened infringement in
the License Territory of any claim of a Joint Patent, that Party shall promptly
notify the other and shall promptly discuss how to proceed in connection with
such actual or threatened infringement. In the event that only one Party wishes
to participate in such proceeding, it shall have the right to proceed alone, at
its expense, and may retain any recovery; provided, at the request and expense
of the participating Party, the other Party agrees to cooperate and join in any
proceedings in the event that a Third Party asserts that the co-owner of such
Joint Patent is necessary or indispensable to such proceedings. Subject to
Licensee's exclusive rights hereunder, each Party shall have the right to
practice any jointly owned technology as provided under applicable law, and with
respect thereto, neither Party shall have a duty to account for revenues or
profits earned in respect of the uses and exploitation of such inventions
jointly owned by such Party to the other joint owner(s).

 
 
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8.  
INFRINGEMENT, VALIDITY CHALLENGES AND THIRD PARTY RIGHTS

 
8.1  
Infringement

 
(i)  
Notice of Infringement. Each Party shall promptly report in writing to the other
Party during the term of this Agreement any known or suspected infringement of
any Patent Right or Trademark in the License Field and License Territory of
which such Party becomes aware, and shall provide the other Party with all
available evidence supporting such infringement or suspected infringement.

 
(ii)  
Infringement Action by Licensor. Licensor shall have the sole right (but not the
obligation), at its own costs and expense, to bring an infringement action or
file any other appropriate action or claim directly related to infringement of a
Patent Right or Trademark against any Third Party. If Licensor elects not to
bring a suit against an alleged infringer, it shall inform Licensee and Licensee
shall be entitled by Licensor to bring such infringement action by way of
authority at Licensee's costs and expense. Licensor shall have the right to
participate in and be represented in any suit under this Section 8.1(ii) by its
own counsel at its own costs and expense.

 
(iii)  
Mutual Information. The Parties shall keep each other reasonably informed of all
material developments in connection with any proceedings under this Section 8.1.

 
8.2  
Validity Challenges

 
(i)  
Defense by Licensor. Licensor shall, at its own costs and expense, use its
reasonable efforts to defend the Patent Rights and Trademarks against validity
challenges of Third Parties.

 
(ii)  
Defense by Licensee. In the event Licensor decides not to defend the Patent
Rights or Trademarks as provided in Section 8.2(i), it shall inform Licensee
thereof and Licensee shall be entitled by Licensor to conduct such litigation by
way of authority at Licensee's costs and expense. Licensor shall have the right
to participate in and be represented in any proceedings under this
Section 8.2(ii) by its own counsel at its own costs and expense.

 
(iii)  
Mutual Information. The Parties shall keep each other reasonably informed of all
material developments in connection with any proceedings under this Section 8.2.

 
8.3  
Third Party Rights

 
(i)  
Notice of Infringement Allegation. If Licensee is alleged by a Third Party to
infringe patent rights or trademarks of such Third Party based on the
exploitation of the Patent Rights or Trademarks, Licensee shall promptly inform
in writing Licensor about such allegation.

 
 
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(ii)  
Defense by Licensee. Licensee shall make Commercially Reasonable Efforts to
defend against any assertions pursuant to Section 8.3(i) at its own costs and
expense. Licensee shall keep Licensor reasonably informed of all material
developments in connection with any suit under this Section 8.3(ii). Licensor
shall have the right to participate in and be represented in any suit under this
Section 8.3(ii) by its own counsel at its own costs and expense.

 
8.4  
Conduct of Action; Costs. If required under applicable law in order for either
Party to initiate or maintain a suit under this Section 8, the non-initiating
Party shall join as a party to the suit, at the initiating Party's expense. The
non-initiating Party shall offer reasonable assistance to the initiating Party
in connection therewith at no charge to the non-initiating Party except for
reimbursement of reasonable out-of-pocket expenses incurred in rendering such
assistance.

