Exhibit 10.18

 

*** Text omitted and filed separately

Confidential Treatment Requested

Under 17 C.F.R. §§ 200.80(b)(4)

and 240.24b - 2

 

LICENSE AGREEMENT

 

This License Agreement (“Agreement”) is made as of this 29th day of March, 2002
(the “Effective Date”) by and between ABBOTT LABORATORIES, an Illinois
corporation, with its principal office at 100 Abbott Park Road, Abbott Park, IL
60064 (“Abbott”) and EMPIRE PHARMACEUTICALS, INC., a Delaware corporation, with
its principal office at 4916 Route 81, Greenville, NY 12083 (“Empire”).

 

WITNESSETH

 

WHEREAS, Abbott, through its Affiliate (as defined below), Knoll GmbH & Co. KG
(“Knoll”), is the holder of certain patent applications and patents (“Patents,”
as more fully defined below) relating to Compound (as defined below);

 

WHEREAS, Abbott also possesses proprietary Know-How (as defined below) relating
to Compound; and

 

WHEREAS, Empire wishes to obtain, and Abbott wishes to grant to Empire, an
exclusive license in the Territory (as defined below) under Abbott’s Technology
(as defined below) for the development, manufacture and commercialization of
Product for Pharmaceutical Uses (as defined below).

 

NOW THEREFORE, in consideration of the mutual obligations and promises as set
forth herein, the parties do hereby agree as follows:

 

1. Definitions. As used in this Agreement, the following terms shall have the
following respective meanings:

 

1.1 “Abbott’s Technology” means the Patents and Know-How, including all
Improvements developed by Abbott.

 

1.2 “Affiliate” means any corporation, company, partnership, joint venture
and/or other entity which controls, is controlled by, or is under common control
of either party hereto. For purposes of this definition, control shall mean
direct or indirect ownership of more than fifty percent (50%) of the stock or
participating shares entitled to vote for the election of directors (but only as
long as such ownership exists).

 

1.3 “Compound” means the compound known as ANCROD, its enantiomers, racemates,
isomers and any pharmaceutically acceptable salt or complex thereof, in its
current and any other formulation, and including any Prodrugs and active
metabolites, whether made before or after the Effective Date.

 

1.4 “Confidential Information” means any and all information or data relating to
the Compound and/or Product which a party discloses to the other party, its
employees or representatives, or is conceived or reduced to practice during the
Term by either party or by a third party conducting feasibility and evaluation
studies for Empire, whether in writing, orally or by

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observation, including, without limitation, all scientific, clinical, technical,
commercial, financial and business information and Know-How, and other
information or data considered confidential in nature. Subject to Section 7.1
hereof, Abbott shall hold in confidence and shall not directly or indirectly
disclose or provide to any third party information pertaining to the Compound or
Abbott Technology without Empire’s prior written consent. Confidential
Information shall not include information or any portion thereof which:

 

(a) is known to the receiving party at the time of disclosure and documented by
written records made prior to the date of this Agreement;

 

(b) is subsequently disclosed to the receiving party without any obligations of
confidence by an unaffiliated third person who has not obtained it directly or
indirectly from the other party and who has the right to make such disclosure;

 

(c) becomes patented, published or otherwise part of the public domain;

 

(d) is independently developed by or for the receiving party by person(s) having
no knowledge of or access to such information and without breach of any
confidentiality obligation as evidenced by its written records; or

 

(e) is required to be disclosed by legal, regulatory, statutory or governmental
process or authorities, provided in each case the party disclosing information
promptly informs the other and uses its best efforts to limit the disclosure and
to maintain confidentiality to the maximum extent possible and permits the other
party to attempt by appropriate legal means to limit such disclosure.

 

The contents of and the Exhibits to this Agreement shall constitute Confidential
Information.

 

1.5 “Effective Date” shall have the meaning ascribed to such term in the opening
paragraph of this Agreement.

 

1.6 “First Commercial Sale” means the first sale of Product in the Territory,
after Regulatory Approval, by Empire or its Affiliates (or their sublicensee(s))
to any unaffiliated third party as evidenced by the selling party’s invoice or
other relevant document provided to such third party. A sale to an unaffiliated
third party shall not include quantities delivered solely for research purposes,
for clinical trials or quantities distributed as free samples or promotions.

 

1.7 “Improvements” means all additions, developments, modifications,
enhancements and adaptations (i) which directly relate to or are used in
connection with the Compound and/or Product, or any formulations thereof or
additions, developments, modifications, enhancements, improvements and
adaptations thereto, and (ii) which are conceived or reduced to practice during
the Term. Ownership of Improvements shall be as set forth in Article 13 hereof.

 

1.8 “Know-How” means any proprietary technology, information, methods of use,
processes, techniques, ideas or inventions (other than the Patents) owned,
possessed or used by Abbott as of the Effective Date which is directly related
to or used in connection with the

 

2

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Compound and/or Product, including all trade secrets and any other technical
information relating to development, use or sale of the Compound and/or Product,
provided that Abbott has the right to license and/or sublicense to Empire. To
the best of Abbott’s knowledge and belief, Abbott has the right to license
and/or sublicense substantially all of the Know-How.

 

1.9 “NDA” means an application (whether original, supplementary or abbreviated)
to the applicable Regulatory Authority in a country of the Territory, for
approval by such Regulatory Authority, necessary for the commercial sale of
Product in such country. An NDA, together with all supplemental filings
referencing the initial NDA filing, shall be deemed one and the same NDA for all
purposes of this Agreement.

 

1.10 “Net Sales” means gross sales of the Product by Empire, by any Affiliates
of Empire, or by any sublicensees of Empire, to unrelated third parties, in
arm’s length transactions, including, but not limited to, pharmaceutical
wholesalers, managed healthcare organizations, pharmacies, hospitals or
dispensing physicians, less any of the following charges or expenses that are
incurred in connection with gross sales of the Product to such entities/persons
during the Term:

 

(a) discounts, including cash discounts, customary trade allowances or rebates
actually taken, governmental rebates, chargebacks, commissions, and group
purchasing management fees for formulary access;

 

(b) credits or allowances given or made for rejection, recall or return of
previously sold Product actually taken;

 

(c) any tax or government charge, duty or assessment (including any tax such as
a value added or similar tax or government charge) levied on the sale,
transportation or delivery of Product when included on the invoice or other
written document between the parties as payable by the purchaser and collectable
by Empire, its Affiliate or sub-licensee; and

 

(d) freight, postage, transportation, insurance and duties on shipment of
Product when included on the invoice or other written document between the
parties as payable by the purchaser and collectable by Empire, its Affiliates or
sublicensees.

 

1.11 “Patents” means the patent applications and patents listed in Exhibit A
hereto and any amendments thereto, including foreign equivalents, and any and
all substitutions, extensions, additions, reissues, re-examinations, renewals,
divisions, continuations, continuations-in-part or supplementary protection
certificates derived from or relating thereto.

 

1.12 “Pharmaceutical Uses” means any therapeutic use of the Compound and/or
Product in any formulation or dosage form for the management of a disease or
condition of the human body, including, but not limited to, acute ischemic
stroke, but excluding any non-therapeutic use or non-human use (which
non-therapeutic or non-human use shall include, but not be limited to, imaging,
diagnostics, veterinary medicine, etc.).

 

* Confidential Treatment Requested

 

3

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1.13 “Prodrug” means different pharmaceutical compounds which, following
administration, are converted into structurally similar active metabolites that
are similar to or act in a similar manner as the Compound.

 

1.14 “Product” means any formulation containing the Compound or any Improvement
as an active ingredient for Pharmaceutical Uses.

