Exhibit 10.23

 

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[*]         designates portions of this document that have been omitted pursuant
to a request for confidential treatment filed seperately with the Commission

 

Execution Copy

 

LICENSE AGREEMENT

between

CROMPTON CORPORATION

and

BIOSYN, INC.

 

THIS AGREEMENT, effective as of the 22nd day of May, 2001 by and between
CROMPTON CORPORATION (“Crompton”), a corporation organized and existing under
the laws of the State of Delaware and having a place of business at Benson Road,
Middlebury, Connecticut 06749, and BIOSYN, INC. (“Biosyn”), a corporation
organized and existing under the laws of the Commonwealth of Pennsylvania and
having its principal place of business at 3401 Market Street, Suite 300,
Philadelphia, Pennsylvania 19104.

 

WITNESSETH:

 

WHEREAS, Crompton owns or controls United States Patents No. [*], and a patent
application that is the United States equivalent of International Application
[*], and corresponding foreign patents and patent applications relating to
compounds useful against the replication of the Human Immunodeficiency Virus
(“HIV”) and compounds having microbicidal properties, and Crompton owns or
controls technology relating to such patents, patent applications and compounds
and to formulations, pharmaceutical compositions and methods and processes for
treating or inhibiting the replication of HIV and/or inactivating pathogenic
microbes;

 

WHEREAS, Crompton wishes to grant to Biosyn an exclusive worldwide license to
make, use and sell formulations and compositions utilizing the UC 781 Technology
(as hereinafter defined), but only for the Permitted Field of Use (as
hereinafter defined); and

 

WHEREAS, Biosyn wishes to obtain an exclusive worldwide license to make, use and
sell formulations and compositions utilizing the UC 781 Technology (as
hereinafter defined), but only for the Permitted Field of Use (as hereinafter
defined).

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements of the
parties contained herein, the parties agree as follows:

 

1.                                       Definitions

 

1.1                                 “Affiliate” shall mean a direct or indirect
subsidiary of a party.

 

1.2                                 “Crompton” shall mean Crompton Corporation,
a Delaware corporation, acting directly or through an Affiliate.

 

1.3                                 “License” shall have the meaning assigned to
such term in Section 2.1 of this Agreement.

 

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[*]         designates portions of this document that have been omitted pursuant
to a request for confidential treatment filed seperately with the Commission

 

1.4                                 “Milestones” shall mean the Milestones
provided for in Article 5 of this Agreement, “Milestone” shall mean one of the
Milestones and “First Milestone”, “Second Milestone” and “Third Milestone” shall
have the meanings provided for those terms in Article 5 of this Agreement.

 

1.5                                 “Net Sales” shall have the meaning assigned
to such term in Section 8.1 of this Agreement.

 

1.6                                 “Patents” shall mean United States Patents
No. [*]and [*], and the patent application that is the United States equivalent
of International Application WO [*]and any patent that issues therefrom, and any
continuation, continuation-in-part, division, provisional, reissue,
reexamination, renewal or extension thereof, and the corresponding foreign
patents and patent applications listed in Attachment A to this Agreement. 
“Patents” shall also include any new United States or foreign patent or patent
application obtained or filed by or on behalf of Crompton or its affiliates
relating to the UC 781 Technology.

 

1.7                                 “Permitted Field of Use” shall mean use as a
human topical microbicide, alone or in combination with other compounds, for
application to the skin, mucosal and/or epithelial tissue as an active
ingredient in formulations such as creams, foams, jellies, or other similar
formulations, including contraceptive and other vaginal delivery devices such as
sponges, intrauterine devices, diaphragms and condoms; but Permitted Field of
Use does not include, and specifically excludes:

 

(a)          non-human uses;

 

(b)         human application for both systemic therapeutic uses and systemic
post-exposure prophylactic uses; and

 

(c)          uses when applied to or incorporated into any surface (except for
human surfaces consisting of skin, mucosal and/or epithelial tissue) or device
(except contraceptive and other vaginal delivery devices as provided for above
in this Section 1.7) including, but not limited to, gloves, aprons, tubing and
filters.

 

1.8                                 “Product” shall mean any formulation,
composition, device or other product that utilizes in any way the UC 781
Technology.

 

1.9                                 “UC 781” shall mean the compound comprising
[*].

 

1.10                           “UC 781 Technology” shall mean any and all
technology, compounds, formulations, pharmaceutical compositions and methods and
processes covered by a Valid Claim in the Patents and/or other proprietary
technology and know-how (including manufacturing process technology) related to
UC 781 or any of the Patents.  The UC 781 Technology shall also include any
improvements in any of the UC 781 Technology.

 

1.11                           “Valid Claim” shall mean a claim of any issued,
unexpired Patent that has not been revoked or held unenforceable or invalid by a
decision of a court or governmental agency of

 

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[*]         designates portions of this document that have been omitted pursuant
to a request for confidential treatment filed seperately with the Commission

 

competent jurisdiction, from which no further appeal can be taken or with
respect to which an appeal is not taken within the time allowed for appeal, and
which has not been disclaimed, denied or admitted to be invalid or unenforceable
through reissue, disclaimer or otherwise.

 

1.12                           “Warrant” means the warrant, in the form attached
to this Agreement as Attachment B, to purchase up to two hundred twenty-eight
thousand (228,000) shares of duly authorized, validly issued, fully paid and
nonassessable shares of the common stock of Biosyn, as provided for in
Section 7.1 of this Agreement.

 

2.                                       License Grant

 

2.1                                 Crompton, Crompton Manufacturing
Company, Inc., Uniroyal Chemical Company, Inc. and Crompton Co./Cie each, to the
extent of its respective rights in the UC 781 Technology, hereby grants to
Biosyn an exclusive, worldwide license under the UC 781 Technology, with the
right to grant sublicenses, to make, have made, use, import, export, sell and
have sold Products, solely for the Permitted Field of Use.  The license rights
granted pursuant to this Section 2.1 are defined herein as the “License”.

 

2.2                                 Crompton, Crompton Manufacturing
Company, Inc. and Uniroyal Chemical Company, Inc. each, to the extent of its
respective rights, hereby assigns to Biosyn the option, pursuant to that certain
Research Agreement executed on behalf of Uniroyal Chemical Company, Inc. on
July 24, 1997, on behalf of the Rega Institute for Medical Research on
August 12, 1997 and by Dr. Jan Balzarini on August 12, 1997 (a copy of which is
attached to this Agreement as Exhibit I), to obtain, for the Permitted Field of
Use, an exclusive, worldwide license under United States Patent No. [*], which
is entitled “Compositions containing two or three inhibitors of different HIV
reverse transcriptases”.

 

3.                                       Term

 

3.1                                 This Agreement shall commence effective as
of the date first above set forth and, unless earlier terminated pursuant to the
terms of this Agreement, shall remain in effect until the expiration of the
last-to-expire Valid Claim of the Patents.

 

4.                                       Representations, Warranties and
Covenants

 

4.1                                 Crompton represents and warrants to Biosyn
as follows:

 

(a)                                  Crompton has been duly incorporated and is
a validly existing corporation in good standing under the laws of the State of
Delaware with full corporate authority to own, lease and operate its properties
and conduct the business in which it is presently engaged.

 

(b)                                 Crompton has taken all actions necessary to
authorize it, and to cause each of its subsidiaries executing this Agreement
(“Executing Subsidiaries”), to enter into and perform its respective obligations
under this Agreement and the agreements

 

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and instruments referred to in this Agreement and to consummate the transactions
contemplated hereby and thereby.

 

(c)                                  This Agreement is a legal, valid and
binding obligation of Crompton, and of each of the Executing Subsidiaries to the
extent of its obligations under this Agreement, enforceable in accordance with
its terms subject, as to enforcement, to bankruptcy, insolvency, reorganization
and other laws of general applicability relating to creditors’ rights and to
general equitable principles.