 
8.5  
Recovery. Any award paid by a Third Party as the result of such proceedings
(whether by way of settlement or otherwise) shall first be applied to
reimbursement of the unreimbursed legal fees and expenses incurred by either
Party and then the remainder shall be divided between the Parties as follows:

 
(i)  
if the amount is based on lost profits, (a) Licensee shall receive an amount
equal to the damages the court determines Licensee has suffered as a result of
the infringement less the amount of any Royalties and other payments that would
have been due to Licensor on Net Sales lost by Licensee and any other lost
opportunities as a result of the infringement and (b) Licensor shall receive an
amount equal to the Royalties and other payments it would have received if such
Net Sales had been made and such other opportunities captured by Licensee; and

 
(ii)  
awards other than those based on lost profits shall inure to the benefit of the
initiating Party.

 
8.6  
Losses. The non-initiating Party shall not be liable for any losses incurred as
the result of an action for infringement brought against the initiating Party as
a result of the initiating Party's exercise of any right granted under this
Agreement.

 
9.  
INDEMNIFICATION

 
 
9.1  
Indemnification by Licensee. Subject to Licensee’s indemnification rights under
Section 9.2, Licensee shall indemnify, defend and hold harmless Licensor and its
Affiliates and their respective trustees, directors, officers, medical and
professional staff, employees and agents and their respective successors, heirs
and assigns (each an "LicensorIndemnitee") from and against any liability,
damage, loss or expense (including reasonable attorney's fees and expenses of
litigation) incurred by or imposed upon the Licensor Indemnitees or any one of
them in connection with any claims, suits, actions, demands, proceedings, causes
of action or judgments arising out of (i) any theory of product liability
(including, but not limited to, actions in the form of tort, warranty or strict
liability; collectively the "Claims") concerning any Product developed,
designed, tested preclinically or clinically, made, used or sold pursuant to any
right or license granted under this Agreement or (ii) any breach of Licensee’s
representations, warranties, covenants or other obligations hereunder or failure
to comply with applicable law, except to the extent that the Claim results from
gross negligent act or willful misconduct by an Licensor Indemnitee.

 
 
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9.2  
Indemnification by Licensor. Subject to Licensor's indemnification rights under
Section 9.1, Licensor shall indemnify, defend and hold harmless Licensee and its
Affiliates and their respective directors, officers, employees and agents and
their respective successors, heirs and assigns (each a "Licensee Indemnitee")
from and against any liability, damage, loss or expense (including reasonable
attorney's fees and expenses of litigation) incurred by or imposed upon the
Licensee Indemnitees or any one of them in connection with any Claims arising
out of any breach of Licensor's representations and warranties pursuant to
Sections 10.1, 10.3 and 10.4, except to the extent that the Claim results from
gross negligent act or willful misconduct by a Licensee Indemnitee.

 
9.3  
Procedure. As applicable, each indemnifying Party agrees, at its own expense, to
provide attorneys reasonably acceptable to the indemnified Party to defend
against any Claim brought or filed against any Licensor or Licensee Indemnitee
(as the case may be) with respect to the subject of indemnity contained herein,
whether or not such Claims are rightfully brought. With respect to any Claim for
indemnification under this Section 9, the Licensor or Licensee Indemnitees (as
the case may be) shall:

 
(i)  
promptly notify the indemnifying Party in writing of any Claim in respect of
which the Licensor or Licensee Indemnitees (as the case may be) intend to seek
such indemnification hereunder;

 
(ii)  
provide the indemnifying Party sole control of the defense or settlement
thereof; and

 
(iii)  
provide the indemnifying Party, at the indemnifying Party's request and expense,
with reasonable assistance and full information with respect thereto.

 
10.  
WARRANTIES, LIABILITY AND DISCLAIMER

 
10.1  
General. As of the Effective Date, each Party represents to the other Party
that:

 
(i)  
such Party is duly organized and validly existing under the laws of the state of
its incorporation and has full corporate power and authority to enter into this
Agreement and to carry out the provisions hereof;

 
(ii)  
such Party is duly authorized to execute and deliver this Agreement and to
perform its obligations hereunder;

 
(iii)  
this Agreement is a legal and valid obligation binding upon it and is
enforceable in accordance with its terms. To the best knowledge of such Party,
the execution, delivery and performance of this Agreement by such Party does not
conflict with any agreement, instrument or understanding, oral or written, to
which it is a party or by which it may be bound, nor violate any law or
regulation of any court, governmental body or administrative or other agency
having authority over it; and

 
 
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(iv)  
there are no actions, suits or proceedings pending or, to its knowledge,
threatened against it or its Affiliates that affect its ability to carry out its
obligations under this Agreement.