 

1.15 “Regulatory Approval” means all governmental approvals and authorizations
necessary for the manufacture and commercial sale of the Product in a country of
the Territory, including, but not limited to, marketing authorization, pricing
approval and pricing reimbursement, as applicable.

 

1.16 “Regulatory Authority” means the United States Food and Drug Administration
or any successor entity and its equivalent in other countries of the Territory,
including, but not limited to, EMEA.

 

1.17 “Royalty Period” shall have the meaning ascribed to such term in Section
5.2(a) of this Agreement.

 

1.18 “Term” means the period commencing on the Effective Date and terminating as
set forth in Article 8 below.

 

1.19 “Territory” means the entire world.

 

1.20 “Trademark” means VIPRINEX ®, ARWIN®, ARVIN ® and any other trademark
registered and owned by Abbott in any country of the Territory.

 

1.21 “Valid Claim” means a claim of an unexpired Patent that has not been
withdrawn, canceled or disclaimed nor held invalid or unenforceable by a court
or government agency of competent jurisdiction in an unappealed or unappealable
decision.

 

2. License Grant. Abbott hereby grants to Empire an exclusive right and license
in the Territory, under Abbott’s Technology, for all Pharmaceutical Uses, with
the right to grant sublicenses pursuant to Section 4.6 hereof, to (i) research,
develop, modify, improve, make or have made, Compound and Product; (ii) apply
for and obtain Regulatory Approvals, all as may be required to manufacture and
commercialize Product; and (iii) register, use, import/export, market, offer to
sell and sell, Product and Compound.

 

3. Information; Exclusivity.

 

3.1 Conveyance of Information/Inventory:

 

(a) On or before June 1, 2002, Abbott shall convey to Empire the information
under Abbott’s and its Affiliates’ control involving the Compound, including but
not limited to all information relating to Patents and Know-How, worldwide
regulatory documentation, draft and final clinical reports and data, toxicity
study reports, annual safety reports (if any) for the previous

 

4

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few years, manufacturing protocol and batch records, production methodologies,
claims related to potential violations of any third party rights, registration
information, any collaborative research agreements in the possession of Abbott,
its Affiliates and agents, and all other pertinent and proprietary information
and files related to the Compound, but excluding raw data sources which are not
customarily required for regulatory submission (e.g., laboratory notebooks and
other laboratory databases). In addition, Abbott shall use reasonable efforts to
transfer to Empire Abbott’s interests in [***], such transfers being subject, in
all respects, to applicable Regulatory Approvals. With regard to information
from raw data sources, in the event that such information is requested from
Empire by a Regulatory Authority, Abbott shall use reasonable efforts to provide
Empire with such information. If such information is requested for other
purposes, Abbott shall use reasonable efforts to provide Empire with such
information at a cost of [***] Dollars ($***) per hour of Abbott employee time
to compile such information. For purposes of this Section 3.1, information shall
not be deemed under Abbott’s and its Affiliates’ control if such information is
protected by confidentiality agreements with third parties. With respect to such
protected information, Abbott shall use reasonable efforts to obtain the consent
of such third parties to release the protected information to Empire.

 

(b) Abbott shall convey to Empire all available inventory of the material
(Compound, bulk, raw venom and processed clinical material) to conduct Phase II
clinical evaluation studies, except for such quantities required by Abbott in
connection with internal research purposes and non-Pharmaceutical Uses of the
Compound. Abbott represents that such material was manufactured in accordance
with then existing Knoll internal specifications. Abbott also warrants and
represents that such material was stored in accordance with Knoll’s storage
specifications. Except as provided in the two (2) preceding sentences, any
inventory of material conveyed to Empire under this Section 3.1(b) shall be
conveyed “AS IS” and “WITH ALL FAULTS,” WITHOUT WARRANTY OF ANY KIND WHATSOEVER,
EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF MERCHANTABILITY AND FITNESS FOR
PARTICULAR PURPOSE. Empire shall be responsible for all testing, quality control
and certification of such material. Empire shall be responsible for testing the
raw venom component of the material in accordance with the testing methodologies
specified on Exhibit E attached hereto and made a part hereof (the “Testing
Specifications”).

 

(c) Upon delivery of raw venom in accordance with the schedule specified on
Exhibit D, Empire shall have thirty (30) days following receipt of the raw venom
to determine its compliance with the Testing Specifications. Within such thirty
(30) day testing period, Empire shall provide Abbott with written notice via
facsimile of its determination whether or not the raw venom complies with the
Testing Specifications. Failure to provide such notice shall be deemed an
admission by Empire that the raw venom complies with the Testing Specifications.
If the raw venom complies (or is deemed to comply) with the Testing
Specifications, payment amounts for such raw venom specified on Exhibit D shall
be due within ten (10) days of the earlier of (i) the expiration of the thirty
(30) day testing period, or (ii) the date of determination that the raw venom
complies with the Testing Specifications. If Empire provides Abbott with timely
notice that the raw venom does not comply with the Testing Specifications, then
Empire shall promptly return the raw venom to Abbott.

 

* Confidential Treatment Requested

 

5

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(d) If a dispute arises as to whether the raw venom complies with the Testing
Specifications and the parties are unable to resolve the dispute, the matter
shall be referred to an independent third party testing laboratory located in
the United States and agreed to by the parties. The testing laboratory shall
perform testing of the raw venom in question in accordance with the Testing
Specifications and shall provide results to Abbott and Empire. The decision of
the testing laboratory shall be final and binding on the parties. The cost of
the testing shall be paid by the party found to be in error. If the raw venom is
finally determined not to comply with the Testing Specifications, Empire shall
have the right to terminate this Agreement in accordance with Section 8.2
hereof.

 

3.2 Empire Exclusivity. During the Term, and except as described in Section 4.3,
neither Abbott nor its Affiliates, shall directly or through intermediaries,
undertake any development or commercialization activities related to
Pharmaceutical Uses, except that Abbott shall be entitled to utilize the
Compound for its internal research purposes (including pharmaceutical research),
provided in no event shall such utilization permit Abbott to develop and/or
commercialize Pharmaceutical Uses. For the avoidance of doubt, Abbott shall have
the express right to undertake development and commercialization activities
relating to the Compound for non-Pharmaceutical Uses.

 

4. Feasibility/Evaluation/Development/Manufacturing/Marketing/Other.

 

4.1 Feasibility/Evaluation Studies: Empire shall use commercially reasonable
efforts to evaluate the Compound for the indication of ischemic stroke. For
purposes of Empire’s obligations under this Agreement, the term “commercially
reasonable efforts” shall mean those efforts that would be commercially
reasonable for a company substantially similar to Empire. Empire shall have sole
responsibility for conducting and/or supervising the feasibility and evaluation
studies on the Compound. Empire shall provide Abbott with an annual update and
summary of such studies and all such information shall be treated as Empire’s
Confidential Information. Recognizing that certain evaluation work may be done
by one or more third parties and recognizing that such work (e.g., formulations)
may involve the patented subject matter of such third party, Empire will use
commercially reasonable efforts to (i) provide in its license with the third
party that the patented subject matter of such third party may be sublicensed to
Abbott in the event that the Compound and Product are returned to Abbott under
Section 4.7; and (ii) negotiate a royalty-free license/sublicense with such
third party for the benefit of Abbott in the event that the Compound and Product
are returned to Abbott under Section 4.7. In the event that Empire is unable to
negotiate a royalty-free license/sublicense, Abbott agrees to assume the royalty
obligations thereunder if it elects to practice under such license/sublicense
following the return of the Compound and Product under Section 4.7. Empire
agrees to promptly provide Abbott with written notice of the terms of any
licenses entered into with third parties which pertain to the Compound and/or
Product.