 

(d)                                 Crompton owns or controls, directly or
indirectly, all right, title and interest in and to the UC 781 Technology and no
person or entity has or shall have any claim of ownership or control with
respect to the UC 781 Technology that would, in any way, affect the License
hereunder; provided, however, that Crompton makes no representation or warranty
that persons other than Crompton and its affiliates do not own or control
proprietary technology and know-how (including manufacturing and process
technology) substantially similar to proprietary technology and know-how
comprising part of the UC 781 Technology.

 

(e)                                  To the best of Crompton’s knowledge, the
Patents are the only patents owned by Crompton and its Affiliates that cover the
manufacture, use or sale of UC 781 Technology for the Permitted Field of Use. 
Crompton has no reason to believe that any of the Patents are or will be found
to be invalid.

 

(f)                                    Crompton and each of the Executing
Subsidiaries is free to perform its respective obligations under this Agreement
in accordance with the terms and conditions set forth herein and there are no
license rights granted by Crompton or any of its Affiliates to any other person
or entity under the UC 781 Technology for the Permitted Field of Use nor are
there any other license rights granted by Crompton or any of its Affiliates to
any other person or entity that would encumber the License granted herein or
that would conflict with the License.

 

(g)                                 Neither Crompton nor any of the Executing
Subsidiaries is aware of any asserted or unasserted claims or demands that it
believes have been or can be asserted against any of the Patents and that would
materially adversely affect the License.  Notwithstanding the foregoing,
Crompton, Crompton Manufacturing Company, Inc. and Uniroyal Chemical
Company, Inc. each, to the extent of its respective rights, hereby assigns to
Biosyn certain rights with respect to United States Patent No. 5,968,910, as
provided for in Section 2.2 of this Agreement.

 

(h)                                 To the best of Crompton’s knowledge and
belief, the quantities of UC 781 that are to be provided by Crompton to Biosyn
pursuant to Section 6.2 of this Agreement will conform to the certificates of
analysis, material data safety sheets and specifications that are to be included
with the shipments of such UC 781.

 

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4.2                                 Crompton covenants as follows:

 

(a)                                  Except as otherwise provided in Article 9
of this Agreement, it shall, with due diligence and good faith, use commercially
reasonable efforts to maintain the Patents in full force and effect during the
term of this Agreement.

 

(b)                                 If, contrary to Crompton’s present best
knowledge, Crompton or any of its Affiliates should own any other patent(s) that
cover the UC 781 Technology for the Permitted Field of Use or the manufacture,
use or sale of Products for the Permitted Field of Use, (i) Crompton agrees not
to, and to cause its Affiliates not to assert such patent(s) against Biosyn or
any sublicensee of Biosyn, with respect to the Permitted Field of Use and
(ii) if any such patent(s) cover UC 781 in the Permitted Field of Use, Crompton
hereby grants, and shall cause its appropriate Affiliate(s)  to grant, a
worldwide, royalty-free, exclusive license to make, use or sell UC 781 under
such patent(s) in the Permitted Field of Use.

 

(c)                                  In the event (i) that Crompton or any
Affiliate of Crompton shall, at any time during the term of this Agreement,
develop any new compound that is not licensed to Biosyn under this Agreement but
that Crompton or such Affiliate perceives to have application or utility for the
Permitted Field of Use and (ii) if Crompton or such Affiliate has an interest in
developing such compound for commercialization on its own or with a third party
or in licensing such compound to a third party for development and
commercialization, Crompton shall notify Biosyn in writing and shall negotiate
exclusively with Biosyn, in good faith and for a period of ninety (90) days, or
such longer period to which the parties may agree, for the grant of a license or
other rights to Biosyn with respect to such compound for the Permitted Field of
Use.

 

(d)                                 As promptly as practicable after the
execution and delivery of this Agreement by the parties hereto, Crompton shall
provide to Biosyn copies of the documents listed on Attachment C to this
Agreement to the extent reasonably available to Crompton.

 

(e)                                  During the term of this Agreement and at
the request of Biosyn, Crompton shall (i) cooperate with Biosyn in the transfer
of know-how and technology licensed to Biosyn under this Agreement, (ii) provide
reasonable access to Crompton’s scientific and manufacturing technical personnel
to assist Biosyn in understanding the know-how and technology licensed to Biosyn
under this Agreement and (iii) otherwise provide reasonable assistance to Biosyn
with respect to the UC 781 Technology.

 

(f)                                    Crompton will file or cause to be filed
with the United States Patent and Trademark Office proper documents of
assignment and/or name changes so that the actual owner of the Patents is shown
as the record owner of the Patents.

 

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4.3                                 Biosyn represents and warrants to Crompton
as follows:

 

(a)                       Biosyn has been duly incorporated and is validly
subsisting under the laws of the Commonwealth of Pennsylvania with full
corporate authority to own, lease and operate its properties and conduct the
business in which it is presently engaged.

 

(b)                      All of the issued and outstanding capital stock of
Biosyn has been duly authorized and is validly issued and fully paid and
nonassessable.

 

(c)                       Biosyn has all requisite corporate power and authority
to enter into and perform all of its obligations under this Agreement and to
carry out the transactions contemplated hereby in accordance with the terms and
conditions set forth herein.

 

(d)                      Biosyn has all requisite power and authority to issue
the shares of common stock issuable upon exercise of the Warrant and such shares
of common stock will, upon their issuance in accordance with the terms of the
Warrant (including payment for such shares), be duly and validly issued, fully
paid and nonassessable and free of any pre-emptive rights.  Certain rights held
by certain shareholders to subscribe to any issuance of equity securities by
Biosyn have been waived with regard to the issuance of the Warrant and the
shares of common stock of Biosyn issuable upon exercise of the Warrant.

 

(e)                       Biosyn has taken all actions necessary to authorize it
to enter into and perform its obligations under this Agreement and the
agreements and instruments referred to in this Agreement and to consummate the
transactions contemplated hereby and thereby.

 

(f)                         This Agreement is a legal valid and binding
obligation of Biosyn, enforceable in accordance with its terms subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws of general
applicability relating to creditors’ rights and to general equitable principles.

 

(g)                      The execution and delivery by Biosyn of this Agreement
and the agreements and instruments referred to in this Agreement, the
consummation by Biosyn of the transactions contemplated herein and therein, and
the performance by Biosyn of its obligations hereunder and thereunder, do not
and will not result in a breach or violation of any of the terms and provisions
of, or constitute a default under, (i) any agreement or instrument to which it
is party or by which it is bound except for those subscription rights held by
certain shareholders that have been waived with regard to the issuance of the
Warrant and the shares of common stock of Biosyn issuable upon exercise of the
Warrant or (ii) its articles of incorporation or by-laws.

 

(h)                      As of the date of this Agreement, the authorized
capital stock of Biosyn consists of twenty-five million (25,000,000) shares of
common stock, par value $0.01 per share (“Common Stock”), and one hundred
thousand (100,000) shares of preferred stock, par value $0.01 per share,
twenty-one thousand (21,000) shares of which have been designated “Series A
Participating Preferred Stock” and twenty-one thousand (21,000) shares of which
have been designated as “Series B Participating

 

6

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[*]         designates portions of this document that have been omitted pursuant
to a request for confidential treatment filed seperately with the Commission

 

Preferred Stock”.  The issued and outstanding shares of capital stock are as set
forth on Attachment D to this Agreement.  Other than as set forth on such
Attachment D and other than the Warrant, there are no rights, subscriptions,
warrants or agreements of any kind outstanding to purchase any capital stock of
Biosyn and no conversion rights with respect to capital stock of Biosyn.