 
10.2  
Restricted Shares in Licensee. Licensee represents to Licensor that the shares
to be transferred to Licensor by Licensee pursuant to Section 5.1(i) are subject
to the U.S. Federal Securities Act of 1933. Licensor understands that such
shares are characterized as "restricted securities" under U.S. federal
securities laws inasmuch as they are being acquired from the Licensor 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 U.S. Federal Securities Act of 1933only in certain limited circumstances.
Licensor agrees to resell such shares only in accordance with the provisions of
Regulation S, pursuant to registration under the U.S. Federal Securities Act of
1933, or pursuant to an available exemption from registration, and agrees not to
engage in hedging transactions with regard to such securities unless in
compliance with the U.S. Federal Securities Act of 1933. Licensor understands
that the shares have not been registered under the Securities Act and will not
sell, offer to sell, assign, pledge, hypothecate or otherwise transfer any of
the Shares unless (i) pursuant to an effective registration statement under the
U.S. Federal Securities Act of 1933, as amended, (ii) such holder provides
Licensee with an opinion of counsel, in form and substance reasonably acceptable
to Licensee, to the effect that a sale, assignment or transfer of the Shares may
be made without registration under the U.S. Federal Securities Act of 1933 and
the transferee agrees to be bound by the terms and conditions of this Agreement,
(iii) such holder provides Licensee with reasonable assurances (in the form of
seller and broker representation letters) that the Shares can be sold pursuant
to Rule 144 promulgated under the U.S. Federal Securities Act of 1933, (iv)
pursuant to Rule 144(k) promulgated under the U.S. Federal Securities Act of
1933 following the applicable holding period, or (v) in accordance with the
provisions of Regulation S. Licensor further understands that, except as
provided below, certificates evidencing the shares may bear the following or any
similar legend: "The securities represented hereby may not be transferred unless
(i) such securities have been registered for sale pursuant to the U.S. Federal
Securities Act of 1933, as amended, (ii) such securities may be sold pursuant to
Rule 144(k), (iii) such securities may be sold pursuant to Regulation S, or (iv)
the Company has received an opinion of counsel reasonably satisfactory to it
that such transfer may lawfully be made without registration under the U.S.
Federal Securities Act of 1933 or qualification under applicable state
securities laws. Hedging transactions involving the securities represented
hereby may not be conducted unless in compliance with the U.S. Federal
Securities Act of 1933."

 
10.3  
Licensor's Patent Rights, Trademarks and IND. As of the Effective Date, Licensor
represents to Licensee that to the best of Licensor's knowledge:

 
 
 
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(i)  
Licensor is the sole owner of all right, title and interest in and to the Patent
Rights and the Trademarks and that, within the License Field, no such rights are
licensed from a Third Party;

 
(ii)  
Licensor, within the License Field, has not at any time disposed of any Patent
Rights or Trademarks whether by selling, assignment, license grant or otherwise
and that it has the right to grant the exclusive licenses granted to Licensor in
this Agreement. Licensor further has not granted any license under the Patent
Rights or the Trademarks to any Third Party that would conflict with the
licenses granted to Licensee hereunder and is under no obligation to grant any
such license;

 
(iii)  
no patent or patent application included in the Patent Rights is the subject of
any pending reexamination, reissue, interference, opposition, cancellation or
other protest proceedings or legal disputes. No Trademark is the subject of any
opposition or cancellation proceedings or other protest proceedings or legal
disputes;

 
(iv)  
Licensor is the sole owner of the IND, free and clear of all liens, claims and
encumbrances;

 
(v)  
no outstanding notice, citation, summons or order has been issued, no
outstanding complaint has been filed, no outstanding penalty has been assessed
and no investigation or review is pending or threatened by any government
authority or other person with respect to any alleged violation by Licensor
related to the Product; and

 
(vi)  
Licensor has paid all user fees and all other fees and payments due as of the
Effective Date necessary in connection with the filing of the IND.