 

4.2 Clinical Development: Empire shall use commercially reasonable efforts to
develop the Compound for the ischemic stroke indication. For purposes of this
Section 4.2(a), development of an indication shall be deemed to have commenced
upon enrollment of the first subject in the first clinical study for an
indication using the formulation selected for clinical development. Empire shall
have sole responsibility for designing, conducting and paying for the

 

6

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cost of the clinical development of Product and shall use commercially
reasonable efforts to diligently conduct such clinical development as set forth
below. Except as set forth in Section 3.2 above, Abbott hereby agrees that it
shall not undertake any research or development related to Pharmaceutical Uses
of the Compound during the Term, except as may be necessary following the
license granted to Abbott under Section 4.7 in the event of a termination of
this Agreement under Sections 8.2, 8.3, 8.4, or 8.5.

 

4.3 Commercialization: Empire shall use commercially reasonable efforts to
develop and commercialize the Product in at least the following major countries:
[***] (each a “Major Country”), using at least that level of effort it would use
with similar compounds in its portfolio; provided, however, that Empire shall
not be obligated to commercialize Product in [***] if, in Empire’s reasonable
opinion, [***] conditions would make the marketing and sale of the Product in
[***] not commercially viable. In the event that Empire or its sublicensees
elect not to market in a particular country(ies), either directly or through
third parties, Abbott shall have the right, upon notice to Empire, to market,
either directly or through third parties, the Product in each such country, by
paying to Empire the [***]. Empire agrees to provide Product to Abbott for sale
in each such country at the [***] and to assign to Abbott all applicable
Regulatory Approvals necessary for Abbott to market Product in such country.

 

4.4 Marketing: Empire shall have sole responsibility for marketing Product,
including entering into any co-marketing and/or co-promotion arrangements.
Empire shall distribute all Product samples in the United States in accordance
with the Prescription Drug Marketing Act.

 

4.5 Manufacturing: Empire and its Affiliates shall have sole responsibility for
manufacturing Product.

 

4.6 Sublicensing: Empire may sublicense its rights under this Agreement with
Abbott’s prior written consent, which consent shall not be unreasonably
withheld. Each sublicense shall be in writing and shall include provisions
acknowledging that such sublicense is subject to the license granted Empire
under this Agreement, that each sublicensee shall make reports and keep and
maintain records of sales to at least the same extent as required under this
Agreement, allowing Abbott the same access and audit rights permitted under this
Agreement, and that such sublicense shall be automatically terminated upon
termination of this Agreement. Empire shall remain primarily liable for all of
Empire’s obligations hereunder and for the performance of sublicensees,
including the obligation to pay milestones and royalties required hereunder.

 

4.7 Improvements: All Improvements and all new patents which relate to the
Compound or the Product which come into existence during the Term and which
relate to or are derived from work done by or for Empire or its Affiliates or
sublicensees relating to the Compound without any contribution by Abbott, its
Affiliates, contractors, or agents, shall be deemed the property of Empire.
Provided, however, in the event this Agreement is terminated by Abbott for any
reason as set forth in Article 8, all such Improvements and patents shall be
exclusively licensed to Abbott solely for use with the Compound and Product on a
worldwide, royalty-free, paid-up

 

* Confidential Treatment Requested

 

7

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basis, and Empire retains all rights in and to any such Improvements and patents
for any and all other uses.

 

5. Financials.

 

5.1 Milestones: Empire shall make the following milestone payments to Abbott
within ten (10) days of the following events:

 

MILESTONE

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   PAYMENT

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

Within 10 days following Regulatory Approval in the U.S.

   $ [***]

Within 10 days following the first Regulatory Approval in an EU Country after
the Effective Date

   $ [***]

Within 10 days following the first Regulatory Approval in a Latin American
Country after the Effective Date

   $ [***]

Within 10 days following the first Regulatory Approval in an Asian Country after
the Effective Date

   $ [***]

 

5.2 Royalty Payments:

 

(a) Royalty Rate and Royalty Period: Beginning with the First Commercial Sale by
Empire, any Affiliates or sublicensees of Empire, Empire shall pay to Abbott a
royalty on annual aggregate worldwide Net Sales of all Product for all
Pharmaceutical Uses as follows:

 

(i) Where Product or its manufacture is covered by a Valid Claim in a country,
Empire shall pay a royalty equal to [***] percent [***%] of Net Sales ([***]
percent [***%] on Patents, [***] percent [***%] on Know-How and [***] percent
[***%] on Trademark) until such time as the last Patent included in Abbott’s
Technology covering such Product has expired and/or is invalidated in such
country, or [***] following the First Commercial Sale, whichever is longer.

 

(ii) Except as set forth in (i) immediately above, where Product or its
manufacture is not covered by a Valid Claim in a country, Empire shall pay a
royalty equal to [***] percent [***%] of Net Sales based upon Abbott Know-How
([***]) percent [***%] and Trademark ([***]) percent (***%) for a period of
[***] following the First Commercial Sale.

 

(iii) Where Product is no longer covered by a Valid Claim in a country and the
period in (ii) immediately above has expired, Empire shall pay a royalty equal
to [***] percent [***%] of Net Sales for the use of a Trademark.

 

For example, where Product is sold under a Trademark in a country where there is
Patent protection, the royalty rate would be [***] percent [***%]. Where the
Product is sold under a Trademark in a country and there is no Patent
protection, and such Product is sold within the first,

 

* Confidential Treatment Requested

 

8

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[***] following the First Commercial Sale, then the royalty would be [***]
percent ([***]%). Where the Product is sold in a country under a Trademark and
there is no Patent protection and more than [***] have elapsed since the First
Commercial Sale, then the royalty would be [***] percent [***%].

 

The periods of time covered by (i) and (ii) above shall be deemed the “Royalty
Period.” The period of time covered under (iii) above shall de deemed the
“Trademark Royalty Period.”

 

(b) End of Royalty Period: Upon the end of the Royalty Period in any country of
the Territory on a country-by-country basis, Empire shall have an exclusive,
perpetual license under Abbott’s Technology in such country of the Territory,
with all of the rights granted under Article 2 hereof, except that, for so long
as a Trademark is used in such country by Empire, an Affiliate or a sublicensee
of either of them, Empire shall continue to pay to Abbott a royalty equal to
[***] percent [***%] of Net Sales due during the Trademark Royalty Period. For
purposes of this Section 5.2(b) only, the term “Net Sales” shall mean sale of
the Product or any other product under a Trademark.

 

(c) Royalty Reports and Payments: Beginning with the First Commercial Sale
anywhere in the Territory, within sixty (60) days after the end of each calendar
quarter, Empire shall prepare and deliver to Abbott a report detailing the
calculation of Net Sales in the Territory, on a country-by-country basis, for
such just ended quarter along with the calculation of royalties due thereon
pursuant to Sections 5.2(a) and (b) above. Each report shall be accompanied by
full payment in U.S. dollars of the royalties shown thereon to be due. In the
event that conversion from foreign currency is required in calculating a royalty
payment hereunder, the exchange rate used shall be the ratio in effect at the
end of the last business day of the applicable quarter for which royalties are
calculated, as reported by The Wall Street Journal (Midwest Edition), or a
substantially similar global publication if The Wall Street Journal (Midwest
Edition) is no longer published.