 

4.4                                 Biosyn covenants as follows:

 

(a)                                  Biosyn shall, with due diligence and good
faith, but subject to the provisions of Article 5 of this Agreement, use
commercially reasonable efforts to achieve each Milestone in a timely manner and
to commercialize the Products as promptly as reasonably practicable consistent
with sound and reasonable business practice and judgment.  Attachment E to this
Agreement sets forth Biosyn’s general, and non-binding, development plan with
respect to a potential compound or formulation utilizing the UC 781 Technology
for the Permitted Field of Use, which development plan Crompton acknowledges to
be commercially reasonable and which development plan Crompton recognizes not to
contain all specific plans and details related to the planned development of any
Product and to be subject to modification as appropriate throughout such
development process.

 

(b)                                 Biosyn shall keep Crompton informed (i) of
progress toward achievement of the Milestones, (ii) of plans, developments and
achievements relating to the marketing of Products throughout the world and
(iii) of efforts to obtain regulatory approvals with respect to the Products and
the marketing of the Products and the status of such efforts.  The parties shall
meet at times and places mutually agreeable or shall participate in telephone
conferences from time to time to enable Biosyn to report to Crompton on the
foregoing matters.  Such reporting, whether by telephone or in meetings, shall
take place not less frequently than semiannually.

 

(c)                                  Biosyn shall reserve for issuance upon
exercise of the Warrant, such number of shares of its Common Stock as shall, at
the time, be issuable upon exercise of the Warrant.

 

5.                                       Milestones

 

5.1                                 Biosyn shall file with the United States
Food and Drug Administration (“FDA”) for a United States Investigational New
Drug Application (or with an equivalent foreign regulatory authority for a
foreign equivalent in (a) [*], (b) [*]or (c) [*]) that will describe protocols
for the first in-human testing for the UC 781 Technology in Phase I or Phase
I/II testing.  Such filing shall comprise achievement of the First Milestone. 
If the First Milestone has not been achieved on or before the date that is
eighteen (18) months from the date of this Agreement, Biosyn and Crompton shall
meet to discuss, in good faith, the reasons for the failure to achieve such
First Milestone, suggested cures and the anticipated time period to achieve such
Milestone.  If, after such discussion, Crompton is unwilling to extend the date
for achievement of such Milestone, Crompton shall have the right to terminate
the License.

 

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[*]         designates portions of this document that have been omitted pursuant
to a request for confidential treatment filed seperately with the Commission

 

5.2                                 [*] shall comprise achievement of the Second
Milestone.  If the Second Milestone has not been achieved on or before the date
that is [*] Biosyn and Crompton shall meet to discuss, in good faith, the
reasons for the failure to achieve such Second Milestone, suggested cures and
the anticipated time period to achieve such Milestone.  If, after such
discussion, Crompton is unwilling to extend the date for achievement of such
Second Milestone, Crompton shall have the right to terminate the License.

 

5.3                                 [*] shall comprise achievement of the Third
Milestone.  If the Third Milestone has not been achieved on or before the date
that is [*] Biosyn and Crompton shall meet to discuss, in good faith, the
reasons for the failure to achieve such Third Milestone, suggested cures and the
anticipated time period to achieve such Milestone.  If, after such discussion,
Crompton is unwilling to extend the date for achievement of such Third
Milestone, Crompton shall have the right to terminate the License.

 

5.4

(a)

If Biosyn shall fail to achieve any of the Milestones and if Crompton shall
exercise its right to terminate the License in accordance with Sections 5.1, 5.2
or 5.3 of this Agreement, Crompton shall have the option to purchase all
development work theretofore undertaken by Biosyn in respect of UC 781 and the
UC 781 Technology for the Permitted Field of Use and all of Biosyn’s rights
therein (collectively, the “Development Work”) at an option exercise price equal
to Biosyn’s cost incurred in such Development Work consisting of out-of-pocket
expenditures paid to third parties plus an amount for overhead and internal
labor costs calculated by using the rates then in effect for Biosyn with the
National Institute of Health as established in accordance with FAR 42.705-1
(“Development Costs”). Such option shall be exercised, if at all, by notice to
Biosyn given within ninety (90) days after the date of Crompton’s notice to
Biosyn terminating the License.

 

 

 

 

(b)

In the event that Biosyn shall determine, at any time prior to the achievement
of the Third Milestone that it does not intend to continue to pursue the
development and testing of, seeking regulatory approval for, and sale, marketing
or other offering of, any Product, Biosyn shall give prompt written notice of
such determination to Crompton and Crompton shall have the option to purchase
the Development Work at an option exercise price consisting of the Development
Costs. Such option shall be exercised, if at all, by notice to Biosyn given
within ninety (90) days after the date of Crompton’s receipt of Biosyn’s notice
of such determination.

 

 

 

 

(c)

In the event that Crompton shall exercise either of the options provided for in
this Section 5.4 in respect of the Development Work, Biosyn shall provide
reasonable assistance and cooperation in transferring the Development Work to
Crompton. Crompton shall bear the reasonable out-of-pocket costs incurred by
Biosyn to effect such transfer.

 

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[*]         designates portions of this document that have been omitted pursuant
to a request for confidential treatment filed seperately with the Commission

 

6.                                       Developmental Efforts

 

6.1                                 All developmental expenses for Products
including, but not limited to, all costs of the conduct of testing and other
trials will be borne by Biosyn.

 

6.2                                 Crompton has available a quantity of UC 781
manufactured in accordance with good manufacturing practices and maintained
under good laboratory practices conditions.  Notwithstanding the provisions of
Section 6.1 of this Agreement, Crompton shall provide to Biosyn up to [*]grams
of such UC 781 to assist Biosyn in connection with its efforts to develop, test
and obtain regulatory approval for Products.  Biosyn shall take delivery of [*]
grams of such UC 781 promptly after the date of this Agreement and shall have
the right, but not the obligation, to take delivery of all or part of the
remaining [*] grams at any time and from time to time thereafter, provided that
if Biosyn shall wish to take delivery of all or part of such remaining [*]
Biosyn shall so notify Crompton not later than [*] from the date of this
Agreement.  Biosyn’s notice shall indicate how much of such remaining [*] grams
Biosyn will take and Biosyn’s best estimate of the date or dates on which it
will want delivery.  No delivery of UC 781 under this Section 6.2 shall be for a
quantity less than [*].  Biosyn shall pay Crompton the sum of [*] for each [*]
gram quantity of UC 781 and such payment shall be made within thirty (30) days
after delivery of such UC 781.  Purification of the UC 781 shall be undertaken
at Crompton’s expense, but Biosyn shall provide good faith assistance in trying
to arrange for such purification at a lower cost than may otherwise be available
to Crompton.  The UC 781 to be delivered hereunder shall have been either
re-crystallized or otherwise purified in such a manner that the UC 781 so
delivered is no less pure than if it had been re-crystallized; provided,
however, that it is understood and agreed that the first [*]grams of UC 781 to
be delivered pursuant to this Section 6.2 will be re-crystallized or otherwise
purified by Crompton at its facilities and, after such re-crystallization or
other purification, may not qualify as being manufactured in accordance with
good manufacturing practices.

 

7.                                       Initial Payment and Milestone Payments

 

7.1                                 Upon the execution of this Agreement, Biosyn
shall pay to Crompton, in consideration of the License granted under this
Agreement, the sum of [*]and shall deliver to Crompton the Warrant.

 

7.2                                 Upon the successful achievement of the First
Milestone, Biosyn shall pay to Crompton, in consideration of the License granted
under this Agreement, the sum of [*].

 

7.3                                 Upon the successful achievement of the
Second Milestone, in consideration of the License granted under this Agreement,
Biosyn shall pay to Crompton the sum of [*] and, in accordance with the terms of
the Warrant, the Warrant shall become exercisable.

 

7.4                                 Upon the successful achievement of the Third
Milestone, Biosyn shall pay to Crompton, in consideration of the License granted
under this Agreement, the sum of [*].

