Exhibit 10.1

Certain information in this document identified by brackets has been omitted
because it is both not material and would be competitively harmful if publicly
disclosed.
LICENSE AGREEMENT
This License Agreement (the “Agreement”) is entered into as of April 21, 2020
(the “Effective Date”) by and between Foamix Pharmaceuticals Ltd., a company
organized and existing under the laws of the State of Israel and having a place
of business at 2 Holzman Street, Rehovot Science Park, Rehovot, Israel
(“Foamix”), and Cutia Therapeutics (HK) Limited, a company organized and
existing under the laws of Companies Ordinance (Chapter 622 of the laws of Hong
Kong) and having a place of business at Unit 402, 4/F Fairmont Hse No 8 Cotton
Tree Drive Admiralty Hong Kong (“Cutia”). Foamix and Cutia are sometimes
referred to herein individually as a “Party” and collectively as the “Parties.”

RECITALS
Whereas, Foamix is currently conducting research, development, and
commercialization of certain topical minocycline products;
Whereas, Cutia is a biopharmaceutical company with experience in developing
pharmaceutical products in the greater China region; and
Whereas, Cutia desires to obtain from Foamix an exclusive license to Develop and
Commercialize Licensed Products in the Cutia Territory (with each capitalized
term as respectively defined below), and Foamix is willing to grant such license
to Cutia, all under the terms and conditions of this Agreement.
Now, Therefore, in consideration of the foregoing premises and the mutual
promises, covenants and conditions contained in this Agreement, the Parties
agree as follows:
ARTICLE 1
DEFINITIONS

1.1 “Adverse Event” means any untoward medical occurrence in a patient or
subject who is administered a Licensed Product, including any undesirable sign
(including abnormal laboratory findings of clinical concern), symptom or disease
temporally associated with the use of Licensed Products.
1.2 “Adverse Risk” means any risk of a material adverse effect on the
Development, procurement or maintenance of Regulatory Approval, Manufacture, or
Commercialization of Licensed Products outside the Cutia Territory.
1.3 “Accounting Standards” means U.S. generally accepted accounting principles
(“GAAP”) or, to the extent that Cutia adopts International Financial Reporting
Standards (“IFRS”), then “Accounting Standards” means IFRS, in either case
consistently applied.
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1.4 “Act” shall mean, as applicable, the United States Federal Food, Drug and
Cosmetic Act, 21 U.S.C. §§301 et seq., and/or the Public Health Service Act, 42
U.S.C. §§262 et seq., as such may be amended from time to time.
1.5 “Affiliate” means, with respect to a particular Party, a Person that
controls, is controlled by, or is under common control with such Party. For the
purposes of this definition, the word “control” (including, with correlative
meaning, the terms “controlled by” or “under common control with”) means the
actual power, either directly or indirectly through one (1) or more
intermediaries, to direct or cause the direction of the management and policies
of such entity, whether by the ownership of fifty percent (50%) or more of the
voting stock of such entity, or by contract, or otherwise. For clarity, once a
Person ceases to be an Affiliate of a Party, then, without any further action,
such Person shall cease to have any rights, including license and sublicense
rights, under this Agreement by reason of being an Affiliate of such Party.
1.6 “Anti-Corruption Laws” means laws, regulations, or orders prohibiting the
provision of a financial or other advantage for a corrupt purpose or otherwise
in connection with the improper performance of a relevant function, including
without limitation, the Corruption of Foreign Public Officials Act (CFPOA), the
US Foreign Corrupt Practices Act (FCPA), the UK Bribery Act 2010, and similar
laws governing corruption and bribery, whether public, commercial or both, to
the extent applicable.
1.7 “Background Intellectual Property” means, with respect to a Party, any and
all Information, inventions, and discoveries, in each case whether or not
patentable, and any Patents or other intellectual property rights therein, in
each case Controlled by such Party as of the Effective Date or acquired, made,
conceived, or reduced to practice during the Term independent of this Agreement.
1.8 “Business Day” means a day other than Saturday, Sunday or any day that banks
in Bridgewater, New Jersey, USA or Hong Kong, China are required or permitted to
be closed.
1.9 “Calendar Quarter” means each successive period of three (3) consecutive
calendar months ending on March 31, June 30, September 30, or December 31.
1.10 “Change of Control” means, with respect to either Party: (a) the sale of
all or substantially all of such Party’s assets or business relating to (i) this
Agreement in its entirety or (ii) any Product or Products (other than to an
Affiliate of such Party); (b) a merger, reorganization, or consolidation
involving such Party in which the voting securities of such Party outstanding
immediately prior thereto cease to represent at least fifty percent (50%) of the
combined voting power of the surviving entity immediately after such merger,
reorganization, or consolidation; or (c) a Person, or group of Persons, acting
in concert acquire more than fifty percent (50%) of the voting equity securities
or management control of such Party.
1.11 “Clinical Trial” means a Phase 1 Clinical Trial, Phase 2 Clinical Trial,
Phase 3 Clinical Trial, Phase 4 Clinical Trial, or Pivotal Clinical Trial, or
any combination thereof.
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1.12 “CMC Information” means Information related to the chemistry, manufacturing
and controls of the Licensed Products, as specified by the FDA, NMPA and other
applicable Regulatory Authorities.
1.13 “Commercialization” means all activities undertaken before and after
obtaining Regulatory Approvals relating to the pre-launch, launch, promotion,
detailing, medical education and medical liaison activities, marketing, pricing,
reimbursement, sale, distribution and disposition of Licensed Products,
including strategic marketing, sales force detailing, advertising, market
Licensed Product support, all customer support, Licensed Product distribution,
and invoicing and sales activities; provided, however, “Commercialization” shall
exclude any activities relating to the Manufacture of Licensed Product.
“Commercialize” and “Commercializing” have the correlative meanings. For
clarity, “Commercialization” shall exclude all activities undertaken in
connection with Voluntary Phase 4 Clinical Trials.
1.14 “Commercially Reasonable Efforts” means, with respect to either Party’s
obligations under this Agreement, the carrying out of such obligations with a
level of efforts and resources consistent with the commercially reasonable
practices of a similarly situated company in the pharmaceutical industry for the
active and diligent commercialization of a similarly situated branded
pharmaceutical product as the Licensed Product at a similar stage of
commercialization, taking into account efficacy, safety, present and future
market potential, competitive market conditions, the profitability of the
product in light of pricing and reimbursement issues, and all other relevant
factors (but not taking in account any payment owed to Foamix under this
Agreement or any other pharmaceutical product that Cutia is then researching,
developing or commercializing, alone or with one or more collaborators).
1.15 “Competing Product” means a pharmaceutical product, other than a Licensed
Product, that contains minocycline, alone or in combination with other
ingredients, formulated for topical delivery.
1.16 “Confidential Information” of a Party means any and all Information of such
Party or its Affiliates that is disclosed to the other Party or its Affiliates
under this Agreement, whether in oral, written, graphic, or electronic form. In
addition, all Information disclosed by a Party or its Affiliates pursuant to the
confidentiality agreement between the Parties dated as of January 23, 2020 (the
“Confidentiality Agreement”) is the Confidential Information of such Party
disclosed hereunder; provided, however, that any use or disclosure of any such
Information that is authorized under Article 12 shall not be restricted by, or
be deemed a violation of, the Confidentiality Agreement. For clarity, Foamix
Licensed Know-How is the Confidential Information of Foamix.
1.17 “Control” means, with respect to any material, Information, Patent or other
intellectual property right, possession of the right, whether directly or
indirectly, and whether by ownership, license, or otherwise, to grant a license,
sublicense, or other right to or under, such material, Information, Patent, or
intellectual property right without violating the terms of any existing
agreement or other arrangement with any Third Party; provided that, with respect
to any material, Information, Patent or other intellectual property right
obtained by Foamix after the Effective Date from a Third Party, Foamix shall be
deemed to Control such material,
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Information, Patent or other intellectual property right only if it possesses
the right to grant such license, sublicense, or other right thereto without
being obligated to pay any royalties or other consideration therefor, unless
Cutia agrees in advance of any grant of rights thereto to pay such royalties or
other consideration. “Controlled” has a correlative meaning.
1.18 “Cover” means, with respect to a Patent and a Licensed Product, that the
Manufacture, use, offer for sale, sale or import of a Licensed Product, absent a
license to such Patent or Licensed Product, would infringe a Valid Claim in such
Patent; provided, however, that in determining whether a claim of a pending
Patent application would be infringed, it shall be treated as if issued in the
form then currently being prosecuted. “Covered” and “Covering” have the
correlative meanings.
1.19 “Cutia Territory” means, collectively, mainland China, Taiwan, Hong Kong
and Macau (each a “Region”).
1.20 “Data” means all data, non-clinical data, preclinical data and clinical
data, generated by or on behalf of a Party or its Affiliates or their respective
sublicensees pursuant to activities conducted under this Agreement; provided,
that Data excludes CMC Information. For clarity, Data does not include any
patentable inventions.
1.21 “Development” means all activities conducted after the Effective Date
relating to preclinical and clinical trials, toxicology testing, statistical
analysis, publication and presentation of study results with respect to Licensed
Products, and the reporting, preparation and submission of regulatory
applications (including any CMC Information) for obtaining, registering and
maintaining Regulatory Approval of Licensed Products, including the conduct of
Phase 4 Clinical Trials; provided, however, “Development” excludes any
activities relating to the Manufacture of Licensed Product. “Develop” and
“Developing” have the correlative meanings.
1.22 “Divest” means the sale or transfer of rights to the Competing Program to a
Third Party where neither the assigning Party nor its assignee have the right to
engage, and neither the assigning Party nor its assignee in fact engage, in any
management, governance or decision-making activities in connection with such
Competing Program. “Divestiture” has the correlative meaning.
1.23 “Executive Officers” means the Chief Executive Officer of Foamix and Chief
Executive Officer of Cutia or their respective designees.
1.24 “FDA” means the U.S. Food and Drug Administration or any successor entity
thereto.
1.25 “Field” means, with respect to each Licensed Product, (a) each
dermatological Indication for which such Licensed Product receives Regulatory
Approval in the United States and (b) with respect to FCD105, any other
Indications agreed by the Parties pursuant to Section 4.8.
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1.26 “First Commercial Sale” means the first sale of a Licensed Product in the
Cutia Territory to a Third Party after Regulatory Approval has been obtained in
the Cutia Territory.
1.27 “Fiscal Year” means Cutia’s fiscal year that starts on January 1 and ends
on December 31.
1.28 “Foamix Licensed Know-How” means all Information (including Data and
Regulatory Materials) that (a) is Controlled by Foamix and/or its Affiliates (i)
as of the Effective Date or (ii) during the Term, and (b) is necessary or
reasonably useful for the Development or Commercialization of Licensed Products
in the Field in the Cutia Territory.
1.29 “Foamix Licensed Patents” means all Patents that (a) are Controlled by
Foamix and/or its Affiliates (i) as of the Effective Date or (ii) during the
Term, and (b) Cover the Development or Commercialization of Licensed Products in
the Field in the Cutia Territory, including Foamix’s interest in any Patents
claiming any Foamix Inventions and Joint Inventions. Foamix Licensed Patents
existing as of the Effective Date are set forth in Exhibit A.
1.30 “Foamix Technology” means the Foamix Licensed Know-How and Foamix Licensed
Patents.
1.31 “Foamix Territory” means the world except for the Cutia Territory.
1.32 “GCP” or “Good Clinical Practices” means the then-current standards,
practices and procedures promulgated or endorsed by the FDA as set forth in the
guidelines entitled “Guidance for Industry E6 Good Clinical Practice:
Consolidated Guidance,” including related regulatory requirements imposed by the
FDA and comparable regulatory standards, practices and procedures promulgated by
the NMPA or other Regulatory Authority applicable to the Cutia Territory, as
they may be updated from time to time, including applicable quality guidelines
promulgated under the ICH.
1.33 “Generic Product” means, with respect to a Licensed Product in a Region,
any pharmaceutical product that (a) (i) contains the same active pharmaceutical
ingredients as such Licensed Product, (ii) is in the same form and format as
such Licensed Product, and (iii) is approved by the Regulatory Authority in such
Region based on reference to data contained in an earlier regulatory filing; and
(b) is sold in such Region by a Third Party that is not a sublicensee and did
not purchase such product or its active pharmaceutical ingredients from Cutia or
its Affiliates or sublicensees.
1.34 “GLP” or “Good Laboratory Practices” means the then-current good laboratory
practice standards promulgated or endorsed by the FDA as defined in 21 C.F.R.
Part 58, and comparable regulatory standards promulgated by NMPA or other
Regulatory Authority applicable to the Cutia Territory, as may be updated from
time to time, including applicable quality guidelines promulgated under the ICH.
1.35 “Government Official” means (a) any official or employee of any
Governmental Authority, or any department, agency, or instrumentality thereof
(including without limitation
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commercial entities owned or controlled, directly or indirectly, by a
Governmental Authority), (b) any political party or official thereof, or any
candidate for political office, or (c) any official or employee of any public
international organization.
1.36 “Governmental Authority” means any multi-national, national, federal,
state, local, municipal, provincial or other governmental authority of any
nature (including any governmental division, prefecture, subdivision,
department, agency, bureau, branch, office, commission, council, court or other
tribunal).
1.37 “ICH” means International Conference on Harmonization of Technical
Requirements for Registration of Pharmaceuticals for Human Use.
1.38 “Indication” means a separately defined, well-categorized class of human
disease or condition for which a separate MAA (including any extensions or
supplements) is required to be filed with a Regulatory Authority. For clarity,
if an MAA is approved for a Licensed Product in a particular Indication and
patient population, a label expansion for such Licensed Product to include such
Indication in a different patient population shall not be considered a separate
Indication.