 

(d) Books and Records/Audit Rights: Empire shall keep books and records
accurately showing all Products manufactured, used or sold under the terms of
this Agreement. The relevant portions of such books and records shall be open to
inspection by representatives of Abbott, at Abbott’s cost, solely for the
purposes of determining the correctness of the royalties payable under this
Agreement. Such audit, conducted no more than one time per calendar year, shall
be during normal business hours after reasonable advance notice and subject to
suitable confidentiality provisions. In the event an audit shows a deficiency to
be due, Empire shall immediately pay such deficiency along with the reasonable
costs and expenses of the audit if the deficiency is more than [***] percent
[***%] of the amount due during such audited period. If the audit shows that an
excess was paid, Empire shall be entitled to deduct the amount of such excess
from the payment due for the next calendar quarter. Such books and records shall
be preserved for a period of at least three (3) years after the date of the
royalty payment to which they pertain, and no audit may be conducted with
respect to royalties due in any calendar year that is more than two (2) years
preceding the calendar year in which the audit is being conducted. Books and
records for a given calendar year may only be audited once.

 

(e) Withholding Taxes on Royalties: Where any sum due to be paid to Abbott
hereunder is subject to any withholding or similar tax, the parties shall use
all reasonable efforts to

 

* Confidential Treatment Requested

 

9

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do all such acts and things and to sign all such documents as will enable them
to take advantage of any applicable double taxation agreement or treaty. In the
event there is no applicable double taxation agreement or treaty, or if an
applicable double taxation agreement or treaty reduces but does not eliminate
such withholding or similar tax, Empire shall pay such withholding or similar
tax to the appropriate government authority, deduct the amount paid from the
amount due Abbott and secure and send to Abbott the best available evidence of
such payment sufficient to enable Abbott to obtain a deduction for such withheld
taxes or obtain a refund thereof.

 

6. Representations/Warranties.

 

6.1 Representations and Warranties of Abbott: Abbott represents and warrants
that it is duly organized, validly existing and in good standing under the laws
of Illinois, that it has full corporate power and authority to enter into this
Agreement and to carry out its provisions, and that there are no outstanding
agreements, assignments or encumbrances in existence that are inconsistent with
the provisions of this Agreement. Abbott further represents and warrants that it
is duly authorized to execute and deliver this Agreement and to perform its
obligations hereunder and that the execution, delivery and performance of this
Agreement by it does not require the consent, approval or authorization of or
notice to, or filing or registration with, any governmental agency or Regulatory
Authority.

 

6.2 Representations and Warranties of Empire: Empire represents and warrants
that it is duly organized, validly existing and in good standing under the laws
of Delaware, that it has full corporate power and authority to enter into this
Agreement and to carry out its provisions, and that there are no outstanding
agreements, assignments or encumbrances in existence that are inconsistent with
the provisions of this Agreement. Empire further represents and warrants that it
is duly authorized to execute and deliver this Agreement and to perform its
obligations hereunder, and that the execution, delivery and performance of this
Agreement by it does not require the consent, approval or authorization of or
notice to, or filing or registration with, any governmental agency or Regulatory
Authority.

 

6.3 Indemnification by Empire: Empire shall indemnify and hold Abbott, its
Affiliates and their directors, officers, employees and agents harmless from and
against any and all liabilities, actions, suits, claims, demands, prosecutions,
damages, costs, expenses or money judgments finally awarded (including
reasonable legal fees) (collectively, “Liabilities”) incurred by or instituted
or rendered against Abbott to the extent such Liabilities result from a third
party claim arising from product liability claims for the sale of Compound or
Product by Empire, its Affiliates, agents or sublicensees, or from the willful
misconduct or the negligent acts or omissions of Empire, its Affiliates, their
agents or sublicensees or Empire’s material breach of this Agreement, except to
the extent such third party claims arise out of the gross negligence or willful
misconduct of Abbott, its Affiliates and their directors, officers, employees
and agents, and provided that Abbott gives Empire prompt notice in writing of
any such claim or lawsuit and permits Empire to undertake sole control of the
defense and settlement thereof at Empire’s expense. In any such claim or
lawsuit:

 

(a) Abbott will cooperate in the defense by providing access to witnesses and
evidence available to it. Abbott shall have the right to participate, at its
expense, in any defense to

 

10

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the extent that in its reasonable judgment Abbott may be prejudiced by Empire’s
sole defense thereof.

 

(b) Abbott shall not settle, offer to settle or admit liability for any
Liabilities for which Abbott intends to seek or has sought indemnification
hereunder from Empire without the written consent of a duly authorized officer
of Empire.

 

6.4 Indemnification by Abbott: Abbott shall indemnify and hold Empire, its
Affiliates and their directors, officers, employees and agents harmless from and
against any and all Liabilities, incurred by or instituted or rendered against
Empire to the extent such Liabilities result from a third party claim arising
from the willful misconduct or the negligent acts or omissions of Abbott, its
Affiliates, their agents or sublicensees, or Abbott’s material breach of this
Agreement, except to the extent such third party claims arise out of the gross
negligence or willful misconduct of Empire, its Affiliates and their directors,
officers, employees and agents, and provided that Empire gives Abbott prompt
notice in writing of any such claim or lawsuit and permits Abbott to undertake
sole control of the defense and settlement thereof at Abbott’s expense. In any
such claim or lawsuit:

 

(a) Empire will cooperate in the defense by providing access to witnesses and
evidence available to it. Empire shall have the right to participate, at its
expense, in any defense to the extent that in its reasonable judgment Empire may
be prejudiced by Abbott’s sole defense thereof.

 

(b) Empire shall not settle, offer to settle or admit liability for any
Liabilities for which Empire intends to seek or has sought indemnification
hereunder from Abbott without the written consent of a duly authorized officer
of Abbott.

 

6.5 Reportable Adverse Events: Each party warrants that it shall advise the
other of any serious adverse events relating in any way to the Compound or the
Product as and when such serious adverse events are reported or reportable by it
to the Regulatory Authorities.

 

6.6 LIMITATION: EXCEPT FOR THE EXPRESS WARRANTIES IN THIS ARTICLE 6, NEITHER
PARTY MAKES ANY WARRANTIES, EXPRESS OR IMPLIED, IN FACT OR BY OPERATION OF LAW,
STATUTORY OR OTHERWISE. EACH PARTY SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTY
OF MERCHANT ABILITY OR FITNESS FOR A PARTICULAR PURPOSE. EXCEPT FOR VIOLATIONS
OF ARTICLE 7 AND AMOUNTS FINALLY AWARDED FOR INDEMNIFICATION FOR THIRD PARTY
LIABILITIES UNDER SECTIONS 6.3 AND 6.4 ABOVE, NEITHER PARTY SHALL BE LIABLE TO
THE OTHER PARTY HERETO OR TO ANY THIRD PARTY FOR ANY SPECIAL, CONSEQUENTIAL,
EXEMPLARY OR INCIDENTAL DAMAGES (INCLUDING LOST OR ANTICIPATED PROFITS RELATING
TO THE SAME) ARISING FROM ANY CLAIM RELATING TO THIS AGREEMENT, WHETHER SUCH
CLAIM IS BASED ON CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, EVEN IF AN
AUTHORIZED REPRESENTATIVE OF SUCH PARTY IS ADVISED OF THE POSSIBILITY OR
LIKELIHOOD OF SAME.

 

11

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7. Confidentiality and Non-Disclosure.

 

7.1 Nondisclosure: Neither party shall use or disclose any Confidential
Information received by it from the other party pursuant to this Agreement
without the prior written consent of the other. This obligation will continue
for a period of seven (7) years after termination of this Agreement or
expiration of the Term, whichever is earlier. The parties recognized in Section
3.2 of this Agreement that Abbott may be utilizing Compound and Abbott
Technology in certain limited circumstances, including, but not limited to,
non-Pharmaceutical Uses and for internal research purposes. Abbott shall be
permitted to disclose information pertaining to the Compound and the Abbott
Technology in such circumstances only if the recipient of such information is
under a duty of confidentiality to Abbott, and further, provided that no such
disclosure of such information shall be made for Pharmaceutical Uses, nor shall
Confidential Information of Empire be disclosed.