 

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8.                                       Royalty Payments

 

8.1                                 Biosyn shall pay to Crompton, during the
term of this Agreement, royalties on Biosyn’s Net Sales of Products.  For
purposes of this Agreement, “Net Sales” shall mean the gross amount billed or
invoiced by Biosyn, or any person or entity acting as Biosyn’s agent, for
Products in the Permitted Field of Use, less the sum of the following:

 

(a)                                  sales taxes, use taxes, tariffs,
import/export duties and other excise taxes imposed on sales;

 

(b)                                 amounts repaid or credited by reason of
rejections, defects, recalls or returns or because of chargebacks, retroactive
price reductions, refunds or billing errors not already reflected in amounts
invoiced;

 

(c)                                  freight costs, import and distribution
allowances and insurance charges on shipments to purchasers if included in
invoiced amounts;

 

(d)                                 trade, cash and/or quantity discounts and
rebates and price reductions actually given and not already reflected in amounts
invoiced; and

 

(e)                                  compulsory payments and rebates directly
related to the sale of Products accrued, paid or deducted pursuant to
agreements, such as managed care agreements, or pursuant to governmental
regulations.

 

Net Sales shall not be deemed to include transfers among divisions of Biosyn or
to or from third party manufacturers or formulators to enable them to produce or
formulate Products on behalf of Biosyn for sale by Biosyn.  Net Sales shall be
deemed to include payments to Biosyn by any sublicensees of all or any part of
the UC 781 Technology (“Sublicense Payments”); provided that any payments to
Biosyn for product development, research work, clinical studies and regulatory
approvals performed by or for Biosyn shall not be included as Net Sales.  As
provided for in Section 10.3 of this Agreement, Net Sales shall include monies
recovered, net of out-of-pocket expenses, in the prosecution of Infringements
(as defined in such Section) or defense against any counterclaim of invalidity
or any declaratory judgment action brought by a third party for
non-infringement, invalidity or interference.

 

8.2                                 Initially the royalties under this Agreement
shall be payable at the rate of [*] of Net Sales; provided, however, that when
the aggregate of the payments made by Biosyn to Crompton pursuant to Article 7
of this Agreement and royalty payments made by Biosyn to Crompton pursuant to
this Article 8 have reached [*], such royalty rate shall be reduced to [*]and
when the aggregate of the payments made by Biosyn to Crompton pursuant to
Article 7 of this Agreement and royalty payments made by Biosyn to Crompton
pursuant to this Article 8 have reached [*], such royalty rate shall be reduced
to [*].  In no event shall the issuance by Biosyn of the Warrant in accordance
with Section 7.1 of this Agreement or the issuance by Biosyn of Common Stock
upon the exercise of the Warrant be deemed a payment pursuant to Article 7 of
this Agreement for purposes of this Section 8.2.

 

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8.3                                 Royalty Obligation, Reduction and Credit

 

(a)                                  Only one royalty amount shall be due and
payable under this Article 8 for any Product sold by or on behalf of Biosyn,
regardless of the number of Patents or the amount of UC 781 Technology covering
such Product, subject to subsection (d) of Section 8.3 of this Agreement.

 

(b)                                 If Biosyn believes, based upon the practice
of the rights licensed hereunder with respect only to the UC 781 Technology in
the Permitted Field of Use, that such practice reasonably may infringe the
patent rights of any third party (“Third Party Rights”), then payments made for
a license to, or other acquisition of, such Third Party Rights shall be
considered for treatment as an offset against royalties otherwise owed to
Crompton under the following conditions:

 

(i)                                     Biosyn shall notify Crompton in writing
either before or after it acquires rights under such Third Party Rights, but no
later than ninety (90) days after acquiring such rights.  Crompton shall have
ninety (90) days to respond to Biosyn’s notification.

 

(ii)                                  If Crompton agrees in writing with
Biosyn’s belief that the practice of the rights licensed hereunder with respect
to the UC 781 Technology in the Permitted Field of Use reasonably may infringe
the Third Party Rights referred to in Biosyn’s notice, or if Crompton fails to
respond within its ninety (90) day response period, then Biosyn may have an
offset against royalties otherwise owed to Crompton hereunder as specified
below.

 

(iii)                               If Crompton notifies Biosyn in writing
within such ninety (90) day period that it does not agree with Biosyn’s belief
that the practice of the rights licensed hereunder with respect to the UC 781
Technology in the Permitted Field of Use reasonably may infringe such Third
Party Rights, then the Chief Executive Officer of Biosyn and an Executive Vice
President of Crompton shall meet to discuss and attempt to resolve the dispute. 
In the event that such parties are unable to resolve the dispute, Biosyn may
obtain the opinion of outside legal counsel reasonably acceptable to Crompton,
regarding such potential infringement of Third Party Rights.

 

(A)                              If such opinion of outside legal counsel agrees
that the practice of the rights licensed hereunder with respect to the UC 781
Technology in the Permitted Field of Use reasonably may infringe such Third
Party Rights, then Biosyn may have an offset against royalties otherwise owed to
Crompton hereunder as specified below.

 

(B)                                If such opinion of outside legal counsel does
not agree that the practice of the rights licensed hereunder with respect to the
UC 781 Technology in the Permitted Field of Use reasonably may infringe such
Third Party Rights, then Biosyn will not have an

 

11

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[*]         designates portions of this document that have been omitted pursuant
to a request for confidential treatment filed seperately with the Commission

 

offset against royalties otherwise owed to Crompton hereunder; provided,
however, that if Crompton shall ultimately acquire rights to such Third Party
Rights, Crompton shall so notify Biosyn, and Biosyn shall be entitled to a
royalty offset retroactive to the date of its notification to Crompton pursuant
to subsection(b)(i) of this Section 8.3.

 

(iv)                              Upon any such acquisition of rights under
subsection (b)(ii) or clause (A) of subsection (b)(iii) of this Section 8.3 or
as contemplated by the proviso of clause (B) of subsection (b)(iii) of this
Section 8.3, [*] of the consideration paid by Biosyn in respect of such access
to such Third Party Rights (whether paid in the form of up-front, milestone or
royalty payments, or otherwise) shall be credited against royalties payable or
becoming payable to Crompton under Article 8 of this Agreement; provided,
however, that in no circumstances shall Biosyn’s acquisition of Third Party
Rights result, in the aggregate, in a reduction of royalties payable to Crompton
of more than [*] of the royalties that would have been payable, calculated on
the basis of the royalty rate in effect, pursuant to Section 8.2 of this
Agreement, at the time such royalty payment would otherwise be due.  For the
avoidance of doubt, the parties agree that the Third Party Rights to which this
subsection (b) shall apply shall be only those, if any, that may impair the
ability of Biosyn (or its sublicensees) to utilize the UC 781 Technology by
itself in the Permitted Field of Use, and not those, if any, that may impair the
ability of Biosyn (or its sublicensees) to utilize the UC 781 Technology in
combination with other compounds, devices or products or that may impair the
utilization of the UC 781 Technology because of a method of manufacture that is
not included as part of the UC 781 Technology.

 

(c)                                  For purposes of this subsection (c),
“Biosyn Product” shall mean a Product developed or manufactured by or for Biosyn
in the Permitted Field of Use.  In the event that any Biosyn Product is sold in
any jurisdiction in which there is no Valid Claim in effect for any Patent
(“Unprotected Jurisdiction”) and in the event that there shall be any Product
offered for sale in such Unprotected Jurisdiction that is in the Permitted Field
of Use (“Competitive Product”), Biosyn may be entitled to a reduction of the
royalties payable on its Net Sales of such Biosyn Product in such Unprotected
Jurisdiction, as provided in this subsection (c).

 

(i)                                     If, because of any Competitive Product
in the Unprotected Jurisdiction, Biosyn reduces the gross selling price of the
applicable Biosyn Product in the Unprotected Jurisdiction by less than [*],
there shall be no royalty reduction under this subsection (c) for such Biosyn
Product in the Unprotected Jurisdiction.