1.39 “Information” means any data, results, technology, business or financial
information or information of any type whatsoever, in any tangible or intangible
form, including know-how, copyrights, trade secrets, practices, techniques,
methods, processes, inventions, developments, specifications, formulae,
software, algorithms, marketing reports, expertise, technology, test data
(including pharmacological, biological, chemical, biochemical, clinical test
data and data resulting from non-clinical studies), stability data and other
study data and procedures.
1.40 “Inventions” means any inventions or discoveries, including processes,
manufacture, composition of matter, Information, methods, assays, designs,
protocols, and formulas, and improvements or modifications thereof, patentable
or otherwise, that are generated, developed, conceived or reduced to practice
(constructively or actually) by or on behalf of a Party or its Affiliates or
their respective sublicensees (a) pursuant to activities conducted under this
Agreement, or (b) in connection with the Development, Manufacture, and
Commercialization of Licensed Product, in each case of (a) and (b), including
all rights, title and interest in and to the intellectual property rights
therein and thereto; provided, however, that Inventions exclude Data.
1.41 “Laws” means, with respect to a given country, the applicable laws,
statutes, rules, regulations, ordinances and other pronouncements having the
effect of law of any federal, national, multinational, state, provincial,
county, municipal, city or other political subdivision, domestic or foreign that
may be in effect from time to time in such country and that relate to a Party’s
activities under this Agreement.
1.42 “Licensed Product” means each of:
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(a) Foamix’s minocycline topical foam product referred to as Amzeeq™, 4%, in the
form and format described in NDA 212379 approved by the FDA on October 18, 2019
(“Amzeeq™”),
(b) Foamix’s minocycline topical foam product referred to as FMX103, 1.5%, and
in the form and format described in NDA N050808 for such product (i) submitted
by or on behalf of Foamix in the United States and (ii) approved by the FDA
(“FMX103”), and
(c) Foamix’s combination minocycline and adapalene foam product referred to as
FCD105 and in the form and format described in the first MAA for such product
(i) submitted by or on behalf of Foamix in the United States and (ii) approved
by the FDA (“FCD105”).
1.43 “Manufacture” and “Manufacturing” mean activities directed to
manufacturing, processing, filling, finishing, packaging, labeling, quality
control, quality assurance testing and release, post-marketing validation
testing, inventory control and management, storing and transporting any Licensed
Product, including oversight and management of vendors therefor.
1.44 “Manufacturing Cost” means, with respect to a particular Licensed Product
(whether as active pharmaceutical ingredient or finished form) supplied by
Foamix pursuant to Section 7.1: (a) if Foamix or its Affiliate Manufactures the
applicable Licensed Product, [***]; or (b) if a Third Party Manufactures such
Licensed Product, [***].
1.45 “Marketing Authorization Application” or “MAA” means a New Drug Application
(“NDA”) or any other application to the appropriate Regulatory Authority for
approval to market a Licensed Product, but excluding pricing approvals.
1.46 “Net Sales” means the gross amounts billed or invoiced by Cutia, its
Affiliates and their respective sublicensees for sales of Licensed Products to
Third Parties, less the following deductions to the extent reasonable,
customary, and actually allowed and taken with respect to such sales:
(a) trade, cash or quantity discounts not already reflected in the amount
invoiced, to the extent related to the gross amount billed or invoiced;
(b) price reductions, rebates and administrative fees (including those paid or
credited to pharmacy benefit managers, governmental authorities or otherwise);
(c) shipping costs, including freight, insurance and other transportation
charges or costs incurred in shipping of Licensed Products to Third Parties
(provided that, such shipping costs shall not be in excess of one percent (1%)
of Net Sales with respect to any given Calendar Quarter);
(d) sales, use, excise, value-added or similar taxes, customs duties and other
governmental fees, charges and surcharges imposed on the sale of Licensed
Products;
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(e) amounts repaid or credited by reason of rejections, defects, recalls or
returns;
(f) amounts paid or credited for wholesaler chargebacks; and
(g) any receivables that have been included in gross sales and are deemed to be
uncollectible according to Accounting Standards (any such bad debt deductions
shall be applied to Net Sales in the period in which such receivables are
written off) (provided that, the amount of such receivables shall not be in
excess of two percent (2%) of Net Sales with respect to any given Calendar
Quarter).
Notwithstanding the foregoing, amounts received or invoiced by Cutia, its
Affiliates, or their respective sublicensees for the sale of Licensed Product
among Cutia, its Affiliates or their respective sublicensees shall not be
included in the computation of Net Sales hereunder unless the purchasing entity
is the end-user. For purposes of determining Net Sales, the Licensed Product
shall be deemed to be sold when billed or invoiced. Net Sales shall be accounted
for in accordance with standard Cutia practices for operation by Cutia, its
Affiliates or their respective sublicensees, as practiced in the Cutia
Territory, but in any event in accordance with Accounting Standards consistently
applied in the Cutia Territory. For clarity, a particular item may only be
deducted once in the calculation of Net Sales. Notwithstanding anything to the
contrary in the foregoing, to the extent any amounts deducted pursuant to
subsections (d) or (g) above are subsequently recovered by Cutia, its
Affiliates, or their respective sublicensees during the Term, such recovered
amounts shall be deemed “Net Sales” for the subsequent Calendar Quarter;
provided that, if no royalties are owed by Cutia for such subsequent Calendar
Quarter Cutia shall promptly refund such recovered amounts to Foamix.
The transfer of any Licensed Product to an Affiliate, sublicensee, or other
Third Party (x) in connection with the research, development or testing of a
Licensed Product (including the conduct of Clinical Trials), (y) for purposes of
distribution as promotional samples, or (z) at no charge for indigent or similar
public support or compassionate use programs, will not, in any case, be
considered a Net Sale of a Licensed Product under this Agreement.
With respect to any transfer of any Licensed Product in the Cutia Territory for
any substantive consideration other than monetary consideration on arm’s length
terms, for the purposes of calculating the Net Sales under this Agreement, such
Licensed Product shall be deemed to be sold exclusively for money at the average
Net Sales price charged to Third Parties for cash sales in the Cutia Territory
during the applicable reporting period (or if there were only de minimus cash
sales in the Cutia Territory, at the fair market value as determined by
comparable markets).
Cutia, its Affiliates, and their respective sublicensees shall sell the Licensed
Product as a standalone product and will not sell the Licensed Product in
combination with other pharmaceutical or biologics products, diagnostic
products, or active ingredients or as part of a bundle with other products or
offer packaged arrangements to customers that include the Licensed Product,
except with Foamix’s prior written consent.
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1.47 “NMPA” means the National Medical Product Administration of the People’s
Republic of China, formerly known as the China National Drug Administration, or
any successor agency or authority thereto.
1.48 “Patents” means (a) pending patent applications, issued patents, utility
models and designs; (b) reissues, substitutions, confirmations, registrations,
validations, re-examinations, additions, continuations, continued prosecution
applications, continuations-in-part, or divisions of or to any of the foregoing;
and (c) extensions, renewals or restorations of any of the foregoing by existing
or future extension, renewal or restoration mechanisms, including supplementary
protection certificate, patent term additions, patent term extensions or the
equivalent thereof.
1.49 “Person” means an individual, corporation, partnership, limited liability
company, limited partnership, trust, business trust, association, joint stock
company, joint venture, pool, syndicate, sole proprietorship, unincorporated
organization, Governmental Authority or any other form of entity not
specifically listed herein.
1.50 “Phase 1 Clinical Trial” means any human clinical trial of a Licensed
Product conducted mainly to evaluate the safety of chemical or biologic agents
or other types of interventions (e.g., a new radiation therapy technique) that
would satisfy the requirements of 21 C.F.R. § 312.21(a) or its non-United States
equivalents.
1.51 “Phase 2 Clinical Trial” means any human clinical trial of a Licensed
Product conducted mainly to test the effectiveness of chemical or biologic
agents or other types of interventions for purposes of identifying the
appropriate dose for a Phase 3 Clinical Trial for a particular Indication or
Indications that would satisfy the requirements of 21 CFR § 312.21(b) or its
non-United States equivalents.
1.52 “Phase 3 Clinical Trial” means any human clinical trial of a Licensed
Product designed to: (a) establish that such Licensed Product is safe and
efficacious for its intended use; (b) define warnings, precautions and adverse
reactions that are associated with the Licensed Product in the dosage range to
be prescribed; and (c) support regulatory approval of such Licensed Product,
that would satisfy the requirements of 21 CFR § 312.21(c) or its non-United
States equivalents.
1.53 “Phase 4 Clinical Trial” means any human clinical trial of a Licensed
Product that is: (a) designed to satisfy a requirement of a Regulatory Authority
in order to maintain a Regulatory Approval for such Licensed Product or (b)
conducted after the first Regulatory Approval of a Licensed Product in the same
Indication for which a Licensed Product received Regulatory Approval.
1.54 “Pivotal Clinical Trial” means a pivotal clinical trial of a Licensed
Product in human patients (whether or not designated a Phase 3 Clinical Trial)
in any Region with a defined dose or a set of defined doses of a Licensed
Product designed to ascertain efficacy and safety of such Licensed Product for
the purpose of submitting applications for MAA approval to the competent
Regulatory Authorities.
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1.55 “Proper Conduct Practices” means, with respect to a Party, each of its
Representatives not, directly or indirectly, (a) making, offering, authorizing,
providing or paying anything of value in any form, whether in money, property,
services or otherwise to any Government Official, or other Person charged with
similar public or quasi-public duties, or to any customer, supplier, or any
other Person, or to any employee thereof, or failing to disclose fully any such
payments in violation of the laws of any relevant jurisdiction to (i) obtain
favorable treatment in obtaining or retaining business for it or any of its
Affiliates, (ii) pay for favorable treatment for business secured, (iii) obtain
special concessions or for special concessions already obtained, for or in
respect of it or any of its Affiliates, in each case which would have been in
violation of any Law, (iv) influence an act or decision of the recipient
(including a decision not to act) in connection with the Person’s or its
Affiliate’s business, (v) induce the recipient to use his or her influence to
affect any government act or decision in connection with the Person’s or its
Affiliate’s business or (vi) induce the recipient to violate his or her duty of
loyalty to his or her organization, or as a reward for having done so;
(b) engaging in any transactions, establishing or maintaining any fund or assets
in which it or any of its Affiliates will have proprietary rights that have not
been recorded in the books and records of it or any of its Affiliates; (c)
making any unlawful payment to any agent, employee, officer or director of any
Person with which it or any of its Affiliates does business for the purpose of
influencing such agent, employee, officer or director to do business with it or
any of its Affiliates; (d) violating any provision of applicable Anti-Corruption
Laws; (e) making any payment in the nature of bribery, fraud, or any other
unlawful payment under the Law of any jurisdiction where it or any of its
Affiliates conducts business or is registered; or, (f) if such Person or any of
its Representatives is a Government Official, improperly using his or her
position as a Government Official to influence the award of business or
regulatory approvals to or for the benefit of such Person, its Representatives
or any of their business operations, or failing to recuse himself or herself
from any participation as a Government Official in decisions relating to such
Person, its Representatives or any of their business operations.
1.56 “Regulatory Approval” means any and all approvals (including marketing
authorization approvals, supplements, amendments, pre- and post-approvals, and
pricing and reimbursement approvals), licenses, registrations or authorizations
of any national, supra-national, regional, state or local regulatory agency,
department, bureau, commission, council or other governmental entity, that are
necessary for the Manufacture, distribution, use or commercial sale of a
Licensed Product in a given country or regulatory jurisdiction.
1.57 “Regulatory Authority” means, in a particular country or jurisdiction, any
applicable Governmental Authority involved in granting Regulatory Approval in
such country or jurisdiction.
1.58 “Regulatory Materials” means regulatory applications (including MAA),
submissions, notifications, communications, correspondence, registrations,
Regulatory Approvals and other filings made to, received from or otherwise
conducted with a Regulatory Authority in order to Develop, Manufacture, market,
sell or otherwise Commercialize Licensed Products in a particular country or
jurisdiction.
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1.59 “Representatives” means, as to any Person, such Person’s Affiliates and its
and their successors, controlling Persons, directors, officers and employees.
1.60 “Third Party” means any Person other than a Party or an Affiliate of a
Party.
1.61 “U.S. Dollar” means a U.S. dollar, and “US$” shall be interpreted
accordingly.
1.62 “U.S.” or “USA” means the United States of America, including all
possessions and territories thereof.
1.63 “Valid Claim” means a claim (including a process, use, or composition of
matter claim) of (a) an issued and unexpired patent that has not (i)
irretrievably lapsed or been revoked, dedicated to the public or disclaimed or
(ii) been held invalid, unenforceable or not patentable by a court, governmental
agency, national or regional patent office or other appropriate body that has
competent jurisdiction, which holding, finding or decision is final and
unappealable or unappealed within the time allowed for appeal, or (b) a pending
patent application that has been pending for no more than seven (7) years since
its earliest priority date and has not been abandoned or finally disallowed
without the possibility of appeal.
1.64 “Voluntary Phase 4 Clinical Trial” means a Phase 4 Clinical Trial that is
not conducted to satisfy a requirement of a Regulatory Authority in order to
maintain a Regulatory Approval for such Licensed Product.