 

7.2 Restriction: Each party shall restrict dissemination of Confidential
Information to those of its employees, contractors, agents and sublicensees (if
any) who have an actual need to know and have a legal obligation to protect the
confidentiality of such Confidential Information. All Confidential Information
disclosed by one party to the other shall remain the sole property of the
disclosing party and neither party shall obtain any right of any kind to the
Confidential Information disclosed, except as granted under this Agreement.

 

7.3 Restriction Exemptions: Nothing contained in this Article 7 shall be
construed to restrict the parties from using or disclosing Confidential
Information solely to the extent and solely as required:

 

(a) for regulatory, tax or customs reasons;

 

(b) for audit purposes;

 

(c) by court order or other governmental order or request; or

 

(d) to perform acts permitted by this Agreement, including (i) disclosure by
Empire to third parties undertaking feasibility and evaluation studies, clinical
trials and the like on behalf of Empire, so long as such third parties are under
a legal obligation to Empire to protect the confidentiality of such Confidential
Information, (ii) disclosure by Empire to sublicensees, so long as such
sublicensees are under a legal obligation to Empire to protect the
confidentiality of such Confidential Information or (iii) disclosure by Empire
in connection with the marketing and commercial sale of Product, to the extent
required by law.

 

8. Term and Termination.

 

8.1 This Agreement shall continue in effect unless and until terminated as
provided in this Article 8. Upon the end of the Royalty Period in any country of
the Territory, Empire shall have an exclusive, perpetual and irrevocable license
under Abbott’s Technology, with all of the rights granted under Article 2
hereof, and without any further obligation to Abbott, except for the payment
obligations accruing prior to such date and the indemnification obligations
under Section 6.3, and except for any obligation to pay a Trademark royalty
during the Trademark Royalty Period, as provided in Section 5.2(a)(iii) hereof.

 

12

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8.2 In the event the raw venom does not comply with the Testing Specifications,
Empire shall not be obligated to pay under Section 3.1(c) and Exhibit D for that
portion of the raw venom determined not to be in compliance. If a material
portion of the total amount of raw venom to be delivered pursuant to Exhibit D
is determined not to be in compliance with the Testing Specifications such that
Empire’s evaluation and development activities contemplated hereunder are
significantly impacted, then Empire may terminate this Agreement upon thirty
(30) days written notice and shall not be obligated to pay for the batch(es) of
material for which payment has not yet been made under Section 3.1(c) and
Exhibit D. Upon such termination, Empire shall assign and deliver, and Abbott
shall be entitled to retain for its own use, all materials (Compound, bulk, raw
venom and processed clinical material), studies and information relating to the
Compound and shall be granted a license to all Improvements as set forth in
Section 4.7 hereof.

 

8.3 Empire shall have the right, without cause, to terminate this Agreement upon
ninety (90) days written notice, at the end of which the termination shall be
effective. Before such termination becomes effective, Empire shall pay all
amounts required under Section 3.1(c) and Exhibit D hereof, even if the delivery
dates for material specified on Exhibit D have not yet occurred, subject to the
first sentence of Section 8.2 above. In addition, Empire shall also pay all
payments and royalties which may have become due prior to the effective date of
such termination. Upon such termination, Empire shall assign and deliver, and
Abbott shall be entitled to retain for its own use, all materials (Compound,
bulk, raw venom and processed clinical material), studies and information
relating to the Compound and shall be granted a license to all Improvements as
set forth in Section 4.7 hereof. Notwithstanding anything to the contrary
contained in this Section 8.3, Empire shall not be obligated to pay for any raw
venom which has not met the Testing Specifications in accordance with Sections
3.1(b), Sections 3.1(c) and 3.1(d). For purposes of clarification, Empire shall
be obligated to pay for material not yet delivered if Empire terminates this
Agreement under this Section 8.3.

 

8.4 Either party may terminate this Agreement by giving to the other party prior
written notice of not less than thirty (30) days in the case of a monetary
breach and of not less than ninety (90) days in the event the other party shall
commit a non-monetary material breach of this Agreement, and such breaching
party shall fail to cure, or commence action to cure, such breach during such
thirty (30) or ninety (90) day period, as applicable. In the case of a
non-monetary breach, the cure period may be extended for such longer period as
may reasonably be necessary if cure is not reasonably possible within the
initial ninety (90) day period, provided the breaching party continues its
diligent efforts to cure. No such cancellation and termination shall release the
breaching party from any obligations hereunder incurred prior thereto. In the
event of a dispute as to whether a material breach has occurred, the existence
of material breach shall be determined using the ADR procedure set forth in
Exhibit C. A party’s right to terminate this Agreement shall only apply if the
breaching party fails to cure such breach in the manner required by the final
judgment of the ADR hearing. In the event that this Agreement is terminated for
Empire’s material breach, Empire shall pay all payments set forth on Exhibit D
hereof, regardless of whether such payments are yet due and payable. Abbott
shall also be entitled to retain for its own use all funds previously paid by
Empire, and Empire shall assign and deliver, and Abbott shall be entitled to
retain for its own use, all materials (Compound, bulk, raw venom and processed
clinical material), studies and information relating to the Compound and Abbott
shall be granted a license to all Improvements and patents generated hereunder
as set forth in Section 4.7 hereof. In the event that

 

13

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this Agreement is terminated for Abbott’s material breach, Empire shall not be
liable for payments not yet due and payable under Article 5 hereof and Exhibit D
hereto, and Empire shall be entitled to retain for its own use all studies,
information, Improvements and patents generated hereunder.

 

8.5 Either party may terminate this Agreement on thirty (30) days notice if the
other party passes a resolution or a court of competent jurisdiction makes an
order for its winding up; or has a receiver or administrator appointed over its
business or all of its assets; or is or becomes bankrupt; or ceases its business
operations. In the event that this Agreement is terminated under this
Section 8.5, subject to the other terms of this Agreement, the terminating party
shall be entitled to the assignment and delivery of, and shall be entitled to
retain for its own use all materials (Compound, bulk, raw venom and processed
clinical material), studies, information, Improvements and patents generated
hereunder. Notwithstanding the bankruptcy or insolvency of Abbott or the
impairment of performance by Abbott of its obligations under this Agreement as a
result of bankruptcy or insolvency of Abbott, Empire shall be entitled to retain
the licenses granted herein, without any further obligation to Abbott other than
the payment obligations under Article 5.

 

8.6 Termination of this Agreement shall be without prejudice to any rights of
either party against the other which may have accrued up to the date such
termination becomes effective.

 

8.7 All causes of action accruing to either party under this Agreement shall
survive expiration or termination of this Agreement for any reason.

 

8.8 Upon any termination or expiration of this Agreement, each party shall
promptly return to the other party all written Confidential Information, and all
copies thereof (retaining one copy of the Confidential Information of the other
in its confidential files for archival purposes only), which is not covered by a
paid-up license or other rights specified herein surviving such termination or
expiration.

 

9. Infringement of Patents By Third Party. In the event of an actual or
suspected infringement of a Patent by a third party, the following shall apply:

 

9.1 Notice: Each party shall give the other written notice if one of them
becomes aware of any infringement by a third party of any Patent. Upon notice of
any such infringement, the parties shall promptly consult with one another with
a view toward reaching agreement on a course of action to be pursued.

 

9.2 Empire’s Right to Bring Infringement Action:

 

(a) Empire Election: If a third party infringes any Patent, Empire shall have
the first right, but not the obligation, to institute and prosecute an action or
proceeding to abate such infringement and to resolve such matter by settlement
or otherwise.