 

(ii)                                  If, because of any Competitive Product in
the Unprotected Jurisdiction, Biosyn reduces the gross selling price of the
applicable Biosyn Product in

 

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[*]         designates portions of this document that have been omitted pursuant
to a request for confidential treatment filed seperately with the Commission

 

the Unprotected Jurisdiction by [*] or more, but not more than [*], Biosyn shall
be entitled to a royalty reduction on its Net Sales of such Biosyn Product in
the Unprotected Jurisdiction.  Such reduction shall be a percentage of the
royalty rate otherwise at the time in effect under this Agreement equal to twice
Biosyn’s percentage reduction in the gross selling prices of the applicable
Biosyn Product in the Unprotected Jurisdiction.

 

(iii)                               If, because of any Competitive Product in
the Unprotected Jurisdiction, Biosyn reduces the gross selling price of the
applicable Biosyn Product in the Unprotected Jurisdiction by more than [*],
Biosyn shall be entitled to a royalty reduction on its Net Sales of such Biosyn
Product in the Unprotected Jurisdiction which shall be [*] of the royalty rate
otherwise at the time in effect under this Agreement.

 

Biosyn shall give Crompton written notice of any Competitive Product being
offered or sold in any Unprotected Jurisdiction that Biosyn believes would
entitle Biosyn to a royalty reduction under this subsection (c).  Such notice
shall include a reasonable description of the Competitive Product and the
applicable Biosyn Product, and the amounts of Biosyn’s original and reduced
gross selling prices of the applicable Biosyn Product in the Unprotected
Jurisdiction.  In the event that the offer or sale of any Competitive Product in
any Unprotected Jurisdiction shall, in Biosyn’s judgment, make it impracticable
for Biosyn to offer or sell any Biosyn Product or Products notwithstanding the
royalty rate reductions provided for in this subsection (c), Biosyn may so
advise Crompton.  In such event, Crompton and Biosyn shall meet to negotiate in
good faith an appropriate and mutually acceptable royalty reduction other than
as set forth in clauses (i), (ii) and (iii) of this subsection (c).

 

(d)                           In any jurisdiction in which any of the Patents
have been filed, if Crompton shall elect, in accordance with Section 9.3 of this
Agreement, not to maintain any Patent or Patents or if Crompton shall not, as
provided in Article 10 of this Agreement, bring an action for an Infringement
(as defined in Section 10.1 of this Agreement) or defend against any
counterclaim of invalidity or any declaratory judgment action brought by a third
party for non-infringement, invalidity or interference and if, as a result of
such election or such failure to bring such an action or defend against such an
action, there shall no longer be in such jurisdiction Valid Claims under Patents
sufficient to prevent sales in such jurisdiction of competitive products
utilizing all or any part of the UC 781 Technology, Biosyn shall no longer be
obligated to pay royalties on its Net Sales of Products in such jurisdiction.

 

8.4                                 Upon the first commercial sale of any
Product by or on behalf of Biosyn and thereafter within forty-five (45) days of
the end of each calendar quarter, Biosyn shall provide Crompton with a
certificate signed by an executive officer of Biosyn certifying the following
information for such quarter for the Products:

 

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[*]         designates portions of this document that have been omitted pursuant
to a request for confidential treatment filed seperately with the Commission

 

(a)                                  the number of Products sold by Biosyn (by
Product type);

 

(b)                                 total of gross amounts billed or invoiced
for Products sold by or on behalf of Biosyn, with a break-out showing separately
billings in each applicable foreign currencies;

 

(c)                                  deductions from total amounts billed or
invoiced for Products used to arrive at Net Sales of Products;

 

(d)                                 exchange rates used for each conversion of
any foreign currency billings or invoices into United States dollars;

 

(e)                                  a tabulation of all initial payments,
Milestone payments (excluding the issuance of the Warrant provided for in
Section 7.1 and any issuance of Biosyn Common Stock upon exercise of the
Warrant) and royalty payments theretofore made by Biosyn to Crompton pursuant to
this Agreement; and

 

(f)                                    amounts claimed by Biosyn, pursuant to
subsection (b) of Section 8.3 of this Agreement as credits against royalty
amounts otherwise payable or, pursuant to subsection (c) of Section 8.3, as
reduced royalties; and

 

(g)                                 Biosyn’s calculation of the royalty amount
payable to Crompton under this Agreement in respect of such quarter.

 

The royalty amounts so calculated by Biosyn in the certificates of Biosyn’s
executive officer shall accompany such certificates.

 

8.5                                 Biosyn shall keep full, true and accurate
books and records containing sufficient detail to enable verification of the
royalties payable to Crompton pursuant to this Article 8.  Such books and
records shall be maintained at Biosyn’s principal place of business for not less
than three (3) years following the end of the quarter to which they pertain.  On
reasonable notice and at reasonable times, Biosyn shall permit a nationally
recognized independent certified public accountant (who may be a representative
of Crompton’s firm of auditors) appointed by Crompton and reasonably acceptable
to Biosyn to examine such books and records of Biosyn as may be reasonably
necessary and only to the extent necessary to verify the royalties payable to
Crompton pursuant to this Article 8; provided that such accountant shall have
entered into a confidentiality agreement with Biosyn.  Such examination may
occur only once in each calendar year and may apply only to records pertaining
to the preceding three (3) calendar years.  Any such audit shall be at
Crompton’s expense, unless such audit shall disclose an underpayment by Biosyn
greater than [*] for any particular calendar year, in which event, the cost of
such audit shall be payable by Biosyn.  In the event that such examination shall
reveal that Biosyn has overpaid royalties under this Article 8, Biosyn shall be
entitled to an immediate credit against future royalty payments for the amount
of any such overpayment.

 

8.6                                 Payments provided for in this Article 8 and
amounts due to Crompton under Article 7 shall, if overdue for more than fifteen
(15) days, bear interest until payment has been made at the

 

14

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lesser of (a) a rate equal to two percent above the “Prime Rate”, as published
in the Wall Street Journal, in effect on the payment due date and (b) the
highest rate permitted by applicable law.  The payment of any such interest
shall not deprive Crompton of any other rights it may have at law or in equity
as a consequence of the lateness of payment.

 

9.                                       Patent Prosecution, Maintenance Fees
and Marking

 

9.1                                 Crompton will be responsible for and will
pay for the prosecution of all patent application matters, including but not
limited to continuations, reissues, oppositions and appeals, relating to the
Patents, except as otherwise provided in Section 9.3 of this Agreement. 
Beginning from and after the execution and delivery of this Agreement, Crompton
shall furnish Biosyn with copies of all substantive communications between the
United States Patent and Trademark Office (or any applicable foreign equivalent)
and Crompton regarding pre- and post- issuance prosecution of International
Application WO 97/45116 everywhere in the world, as well as copies of any
responses or amendments thereto.  Crompton shall provide copies of all
substantive communications relating to such patent application sufficiently in
advance of the proposed submission date of amendments and responses to allow
Biosyn to comment thereon.  Crompton shall consider any reasonable request,
comment or recommendation made by Biosyn pertaining to such communication. 
Notwithstanding anything to the contrary above, final decisions with respect to
the prosecution of such patent application shall be determined by Crompton in
its sole discretion.

 

9.2                                 Crompton shall be solely responsible for all
maintenance fees relating to the Patents, except as otherwise provided in
Section 9.3 of this Agreement.

 

9.3                                 Crompton may, in its sole discretion, decide
to abandon any pending Patent application or to refrain from paying any fee
required to maintain any Patent.  In such event, Crompton shall notify Biosyn,
in writing, of such decision not less than forty-five (45) days before the
expiration of the time when such decision would have irrevocable effect and
Biosyn shall, thereupon, have the right to assume responsibility for the
prosecution of such pending Patent application or the maintenance of such Patent
at its sole cost and expense.  If Biosyn shall assume such responsibility,
Crompton shall assign such Patent application or Patent, as the case may be, to
Biosyn but subject, in any such case, to any rights theretofore granted or
conveyed by Crompton to other parties in respect of fields of use other than the
Permitted Field of Use.

 

9.4                                 Biosyn shall mark or cause to be marked all
Products with the applicable Patent numbers.