1.65 Additional Definitions: The following table identifies the location of
definitions set forth in various Sections of the Agreement:

Defined TermsSectionAdditional Product
2.5
Additional Tax
8.8(b)(i)
AgreementPreambleAlliance Manager
3.1
Amzeeq™
1.42(a)
Claims
11.1
Competing Program
2.6(b)
Confidentiality Agreement
1.16
CRC
6.3
CutiaPreambleCutia Data
9.1(b)
Cutia Indemnitees
11.1
Cutia Inventions
9.1(d)(ii)
Cutia Sublicense
2.1(c)
Cutia Withholding Tax Action
8.8(b)(i)
Development Plan
4.2
Dispute
14.1
Effective DatePreamble

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FCD105
1.42(c)
FMX103
1.42(b)
FoamixPreambleFoamix Indemnitees
11.2
Foamix Inventions
9.1(d)(i)
Foamix Partner
2.2
GAAP
1.3
IFRS
1.3
Indemnified Party
11.3
Indemnifying Party
11.3
Infringement
9.4(a)
Initial Development Plan
4.2
Initial Transfer
2.7
JDC
3.2(a)
Joint Inventions
9.1(d)(iii)
Licensed Mark
9.6(a)
Losses
11.1
NDA
1.45
PartyPreambleProduct Marks
9.6(b)
Product Materials
4.6
Region
1.19
Remedial Action
5.9
Royalty Term
8.3(b)
Rules14.2(a)Safety Agreement
5.8(a)
SEC
12.3(c)
Supply Agreement
7.1
Term
13.1
Third Party Infringement Actions
9.5
Tax Withholding
8.8(b)
VAT
8.8(d)

ARTICLE 2
LICENSE
2.1 License to Cutia.
(a) License Grant. Subject to the terms and conditions of this Agreement, Foamix
hereby grants Cutia an exclusive (even as to Foamix and its Affiliates, except
as provided in Section 2.1(b) below), royalty-bearing license, with the right to
sublicense (solely as provided in Section 2.1(c)), under the Foamix Technology,
to Develop, use, have used, distribute, market, promote, sell, have sold, offer
for sale, import, label, package and otherwise
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Commercialize Licensed Products in the Field in the Cutia Territory, including
to act as the local agent for Foamix to fulfil its obligations as the MAH
(Marketing Authorization Holder) of the Licensed Products in the Cutia
Territory.
(b) Foamix Retained Rights. Notwithstanding the exclusive rights granted to
Cutia in Section 2.1(a), Foamix and its Affiliates shall retain:
(i) the right to practice the Foamix Technology within the scope of the license
granted to Cutia under Section 2.1(a) in order to perform, or have performed by
a Third Party, Foamix’s obligations under this Agreement; provided that Foamix
shall remain solely responsible for such Third Party’s performance of or
failures to perform any obligations of Foamix under this Agreement; and
(ii) the right to practice and license the Foamix Technology outside the scope
of the license granted to Cutia under Section 2.1(a).
(c) Sublicense Rights. Cutia may grant sublicenses of the license granted in
Section 2.1(a) and Section 9.6(a) (i) to its Affiliates, including through
multiple tiers, without requiring Foamix’s prior consent; and (ii) to Third
Parties with Foamix’s prior written consent, such consent not to be unreasonably
withheld, conditioned, or delayed; provided, that (x) Foamix shall respond
within thirty (30) days of receiving Cutia’s written notice containing the name
of the sublicensee and the material terms of a proposed sublicense, (y) that
such consent shall be deemed granted by Foamix if Foamix fails to respond within
such thirty (30)-day period, and (z) Cutia shall not enter into a proposed
sublicense with material terms different than those presented to Foamix without
first notifying Foamix of such changes and obtaining Foamix’s prior written
consent pursuant to this Section 2.1(c). Cutia shall, within thirty (30) days
after granting any sublicense under Section 2.1(c), notify Foamix of the
execution of such sublicense and provide Foamix with a summary of the sublicense
agreement (each, an “Cutia Sublicense”). Cutia shall ensure that each Cutia
Sublicense is consistent with the terms and conditions of this Agreement, and
Cutia shall be solely responsible for all of its sublicensees’ activities and
any and all failures by its sublicensees to comply with the terms of this
Agreement. Without limiting the foregoing, each Cutia Sublicense shall include
the following additional terms and conditions:
(i) the sublicensee shall be bound by confidentiality obligations no less
stringent than those set forth in this Agreement;
(ii) he sublicensee shall not have any right to prosecute or maintain or enforce
any Foamix Licensed Patents;
(iii) the sublicensee shall assign or license to Cutia all Data and Inventions
generated by or on behalf of such sublicensee, and shall grant Cutia all of the
rights necessary for Cutia to fulfill its obligations under Section 9.1; and
(iv) Cutia shall use Commercially Reasonable Efforts to include in each Cutia
Sublicense a provision that, if this Agreement terminates, Foamix may assume
Cutia’s rights and obligations under the Cutia Sublicense.
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2.2 Foamix Partner. Foamix may enter into one (1) or more agreements with Third
Parties and may grant such Third Parties the right to Develop, Manufacture, and
Commercialize Licensed Products in one or more countries in the Foamix Territory
(each such Third Party, a “Foamix Partner”). In addition, Foamix may exercise
any or all of its rights and may fulfill any or all of its obligations under
this Agreement through one (1) or more Foamix Partners; provided that (a) any
such Foamix Partner is not actively developing, manufacturing or commercializing
a Competing Product in the Cutia Territory, and (b) Foamix shall remain solely
responsible for any Foamix Partner’s performance of or failures to perform any
obligations of Foamix under this Agreement.
2.3 Negative Covenants. Cutia shall not, and shall not permit any of its
Affiliates or sublicensees to, use or practice any Foamix Technology outside the
scope of the license granted to it under Section 2.1(a). Cutia shall not, and
shall not permit any Affiliate or sublicensee to, directly or indirectly,
Develop, distribute, market, promote, sell, have sold, offer for sale, import,
label, package and otherwise Commercialize Licensed Products in the Cutia
Territory for any use outside the Field. Foamix shall not, and shall not permit
any of its Affiliates to, directly or indirectly, Develop, distribute, market,
promote, sell, have sold, offer for sale, import, label, package and otherwise
Commercialize Licensed Products in the Cutia Territory for any use outside the
Field unless (a) Foamix has first offered such rights to Cutia pursuant to
Section 2.5 and the Parties have failed to reach agreement under Section 2.5 or
(b) Foamix obtains Cutia’s prior written consent.
2.4 No Implied Licenses. Except as explicitly set forth in this Agreement,
neither Party shall be deemed by estoppel, implication, or otherwise to have
granted the other Party any license or other right to any intellectual property
of such Party.
2.5 Right of First Offer. Foamix hereby grants to Cutia a right of first offer
to obtain an exclusive or non-exclusive license, as the Parties mutually agree,
with the right to sublicense through multiple tiers, to Develop, distribute,
market, promote, sell, have sold, offer for sale, import, label, package and
otherwise Commercialize any topical minocycline product of Foamix, other than
the Licensed Products, for any dermatological Indication in the Cutia Territory
(an “Additional Product”). Foamix shall notify Cutia in writing of its desire to
out-license such Additional Product. Together with such notice, Foamix shall
provide Cutia with all material information in Foamix’s control relating to the
applicable Additional Product. Cutia shall have fifteen (15) days from receipt
of such written notice to notify Foamix in writing as to whether Cutia desires
to negotiate for a license for such Additional Product. If Cutia so notifies
Foamix that it does desire to negotiate for such rights for such Additional
Product, then for forty-five (45) days the Parties shall negotiate in good faith
a definitive agreement for such rights for such Additional Product. For clarity,
Foamix may only enter into discussions, exchange information, and negotiate with
a Third Party with respect to an agreement related to the transfer of or grant
of rights for such Additional Product after the foregoing sixty (60)-day notice
and negotiation period.
2.6 Exclusivity.
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(a) Obligations. During the Term, Cutia shall not, directly or indirectly,
either by itself or with or through any of its Affiliates or any Third Party
(including via any arrangement or series of arrangements with a Third Party),
Develop, Manufacture or Commercialize any Competing Product in the Cutia
Territory.
(b) Acquisition of Competing Program. If a Third Party becomes an Affiliate of
Cutia after the Effective Date through merger, acquisition, consolidation or
other similar transactions and, as of the closing date of such transaction, such
Third Party is engaged in the research, development, manufacture or
commercialization of a Competing Product such that, if conducted by such Third
Party, it would cause Cutia to be in breach of its exclusivity obligations set
forth above (a “Competing Program”) then Cutia and its new Affiliate will have
twelve (12) months from the closing date of such transaction to wind down or
complete the Divestiture of such Competing Program, and Cutia’s new Affiliate’s
conduct of such Competing Program during such twelve (12)-month period will not
be deemed a breach of Cutia’s exclusivity obligations set forth above; provided
that such new Affiliate conducts such Competing Program during such twelve
(12)-month period independently of the activities of this Agreement and does not
use or access any of Foamix’s intellectual property rights or Confidential
Information in the conduct of such Competing Program.
2.7 Transfer of Foamix Licensed Know-How. Promptly after the Effective Date and
no later than one hundred (100) Business Days thereafter, Foamix shall, to the
extent expressly provided for in Exhibit B, provide Cutia with complete and
accurate copies through the Intralinks data room of the Foamix Licensed Know-How
set forth in Exhibit B (such transfer the “Initial Transfer”). The JDC shall
establish a reasonable process and schedule for the transfer of any additional
Foamix Licensed Know-How that subsequently becomes Controlled by Foamix or its
Affiliates during the Term. Foamix shall reasonably cooperate with Cutia in
providing Cutia with copies of such Foamix Licensed Know-How in accordance with
the process and schedule agreed upon through the JDC. Notwithstanding anything
to the contrary, Foamix is not obligated to transfer to Cutia any CMC
Information as part of the Initial Transfer or any subsequent transfer. For
clarity, all Licensed Know-How, including the Initial Transfer, will be provided
by Foamix in English and in such editable PDF form and format then in Foamix’s
possession.
ARTICLE 3
GOVERNANCE

3.1 Alliance Managers. Within thirty (30) days after the Effective Date, each
Party shall appoint and notify the other Party of the identity of a
representative having the appropriate qualifications, including a general
understanding of pharmaceutical development, manufacturing, and
commercialization issues, to act as its alliance manager under this Agreement
(the “Alliance Manager”). The Alliance Managers shall serve as the primary
contact points between the Parties for the purpose of providing each Party with
information on the progress and results of Cutia’s Development, Manufacturing,
and Commercialization of Licensed Products. The Alliance Managers shall also be
primarily responsible for facilitating the flow of information and otherwise
promoting communication, coordination and collaboration between the Parties with
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respect to Licensed Products. Each Party may replace its Alliance Manager at any
time upon written notice to the other Party.
3.2 Joint Development Committee.
(a) Formation; Purpose. Within thirty (30) days after the Effective Date, the
Parties shall establish a joint development committee (the “JDC”) for the
overall coordination and oversight of the Parties’ activities under this
Agreement. The role of the JDC is:
(i) to review, discuss and coordinate the overall strategy for the Development,
Manufacturing, and Commercialization of Licensed Products in the Cutia
Territory, including related regulatory activities;
(ii) to review, discuss and approve any proposed amendments or revisions to the
Development Plan, including those with respect to clinical Development
activities set forth in Section 4.3, and to review, discuss and approve the
conduct of any Development activities by Cutia;
(iii) to perform such other functions as appropriate to further the purposes of
this Agreement, as expressly set forth in this Agreement or as determined by the
Parties in writing.
(b) Members. The JDC shall be comprised of an equal number of representatives
from each Party. Each Party’s representatives shall be an officer or employee of
such Party or its Affiliate having sufficient seniority within the applicable
Party to make decisions arising within the scope of the JDC’s responsibilities.
Each Party shall initially appoint two (2) representatives to the JDC. Each
Party may replace its representatives at any time upon written notice to the
other Party. Each Party shall appoint one (1) of its representatives on the JDC
to act as the co-chairperson. The role of the co-chairpersons is to convene and
preside at the JDC meetings and to ensure the circulation of meeting agendas at
least five (5) days in advance of JDC meetings and the preparation of meeting
minutes and any pre-read materials in accordance with Section 3.2(c), but the
co-chairpersons have no additional powers or rights beyond those held by other
JDC representatives. Employees or consultants of either Party that are not
representatives of the Parties on the JDC may attend meetings of the JDC,
provided that such attendees shall not vote or otherwise participate in the
decision-making process of the JDC and are subject to obligations of
confidentiality substantially similar to the provisions set forth in Section
12.1.
(c) Meetings. The JDC shall meet at least every six (6) months during the Term,
and at least one (1) such meeting per calendar year shall be in-person, unless
the Parties mutually agree in writing to a different frequency for such
meetings. Either Party may also call a special JDC meeting (by videoconference
or teleconference) with reasonable advanced written notice to the other Party in
the event such Party reasonably believes that a significant matter must be
addressed prior to the next regularly scheduled meeting, and such Party shall
promptly provide the JDC prior to the special meeting with materials reasonably
adequate to enable an informed decision. All JDC meetings shall be conducted in
English, and all communications
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under this Agreement shall be in English. The location of each in-person JDC
meeting shall alternate between locations reasonably selected by each of the
Parties. The co-chairpersons shall be responsible for preparing reasonably
detailed written minutes of the JDC meetings that reflect all material decisions
made at such meetings. The co-chairpersons shall send draft meeting minutes to
each representative of the JDC for review and approval within ten (10) Business
Days after the JDC meeting. Such minutes shall be deemed approved unless one or
more JDC representatives object to the accuracy of such minutes within ten (10)
Business Days of receipt.