 
10.4  
No Third-Party Infringement. Licensor represents and warrants that to its
knowledge there are no restrictions or limitations on the Licensor's Patent
Rights and Trademarks and that there has been, by the Effective Date, no
conflict with, or infringement or threatened or likely infringement directed to
Licensor of any of the Licensor's Patent Rights, Know-How or Trademarks.
Licensor makes no representation or warranty that the manufacture, use,
importation or sale of the Product by Licensee or its Affiliates, Distributors
or Sublicensees or their customers will not constitute an infringement of the
intellectual property rights of others. Licensor makes no representations,
extends no warranties of any kind, either express of implied, including but not
limited to the implied warranties of merchantability or fitness for a particular
purpose, and assumes no responsibility whatever with respect to design,
development, manufacture, use, sale, importation or other disposition of the
Product by Licensee, its Affiliates, Distributors or Sublicensees to their
respective customers.

 
10.5  
Liability Limitation. Notwithstanding anything herein to the contrary, in no
event shall either Party be liable to the other Party for lost profits or
indirect, incidental, special, consequential or punitive damages resulting from
this Agreement. For the avoidance of doubt, Licensor does not assume any
liability under this Agreement as to the fitness of the Product for a particular
use or the marketability of the Product.

 
 
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11.  
TERM AND TERMINATION

 
11.1  
Term. This Agreement shall enter into force on the Effective Date and shall
remain in effect, on a country by country basis, until the date on which all
Valid Claims included in the Patent Rights of such country have expired, unless
this Agreement is terminated earlier in accordance with this Section 11.

 
11.2  
Ordinary Termination. Licensee may terminate this Agreement by giving nine (9)
months' advance notice to Licensor.

 
11.3  
Termination with Immediate Effect. This Agreement may be terminated with
immediate effect:

 
(i)  
by Licensor if Licensee fails to perform the Initial Milestone Payment when due;

 
(ii)  
by Licensor if Licensee fails to file the NDA pursuant to Section 4.2(i);

 
(iii)  
by Licensor, if the Net Sales of all Products do not reach or [***]in the second
Royalty Period; provided, however, that Licensor refunds to Licensee the
clinical development costs of the Product up to [***] which Licensee can show by
written evidence (a) have been incurred by Licensee and (b) are directly
attributable to the development of the Product; in the event the FDA requires a
clinical end point study as provided in Section 4.2(i), such [***];

 
(iv)  
by Licensor if the Net Sales of all Products do not reach or exceed [***]in the
fourth Royalty Period; provided, however, that Licensor refunds to Licensee the
clinical development costs of the Product up to a maximum of [***] which
Licensee can show by written evidence (a) have been incurred by Licensee and (b)
are directly attributable to the development of the Product; in the event the
FDA requires a clinical end point study as provided in Section 4.2(i), such
maximum shall be [***];

 
(v)  
by Licensor if Licensee develops, manufactures or commercializes a product which
Licensor reasonably considers to substitute the Product in any country of the
License Territory where a Valid Claim exists;

 
 
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(vi)  
by Licensor if Licensee directly or indirectly challenges the validity of any
Patent Right or Trademark;

 
(vii)  
subject to Licensor's right to immediate termination according to
Sections 11.3(i) and 11.3(ii), by the non-defaulting Party if the other Party
defaults in the performance of any of its material obligations under this
Agreement to an extent that renders continuation of this Agreement unacceptable
for the non-defaulting Party and if such default has not been cured within
ninety (90) days after notification of the defaulting Party; "material
obligation" shall include, without limitation, Licensee's obligations pursuant
to Sections 4.2(ii), 5.1(iii) and 5.1(iv); and

 
(viii)  
by Licensor in the event of bankruptcy, receivership, insolvency or assignment
for the benefit of creditors of Licensee.

 
11.4  
Partial Termination. This Agreement automatically terminates in those countries
of the License Territory where Licensee has not filed Marketing Authorizations
within [***] after the filing date of the NDA pursuant to Section 4.2(iii). In
respect of the countries concerned by such partial termination, the provisions
set forth in Section 11.6 shall apply correspondingly.