 

10.                                 Enforcement of Patents

 

10.1                           Each party shall promptly notify the other party,
in writing, of any alleged Patent infringement relating to the manufacture, use
and/or sale of Products for the Permitted Field of Use (“Infringement”) of which
it becomes aware and shall provide any evidence available to it of such
Infringement.

 

10.2                           Crompton may bring an action for an Infringement
and may defend against any counterclaim of invalidity or any declaratory
judgment action brought by a third party for non-infringement,

 

15

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invalidity or interference.  Biosyn shall cooperate with Crompton in all
reasonable respects in the prosecution and/or defense of such action including,
without limitation, making its employees available to testify and providing all
relevant documents, records, papers, information, samples, specimens and the
like, as reasonably requested by Crompton.

 

10.3                           If Crompton does not, within ninety (90) days of
notice from Biosyn of an Infringement, bring such an action for patent
infringement and/or act to defend against any such counterclaim or declaratory
judgment action, Biosyn shall have the right to bring suit for such infringement
and to join Crompton as a party plaintiff or to use Crompton’s name, if required
by law, at Biosyn’s sole cost and expense and with counsel of its own selection;
provided, however, that Biosyn acknowledges and agrees that any other person or
entity to whom Crompton shall have theretofore granted or conveyed rights under
such Patent may join as a party plaintiff in such action.  Crompton shall
cooperate with Biosyn in all reasonable respects in the prosecution or defense
of such action including, without limitation, making its employees available to
testify and providing all relevant documents, records, papers, information,
samples, specimens and the like, as reasonably requested by Biosyn.  Biosyn may
settle any such action at its own expense and through its own counsel, subject
to the approval of Crompton, which approval shall not be unreasonably withheld
or delayed, but Biosyn understands and acknowledges that Crompton will not, and
may not be required to, approve any settlement that may materially adversely
affect the rights of any other person or entity to which Crompton shall have
theretofore granted or conveyed rights under the applicable Patent.  In the
event that Biosyn shall recover any moneys in any such action, whether by way of
judgment or settlement, the excess of such recoveries, including damages and
interest amounts, over Biosyn’s out-of-pocket expenses in the prosecution or
defense of such action shall be included as Net Sales of Products for the
purpose of calculation of royalties payable to Crompton pursuant to Article 8 of
this Agreement.

 

11                                    Liability and Indemnity

 

11.1                           Biosyn shall indemnify and hold harmless Crompton
and its subsidiaries, affiliates, directors, officers, employees and agents from
and against any and all loss, cost, claim, damage, liability or expense
(including reasonable attorneys’ fees, costs of suit and costs of appeal)
incurred by any of them arising out of or in connection with any claim, action,
suit, proceeding or investigation (“Claim”) filed or threatened including,
without limitation, any Claim alleging death or injury to any person, with
respect to (a) the production, manufacture, sale, marketing, distribution,
shipment, transportation, handling, cleanup, use or disposal of any Product
developed, manufactured or sold by or on behalf of Biosyn, (b) the negligence or
willful misconduct of Biosyn and/or its subsidiaries, affiliates, directors,
officers, agents, contract manufacturers, distributors, sublicensees and other
representatives and (c) the breach by Biosyn of any of its obligations under
this Agreement.

 

11.2                           Crompton shall indemnify and hold harmless Biosyn
and its subsidiaries, affiliates, directors, officers, employees and agents from
and against any and all loss, cost, claim, damage, liability or expense
(including reasonable attorneys’ fees, costs of suit and costs of appeal)
incurred by any of them arising out of or in connection with any Claim filed or
threatened including, without limitation, any Claim alleging death or injury to
any person, with respect to

 

16

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[*]         designates portions of this document that have been omitted pursuant
to a request for confidential treatment filed seperately with the Commission

 

(a) the breach by Crompton of any of its representations and warranties set
forth in Section 4.1 of this Agreement and (b) the breach by Crompton of any of
its obligations under this Agreement.

 

11.3                           The selection of the UC 781 Technology for the
development, making, use and sale of Products, and the decision to market any
Products for the Permitted Field of Use, is solely Biosyn’s, and Crompton does
not assume any responsibility whatsoever for such development, making, use, sale
or marketing.  CROMPTON MAKES NO EXPRESS OR IMPLIED WARRANTY OF ANY KIND
INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, OR ANY OTHER THING CONCERNING THE PATENTS OR UC 781
TECHNOLOGY, NOR DOES CROMPTON MAKE ANY REPRESENTATIONS CONCERNING ANY PRODUCT
THAT MAY BE MADE, USED OR SOLD.  IN PARTICULAR, AND WITHOUT LIMITING THE
GENERALITY OF THE FOREGOING, CROMPTON MAKES NO REPRESENTATION OR WARRANTY THAT
ANY PRODUCT WILL BE SAFE OR EFFECTIVE FOR THE PERMITTED FIELD OF USE OR WILL BE
GRANTED ANY REQUIRED REGULATORY APPROVALS.  Nor does Crompton make any
representation or warranty that the practice by Biosyn of the rights under the
License will not infringe proprietary rights of any third party.  In no event
shall Crompton have any liability whatsoever for damages, whether direct,
indirect, special or consequential, including without limitation damages for
economic loss, death or injury to persons or damage to property, in respect of
any Patent, the UC 781 Technology or any Product, whether or not Crompton shall
be advised, shall have reason to know or in fact shall know of the possibility
of such damages.

 

11.4                           Biosyn shall, with respect to the Product in the
Permitted Field of Use, obtain and maintain in full force and effect product
liability insurance in an amount and with coverage (which shall include Biosyn’s
indemnification obligations to Crompton pursuant to this Agreement), which is
reasonable and customary in Biosyn’s industry based on the developmental stage
of the Product under development and which shall not be less than [*] per
occurrence during such development but which shall be reviewed at the
commencement of clinical trials and upon commercialization and increased as
appropriate, reasonable and customary in such industry, at such stages.  Biosyn
shall provide Crompton with evidence of such insurance and the policies of such
insurance shall require that Crompton be given notice of any cancellation of
such insurance or reduction of coverage or amount and shall name Crompton as an
additional insured.

 

12.                                 Compliance with Law

 

12.1                           Biosyn, its subsidiaries, affiliates, directors
and officers shall, and Biosyn shall use commercially reasonable efforts to
cause its agents, contract manufacturers, distributors, sublicensees and other
representatives to, comply with all United States federal, state and local laws,
rules and regulations and all foreign laws, rules and regulations applicable to
the development, testing, production, transportation, packaging, labeling,
export, import, marketing, distribution, sale and use of the Products in the
Permitted Field of Use.

 

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13.                                 Confidentiality

 

13.1                           The recipient of information supplied pursuant to
this Agreement shall treat the same as confidential.  For purposes of this
Section 13.1, the terms “recipient” and “recipient party” shall mean the party
receiving information pursuant to this Agreement, its officers, directors,
employees and agents.  The foregoing obligations as to confidentiality shall not
extend to any transmitted information that is publicly available at the date of
its disclosure to the recipient party or which is, at that date, already
properly in the possession of the recipient party (evidenced by writing) or
which may thereafter become publicly available from sources other than the
recipient party and its employees or which may properly thereafter become
available to the recipient party on a non-confidential basis from a source other
than the disclosing party and that is not known by the recipient party to be
under an obligation of confidentiality to the disclosing party with respect
thereto.  For the purpose of this Section 13.1, disclosures made to the
recipient party under this Agreement which are specific shall be deemed to be
confidential and therefore shall not be deemed to be within the exceptions set
forth in this Section 13.1 merely because they are embraced by general
disclosures in the public domain or in the possession of the recipient party. 
In addition, any combination of features shall be deemed to be confidential and
therefore shall not be deemed to be within the foregoing exceptions merely
because individual features are in the public domain or in the possession of the
recipient party; provided that such combination of features shall be deemed not
to be confidential and to be within the exception set forth in this Section 13.1
only if the combination itself and its principle of operation are in the public
domain or in the possession of the recipient party.  The obligations set forth
in this Section shall survive for a period of five years after the expiration or
termination of this Agreement.  Notwithstanding the foregoing provisions of this
Section 13.1, Biosyn may disclose information supplied by or on behalf of
Crompton pursuant to this Agreement to sublicensees of Biosyn’s rights under
Article 2 of this Agreement or any consultants, manufacturers and other third
parties for the purpose of development, manufacture and/or sale of Products, but
only if such sublicensees, consultants, manufacturers and other third parties,
as the case may be, agree in writing to be bound by nondisclosure undertakings
equivalent to those of Biosyn under this Article 13.