 

(i) Empire shall notify Abbott of its intention to bring an action or proceeding
prior to filing the same and in sufficient time to allow Abbott the opportunity
to discuss with Empire the choice of counsel for such matter. Empire shall keep
Abbott timely informed of

 

14

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material developments in the prosecution or settlement of such action or
proceeding. Empire shall be responsible for all fees and expenses of any action
or proceeding against infringers which Empire initiates. Abbott shall cooperate
fully at its expense by joining as a party plaintiff if reasonably requested to
do so by Empire or if required to do so by law to maintain such action or
proceeding and by executing and making available such documents as Empire may
reasonably request. Abbott may be represented by counsel in any such legal
proceedings, at Abbott’s own expense.

 

(ii) If Empire elects not to exercise such first right, Abbott shall have the
right, at its discretion, to institute and prosecute an action or proceeding to
abate such infringement and to resolve such matter by settlement or otherwise.
Empire shall cooperate fully by joining as a party plaintiff if reasonably
requested to do so by Abbott or if required to do so by law to maintain such
action and by executing and making available such documents as Abbott may
reasonably request. Empire may be represented by counsel in any such action, at
its own expense.

 

(b) Empire’s Use of Proceeds: All amounts of every kind and nature recovered
from an action or proceeding of infringement brought by Empire shall belong to
Empire, and shall be used first to reimburse Empire for its documented and
actual costs of prosecution, including attorneys’ fees, expert fees and all
other related expenses, second to reimburse Abbott for its documented and actual
costs if it is represented by counsel in the proceedings, and the balance shall
thereafter belong to Empire.

 

(c) Abbott’s Use of Proceeds: All amounts of every kind and nature recovered
from an action or proceeding of infringement brought by Abbott shall belong to
Abbott, and shall first be used to reimburse Abbott for its documented and
actual costs of prosecution, including attorneys’ fees, expert fees and all
other related expenses, second to reimburse Empire for its documented and actual
costs if it is represented by counsel in the proceedings, and the balance shall
thereafter belong to Abbott.

 

10. Infringement of Third Party Rights; Empire Defense of Suit: If Abbott, its
Affiliates, Empire, its Affiliates, sublicensees, distributors or other
customers are sued or threatened with suit by a third party alleging
infringement in one or more countries of the Territory of such party’s patents
or other intellectual property rights that are alleged to cover the manufacture,
use, sale, import, export or distribution of one or more Products, Abbott or
Empire, whichever is relevant, will promptly notify the other in writing and
provide a copy of the lawsuit or claim. Empire shall control the defense in any
such claim or suit. Empire shall have the right to settle any such suit,
including the right to grant one or more sublicenses with Abbott’s prior written
approval, which approval shall not unreasonably be withheld, provided that
Empire shall not otherwise have the right to surrender, limit or adversely
affect any rights to the Patents. ABBOTT MAKES NO WARRANTIES AND SPECIFICALLY
DISCLAIMS ANY WARRANTIES REGARDING THE NON-INFRINGEMENT BY THE PRODUCTS OF THIRD
PARTY RIGHTS.

 

11. Patent Prosecution and Maintenance; Patent Costs; Patent Term Extension.

 

11.1 Disclosure of Patents/Applications to Empire: Within thirty (30) days
following the Effective Date, Abbott shall disclose to Empire the complete text
of, and all other information in its possession or control directly related to
(a) all patent applications included in the Patents filed

 

15

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

anywhere in the Territory; and (b) all patents included in the Patents as well
as all information in Abbott’s, its Affiliates and its patent counsel’s
possession concerning the institution or possible institution of any
interference, opposition, reexamination, reissue, revocation, nullification or
any official proceeding involving an issued patent included in the Patents
anywhere in the Territory. ABBOTT MAKES NO WARRANTIES AND SPECIFICALLY DISCLAIMS
ANY WARRANTIES REGARDING THE PATENTABILITY OF PENDING PATENT APPLICATIONS.

 

11.2 Prosecution and Maintenance: Abbott shall be solely responsible for the
preparation, filing, prosecution and maintenance of the Patents in Abbott’s
name, including oppositions and interferences, subject to Empire’s right to
assume such duties in the event Abbott reasonably fails to adequately prepare,
file, prosecute and maintain the Patents. Abbott and Empire shall consult and
cooperate with each other, and Abbott shall keep Empire reasonably informed,
with respect to the prosecution and maintenance of the Patents hereunder. Abbott
will provide Empire with copies of all material documents received or prepared
by Abbott in the prosecution and maintenance of the Patents. Abbott shall
provide copies in a timely manner to allow Empire an opportunity, if it so
elects, to review and comment on Abbott’s proposed patent strategy.

 

11.3 Patent Extensions: Empire shall have the right and sole responsibility for
obtaining patent term extensions under the provisions of 35 USC ¶ 156 for any
U.S. Patent and for non-U.S. Patents under similar provisions of law of other
countries involving a Product which has obtained Regulatory Approval.

 

11.4 Employee Inventor Remuneration: The parties acknowledge that German law
requires the payment of consideration to employee inventors. Abbott shall be
solely responsible for all such payments pertaining to the Patents listed on
Exhibit A hereto, whether previously negotiated or yet to be negotiated.

 

12. Trademarks: Abbott hereby grants to Empire and its Affiliates an exclusive
royalty bearing license with the right to grant sublicenses to third parties to
use the Trademarks identified on Exhibit B and any other Trademark for the
Product selected by Empire (collectively the “Licensed Trademarks”). All use of
the Licensed Trademarks by Empire shall inure to the benefit of Abbott and any
sublicenses granted by Empire shall provide that all use of the Licensed
Trademarks by a sublicensee shall inure to the benefit of Abbott. This license
includes the right of Empire to use the Licensed Trademarks in publicity,
advertising and other marketing material. Empire may select any other Trademarks
for the Product in the Territory and such Trademarks shall be registered by
Abbott and licensed to Empire under this Section 12 as Licensed Trademarks. All
costs related to the selection of the Trademark(s) shall be borne by Empire and
all costs related to maintenance of the Trademark(s) shall be borne by Abbott.
The Trademarks shall be owned by Abbott.

 

13. Improvements: All Improvements made solely by Empire and/or its Affiliates
hereunder shall be the sole and exclusive property of Empire. All Improvements
made solely by Abbott and/or its Affiliates shall become part of Abbott’s
Technology, licensed exclusively to Empire with all of the rights set forth in
Article 2 hereof. All Improvements made jointly by Abbott and Empire (or by
their Affiliates) hereunder shall become jointly owned, provided that to the
extent that such

 

16

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Improvements are owned by Abbott, they shall be included in the license granted
to Empire under Article 2 hereof. The provisions of this Article 13 are subject
to the rights of the terminating party under Article 8 hereof.

 

14. Miscellaneous.

 

14.1 Force Majeure: If the performance by either party of any of its obligations
under this Agreement shall be prevented by circumstances beyond its reasonable
control which could not have been avoided by the exercise of reasonable
diligence, then such party shall be excused from the performance of that
obligation for the duration of the event. The affected party shall promptly
notify the other party in writing should such circumstances arise, give an
indication of the likely extent and duration thereof, and shall use commercially
reasonable efforts to resume performance of its obligations as soon as
practicable.

 

14.2 Notices: Any notice required to be given or made under this Agreement by
one of the parties hereto to the other shall be in writing, by personal
delivery, registered U.S. mail or overnight courier, addressed to such other
party at its address indicated below, or to such other address as the addressee
shall have last furnished in writing to the addressor and shall be effective
upon the date of receipt.