 
11.5  
Change of Licensee's Ownership. If Licensee is acquired by a share or asset deal
by a Third Party before the Royalty Ceiling has been reached, Licensee has the
option to (i) pay, at the same time Licensee's acquisition is executed, to
Licensor the difference between the Royalty Ceiling and the cumulative Royalties
effectively paid up to that time, whereupon no further Royalties shall be due,
or (ii) terminate this Agreement with immediate effect after the execution of
Licensee's acquisition without any duty of Licensor to compensate for Licensee's
clinical development costs of the Product.

 
11.6  
Effects of Termination. Upon termination of this Agreement in accordance with
Section 11.2, 11.3, 11.4 or 11.5(ii):

 
(i)  
Licensee shall immediately cease all (a) use of the rights and licenses granted
under this Agreement and (b) Transfer of the Product;

 
(ii)  
each Party shall immediately return the Confidential Information of the other
Party;

 
(iii)  
all Marketing Authorizations including, without limitation, any related
application documents held by Licensee shall immediately be transferred to
Licensor, whereby such transfer shall be arranged for by Licensee in due time in
order that such transfer can be effected by the date the termination becomes
effective;

____________________
 
 
[***]CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO SUCH OMITTED PORTIONS.

 
 
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(iv)  
ownership of all trademarks and other intellectual property attributable to the
Product and held by Licensee shall immediately be transferred to Licensor;

 
(v)  
all Royalties and other payments accrued or due to Licensor as of the
termination date shall become immediately payable; and

 
(vi)  
Licensor has the option to acquire Licensee's remaining inventory of the Product
at Licensee's cost price. If Licensor does not exercise such option within
fourteen (14) days after termination of this Agreement, Licensee is granted a
period of six (6) months from the date of termination of this Agreement during
which it may sell its remaining inventory of the Product; provided, however,
that it (a) sells such inventory in a manner substantially similar to the manner
in which it was selling the Product prior to the termination of this Agreement
and (b) pays to Licensor any Royalties accruing on sales of such Product in
accordance with Section 5 hereof.

 
11.7  
Effects of Termination on Sublicenses and Distributors. Any sublicenses granted
by Licensee under this Agreement as well as any agreements with any Distributors
shall provide for termination or assignment to Licensor of Licensee's interest
therein at the option of Licensor upon termination of this Agreement.

 
11.8  
Survival. Expiration or termination of this Agreement for any reason shall
neither release either Party from any liability which at such time has already
accrued or which thereafter accrues from a breach or default prior to such
expiration or termination, nor affect in any way the survival of any other
right, duty or obligation of either Party which is expressly stated elsewhere in
this Agreement to survive such termination. Sections 7.5, 7.6, 9, 11.6, 11.7,
12.7 and 13 shall survive expiration or termination of this Agreement.

 
12.  
MISCELLANEOUS

 
12.1  
Notices. All notices or other communications between the Parties in connection
with this Agreement shall be made in writing and sent by registered mail or a
recognized courier service to the addresses listed on the first page of this
Agreement or such other address as the addressee shall have specified in a
notice actually received by the addressor.

 
 
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12.2  
Costs, Expenses and Taxes. Except as otherwise provided in this Agreement, all
costs, expenses and taxes incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by the Party incurring such
costs, expenses and taxes.

 
12.3  
Entire Agreement. This Agreement constitutes the entire agreement between the
Parties with respect to the subject matter of this Agreement and supersedes all
other prior written and oral agreements of the Parties relating thereto.

 
12.4  
Amendment; Waiver. No provision of this Agreement may be modified, amended or
waived except by an instrument in writing signed by the Parties. No failure of a
Party to exercise a contractual right or to insist on strict compliance with
this Agreement, and no practice at variance with the terms of this Agreement
shall constitute a waiver of the right to demand strict compliance and shall not
impair the rights with respect to any subsequent breach of this Agreement.

 
12.5  
Severability. If any provision of this Agreement is found invalid or
unenforceable, the remainder of this Agreement remains in full force and effect.
The invalid or unenforceable provision shall be replaced by such valid and
enforceable provision attaining as nearly as possible the same economic effect.