 

13.2                           If either party becomes or believes that it will
become legally compelled to disclose any confidential information of the other
party, the party subject to such disclosure requirement shall give prompt
written notice of such requirement to the other party prior to any such
disclosure so that such other party may seek a protective order or other
appropriate remedy and/or waive compliance with the provisions of Section 13.1
of this Agreement.  The party subject to such disclosure requirement shall
disclose only the portion of the confidential information that, in the
reasonable judgment of its counsel, it is legally required to disclose and shall
use reasonable efforts to obtain an appropriate protective order or other
reasonable assurance that the confidential information being disclosed will be
given confidential treatment.

 

13.3                           Biosyn shall have the right to publish its
results in scientific journals or at scientific meetings.  In order that
disclosure of information described in a publication will not adversely affect
the patent rights or proprietary rights of Crompton, Crompton shall be given the
opportunity to review any proposed manuscript or abstract for a period of thirty
(30) days before it is submitted for publication.  If Crompton shall reasonably
determine that any proprietary information of Crompton is disclosed in the
proposed manuscript or abstract, Crompton shall have the right to require that
such information be deleted.  If the proposed manuscript or abstract describes
any patentable invention, Crompton shall have the right to request a reasonable
delay

 

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in submission of the proposed manuscript or abstract so that Crompton can
further evaluate such invention and initiate filing, if it deems it necessary,
of appropriate patent applications.

 

14.                                 Termination

 

14.1                           Biosyn may terminate this Agreement at any time
and for any reason or no reason upon sixty (60) days prior written notice.  In
the event of any such termination, the License shall immediately and
automatically revert back to Crompton.

 

14.2                     This Agreement may be terminated prior to expiration of
the term hereof by either party “for cause” immediately upon notice.  A party
shall have the right to terminate this Agreement “for cause” in the event of:
(i) any material breach of this Agreement by the other party that shall go
uncorrected for a period of thirty (30) days after notice of such breach,
setting forth the details thereof with reasonable particularity, has been given
to the other party; or (ii) the institution against the other party of voluntary
proceedings in bankruptcy or under any insolvency law or law for the relief of
debtors, the making by or on behalf of the other party of an assignment for the
benefit of creditors, the filing by or on behalf of the other party of an
involuntary petition under any bankruptcy or insolvency law, unless such
petition is dismissed or set aside within sixty (60) days from the date of its
filing, or the appointment for such other party of a receiver or trustee, unless
such appointment is dismissed or set aside within sixty (60) days from the date
of such appointment.  Termination of this Agreement, or of the License as
provided for in Article 5 of this Agreement, shall not be deemed to terminate or
extinguish any right accruing prior to the effectiveness of such termination. 
In the event of any such termination by Crompton pursuant to clause (i) of this
Section 14.2, the License shall immediately and automatically revert back to
Crompton.  In the event of any termination of this Agreement by Biosyn pursuant
to clause (i) of this Section 14.2, the License shall survive as a fully-paid,
perpetual, worldwide, exclusive license in the Permitted Field of Use.

 

14.3                           In the event of any termination of this Agreement
by Biosyn pursuant to Section 14.1 of this Agreement or by Crompton pursuant to
Section 14.2 of this Agreement, Crompton shall have the option in respect of the
Development Work provided for in Section 5.4 of this Agreement.

 

15.                                 Notice

 

15.1                           All notices, requests, demands and other
communications which are required or permitted to be given under this Agreement
shall be in writing and shall be deemed to be duly given upon the delivery or
mailing thereof, as the case may be, if hand delivered or sent by registered or
certified mail, return receipt requested, postage prepaid, or upon delivery to
an express courier service, addressed in any such case:

 

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if to Crompton or any Crompton Affiliate:

 

 

Crompton Corporation

 

Benson Road

 

Middlebury, Connecticut 06749

 

Attn: Executive Vice President and

 

General Manager Crop Protection Division

 

if to Biosyn:

 

 

Biosyn, Inc.

 

3401 Market Street, Suite 300

 

Philadelphia, Pennsylvania 19104

 

Attn: Chief Executive Officer

 

or to such other address as either party shall have specified for itself by
notice to the other given in accordance with this Section 15.1.

 

16.                                 Use of Name

 

16.1                           Except as otherwise provided herein, neither
party shall have any right, express or implied, to use in any manner the name of
the other party or any other trade name or trademark or other identifying mark
or symbol of the other party for any purpose in connection with the performance
of this Agreement.

 

17.                                 Announcements

 

17.1                           All press releases and other public announcements
related to the subject matter hereof shall be made only with the mutual written
agreement of the parties hereto (which shall not be unreasonably withheld or
delayed), except that any such public announcement required by law (including
regulations of the FDA or Securities and Exchange Commission) may be made
without such written agreement.

 

18.                                 General

 

18.1                           This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns,
provided, however, that neither party shall have the right to transfer or assign
its interest in this Agreement without the prior written consent of the other
party except pursuant to (a) a merger, consolidation or reorganization of the
assigning party or the sale of substantially all of the assets of the assigning
party or (b) an assignment, in whole or in part, to any entity controlling,
controlled by or under common control with the assigning party, provided that
the assigning party remains liable for the performance and observance of the
duties and obligations of the assignee under this Agreement.

 

18.2                           This Agreement shall be governed by and construed
in accordance with the laws of the State of Connecticut, United States, without
giving effect to the conflicts-of-laws provisions

 

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thereof, except where the federal laws of the United States are applicable and
have precedence; provided, however, that it is hereby acknowledged that the
Warrant and the issuance of the Warrant will, as provided therein, be governed
by and construed in accordance with the laws of the Commonwealth of
Pennsylvania.

 

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

 

18.4                           This Agreement, the agreements referred to in
this Agreement and the License Agreement between Biosyn and Crompton of even
date herewith relating to rights of reference and use of data related to certain
Biosyn regulatory filings set forth and constitute the entire agreement between
the parties hereto with respect to the subject matter hereof, and supersede any
and all prior agreements, understandings, promises and representations made by
either party to the other concerning the subject matter hereof and the terms
applicable hereto.  No other terms and conditions shall be binding on either
party including terms that may be additional to or at variance with the terms
hereof, unless such provision is expressly agreed to in writing signed by both
parties hereto.

 

18.5                           If any provision of this Agreement is or becomes
or is deemed invalid, illegal or unenforceable in any jurisdiction to which the
Agreement is sought to be enforced, (a) such provision shall be deemed amended
to conform to applicable laws of such jurisdiction so as to be valid and
enforceable or, if it cannot be so amended without materially altering the
intention of the parties, it shall be stricken; (b) the validity, legality and
enforceability of such provision shall not in any way be affected or impaired
thereby in any other jurisdiction; and (c) the remainder of this Agreement shall
remain in full force and effect.