3.3 Decision Making. The JDC shall strive to seek consensus in its actions and
decision making process, and all decisions by the JDC shall be made by
consensus, with each Party having collectively one (1) vote in all decisions. If
after reasonable discussion and good faith consideration of each Party’s view on
a particular matter before the JDC, the representatives of the Parties cannot
reach an agreement as to such matter (to the extent that such matter requires
the agreement of the Parties hereunder) within ten (10) Business Days after such
matter was brought to the JDC for resolution or after such matter has been
referred to the JDC, such disagreement shall be referred to the Executive
Officers for resolution. If the Executive Officers cannot resolve such matter
within thirty (30) days after such matter has been referred to them, then:
(a) the Cutia Executive Officer has the final decision making authority with
respect to the Development or Commercialization of Licensed Products in the
Field in the Cutia Territory to the extent such Development and
Commercialization activities primarily arise within the Cutia Territory and
would be reasonably expected to primarily affect the Development,
Commercialization, and Manufacture of Licensed Products in the Cutia Territory;
provided, that the Cutia Executive Officer shall consider in good faith Foamix’s
comments and suggestions with respect to such matter; provided, further, that
the Cutia Executive Officer may not exercise such final decision making
authority in a manner that creates an Adverse Risk;
(b) the Foamix Executive Officer has the final decision making authority with
respect to all other matters not allocated to Cutia in Section 3.3(a).
For clarity, the Parties shall resolve in accordance with Section 14.2 any
Dispute concerning whether the Cutia Executive Officer or the Foamix Executive
Officer has the final decision making authority, including a Dispute as to
whether a decision by the Cutia Executive Officer creates an Adverse Risk.
3.4 Limitation of JDC Authority. The JDC shall only have the powers expressly
assigned to it in this Article 3 and elsewhere in this Agreement and shall not
have the authority to: (a) modify or amend the terms and conditions of this
Agreement; (b) waive or determine either Party’s compliance with the terms and
conditions of under this Agreement; or (c) decide any issue in a manner that
would conflict with the express terms and conditions of this Agreement.
3.5 Discontinuation of the JDC. The activities to be performed by the JDC shall
solely relate to governance under this Agreement, and are not intended to be or
involve the delivery of services. The JDC shall continue to exist until the
first to occur of: (a) the Parties
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agree to disband the JDC; or (b) Foamix provides written notice to Cutia of its
intention to disband and no longer participate in the JDC. Thereafter, the JDC
will have no further obligations under this Agreement and, thereafter, each
Party shall designate a contact person for the exchange of information relevant
to the JDC under this Agreement and decisions of the JDC shall be decisions as
between the Parties, subject to the other terms and conditions of this
Agreement.
3.6 Notification of Threatened Action. Each Party shall immediately notify the
other Party (including by providing notice to the other Party’s Alliance
Manager) of any information it receives regarding any threatened or pending
action, inspection or communication by or from any Third Party, including a
Regulatory Authority, which has an Adverse Risk. Upon receipt of such
information, the Parties shall consult with each other in an effort to arrive at
a mutually acceptable procedure for taking appropriate action.
3.7 No Harmful Actions. If Foamix believes that Cutia is taking or intends to
take any action (or inaction) with respect to any Licensed Product that could
reasonably be expected to create Adverse Risk, then Foamix may bring the matter
to the attention of the JDC and the Parties shall discuss in good faith to
promptly resolve such concern.
ARTICLE 4
DEVELOPMENT

4.1 Overview; Diligence. Subject to the terms and conditions of this Agreement
(including the diligence obligations set forth below), Cutia shall be solely
responsible for the Development of Licensed Products in the Field in the Cutia
Territory, at its own cost and expense (except as otherwise expressly set forth
herein), including all non-clinical and clinical studies, as necessary to obtain
Regulatory Approval for Licensed Products in any Region in the Cutia Territory.
Cutia shall use Commercially Reasonable Efforts to Develop and to obtain
Regulatory Approval for each Licensed Product in each Region in the Cutia
Territory and in each Indication for which such Licensed Product has received
Regulatory Approval in the United States.
4.2 Development Plan. Without limiting the generality of the other provisions in
this Article 4, Cutia shall conduct its Development activities under and in
accordance with the Development Plan and shall be solely responsible for all
decisions regarding the day-to-day conduct of Development within the Cutia
Territory. An initial, mutually agreed Development Plan is attached hereto as
Exhibit C (the “Initial Development Plan” and together with any subsequent
updates pursuant to this Section 4.2, collectively the “Development Plan”). The
Development Plan shall include among other things, (a) the Indications in the
Field for which the Licensed Products are to be Developed, (b) critical
activities to be undertaken under this Agreement, (c) go/no-go decision points
and relevant decision criteria, (d) solely to the extent expressly agreed by
Foamix with respect to any responsibilities allocated to Cutia, certain
allocations of responsibilities between the Parties under the Development Plan,
and (e) all non-clinical and clinical studies, CMC Information collection
activities, and regulatory activities with respect to the Licensed Products to
be conducted by or on behalf of Cutia or its Affiliates or their
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respective sublicensees in the Cutia Territory. From time to time during the
Term, Cutia may prepare written amendments and updates, as appropriate, to the
then-current Development Plan, and shall submit such amendments and updates to
the JDC in accordance with Section 3.2. Such Development Plan and the contents
therein shall be Confidential Information of Cutia.
4.3 Cooperation. Foamix shall provide such technical assistance and cooperation
to Cutia as Cutia may reasonably request, as necessary or reasonably useful for
Cutia to Develop or Commercialize Licensed Products in the Field in the Cutia
Territory, without additional charge to Cutia. For clarity, Foamix is not
obligated to provide Cutia with any CMC Information.
4.4 Development Records. Cutia shall maintain complete, current and accurate
records of all activities conducted pursuant to the Development Plan by Cutia,
its Affiliates and their respective sublicensees, and all Data and other
Information resulting from such activities. Such records shall fully and
properly reflect all work done and results achieved in the performance of the
Development activities in good scientific manner appropriate for regulatory and
patent purposes. Cutia shall document all non-clinical studies and clinical
trials in formal written study records in accordance with all Law, including
applicable national and international guidelines such as ICH, GCP and GLP. Cutia
shall, to the extent permitted by applicable Laws, permit Foamix to review and
copy such records at reasonable times and to obtain access to the original to
the extent necessary or useful for regulatory or patent purposes.
4.5 Development Reports. Cutia shall keep Foamix reasonably informed as to the
progress and results of its and its Affiliates’ and their respective
sublicensees’ work under the Development Plan (including prompt reporting of
available clinical data). Without limiting the foregoing, at each regularly
scheduled JDC meeting, Cutia shall provide Foamix with a written report
summarizing the Development activities performed since the last JDC meeting and
the results thereof, and comparing such activities with the Development Plan for
such time period. Such reports shall be provided in English and at a level of
detail reasonably requested by Foamix and sufficient to enable Foamix to
determine Cutia’s compliance with its diligence obligations under Section 4.1.
At such JDC meeting, the Parties shall discuss the status, progress and results
of Cutia’s Development activities. Cutia shall promptly respond to Foamix’s
reasonable questions or requests for additional information relating to such
Development activities. In addition, within thirty (30) days after the end of
each Fiscal Year, Cutia shall provide Foamix with a detailed written annual
report in English regarding the progress under the Development Plan and results
thereof (or upon Foamix’s reasonable request, on a more frequent basis).
4.6 Data Exchange. In addition to Foamix’s obligation with respect to the
transfer of Foamix Licensed Know-How set forth under Section 2.7 and each
Party’s adverse event, safety data, and product quality complaint reporting
obligations pursuant to Section 5.8, but subject to the remainder of this
Section 4.6, each Party shall, at its sole cost and expense, solely to the
extent permitted by applicable Laws, promptly provide the other Party with
copies of all Data and Regulatory Materials related to all Licensed Products
generated by or on behalf of such Party or its Affiliates or sublicensees in the
performance of Development activities of the Licensed Products in their
respective territories (the “Product Materials”). The JDC may establish
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reasonable policies to effectuate such exchange of Product Materials between the
Parties. For clarity, Product Materials exclude CMC Information.
4.7 Subcontractors. Cutia may engage subcontractors to conduct any activities
necessary for Development of Licensed Products, including non-clinical studies,
clinical studies, CMC activities (subject to Foamix’s prior written consent),
and regulatory services for Licensed Products, under this Agreement, provided
that such subcontractors are bound by written obligations of confidentiality
consistent with this Agreement and have agreed in writing to assign to Cutia all
Data, Information, inventions or other intellectual property generated by such
subcontractor in the course of performing such subcontracted work. Cutia shall
remain responsible for any obligations that have been delegated or subcontracted
to any subcontractor, and shall be responsible for the performance of its
subcontractors.
4.8 Development of FCD105.
(a) If Foamix decides, in its sole discretion, to conduct a global Clinical
Trial for FCD105 (“Global Trial”) and wishes to include Clinical Trial sites in
the Cutia Territory as part of such Global Trial, Foamix shall notify Cutia in
writing. Cutia and Foamix shall discuss in good faith the terms of Cutia’s
participation in any such Global Trial. If the Parties agree to collaborate with
respect to such Global Trial, the Parties shall enter into a separate clinical
trial agreement that is negotiated in good faith and contains commercially
reasonable terms and conditions.
(b) In the event Foamix decides to cease, abandon or discontinue the Development
of FCD105 prior to receiving Regulatory Approval therefor in the United States
within five (5) years from the Effective Date (“Abandoned FCD105”), Foamix shall
notify Cutia of such cessation, abandonment or discontinuance. Upon Cutia’s
request within sixty (60) days after such notice, the Parties shall discuss in
good faith including such Abandoned FCD105, in its then-current form and format
at the time of the cessation, abandonment or discontinuance, as a Licensed
Product under this Agreement. If the Parties agree to include Abandoned FCD105
as a Licensed Product under this Agreement, the Parties shall amend and modify
this Agreement as necessary to adjust the rights and obligations of the Parties
hereunder with respect to the Abandoned FCD105.
ARTICLE 5
REGULATORY MATTERS

5.1 Holder of Regulatory Approvals and Regulatory Materials. Foamix shall
initially be the holder of Regulatory Approvals and Regulatory Material for
Licensed Products in the Cutia Territory to the extent required by Law in the
Cutia Territory. As soon as is practicable during the Term, the Parties shall
cooperate in good faith to enable Cutia to hold all Regulatory Approvals and
Regulatory Materials, whether by transfer to Cutia of such Regulatory Approvals
and Regulatory Materials or through the submission by Cutia of a new application
for Regulatory Approval in a Region in the Cutia Territory, to the extent
permitted by Law and in accordance therewith. Cutia shall reimburse Foamix’s
actual costs and expenses related to Foamix’s cooperation to enable Cutia to
hold all such Regulatory Approvals and Regulatory Materials.
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5.2 Cutia Responsibilities.
(a) Cutia shall conduct all regulatory activities delegated to Cutia in this
Agreement in connection with the Development and Commercialization of Licensed
Products in the Cutia Territory at Cutia’s sole cost and expense. During such
time that Foamix is the holder of Regulatory Approvals and Regulatory Materials
for Licensed Products in the Cutia Territory, Cutia shall act as the express and
authorized regulatory agent of record for Foamix in the Cutia Territory, and
shall carry out specific activities delegated to Cutia by Foamix that are within
the scope of this Agreement. Promptly after the Effective Date, the Parties
shall execute such documents as are required for Cutia to act as Foamix’s
express and authorized regulatory agent of record in the Cutia Territory. Cutia
shall, and shall ensure that its Affiliates and sublicensees, comply with all
Laws in its conduct of regulatory activities under this Agreement, and Cutia
shall use Commercially Reasonable Efforts, in its capacity as a regulatory agent
of record for Foamix in the Cutia Territory, to comply with guidelines in the
United States applicable to regulatory agents of record to the extent that
equivalent guidelines do not exist in the Cutia Territory, and only to the
extent that such guidelines do not conflict with Laws in the Cutia Territory.
Subject to Section 5.1, Cutia shall use Commercially Reasonable Efforts to
obtain and maintain all Regulatory Approvals and Regulatory Materials necessary
to Manufacture Licensed Products in the Cutia Territory as soon as practicable
during the Term and to the extent permitted by Law and in accordance therewith.
After Regulatory Approvals and Regulatory Materials necessary for the
Development and Commercialization of Licensed Products in the Cutia Territory
are held by Cutia, Cutia shall be solely responsible for all regulatory
activities, including making additional Regulatory Materials and obtaining
additional Regulatory Approvals for Licensed Products from the Regulatory
Authorities in the Cutia Territory, at its sole cost and expense; provided that,
Cutia undertakes any such activities in compliance with this Agreement to the
same extent as if Cutia were acting as Foamix’s authorized regulatory agent
under this Agreement.
(b) Cutia, either itself or on behalf of Foamix in accordance with the foregoing
Section 5.1, shall apply for Regulatory Approval of Licensed Products in each
Region in the Cutia Territory, provided that Cutia has obtained, or has been
provided with access by Foamix to, Data sufficient for such Regulatory Material.
(c) Except as required by Law, Cutia, its Affiliates and sublicensees shall not
submit any Regulatory Materials to, or communicate with, any Regulatory
Authority in the Foamix Territory regarding any Licensed Products. If such
submission or communication is required by Law, Cutia shall immediately notify
Foamix in writing of such requirement and the content of such submission or
communication.