 
12.6  
Assignment. So long as the Royalty Ceiling is not achieved in accordance with
Section 5.4 or 11.5, Licensee may not transfer or assign its rights and
obligations under this Agreement without the prior written consent of Licensor.
Licensor shall not be restricted to assign or transfer the Patent Rights, the
Trademarks, this Agreement or any of its rights and obligations under this
Agreement. The rights and obligations of the Parties under this Agreement shall
be binding upon and inure to the benefit of the successors and permitted assigns
of the Parties. Any assignment not in accordance with this Agreement shall be
void.

 
12.7  
Confidentiality. The Parties shall keep the Confidential Information and the
contents of this Agreement strictly confidential. All public announcements or
press releases issued in connection with the transactions contemplated by this
Agreement shall only be published after the Parties have agreed on the contents
of such public announcements or press releases.

 
12.8  
Execution. This Agreement may be executed in two or more counterparts, all of
which when taken together shall be considered one and the same instrument.

 
12.9  
Force Majeure. Neither Party shall be held liable or responsible to the other
Party nor be deemed to have defaulted under or breached this Agreement for
failure or delay in fulfilling or performing any term of this Agreement when
such failure or delay is caused by or results from causes beyond the control of
the affected Party, such as fire, floods, embargoes, war, acts of war (whether
war be declared or not), insurrections, riots, civil commotions, strikes,
lockouts or other labor disturbances or acts of God.

 
12.10  
Independent Contractors. It is expressly agreed that Licensor and Licensee shall
be independent contractors and that the relationship between the two Parties
shall not constitute a partnership or agency of any kind. Neither Licensor nor
Licensee shall have the authority to make any statements, representations or
commitments of any kind, or to take any action, which shall be binding on the
other Party, without the prior written consent of the other Party.

 
 
29

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13.  
GOVERNING LAW AND DISPUTE RESOLUTION

 
13.1  
Governing Law. This Agreement shall be governed by, and construed in accordance
with, the laws of Switzerland, without giving effect to any conflict of law
provisions thereof.

 
13.2  
Dispute Resolution. Any dispute arising out of or in relation to this Agreement
shall be finally settled under the Rules of Arbitration of the International
Chamber of Commerce. The place of arbitration shall be in Paris, France, and the
arbitration proceedings shall be held in English. The arbitration tribunal shall
consist of three (3) arbitrators. Each Party shall nominate in the request for
arbitration and the answer thereto one (1) arbitrator and the two (2)
arbitrators so named will then jointly appoint the third arbitrator as the
chairman of the arbitration tribunal. If a Party fails to nominate its
arbitrator or if the Parties cannot agree on the person to be named as chairman
within sixty (60) days, the International Chamber of Commerce in Paris, France,
shall make the necessary appointment of arbitrator or chairman.

 
 

 
 
[signature page follows]
 
 

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 Place / date      Place / date           November 20, 2007   November 20, 2007
           M & P Patent AG     Urigen Pharmaceuticals, Inc.           /s/ Udo
Mattern   /s/  Terry Nida   Chairman and CEO   COO          

                                                                             
 
 
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Annexes
 
Annex 1                      Development Plan
 
Annex 2                      Patent Rights
 
Annex 3                      Specification of the device 3319F-B03B60
 
Annex 4                      Specification of the testosterone-preparation ref.
no. 291007
 
Annex 5                      Licensor's equipment
 
 
 
K:\mandate\118184\license agreement\071115 license agreement urigen.doc
 

 
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Annex 1 - Development Plan
 
 
[***]
 
 
Annex 2 - Patent Rights
 

--------------------------------------------------------------------------------

 
 
 
[***]CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO SUCH OMITTED PORTIONS.

 
 
33

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[***]Annex 3 - Specification of the device 3319F-B03B60
 
 
[***]
 
 

 

--------------------------------------------------------------------------------

 
 
Annex 4 - Specification of the testosterone-preparation ref. no. 291007
 
 
[***]
 
 

 
 
Annex 5 - Licensor's equipment
 
 

 
Amount
Description
Specification
6 (six)
Tank for transport and storage of bulk mixture
250 litre, stainless steel,
no. GST 250
1 (one)
Tool for BFS filling and packaging
3 x 10 moulds,
design no. 3319F-B03B60

 

 

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[***]CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO SUCH OMITTED PORTIONS.

 

34