 

If to Empire:

    

Empire Pharmaceuticals, Inc.

4916 Route 81

Greenville, NY 12083

Attn: Samn Raffaniello, Principal and Managing Director

With copy to:

    

Schiff Hardin & Waite

6600 Sears Tower

Chicago, Illinois 60606-6473

Attn: Lael F. Johnson, Esq.

If to Abbott:

    

Abbott Laboratories

100 Abbott Park Road

Dept. 309; Bldg. AP30

Abbott Park, IL 60064-3537

Attn: Senior Vice President,
Pharmaceutical Operations

With a copy to:

    

Abbott Laboratories

100 Abbott Park Road

Dept. 364; Bldg. AP6D

Abbott Park, IL 60064-6032

Attn: Senior Vice President, Secretary
and General Counsel

 

14.3 Applicable Law/Compliance: This Agreement shall be governed by and
construed in accordance with the laws of the State of Illinois, excluding its
conflict of laws provision. Each

 

17

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

party hereto shall comply with all applicable laws, rules, ordinances,
guidelines, consent decrees and regulations of any federal, state or other
governmental authority.

 

14.4 Entire Agreement: This Agreement and the attachments (Exhibits) contain the
entire understanding of the parties with respect to the subject matter hereof.
All express or implied agreements and understandings, either oral or written,
heretofore made are expressly merged in and made a part of this Agreement. This
Agreement may be amended, or any term hereof modified, only by a written
instrument duly executed by both parties hereto.

 

14.5 Counterparts: This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.

 

14.6 Severability/Headings: If any provision of this Agreement is deemed
unenforceable, the remainder of the Agreement will not be affected and, if
appropriate, the parties will attempt to replace the unenforceable provision
with a new provision that, to the extent possible, reflects the parties’
original intent. The captions and headings used in this Agreement are for
reference only and are not to be construed in any way as terms or used to
interpret the provisions of this Agreement.

 

14.7 Assignment: Neither party may without prior written approval of the other
assign this Agreement or transfer its interest or any part thereof under this
Agreement to any third party except that (i) either party may assign this
Agreement without consent to a third party that acquires all or substantially
all of the business to which this Agreement pertains, or, (ii) either party may
assign this Agreement in whole or part to any Affiliate of that party and such
party hereby guarantees the performance by such Affiliate.

 

14.8 Dispute Resolution: The parties hereto shall attempt to settle any dispute
arising out of or relating to this Agreement in an amicable way. Except for
claims for injunctive or other equitable relief, which may be brought in any
court of competent jurisdiction, any controversy, claim or right of termination
for cause which may arise under, out of, in connection with, or relating to this
Agreement, or any breach thereof, shall be settled according to the Alternative
Dispute Resolution provisions attached hereto as Exhibit C.

 

14.9 Independent Contractor: It is understood that both parties hereto are
independent contractors and engage in the operation of their own respective
businesses and neither party hereto is to be considered the agent of the other
party for any purpose whatsoever and neither party has any authority to enter
into any contract or assume any obligation for the other party or to make any
warranty or representation on behalf of the other party. Each party shall be
fully responsible for its own employees, servants and agents, and the employees,
servants and agents of one party shall not be deemed to be employees, servants
and agents of the other party for any purpose whatsoever.

 

14.10 Publicity: No press release or other public announcement shall be made by
either party concerning the execution of this Agreement or the fact that Empire
has licensed the Compound from Abbott, without the prior written consent of the
non-disclosing party, which consent may be withheld in the non-disclosing
party’s sole discretion. Neither party shall use the

 

18

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

name of the other party, its officers, employees or agents for purposes of any
public commercial activity without the other party’s prior written consent,
except where the name of the other party must be disclosed as a matter of law.
Should either party wish to make a disclosure or be required by law to make a
disclosure, the disclosing party shall submit a copy of the proposed disclosure
to the other party for review. The non-disclosing party shall have three (3)
weeks to review and comment on the content of such disclosure. In the case of a
disclosure required by law, the disclosing party, subject to legal requirements,
shall use all reasonable efforts to accommodate the non-disclosing party’s
comments. For non-routine matters like an emergency, special circumstance, or
other situation where the law compels a disclosure in less than three (3) week’s
time, the non-disclosing party agrees to use commercially reasonable efforts to
provide its review and comment in order to meet the disclosing party’s
timetable.

 

14.11 Time of the Essence. The parties acknowledge that time shall be of the
essence in the performance of all provisions of this Agreement.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
Effective Date.

 

ABBOTT LABORATORIES       EMPIRE PHARMACEUTICALS, INC.

By:

 

/s/ James L. Tyree

     

By:

 

/s/ Samn Raffaniello

Name:

 

James L. Tyree

     

Name:

 

Samn Raffaniello

Its:

 

Vice President,

     

Its:

 

Principal and Managing Director

   

Global Licensing / New Business Development

           

 

19

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EXHIBIT A

TO

EXCLUSIVE LICENSE AGREEMENT

BETWEEN

ABBOTT LABORATORIES

AND

EMPIRE PHARMACEUTICALS, INC.

Dated March 29, 2002

 

(PATENTS AND PATENT APPLICATIONS)

 

[***]

Abbott/LU Case No.: [***]

Inventor(s): [***]

Priority Date: [***]

 

Country

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

 

Application No.

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

 

Registration/Patent No.

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

[***]   [***]   [***]

 

[***]

 

Abbott/LU Case No.: [***]

Inventor(s): [***]

Priority Date: [***]

 

Country

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

 

Application No.

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

 

Registration/Patent No.

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

[***]   [***]   [***]

 

[***]

 

Abbott/LU Case No.: [***]

Inventor(s): [***]

Priority Date: [***]

 

Country

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

 

Application No.

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

 

Registration/Patent No.

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

[***]   [***]   [***]

 

* Confidential Treatment Requested

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

EXHIBIT B

TO

EXCLUSIVE LICENSE AGREEMENT

BETWEEN

ABBOTT LABORATORIES

AND

EMPIRE PHARMACEUTICALS, INC.

Dated March 29, 2002

 

(LICENSED TRADEMARKS)

 

VIPRINEX®

 

ARWIN®

 

ARVIN®

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

EXHIBIT C

TO

EXCLUSIVE LICENSE AGREEMENT

BETWEEN

ABBOTT LABORATORIES

AND

EMPIRE PHARMACEUTICALS, INC.

Dated March 29, 2002

 

(ALTERNATIVE DISPUTE RESOLUTION)

 

The parties recognize that from time to time a dispute may arise relating to
either party’s right or obligations under this Agreement. The parties agree that
any such dispute shall be resolved by the Alternative Dispute Resolution (“ADR”)
provisions set forth in this Exhibit, the result of which shall be binding upon
the parties.

 

To begin the ADR process, a party first must send written notice of the dispute
to the other party for attempted resolution by good faith negotiations between
their respective presidents (or their designees) of the affected subsidiaries,
divisions, or business units within twenty-eight (28) days after such notice is
received (all references to “days” in this ADR provision are to calendar days).
If the matter has not been resolved within twenty-eight (28) days of the notice
of dispute, or if the parties fail to meet within such twenty-eight (28) days,
either party may initiate an ADR proceeding as provided herein. The parties
shall have the right to be represented by counsel in such a proceeding.

 

1. To begin an ADR proceeding, a party shall provide written notice to the other
party of the issues to be resolved by ADR. Within fourteen (14) days after its
receipt of such notice, the other party may, by written notice to the party
initiating the ADR, add additional issues to be resolved within the same ADR.