5.3 Foamix Responsibilities. Foamix shall use Commercially Reasonable Efforts to
maintain Regulatory Approvals in the U.S. for Licensed Products. Foamix shall
keep Cutia promptly informed of material notices and communications issued by
the FDA in connection with Regulatory Approvals for Licensed Products in the
U.S. Foamix shall reasonably cooperate with Cutia in obtaining any Regulatory
Approvals for Licensed Products in the Field in the Cutia Territory by
providing, to the extent Controlled by Foamix, access to Regulatory Approvals,
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Regulatory Materials, Data, Information, and documentation for Licensed Products
outside of the Cutia Territory. The Parties shall establish a reasonable process
and schedule for Foamix to provide CMC Information to the applicable Regulatory
Authority for purposes of the MAA. With respect to CMC Information and
regardless of which Party is then holding the Regulatory Materials and
Regulatory Approvals for Licensed Products in the Cutia Territory, Foamix shall
reasonably cooperate with Cutia, at Cutia’s cost and expense, in directly
providing to Regulatory Authorities the CMC Information required to obtain
Regulatory Approvals for Licensed Products in the applicable Region in the Cutia
Territory. Cutia shall reimburse Foamix’s reasonable costs and expenses incurred
in connection with the submission of CMC Information. Foamix shall provide all
other regulatory assistance at Foamix’s cost and expense. Except as expressly
permitted under this Agreement or required by Law, Foamix, its Affiliates and
sublicensees shall not submit any Regulatory Materials to, or communicate with,
any Regulatory Authority in the Cutia Territory regarding any Licensed Products.
If such submission or communication is required by Law, Foamix shall immediately
notify Cutia in writing of such requirement and the content of such submission
or communication.
5.4 Right of Reference. Each Party hereby grants to the other Party the right of
reference to all Regulatory Materials pertaining to Licensed Products in the
Field submitted by or on behalf of such Party. Cutia may use such right of
reference to Foamix’s Regulatory Materials in the Field solely for the purpose
of seeking, obtaining and maintaining Regulatory Approval of Licensed Products
in Field in the Cutia Territory. Foamix may use the right of reference to
Cutia’s Regulatory Materials in the Field solely for the purpose of seeking,
obtaining and maintaining Regulatory Approval of Licensed Products in the Foamix
Territory. Each Party shall support the other Party, as reasonably requested by
such other Party and at such other Party’s expense (except as otherwise provided
in Section 5.3), in obtaining Regulatory Approvals in such other Party’s
territory, including providing necessary documents or other materials required
by Law to obtain Regulatory Approval in such territory, all in accordance with
the terms and conditions of this Agreement.
5.5 Regulatory Information Sharing. Cutia shall notify Foamix of any material
verbal or written communication or question relating to Licensed Products
received by Cutia from the Regulatory Authority in the Cutia Territory and shall
promptly notify Foamix in writing of any decision by any Regulatory Authority in
the Cutia Territory regarding Licensed Products. Cutia shall provide Foamix with
all Regulatory Materials containing or requesting CMC Information upon receipt,
and Foamix shall provide any responses or written communications relating to the
request for submission directly to the applicable Regulatory Authority. In
addition, Cutia shall notify Foamix of any Regulatory Materials received from
any Regulatory Authority in the Cutia Territory and shall provide Foamix with
copies thereof within five (5) days after receipt. If any such Regulatory
Material is not in the English language, Cutia shall also provide Foamix with
both the original document and an English summary thereof.
5.6 Regulatory Audits and Inspection. Upon reasonable notice, Foamix may
conduct, once every other year or at any time upon reasonable cause, an audit of
safety and regulatory systems, procedures, and practices of Cutia, including on
site evaluations. Cutia shall promptly notify Foamix of any inspections relating
to the Development or Commercialization of
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Licensed Products by any Regulatory Authority in the Cutia Territory, including
the NMPA, of which it becomes aware. Unless prohibited by Laws, Cutia shall
permit Foamix’s representative to observe such inspection. Cutia shall also
provide Foamix with copies of all correspondences submitted to or received from
the Regulatory Authority relating to such inspection.
5.7 Meetings with Regulatory Authorities. Each Party shall provide the other
Party with at least fifteen (15) days’ prior written notice (or, to the extent
such meeting or discussion is scheduled in less than fifteen (15) days, notice
as quickly as practicable) of any meeting or discussion with any Regulatory
Authority in the Cutia Territory related to Licensed Products. Cutia shall lead
all interactions with Regulatory Authorities in the Cutia Territory with respect
to Licensed Products. To the extent permitted by Law and by the Regulatory
Authorities, Foamix may participate (whether directly or through a
representative) in all such meetings and discussions, at Foamix’s cost (except
as otherwise provided in Section 5.3). If Foamix elects not to attend such
meeting or discussion, Cutia shall provide Foamix with a written summary thereof
in English promptly following such meeting or discussion. Cutia shall keep
Foamix reasonably informed of any material regulatory developments related to
Licensed Products in the Field in the Cutia Territory. At each regularly
scheduled JDC meeting, Cutia shall provide Foamix with a list and schedule of
any meeting or discussion with the applicable Regulatory Authorities (or related
advisory committees) in the Cutia Territory planned for the next Calendar
Quarter that relates to any Licensed Product in the Field.
5.8 Adverse Events Reporting.
(a) Promptly following the Effective Date, but in no event later than sixty (60)
days before the commencement of a clinical study with respect to Development of
any Licensed Product by Cutia in the Cutia Territory, Cutia and Foamix shall
develop and agree to the worldwide safety and pharmacovigilance procedures for
the Parties with respect to Licensed Products, such as safety data sharing and
exchange, Adverse Events reporting and prescription events monitoring in a
written agreement (the “Safety Agreement”). Such Safety Agreement shall describe
the coordination of collection, investigation, reporting, and exchange of
information concerning Adverse Events or any other safety problem of any
significance, and product quality and product complaints involving Adverse
Events, sufficient to permit each Party, its Affiliates, or sublicensees to
comply with its legal obligations. The Parties shall promptly update the Safety
Agreement if required by changes in legal requirements. Each Party shall comply
with its respective obligations under the Safety Agreement and to cause its
Affiliates and sublicensees to comply with such obligations.
(b) Cutia shall maintain an Adverse Event database for Licensed Products in the
Cutia Territory, at its sole cost and expense, and, to the extent required by
Laws, shall report quality complaints, Adverse Events and safety data related to
Licensed Products to the applicable Regulatory Authorities in the Cutia
Territory, as well as responding to safety issues and to all requests of
Regulatory Authorities related to Licensed Products in the Cutia Territory.
Cutia shall provide to Foamix access to Cutia’s Adverse Event database for the
Cutia Territory. Foamix shall maintain a global Adverse Event database at its
sole cost and expense, and, except as prohibited by applicable Law, shall
provide Cutia with information contained in such global
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Adverse Event database at JDC meetings, provided, that Foamix shall promptly
provide Cutia with any material Adverse Event information that arises between
any such JDC meetings.
(c) Each Party shall comply with all Laws governing Adverse Events in its
respective territory, and shall notify the other Party on a timely basis of any
Adverse Events occurring in its respective territory. Each Party shall submit
copies of reports of Adverse Events to the other Party simultaneously with
submission to the applicable Regulatory Authorities. Each Party shall notify the
other in a timely manner and in any event within twenty-four (24) hours of
receiving any serious Adverse Event reports from Clinical Trials that each Party
is monitoring, notice from a Regulatory Authority, independent review committee,
data safety monitoring board or another similar Clinical Trial or post-marketing
monitoring body alleging significant concern regarding a patient safety issue or
other material information relevant to the safety or efficacy of Licensed
Products.
5.9 Remedial Actions. Each Party shall notify the other immediately, and
promptly confirm such notice in writing, if it obtains information indicating
that any Licensed Product may be subject to any recall, corrective action, or
other regulatory action by any Governmental Authority or Regulatory Authority (a
“Remedial Action”). The Parties shall assist each other in gathering and
evaluating such information as is necessary to determine the necessity of
conducting a Remedial Action. Cutia has sole discretion with respect to any
matters relating to any Remedial Action in the Cutia Territory, including the
decision to commence such Remedial Action and the control over such Remedial
Action in the Cutia Territory; provided, however, if Foamix determines in good
faith that any Remedial Action with respect to any Licensed Product in the Cutia
Territory should be commenced or is required by Law or Regulatory Authority, (a)
Foamix shall discuss such Remedial Action with Cutia and (b) Cutia shall
consider in good faith such Remedial Action upon Foamix’s request. The cost and
expenses of any Remedial Action in the Cutia Territory shall be borne solely by
Cutia. Cutia shall, and shall ensure that its Affiliates and sublicensees will,
maintain adequate records to permit the Parties to trace the distribution, sale
and use of Licensed Products in the Cutia Territory. Each Party shall provide
the other Party, at the other Party’s expense, with such assistance in
connection with a Remedial Action as may be reasonably requested by such other
Party. Notwithstanding the foregoing, any Remedial Action that relates to the
manufacture and supply of Licensed Products by Foamix to Cutia shall be governed
by the terms and conditions of the applicable Supply Agreement.
ARTICLE 6
COMMERCIALIZATION

6.1 Overview; Diligence. Subject to the terms and conditions of this Agreement
(including the diligence obligations set forth below), Cutia has the sole right
and responsibility for all aspects of the Commercialization of Licensed Products
in the Field in the Cutia Territory, including: (a) developing and executing a
commercial launch and pre-launch plan, (b) negotiating with applicable
Governmental Authorities regarding the price and reimbursement status of
Licensed Products; (c) marketing, advertising and promotion; (d) booking sales
and distribution and performance of related services; (e) handling all aspects
of order processing, invoicing and collection, inventory and receivables; (f)
providing customer support, including
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handling medical queries, and performing other related functions; and (g)
conforming its practices and procedures to Laws relating to the marketing,
detailing and promotion of Licensed Products in the Field in the Cutia
Territory. Cutia shall bear all of the costs and expenses incurred in connection
with such Commercialization activities. Cutia shall use Commercially Reasonable
Efforts to Commercialize the Licensed Products in the Cutia Territory.
6.2 Commercialization Report. For each Fiscal Year following Regulatory Approval
for each Licensed Product, Cutia shall provide to Foamix within sixty (60) days
after the end of such Fiscal Year a high-level annual report summarizing (a)
Cutia’s activities with respect to the Commercialization of Licensed Products in
such Fiscal Year and (b) Cutia’s anticipated activities with respect to the
Commercialization of Licensed Products in the next Fiscal Year. Such reports and
the contents therein shall be Confidential Information of Cutia.
6.3 Data Exchange. Cutia shall keep Foamix reasonably informed of Cutia’s, its
Affiliates’ and their respective sublicensees’ Commercialization activities with
respect to the Licensed Products in the Field in the Cutia Territory. Foamix
shall provide to Cutia, upon Cutia’s request, and no more than once each
Calendar Quarter, at Foamix’s cost, access to materials prepared by or on behalf
of Foamix that are approved and authorized to be distributed as promotional
materials pursuant to Foamix’s internal commercial review committee (“CRC”) that
are necessary or reasonably useful in connection with Cutia’s Commercialization
of Licensed Products in the Field in the Cutia Territory (including relevant
final and CRC-approved training materials, and any final global brand and global
market research materials, in each case, with respect to Licensed Products).
Until Cutia has received Regulatory Approval for a Licensed Product in a Region
in the Cutia Territory, Foamix shall provide such promotional materials in
read-only access format.
6.4 No Diversion. Each Party hereby covenants and agrees that it shall not, and
shall ensure that its Affiliates and sublicensees will not, directly or
indirectly, promote, market, distribute, import, sell or have sold the Licensed
Products, including via internet or mail order, in the other Party’s territory.
With respect to any country in the other Party’s territory, a Party shall not,
and shall ensure that its Affiliates and their respective sublicensees will not:
(a) establish or maintain any branch, warehouse or distribution facility for
Licensed Products in such countries, (b) knowingly engage in any advertising or
promotional activities relating to Licensed Products that are directed primarily
to customers or other purchaser or users of Licensed Products located in such
countries, (c) actively solicit orders for Licensed Products from any
prospective purchaser located in such countries, or (d) knowingly sell or
distribute Licensed Products to any person in such Party’s territory who intends
to sell or has in the past sold Licensed Products in such countries. If either
Party receives any order for any Licensed Product from a prospective purchaser
reasonably believed to be located in a country in the other Party’s territory,
such Party shall immediately refer that order to the other Party and such Party
shall not accept any such orders. Each Party shall not deliver or tender (or
cause to be delivered or tendered) Licensed Products into a country in the other
Party’s territory. Each Party shall not, and shall ensure that its Affiliates
and their respective sublicensees will not, knowingly restrict or impede in any
manner the other Party’s exercise of its retained exclusive rights in the other
Party’s territory.
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ARTICLE 7
MANUFACTURE AND SUPPLY

7.1 Foamix Manufacture and Supply. Except as otherwise provided for in this
Agreement or a Supply Agreement, Cutia shall purchase from Foamix, and Foamix
shall use Commercially Reasonable Efforts to supply to Cutia, all of Cutia’s
requirements for the Licensed Products, subject to the terms and conditions of
each Supply Agreement. [***].
7.2 Cutia Supply; Manufacturing Technology Transfer. Foamix may require that
Cutia, and Cutia shall, assume the Manufacture of all of Cutia’s requirements
for the Licensed Products for use in the Cutia Territory in accordance with the
procedures set forth in this Section 7.2. At any time after twelve (12) months
after the First Commercial Sale of a Licensed Product in the Cutia Territory,
Foamix may provide written notice to Cutia of its transfer of the Manufacture of
such Licensed Product to Cutia. The commercial Supply Agreement shall set forth
the applicable time periods and mechanics of a technology transfer that is
reasonably necessary for Cutia, itself or through an Affiliate or Third Party,
to Manufacture such Licensed Product for use in the Cutia Territory, including
the transfer to Cutia relevant documents and information to the extent
Controlled and actually used in the Manufacture of Licensed Products by Foamix
as of such transfer date, and the provision of technical assistance and support.