 

18.6                           Except as otherwise provided herein, neither
party to this Agreement shall be liable, or be in breach of any provision
hereof, for any failure or delay on its part to perform any obligation (other
than the obligation to make payments when due) under any provision of this
Agreement because of circumstances of force majeure, including, but not limited
to, any act of God, flood, fire, explosion, breakdown of plant, strike, lockout,
labor dispute, war, insurrection, riot, sabotage, or any injunction, law,
ordinance or demand or requirement of any governmental authority, or inability
to procure or use materials, labor, equipment or energy sufficient to meet
manufacturing needs from customary sources at customary prices and without
litigation, or any other cause whatsoever, whether similar or dissimilar to
those enumerated herein, beyond the reasonable control of such party.  If any
such event or force majeure shall prevent a party from performing its
obligations hereunder for a period of six months or more, the other party may
terminate this Agreement forthwith by written notice.

 

18.7                           The headings of this Agreement are included only
for ease of reference and shall not affect the interpretation of this Agreement
in any manner.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective authorized representatives on the dates indicated below,
effective as of the 22nd day of May, 2001.

 

 

BIOSYN, INC.

 

 

 

By:

 

 

 

Name:  Anne-Marie Corner

 

Title: Chief Executive Officer

 

 

 

 

 

CROMPTON CORPORATION

 

 

 

By:

 

 

 

Name:  Alfred F. Ingulli

 

Title: Executive Vice President

 

 

With respect to the matters set forth in Article 2 of the foregoing Agreement.

 

 

 

CROMPTON MANUFACTURING

 

COMPANY, INC.

 

 

 

 

 

By:

 

 

 

Name:  Alfred F. Ingulli

 

Title: Executive Vice President

 

 

 

 

 

UNIROYAL CHEMICAL COMPANY, INC.

 

 

 

 

 

By:

 

 

 

Name:  Walter K. Ruck

 

Title: President

 

 

 

 

 

CROMPTON CO./ CIE

 

 

 

By:

 

 

 

Name:  Walter K. Ruck

 

Title: President

 

22

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

 

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[*]         designates portions of this document that have been omitted pursuant
to a request for confidential treatment filed seperately with the Commission

 

ATTACHMENT A

 

Foreign Patents and Patent Applications

 

I.                                         USPN 5,268,389 AND 5,693,827 AND
FOLLOWING FOREIGN EQUIVALENTS

 

[*]

 

COUNTRY

 

STATUS

 

APPLN. NO.

 

PATENT NO.

 

AUSTRIA

 

GRANTED

 

90915588.9

 

0497816

 

AUSTRALIA

 

GRANTED

 

66035/90

 

636409

 

BELGIUM

 

GRANTED

 

90915588.9

 

0497816

 

[*]

 

 

 

 

 

 

 

[*]

 

 

 

 

 

 

 

SWITZERLAND

 

GRANTED

 

90915588.9

 

0497816

 

GERMANY

 

GRANTED

 

90915588.9

 

69019533.8

 

DENMARK

 

GRANTED

 

90915588.9

 

0497816

 

FRANCE

 

GRANTED

 

90915588.9

 

0497816

 

GREAT BRITAIN

 

GRANTED

 

90915588.9

 

0497816

 

GREECE

 

GRANTED

 

90915588.9

 

3017128

 

HAITI

 

GRANTED

 

 

 

198/5

 

[*]

 

 

 

 

 

 

 

ISRAEL

 

GRANTED

 

95956

 

95956

 

ITALY

 

GRANTED

 

90915588.9

 

0497816

 

JAPAN

 

GRANTED

 

514569/90

 

1967760

 

SOUTH KOREA

 

GRANTED

 

700831/92

 

0222233

 

LUXEMBOURG

 

GRANTED

 

90915588.9

 

0497816

 

MEXICO

 

GRANTED

 

22844

 

179450

 

NICARAGUA

 

GRANTED

 

91-009

 

920R.P.I.

 

NETHERLANDS

 

GRANTED

 

90915588.9

 

0497816

 

NEW ZEALAND

 

GRANTED

 

235653

 

235653

 

[*]

 

 

 

 

 

 

 

RUSSIAN FED.

 

GRANTED

 

5011885.04

 

2108785

 

SWEDEN

 

GRANTED

 

90915588.9

 

0497816

 

 

23

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

 

TAIWAN

 

GRANTED

 

79108696

 

NI-58187

 

SOUTH AFRICA

 

GRANTED

 

90/8094

 

90/8094

 

 

II.                                     USPN 5,696,151 AND THE FOLLOWING FOREIGN
EQUIVALENTS

 

COUNTRY

 

STATUS

 

APPLICATION NO.

 

PATENT NO.

 

KENYA

 

GRANTED

 

AP/P/98/01245

 

AP902

 

GAMBIA

 

GRANTED

 

AP/P/98/01245

 

AP902

 

ZIMBABWE

 

GRANTED

 

AP/P/98/01245

 

AP902

 

GHANA

 

GRANTED

 

AP/P/98/01245

 

AP902

 

AFRICA (ARIPO)

 

GRANTED

 

AP/P/98/01245

 

AP902

 

LESOTHO

 

GRANTED

 

AP/P/98/01245

 

AP902

 

MALAWI

 

GRANTED

 

AP/P/98/01245

 

AP902

 

SUDAN

 

GRANTED

 

AP/P/98/01245

 

AP902

 

SWAZILAND

 

GRANTED

 

AP/P/98/01245

 

AP902

 

UGANDA

 

GRANTED

 

AP/P/98/01245

 

AP902

 

AUSTRALIA

 

GRANTED

 

11199/97

 

704086

 

BRAZIL

 

PENDING

 

PI9611838.5

 

 

 

[*]

 

 

 

 

 

 

 

[*]

 

 

 

 

 

 

 

[*]

 

 

 

 

 

 

 

[*]

 

 

 

 

 

 

 

[*]

 

 

 

 

 

 

 

HAITI

 

GRANTED

 

 

 

229-REG.5

 

HUNGARY

 

PUBLISHED

 

P9901990

 

 

 

JAPAN

 

GRANTED

 

520533/97

 

3027771

 

[*]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NEW ZEALAND

 

GRANTED

 

324118

 

324118

 

[*]

 

 

 

 

 

 

 

 

24

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

 

[*]

 

 

 

 

 

 

 

[*]

 

 

 

 

 

 

 

[*]

 

 

 

 

 

 

 

SOUTH AFRICA

 

GRANTED

 

96/9490

 

96/9490

 

 

 

III.                                 USPN 6,017,947

 

No filings outside of the United States.

 

IV.                                 INTERNATIONAL APPLICATION PUBLICATION NO.
WO/97/45116 AND THE FOLLOWING EQUIVALENTS:

 

COUNTRY

 

STATUS

 

APPLICATION NO.

 

PATENT NO.

 

[*]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

25

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

 

ATTACHMENT B

 

FORM OF WARRANT

 

26

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

 

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

 

[*]         designates portions of this document that have been omitted pursuant
to a request for confidential treatment filed seperately with the Commission

 

ATTACHMENT C

 

Documents for Transfer of UC-781 Technology

 

[*]

 

27

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

 

ATTACHMENT D

 

CAPITALIZATION OF BIOSYN

 

Capitalization of Biosyn, Inc.

as of May 18, 2001

 

 

 

Total Outstanding

 

Convertible into
or Exercisable for
No. of Shares of
Common Stock

 

Common Stock

 

4,506,267

 

n/a

 

 

 

 

 

 

 

Series A Preferred

 

7,000

 

2,800,000

 

 

 

 

 

 

 

Series B Preferred

 

5,000

 

1,666,667

 

 

 

 

 

 

 

Warrants (other than the Warrant to be issued to Crompton per License)

 

n/a

 

563,000

 

 

 

 

 

 

 

Options (NQSOs & ISOs)

 

n/a

 

1,866,168

 

 

 

 

 

 

 

 

 

Fully Diluted Total

 

11,402,102

 

 

28

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

 

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

 

[*]         designates portions of this document that have been omitted pursuant
to a request for confidential treatment filed seperately with the Commission

 

ATTACHMENT E

 

Non-binding Development Plan

 

[*]

 

29

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

 

EXHIBIT I

 

Research Agreement between Rega Institute for Medical Research

and Uniroyal Chemical Company, Inc.

 

30

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