 

2. Within twenty-one (21) days following receipt of the original ADR notice, the
parties shall select a mutually acceptable neutral to preside in the resolution
of any disputes in this ADR proceeding. If the parties are unable to agree on a
mutually acceptable neutral within such period, either party may request the
President of the CPR Institute for Dispute Resolution (“CPR”), 366 Madison
Avenue, 14th Floor, New York, New York 10017, to select a neutral pursuant to
the following procedures:

 

  (a) The CPR shall submit to the parties a list of not less than five (5)
candidates within fourteen (14) days after receipt of the request, along with a
Curriculum Vitae for each candidate. No candidate shall be an employee,
director, or shareholder of either party or any of their subsidiaries or
affiliates.

 

  (b) Such list shall include a statement of disclosure by each candidate of any
circumstances likely to affect his or her impartiality.

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

  (c) Each party shall number the candidates in order of preference (with the
number one (1) signifying the greatest preference) and shall deliver the list to
the CPR within seven (7) days following receipt of the list of candidates. If a
party believes a conflict of interest exists regarding any of the candidates,
that party shall provide a written explanation of the conflict to the CPR along
with its list showing its order of preference for the candidates. Any party
failing to return a list of preferences on time shall be deemed to have no order
of preference.

 

  (d) If the parties collectively have identified fewer than three (3)
candidates deemed to have conflicts, the CPR immediately shall designate as the
neutral the candidate for whom the parties collectively have indicated the
greatest preference. If a tie should result between two candidates, the CPR may
designate either candidate. If the parties collectively have identified three
(3) or more candidates deemed to have conflicts, the CPR shall review the
explanations regarding conflicts and, in its sole discretion, may either (i)
immediately designate as the neutral the candidate for whom the parties
collectively have indicated the greatest preference, or (ii) issue a new list of
not less than five (5) candidates, in which case the procedures set forth in
subparagraphs 2(a) -2(d) shall be repeated.

 

3. No earlier than twenty-eight (28) days or later than fifty-six (56) days
after selection, the neutral shall hold a hearing to resolve each of the issues
identified by the parties. The ADR proceeding shall take place at a location
agreed upon by the parties. If the parties cannot agree, the neutral shall
designate a location other than the principal place of business of either party
or any of their subsidiaries or affiliates.

 

4. At least seven (7) days prior to the hearing, each party shall submit the
following to the other party and the neutral:

 

  (a) a copy of all exhibits on which such party intends to rely in any oral or
written presentations to the neutral;

 

  (b) a list of any witnesses such party intends to call at the hearing, and a
short summary of the anticipated testimony of each witness;

 

  (c) a proposed ruling on each issue to be resolved, together with a request
for a specific damage aware or other remedy for each issue. The proposed rulings
and remedies shall not contain any recitation of the facts or any legal
arguments and shall not exceed one (1) page per issue.

 

  (d) a brief in support of such party’s proposed rulings and remedies, provided
that the brief shall not exceed twenty (20) pages. This page limitation shall
apply regardless of the number of issues raised in the ADR proceeding.

 

Except as expressly set forth in subparagraphs 4(a)-4(d), no discovery shall be
required or permitted by any means, including depositions, interrogatories,
requests for admissions, or production of documents.

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

5. The hearing shall be conducted on two (2) consecutive days and shall be
governed by the following rules:

 

  (a) Each party shall be entitled to five (5) hours of hearing time to present
its case. The neutral shall determine whether each party has had the five (5)
hours to which it is entitled.

 

  (b) Each party shall be entitled, but not required, to make an opening
statement, to present regular and rebuttal testimony, documents or other
evidence, to cross-examine witnesses, and to make a closing argument.
Cross-examination of witnesses shall occur immediately after their direct
testimony, and cross-examination time shall be charged against the party
conducting the cross-examination.

 

  (c) The party initiating the ADR shall begin the hearing and, if it chooses to
make an opening statement, shall address not only issues it raised but also any
issues raised by the responding party. The responding party, if it chooses to
make an opening statement, also shall address all issues raised in the ADR.
Thereafter, the presentation of regular and rebuttal testimony and documents,
other evidence, and closing arguments shall proceed in the same sequence.

 

  (d) Except when testifying, witnesses shall be excluded from the hearing until
closing arguments.

 

  (e) Settlement negotiations, including any statements made therein, shall not
be admissible under any circumstances. Affidavits prepared for purposes of the
ADR hearing also shall not be admissible. As to all other matters, the neutral
shall have sole discretion regarding the admissibility of any evidence.

 

6. Within seven (7) days following completion of the hearing, each party may
submit to the other party and the neutral a post-hearing brief in support of its
proposed rulings and remedies, provided that such brief shall not contain or
discuss any new evidence and shall not exceed ten (10) pages. This page
limitation shall apply regardless of the number of issues raised in the ADR
proceeding.

 

7. The neutral shall rule on each disputed issue within fourteen (14) days
following completion of the hearing. Such ruling shall adopt in its entirety the
proposed ruling and remedy of one of the parties on each disputed issue but may
adopt one party’s proposed rulings and remedies on some issues and the other
party’s proposed rulings and remedies on other issues. The neutral shall not
issue any written opinion or otherwise explain the basis of the ruling.

 

8. The neutral shall be paid a reasonable fee plus expenses. These fees and
expenses, along with the reasonable legal fees and expenses of the prevailing
party (including all expert witness fees and expenses), the fees and expenses of
a court reporter, and any expenses for a hearing room, shall be paid as follows:

 

  (a) If the neutral rules in favor of one party on all disputed issues in the
ADR, the losing party shall pay 100% of such fees and expenses.

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

  (b) If the neutral rules in favor of one party on some issues and the other
party on other issues, the neutral shall issue with the rulings a written
determination as to how such fees and expenses shall be allocated between the
parties. The neutral shall allocate fees and expenses in a way that bears a
reasonable relationship to the outcome of the ADR, with the party prevailing on
more issues, or on issues of greater value or gravity, recovering a relatively
larger share of its legal fees and expenses.

 

9. The rulings of the neutral and the allocation of fees and expenses shall be
binding, non-reviewable, and non-appealable, and may be entered as a final
judgment in any court having jurisdiction.

 

10. Except as provided in paragraph 9 or as required by law, the existence of
the dispute, any settlement negotiations, the ADR hearing, any submissions
(including exhibits, testimony, proposed rulings, and briefs), and the rulings
shall be deemed Confidential Information. The neutral shall have the authority
to impose sanctions for unauthorized disclosure of Confidential Information.

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

EXHIBIT D

TO

EXCLUSIVE LICENSE AGREEMENT

BETWEEN

ABBOTT LABORATORIES

AND

EMPIRE PHARMACEUTICALS, INC.

Dated March 29, 2002

 

(MATERIALS DELIVERY AND PAYMENT SCHEDULE)

 

Empire shall pay Abbott Five Hundred Thousand and No/100 U.S. Dollars
($500,000.00) for material conveyed under Section 3.1(b) in accordance with the
following schedule:

 

Materials

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

  

Delivery Date

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

   Amount Payable

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

Shipment A

   July 1, 2002    $ 0

Shipment B

   September 1, 2002    $ 250,000.00

Shipment C

   November 1, 2002    $ 250,000.00

 

Material Shipment Schedule

 

Shipment A

 

All data, 5 pallets of files and Ancrod information and data

 

Shipment B

 

[***]

 

Shipment C

 

[***]

 

* Confidential Treatment Requested

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

EXHIBIT E

TO

EXCLUSIVE LICENSE AGREEMENT

BETWEEN

ABBOTT LABORATORIES

AND

EMPIRE PHARMACEUTICALS, INC.

Dated March 29, 2002

 

(TESTING SPECIFICATIONS)