Cutia shall pay Foamix’s external and internal costs incurred in connection with
providing such information or assistance, as further set forth in the commercial
Supply Agreement.
7.3 Distribution. Cutia will be solely responsible for the distribution of
Licensed Products in the Field in the Cutia Territory.
7.4 Brand Security and Anti-Counterfeiting. The Parties will establish contacts
for communication regarding brand security issues, and each Party shall
reasonably cooperate with the other Party with respect thereto.
ARTICLE 8
COMPENSATION

8.1 Initial Upfront Payments. As partial consideration for the licenses granted
under this Agreement and as reimbursement of Foamix’s certain research and
development expenses and activities conducted prior to the Effective Date, Cutia
shall pay Foamix a one-time, non-refundable, non-creditable payment of ten
million U.S. Dollars (US$10,000,000) as follows: (a) six million U.S. Dollars
(US$6,000,000) within twenty-five (25) Business Days after the Effective Date,
and (b) four million U.S. Dollars (US$4,000,000) within one hundred (100)
Business Days after the Effective Date, provided that Foamix has provided Cutia
with the Foamix Licensed Know-How set forth in Exhibit B.
8.2 Milestone Payment. Cutia shall pay to Foamix a one-time, non-refundable,
non-creditable milestone payment of one million U.S. Dollars (US$1,000,000)
within thirty (30) Business Days after the first Regulatory Approval of the
first Licensed Product by the NMPA, whether achieved by or on behalf of Cutia,
its Affiliate, or their respective sublicensees. For
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clarity, such milestone payment shall be due only once for all Licensed Products
and shall not exceed one million U.S. Dollars (US$1,000,000).
8.3 Royalties on Net Sales.
(a) Royalty Rate. Subject to the terms and conditions of this Section 8.3,
within sixty (60) days after the end of each Calendar Quarter during the Royalty
Term, Cutia shall pay to Foamix non-creditable, non-refundable royalties on the
Net Sales in the Cutia Territory during such Calendar Quarter, [***].
(b) Royalty Term. Royalties payable under Section 8.3(a) shall be paid by Cutia
(on a Licensed Product-by-Licensed Product and Region-by-Region basis) beginning
on the date of the First Commercial Sale of each Licensed Product in a Region in
the Cutia Territory and continuing until the later of: (i) ten (10) years from
the date of First Commercial Sale of such Licensed Product in such Region, and
(ii) expiration of the last Valid Claim of a Foamix Licensed Patent Covering
such Licensed Product in such Region (the “Royalty Term”). For clarity, if a
Valid Claim of a Foamix Licensed Patent Covers the Manufacture of such Licensed
Product in such Region, then regardless of whether such Licensed Product is
actually manufactured in such Region, such Licensed Product shall be deemed to
be Covered by a Valid Claim of a Foamix Licensed Patent in such Region.
(c) Generic Competition. If, in a Region within the Territory during the Royalty
Term for a Licensed Product, sales of all Generic Products to such Licensed
Product in such Region in a Calendar Quarter exceed [***] of the unit volume of
all sales of such Licensed Product plus the unit volume of all sales of such
Generic Products to such Licensed Product in such country, then the royalty rate
payable by Cutia to Foamix with respect to Net Sales of the Licensed Product in
such Region for such Calendar Quarter shall be reduced by [***] of the otherwise
applicable rate. If, in a Region within the Territory during the Royalty Term
for a Licensed Product, sales of all Generic Products to such Licensed Product
in such Region in a Calendar Quarter exceed [***] of the unit volume of all
sales of such Licensed Product plus the unit volume of all sales of such Generic
Products to such Licensed Product in such country, then the royalty rate payable
by Cutia to Foamix with respect to Net Sales of the Licensed Product in such
Region for such Calendar Quarter shall be [***]. All such determinations of the
unit volume of sales shall be based upon a mutually acceptable calculation
method using market share data provided by a reputable and mutually agreed upon
provider, such as IMS Health.
(d) Third Party License. To the extent a Third Party license is necessary to
make, use, import, sell, have sold, offer for sale or otherwise Commercialize a
Licensed Product in a particular Region, the royalties payable by Cutia to
Foamix shall be [***].
(e) Floor. In no circumstances will the royalties payable to Foamix under this
Section 8.3 in any Calendar Quarter be reduced, as a result of Section
8.3(c)–(d) below [***] otherwise payable under Section 8.3. Cutia may carry
forward to subsequent Calendar Quarters any deductions that it was not able to
deduct as a result of the foregoing provision.
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8.4 Royalty Payments; Reports. Royalties under Section 8.3 shall be calculated
and reported for each Calendar Quarter during the Royalty Term and shall be paid
within sixty (60) days after the end of the applicable Calendar Quarter,
commencing with the Calendar Quarter in which the First Commercial Sale of a
Licensed Product occurs; provided, that if, after further review of its books
and records of Net Sales for the Calendar Quarter for which Cutia last paid
Foamix royalties, Cutia determines that the royalty rate paid during such
Calendar Quarter was (i) more than [***], the corresponding overpayment received
by Foamix shall be credited to Cutia against royalty payments due for the next
Calendar Quarter or (ii) less than [***], Cutia shall pay the amount owed within
sixty (60) days after the determination of such underpayment. Each payment or
adjustment of royalties shall be accompanied by a report of Net Sales of
Licensed Products by Cutia, its Affiliates and their respective sublicensees in
sufficient detail to permit confirmation of the accuracy of the royalty payment
made, including: (a) the amount of gross sales and Net Sales of Licensed
Products in the Cutia Territory on a Licensed Product-by-Licensed Product and
Region-by-Region basis, (b) an itemized calculation showing the deductions from
gross sales (by each major category as set forth in the definition of Net Sales
herein) to determine Net Sales, and (c) a calculation of the amount of royalties
due to Foamix in U.S. Dollars, including the application of any exchange rate
used.
8.5 Payment Method; Foreign Exchange. All payments owed by Cutia under this
Agreement shall be made by wire transfer in immediately available funds to a
bank and account designated in writing by Foamix. For clarity, all payments by
Cutia to Foamix under this Agreement shall be in U.S. Dollars. The rate of
exchange to be used in computing the amount of currency equivalent in U.S.
Dollars of any amounts payable in U.S. Dollars by Cutia to Foamix under this
Agreement shall be determined and calculated using the average rate of exchange
based on OANDA rates for the Calendar Quarter in which the applicable payment is
due.
8.6 Interest on Late Payments. If Foamix does not receive payment of any sum due
to it on or before the due date, interest shall thereafter accrue on the sum due
to Foamix until the date of payment at the per annum rate of one percent (1%)
over the then-current prime rate reported in The Wall Street Journal or the
maximum rate allowable by Law, whichever is lower, with such interest compounded
quarterly.
8.7 Records; Audits.
(a) Cutia shall, and shall cause its Affiliates and their respective
sublicensees to, maintain complete and accurate records in accordance with
Accounting Standards and in sufficient detail to permit Foamix to confirm the
accuracy of the calculation of royalty payments and the achievement of the
milestone event. All payments and other amounts under this Agreement shall be
accounted for in accordance with Accounting Standards. Upon reasonable prior
notice, such records shall be available for examination during regular business
hours for a period of three (3) years from the end of the Fiscal Year to which
they pertain, and not more often than once each Fiscal Year, by an independent
certified public accountant selected by Foamix and reasonably acceptable to
Cutia, for the sole purpose of verifying the accuracy of the financial reports
furnished by Cutia pursuant to this Agreement and any payments with respect
thereto. Any such auditor shall not disclose Cutia’s Confidential Information,
except to the extent
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such disclosure is necessary to verify the accuracy of the financial reports
furnished by Cutia or the amount of payments due under this Agreement. Any
amounts shown to be owed but unpaid shall be paid within thirty (30) days from
the accountant’s report, plus interest (as set forth in Section 8.6) from the
original due date. Any amount overpaid by Cutia shall be returned to Cutia
within thirty (30) days from the accountant’s report, plus interest (as set
forth in Section 8.6) from the original payment date. Foamix shall bear the full
cost of such audit; provided, however, if the audit discovers that the royalties
payable by Cutia for such period are more than one hundred ten percent (110%) of
the royalties actually paid for such period, then Cutia shall pay the reasonable
fees and expenses of such audit.
(b) Foamix shall, and shall cause its Affiliates to, maintain complete and
accurate records in accordance with Accounting Standards and in sufficient
detail to permit Cutia to confirm the accuracy of the calculation of the
Manufacturing Cost of the Licensed Products. All such amounts under this
Agreement shall be accounted for in accordance with Accounting Standards. Upon
reasonable prior notice, such records shall be available for examination during
regular business hours for a period of three (3) years from the end of the
Fiscal Year to which they pertain, and not more often than once each Fiscal
Year, by an independent certified public accountant selected by Cutia and
reasonably acceptable to Foamix, for the sole purpose of verifying the accuracy
of the Manufacturing Cost of the Licensed Products furnished by Foamix. Any such
auditor shall not disclose Foamix’s Confidential Information, except to the
extent such disclosure is necessary to verify the accuracy of the Manufacturing
Cost of the Licensed Products furnished by Foamix. Any amounts shown to be owed
but unpaid shall be paid within thirty (30) days from the accountant’s report,
plus interest (as set forth in Section 8.6) from the original due date. Any
amount overpaid by Cutia shall be returned to Cutia within thirty (30) days from
the accountant’s report, plus interest (as set forth in Section 8.6) from the
original payment date. Cutia shall bear the full cost of such audit; provided,
however, if the audit discovers that the Manufacturing Cost furnished by Foamix
over the course of a Fiscal Year is more than one hundred ten percent (110%) of
the Manufacturing Cost actually incurred in such Fiscal Year, then Foamix shall
pay the reasonable fees and expenses of such audit.
(c) Foamix shall, and shall cause its Affiliates and its and their respective
employees, agents and contractors, maintain complete and accurate records with
respect to Foamix’s pharmacovigilance-related obligations set forth in Section
5.8. Upon reasonable prior notice, such records shall be available for
examination during regular business hours for a period of three (3) years from
the end of the Fiscal Year to which they pertain, and not more often than once
each Fiscal Year, by Cutia or its designee that is reasonably acceptable to
Foamix, for the sole purpose of ensuring compliance with NMPA and other
Regulatory Authority regulations. Any such records shall be deemed Confidential
Information of Foamix.
8.8 Taxes.
(a) Taxes on Income. Each Party shall be solely responsible for the payment of
all taxes imposed on its share of income arising directly or indirectly from the
efforts of the Parties under this Agreement.
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(b) Withholding Taxes. If Cutia is required by Laws to make any tax deduction,
tax withholding or similar payment from any amount paid or payable by Cutia to
Foamix (a “Tax Withholding”) under this Agreement, then (1) in the case of
payments to be made by Cutia to Foamix under Section 8.1, Cutia shall pay Foamix
the actual stated amount set forth under this Agreement in full and shall also
pay any such Tax Withholding (including any additional Tax Withholding required
with respect to Cutia’s additional payments under this Section 8.8) directly to
the proper Governmental Authority so that Foamix receives the full amount it
would have received had no withholding tax applied and (2) in the case of all
other payments to be made by Cutia to Foamix under this Agreement (including
Sections 8.2 and 8.3), Cutia shall deduct such Tax Withholding, shall pay Foamix
such remaining amount after deduction, and shall pay any such Tax Withholding
directly to the proper Governmental Authority. If (A) a Tax Withholding is
required, but some or all of the tax required to be withheld and remitted by
Cutia is not withheld and/or is not remitted by Cutia, and (B) instead Foamix
pays the relevant amount to a Governmental Authority, Cutia shall indemnify
Foamix for the full amount of any such tax paid by Foamix and any liability
(including penalties, interest and reasonable expenses) arising therefrom or
with respect thereto.
(i) Taxes Resulting from Cutia Action. If Cutia is required to make a payment to
Foamix subject to Tax Withholding, then (A) if such Tax Withholding arises as a
result of any action by Cutia, including payment of amounts owed under this
Agreement by through Cutia’s Affiliates, an assignment or transfer of this
Agreement (or the rights and obligations hereunder), a change in Cutia’s tax
domicile, or any failure on the part of Cutia to comply with applicable Law, (a
“Cutia Withholding Tax Action”), then subject to Section 8.8(b)(ii), the payment
by Cutia (in respect of which such deduction or withholding of Tax is required
to be made) shall be increased by the amount necessary (the “Additional Tax”) to
ensure that Foamix receives an amount equal to the amount that it would have
received had no such Cutia Withholding Tax Action occurred, and. All Tax
deducted and withheld from any payment made by Cutia, shall be timely remitted
to the proper Governmental Authority for the account of Foamix in accordance
with applicable Law.
(ii) Tax Credits and Tax Repayments. If Foamix determines that it has derived
full use and benefit from a credit (arising with respect to any Additional Tax)
against the payment of any other Tax owed by Foamix, or if Foamix receives a
refund of any Additional Tax from the Hong Kong Tax Authority, then Foamix
shall, to the extent that it can do so without prejudice to financial or tax
position of Foamix, refund to Cutia an amount that, after payment to Cutia, will
leave Foamix in no worse of an after-Tax position than it would have been in had
it not made the payment to Cutia provided that Cutia has not previously obtained
a refund or payment of any such amount from the applicable Tax authority.
Nothing in this Agreement shall obligate Foamix to make available to Cutia any
Tax returns, financial information, or other documents reasonably determined by
Foamix to be confidential.
(c) Tax Cooperation. The Parties shall cooperate with one another and use
reasonable efforts to reduce or eliminate Tax Withholding, VAT, or similar
obligations in respect of payments made by Cutia to Foamix under this Agreement
(including pursuant to Section 8.1 and Section 8.2). To the extent Cutia is
required to deduct and withhold taxes from any payment
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to Foamix, Cutia shall pay the amounts of such taxes to the proper Governmental
Authority in a timely manner and promptly transmit to Foamix an official tax
certificate or other evidence of such withholding sufficient to enable the other
Party to claim such payment of taxes from any applicable Government Authority.
Foamix shall use Commercially Reasonable Efforts to provide Cutia any tax forms
that may be necessary in order for Cutia not to withhold tax or to withhold tax
at a reduced rate under an applicable bilateral income tax treaty to the extent
Foamix is able to do so. Each Party shall provide the other with reasonable
assistance to enable the recovery, as permitted by Law, of withholding taxes,
VAT or similar obligations resulting from payments made under this Agreement,
such recovery to be for the benefit of the Party bearing such withholding tax or
VAT. Specifically, in the event that any tax has been withheld upon a payment
made under this Agreement and been remitted by Cutia to a Governmental
Authority, if requested by Cutia and if, and for so long as, the Parties acting
in good faith mutually agree that there is a reasonable prospect of successfully
obtaining a refund of such tax, then Cutia may, at its sole cost and expense,
seek a refund of such tax from the proper Governmental Authority. Foamix shall
reasonably cooperate with Cutia in the pursuit of such tax refund (including, if
required by Law or by the applicable Governmental Authority, permitting Cutia to
seek such tax refund in Foamix’s name and participating in any application or
appeal that requires that Foamix be the party applying for such tax refund,
solely with Foamix’s prior written consent); provided that, (i) Cutia shall
assume responsibility for direct payment of lawyers’ and other advisors’ fees
and any other costs associated with seeking such refund, and (ii) to the extent
that Foamix is ever the party making such payment, Cutia agrees that forthwith
upon presentation by Foamix of the applicable invoice(s), Cutia shall refund
Foamix’s reasonable expenses in cooperating in the pursuit of such tax refund.
(d) VAT. All payments due to Foamix from Cutia pursuant to this Agreement shall
be paid exclusive of, and without reduction for, any value-added tax (including,
for greater certainty, any goods and services tax, harmonized sales tax and any
similar provincial sales tax) (“VAT”) (which, if applicable, shall be payable by
Cutia upon receipt of a valid VAT invoice). If Foamix determines that it is
required to report any such tax, Cutia shall promptly provide Foamix with
applicable receipts and other documentation necessary or appropriate for such
report. For clarity, this Section 8.8(d) is not intended to limit Cutia’s right
to deduct VAT in determining Net Sales. Cutia shall and hereby does indemnify
Foamix for any VAT that is the responsibility of Cutia pursuant to this Section
8.8(d).
ARTICLE 9
INTELLECTUAL PROPERTY MATTERS

9.1 Ownership; License Grants.
(a) Background IP. Each Party shall own and retain all right, title, and
interest in and to all Background Intellectual Property Controlled by such
Party. For clarity, Foamix’s Background Intellectual Property excludes Foamix
Technology, Foamix Inventions, and Joint Inventions.
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(b) Data. Foamix shall solely own all Data generated by or on behalf of Foamix.
Cutia shall solely own all Data generated by or on behalf of Cutia in the
Development, Manufacture, and Commercialization of Licensed Products in the
Field in the Cutia Territory (“Cutia Data”). For good and valuable
consideration, the receipt of which is hereby acknowledged, to the maximum
extent permitted by Law, Cutia hereby grants to Foamix a perpetual,
royalty-free, fully paid-up, exclusive license, with the right to grant
sublicenses through multiple tiers, to use the Cutia Data to Develop,
Manufacture, and Commercialize the Licensed Products in the Foamix Territory,
and, to the extent the foregoing exclusive license is not permitted by Law,
Cutia hereby grants to Foamix a perpetual, royalty-free, fully paid-up,
non-exclusive license, with the right to grant sublicenses through multiple
tiers, to use the Cutia Data to Develop, Manufacture, and Commercialize the
Licensed Products in the Foamix Territory.
(c) Product Materials. Subject to the terms and conditions of this Agreement,
each Party hereby grants to the other Party a fully paid-up, royalty-free
license, with the right to grant sublicenses through multiple tiers, to use
Product Materials generated and owned by such Party, for the Development,
Manufacture (with respect to Cutia, solely to the extent applicable under
Section 7.2 or a Supply Agreement) and Commercialization of Licensed Products in
the other Party’s respective territory during the Term.
(d) Inventions. Inventorship of any Inventions will be determined in accordance
with the standards of inventorship and conception under U.S. patent laws.
(i) Foamix Inventions. Any Inventions generated, developed, conceived or reduced
to practice (constructively or actually) solely by or on behalf of Foamix, its
Affiliates and their respective sublicensees, including their employees, agents
and contractors (“Foamix Inventions”) shall be solely and exclusively owned by
Foamix.
(ii) Cutia Inventions. Any Inventions, including Manufacturing improvements,
generated, developed, conceived or reduced to practice (constructively or
actually) solely by or on behalf of Cutia, its Affiliates and their respective
sublicensees, including their employees, agents and contractors (“Cutia
Inventions”) shall be solely and exclusively owned by Cutia. For good and
valuable consideration, the receipt of which is hereby acknowledged, to the
maximum extent permitted by Law, Cutia shall and hereby does grant to Foamix a
perpetual, royalty-free, fully paid-up, exclusive license, with the right to
grant sublicenses through multiple tiers, under the Cutia Inventions and all of
Cutia’s intellectual property rights therein and thereto, to Develop,
Manufacture, and Commercialize the Licensed Products in the Foamix Territory,
and, to the extent the foregoing exclusive license is not permitted by Law,
Cutia hereby grants to Foamix a perpetual, royalty-free, fully paid-up,
non-exclusive license, with the right to grant sublicenses through multiple
tiers, under the Cutia Inventions and all of Cutia’s intellectual property
rights therein and thereto, to Develop, Manufacture, and Commercialize the
Licensed Products in the Foamix Territory.
(iii) Joint Inventions. Any Inventions generated, developed, conceived or
reduced to practice (constructively or actually) jointly by or on behalf of
Cutia and Foamix, their Affiliates and respective sublicensees, including their
employees, agents and contractors
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(“Joint Inventions”) shall be jointly owned by Foamix and Cutia. Each Party may
use, or allow Third Parties to use, the Joint Inventions without the duty to
account to the other Party.
(e) Affiliates, Sublicensees and Subcontractors. Each Party shall ensure that
each of its Affiliates, sublicensees and subcontractors under this Agreement has
a contractual obligation to disclose to such Party all Data, Product Materials
and Inventions generated, invented, discovered, developed, made or otherwise
created by them or their employees, agents or independent contractors, and to
provide sufficient rights with respect thereto, so that such Party can comply
with its obligations under this Article 9.
9.2 Patent Prosecution.
(a) Definition. For the purpose of this Article 9, “prosecution” (and all
correlative forms of “prosecution”) of Patents includes all communication and
other interaction with any patent office or patent authority having jurisdiction
over a Patent application throughout the world in connection with any pre-grant
proceedings and post-grant proceeding, including opposition proceedings.
(b) Foamix Licensed Patents. As between the Parties, Foamix has the first right,
but not obligation, to prepare, file, prosecute and maintain or abandon the
Foamix Licensed Patents on a worldwide basis. Foamix shall use Commercially
Reasonable Efforts to prepare, file, prosecute, defend and maintain all Foamix
Licensed Patents in the Cutia Territory; provided, however, that Foamix does not
represent or warrant that any patent will issue or be granted based on patent
applications contained in the Foamix Licensed Patents. After the Effective Date,
Foamix shall provide Cutia reasonable opportunity to review and comment on such
prosecution efforts regarding the Foamix Licensed Patents in the Cutia
Territory, including, (i) promptly providing Cutia with copies of all material
communications from any patent authority in the Cutia Territory with respect
thereto; (ii) providing Cutia, for its review and comment, with drafts of any
material filings or responses to be made to such patent authorities in a
reasonable amount of time in advance of submitting such filings or responses;
and (iii) considering in good faith comments thereto provided by Cutia in
connection with the prosecution thereof. Cutia shall reimburse Foamix for all
out-of-pocket patent expenses incurred on or after the Effective Date in
connection with the preparation, filing, prosecution, and maintenance of all
Foamix Licensed Patents in the Cutia Territory.
(c) Step-In Rights. If Foamix elects to cease prosecution or maintenance of a
Foamix Licensed Patent in a Region in the Cutia Territory, Cutia may, at its
cost, continue prosecution or maintenance of such Foamix Licensed Patent in such
Region. If Cutia elects to continue prosecution or maintenance or elects to file
additional applications following Foamix’s election to cease prosecution or
maintenance pursuant to this Section 9.2, Foamix shall transfer the applicable
patent files to Cutia or its designee and execute such documents and perform
such acts at Foamix’s expense as may be reasonably necessary to allow Cutia to
initiate or continue such filing, prosecution or maintenance at Cutia’s sole
expense.
(d) Cooperation. Each Party shall provide the other Party with all reasonable
assistance and cooperation in the patent prosecution efforts set forth in this
Section 9.2, including
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providing any necessary powers of attorney and executing any other required
documents or instruments for such prosecution.
9.3 Patent Term Extensions in the Cutia Territory. The JDC will discuss and
recommend for which, if any, of the Patents within the Foamix Licensed Patents
in the Cutia Territory the Parties should seek patent term extensions. Cutia has
final decision-making authority with respect to applying for any such patent
term extension in the Cutia Territory, and shall act with reasonable promptness
in light of the development stage of Licensed Products to apply for any such
patent term extension, where it so elects; provided, however, that if only one
such Patent can obtain a patent term extension, then the Parties shall consult
in good faith to determine which such Patent(s) should be the subject of efforts
to obtain a patent term extension. Cutia shall cooperate fully with Foamix in
making such filings or actions, including making available all required
regulatory Data and Information and executing any required authorizations to
apply for such patent term extension. All expenses incurred in connection with
activities of Foamix with respect to the Foamix Licensed Patents for which
Foamix seeks patent term extensions pursuant to this Section 9.3 shall be borne
by Foamix.
9.4 Patent Enforcement.
(a) Notification; Information Sharing. If either Party becomes aware of any
existing or threatened infringement of any Foamix Licensed Patent by the use,
offer for sale or sale of a Product or a Competing Product (“Infringement”), it
shall promptly notify the other Party in writing to that effect, and the Parties
shall consult with each other regarding any actions to be taken with respect to
such Infringement. Each Party shall share with the other Party all Information
available to it regarding such alleged Infringement, pursuant to a mutually
agreeable “common interest agreement” executed by the Parties under which the
Parties agree to their shared, mutual interest in the outcome of any suit to
enforce the Foamix Licensed Patents against such Infringement.
(b) Enforcement Rights. Cutia has the first right, but not the obligation, to
bring an appropriate suit or other action against any Person engaged in
Infringement in the Cutia Territory. If Cutia elects to commence a suit to
enforce such patent rights against such Infringement, then Foamix may join such
enforcement action upon notice to Cutia, and in this case the Parties shall
share the cost and expense of such enforcement action equally. If Cutia notifies
Foamix that it does not intend to commence a suit to enforce the applicable
Foamix Licensed Patent against such Infringement or to take other action to
secure the abatement of such Infringement, or fails to take any such action
after a period of one hundred twenty (120) days, then Foamix may commence such a
suit or take such action, at its sole cost and expense; provided that, in no
event shall Cutia take any action that is likely to materially or adversely
impact the scope or enforceability of the Foamix Licensed Patents in the Foamix
Territory. If Foamix believes in good faith that the commencement of any such
suit or action by Cutia would reasonably be likely to have such an impact, then
Cutia shall not commence or continue such suit or action without the prior
written consent of Foamix. In addition, neither Party shall settle any such suit
or action in any manner that would limit or restrict the ability of the other
Party to sell the Licensed Products in its respective Territory without the
prior written consent of such Party.
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For clarity, Foamix has the sole right to bring an appropriate suit or other
action against any Person engaged in Infringement in the Foamix Territory.
(c) Collaboration. Each Party shall provide the other Party with reasonable
assistance in such enforcement, at such enforcing Party’s request and expense
(unless a Party elects to join an enforcement action when the other Party is the
enforcing Party, in which case the expenses will be shared equally by the
Parties), including joining such action as a party plaintiff if required by Law
to pursue such action. The enforcing Party shall keep the other Party regularly
informed of the status and progress of such enforcement efforts, and shall
reasonably consider the other Party’s comments on any such efforts. The
non-Enforcing Party shall be entitled to separate representation in such matter
by counsel of its own choice and at its own expense, but such Party shall at all
times cooperate fully with the enforcing Party.
(d) Expenses and Recoveries. The enforcing Party shall be solely responsible for
any expenses it incurs as a result of such enforcement action, except that the
Parties shall share equally the cost and expense of the enforcement action when
the non-enforcing Party elects to join the enforcement action. If the enforcing
Party recovers monetary damages in such claim, suit or action brought under
Section 9.4(a), such recovery shall be allocated first to the reimbursement of
any documented expenses incurred by the Parties in such enforcement action, and
any remaining amounts shall be shared by the Parties as follows:
(i) if Foamix is the enforcing Party: one hundred percent (100%) of the
remaining amounts shall be retained by Foamix;
(ii) if Cutia is the enforcing Party and Foamix does not elect to join the
enforcement action and share the cost and expense of the enforcement action: one
hundred percent (100%) of the remaining amounts shall be retained by Cutia
(provided that, such remaining amounts shall be treated as Net Sales); and
(iii) if Cutia is the enforcing Party and Foamix elects to join the enforcement
action and share the cost and expense of the enforcement action: fifty percent
(50%) of the remaining amounts shall be retained by Cutia, and fifty percent
(50%) of the remaining amounts shall be paid to Foamix.
For clarity, Foamix shall retain all amounts recovered under any suit or action
with respect to Infringement of any Foamix Licensed Patent in the Foamix
Territory.
9.5 Third Party Infringement Claims. If the Development, Manufacture, or
Commercialization of any Licensed Product in the Field in the Cutia Territory
pursuant to this Agreement results in a claim, suit or proceeding alleging
patent infringement against Foamix or Cutia (or their respective Affiliates,
licensees or sublicensees) (collectively, “Third Party Infringement Actions”),
such Party shall promptly notify the other Party hereto in writing. Foamix may
direct and control the defense of such Third Party Infringement Action, at its
own expense with counsel of its choice; provided, however, that Cutia may
participate in the defense and settlement thereof, at its own expense with
counsel of its choice. In any event, Foamix shall keep Cutia reasonably informed
of all material developments in connection with any such Third
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Party Infringement Action for which Foamix exercises its right to direct and
control the defense. Foamix agrees not to settle such Third Party Infringement
Action, or make any admissions or assert any position in such Third Party
Infringement Action, in a manner that would materially adversely affect the
rights or interests of Cutia, without the prior written consent of Cutia, which
shall not be unreasonably withheld or delayed. If Foamix does not exercise its
right to direct and control the defense of a Third Party Infringement Action
that is brought against Cutia, then Cutia may exercise such right and it shall
keep Foamix reasonably informed of all material developments in connection with
such Third Party Infringement Action, and it shall not settle such Third Party
Infringement Action, or make any admissions or assert any position in such Third
Party Infringement Action, in a manner that would materially adversely affect
the rights or interests of Foamix, without the prior written consent of Foamix,
which shall not be unreasonably withheld or delayed.
9.6 Trademarks.
(a) Foamix shall own and retain all right, title, and interest in and to all
trademarks associated with any Licensed Product that are owned or Controlled by
Foamix worldwide (each, a “Licensed Mark”). Foamix shall register and maintain
all Licensed Marks at Foamix cost and expense, and all goodwill in any such
Licensed Mark shall accrue to Foamix. Foamix hereby grants Cutia an exclusive
(even as to Foamix), sublicensable right to use all Licensed Marks to Develop,
Commercialize, and Manufacture Licensed Products in the Field in the Cutia
Territory. Cutia shall, and shall ensure that its Affiliates and its and their
respective sublicensees, use the Licensed Marks solely in connection with the
Development, Commercialization, and Manufacture of Licensed Products in the
Field in the Cutia Territory. For clarity, Foamix has no obligation to register
or maintain any trademark in the Cutia Territory.
(b) Cutia may brand Licensed Products in the Cutia Territory using trademarks,
logos, and trade names it determines appropriate for Licensed Products, which
may vary by Region or within a Region (the “Product Marks”). Cutia shall own all
rights in the Product Marks in the Cutia Territory and shall register and
maintain the Product Marks in the Cutia Territory that it determines reasonably
necessary, at Cutia’s cost and expense. Cutia shall consult with Foamix and
consider Foamix’s comments in good faith in the selection and design of the
Product Marks.
(c) During the Term, Cutia may request in writing a transfer of ownership of any
Licensed Mark in the Cutia Territory from Foamix to Cutia. Foamix shall review
such request in good faith, and within thirty (30) days of receipt of Cutia’s
request to transfer ownership of such Licensed Mark, Foamix may, at its sole
discretion, approve such request and submit to Cutia a written invoice for all
past preparation, filing, prosecution, and maintenance costs incurred by Foamix
with respect to such approved Licensed Mark. Cutia shall pay the invoiced amount
to Foamix within thirty (30) days of receipt of such invoice. Upon full payment
of the invoiced amount pursuant to this Section 9.6(b), Foamix hereby transfers
and assigns all its right, title, and interest in and to such Licensed Mark in
the Cutia Territory to Cutia.
(d) Notwithstanding anything to the contrary, to the extent required by Law,
(i) Cutia may include Foamix’s name and corporate logo on the Licensed Product
label,
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packaging, promotional/marketing materials to indicate that the Licensed Product
is in-licensed from Foamix, and shall display Foamix’s name and corporate logo
with equal prominence and comparable size, resolution, print quality, and
location, as instructed by Foamix from time to time, as Cutia’s name and
corporate logo is displayed, and (ii) Foamix hereby grants to Cutia a
non-exclusive, fully paid-up, royalty free, sublicensable license to use
Foamix’s name and corporate logo for the Commercialization of the Licensed
Product in the Cutia Territory to the extent consistent with this Section
9.6(d).
ARTICLE 10
REPRESENTATIONS AND WARRANTIES; COVENANTS

10.1 Mutual Representations and Warranties. Each Party hereby represents and
warrants to the other Party, as follows:
(a) Corporate Existence. As of the Effective Date, it is a company or
corporation duly organized, validly existing, and in good standing under the
Laws of the jurisdiction in which it is incorporated;
(b) Corporate Power, Authority and Binding Agreement. As of the Effective Date,
(i) it has the corporate power and authority and the legal right to enter into
this Agreement and perform its obligations hereunder; (ii) it has taken all
necessary corporate action on its part required to authorize the execution and
delivery of this Agreement and the performance of its obligations hereunder; and
(iii) this Agreement has been duly executed and delivered on behalf of such
Party, and constitutes a legal, valid, and binding obligation of such Party that
is enforceable against it in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium and similar Laws affecting
creditors’ rights and remedies generally;
(c) No Conflict. The execution and delivery of this Agreement, the performance
of such Party’s obligations in the conduct of the Development Plan and the
license granted pursuant to this Agreement (i) do not and will not conflict with
or violate any requirement of Law existing as of the Effective Date; (ii) do not
and will not conflict with or violate the certificate of incorporation or
by-laws (or other constating documents) of such Party; and (iii) do not and will
not conflict with, violate, breach or constitute a material default under any
contractual obligations of such Party or any of its Affiliates existing as of
the Effective Date;
(d) No Violation. Neither such Party nor any of its Affiliates is under any
obligation to any Person, contractual or otherwise, that is in violation of the
terms of this Agreement or that would impede the fulfillment of such Party’s
obligations hereunder;
(e) No Debarment. Neither such Party nor any of its Affiliates is debarred or
disqualified under the Act or comparable Laws outside the U.S.; and
(f) No Consents. No authorization, consent, approval of a Third Party, nor to
such Party’s knowledge, any license, permit, exemption of or filing or
registration with or notification to any court or Governmental Authority is or
will be necessary for the (i) valid
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execution and delivery of this Agreement by such Party; or (ii) the consummation
by such Party of the transactions contemplated hereby.
10.2 Additional Representations and Warranties of Foamix. Foamix represents and
warrants to Cutia, as of the Effective Date, as follows:
(a) Title; Encumbrances. (i) It has sufficient legal or beneficial title or
ownership or license, free and clear from any mortgages, pledges, liens,
security interests, conditional and installment sale agreement, encumbrances,
charges or claim of any kind, of the Foamix Technology to grant the licenses to
Cutia as purported to be granted pursuant to this Agreement; (ii) to Foamix’s
knowledge, no Third Party has taken any action before the United States Patent
and Trademark Office or a court, or any counterpart thereof outside the U.S.,
claiming legal or beneficial title or ownership or license of any Foamix
Technology; and (iii) it has not received any written notice from any Third
Party claiming legal or beneficial title or ownership or license of any Foamix
Technology;
(b) Compliance. To Foamix’s knowledge, Foamix has complied in all respects with
and is not in breach, violation or noncompliance of any applicable Laws with
respect to its ownership, use, or Manufacture of the Licensed Products. To
Foamix’s knowledge, no employee of Foamix has breached any non-use or
confidentiality obligations under any agreement with his or her respective prior
employers, or has otherwise misappropriated any trade secret or confidential
information of such prior employers, in each case relating to the Foamix
Technology;
(c) Intellectual Property Rights. The Foamix Technology includes all
intellectual property rights Controlled by Foamix that (i) are necessary or
reasonably useful for the Development or Commercialization of the Licensed
Product by Cutia in the Cutia Territory in accordance with the terms of this
Agreement as contemplated on the Effective Date or (ii) were generated,
developed, conceived, reduced to practice (constructively or actually) or used
by or on behalf of Foamix or its Affiliates in the Development or
Commercialization of Licensed Product.
(d) The Information that Foamix has disclosed to Cutia, together with the Foamix
Licensed Know-How set forth in Exhibit B, constitute all material Information
(other than CMC Information) in its or its Affiliates’ possession regarding the
Foamix Technology and Licensed Products (including all clinical trial and safety
data, databases and analyses);
(e) To Foamix’s knowledge (without any inquiry or requirement to conduct any
freedom-to-operate patent search), (i) the Development of Amzeeq™ in the manner
contemplated by the Initial Development Plan and (ii) the Commercialization of
Amzeeq™ in the same manner as Amzeeq™ is commercialized by Foamix in the U.S.,
in each case of (i) and (ii) does not infringe or misappropriate any
intellectual property rights of any Third Party in the Cutia Territory.
(f) Notice of Infringement or Misappropriation. To Foamix’s knowledge, the
Development, Manufacture and Commercialization of the Licensed Products ongoing
as of
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the Effective Date does not infringe or misappropriate any intellectual property
rights of any Third Party in the Foamix Territory. It has not received any
written notice from any Third Party asserting or alleging that (i) any research,
development, manufacture, or commercialization of a Licensed Product by Foamix
prior to the Effective Date infringed or misappropriated the intellectual
property rights of such Third Party, or (ii) the Development, Manufacture, or
Commercialization of the Licensed Products in the Cutia Territory would infringe
or misappropriate the intellectual property rights of such Third Party;
(g) Non-Infringement of Rights by Third Parties. To Foamix’s knowledge, no Third
Party is infringing or misappropriating, or has infringed or misappropriated the
Foamix Technology as of the Effective Date;
(h) No Proceeding. There is no pending, and to Foamix’s knowledge, no
threatened, adverse action, suit or proceeding against Foamix involving any
Foamix Technology or a Licensed Product;
(i) No Conflicts. Foamix has not entered, and shall not enter, into any
agreement with any Third Party that is in conflict with the rights granted to
Cutia under this Agreement, and has not taken and shall not take any action that
would in any way prevent it from granting the rights granted to Cutia under this
Agreement, or that would otherwise materially conflict with or adversely affect
Cutia’s rights under this Agreement;
(j) Foamix hereby covenants to Cutia that neither Foamix nor any of its
Affiliates or it or their respective contractors will employ or use the services
of any Person who is debarred or disqualified under the Act, or comparable Laws
outside the U.S., in connection with activities relating to any Licensed
Product; and in the event that Foamix becomes aware of the debarment or
disqualification or threatened debarment or disqualification of any Person
providing services to Foamix or any of its Affiliates with respect to any
activities relating to any Licensed Product, Foamix will immediately notify
Cutia in writing and Foamix will cease, or cause its Affiliate or it or their
respective contractors to cease (as applicable), employing, contracting with, or
retaining any such Person to perform any services relating to any Licensed
Product; and
(k) Foamix hereby covenants to Cutia that neither Foamix nor any of its
Affiliates, nor any of their respective employees, agents or contractors shall
use any confidential information obtained from any Third Party (including any
prior employer), directly or indirectly, whether obtained prior to the Effective
Date or during the Term, in connection with activities performed under this
Agreement, and Foamix shall be solely responsible and liable for, and shall
indemnify Cutia pursuant to Section 11.1 in connection with, any breach of this
covenant by Foamix, any of its Affiliates, or their respective employees, agents
or contractors.
10.3 Additional Representations, Warranties and Covenants of Cutia.
(a) Cutia represents and warrants to Foamix that, as of the Effective Date, to
Cutia’s knowledge as of the Effective Date, Cutia does not Control any Patent
that is necessary to make, use, import, offer for sale or sell Licensed
Products.
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(b) Cutia hereby covenants to Foamix that neither Cutia nor any of its
Affiliates or it or their respective sublicensees will employ or use the
services of any Person who is debarred or disqualified under the Act, or
comparable Laws outside the U.S., in connection with activities relating to any
Licensed Product; and in the event that Cutia becomes aware of the debarment or
disqualification or threatened debarment or disqualification of any Person
providing services to Cutia or any of its Affiliates with respect to any
activities relating to any Licensed Product, Cutia will immediately notify
Foamix in writing and Cutia will cease, or cause its Affiliate or it or their
respective sublicensee to cease (as applicable), employing, contracting with, or
retaining any such Person to perform any services relating to any Licensed
Product.
(c) Cutia hereby covenants to Foamix that neither Cutia nor any of its
Affiliates, or its or their sublicensees, shall exploit in any manner any
Licensed Product outside of the scope of the licenses expressly granted to Cutia
under this Agreement.
(d) Cutia hereby covenants to Foamix that neither Cutia nor any of its
Affiliates, nor any of their respective employees, agents or contractors shall
use any confidential information obtained from any Third Party (including any
prior employer), directly or indirectly, whether obtained prior to the Effective
Date or during the Term, in connection with activities performed under this
Agreement, and Cutia shall be solely responsible and liable for, and shall
indemnify Foamix pursuant to Section 11.2 in connection with, any breach of this
covenant by Cutia, any of its Affiliates, or their respective employees, agents
or contractors.
10.4 Compliance with Laws.
(a) Each Party shall, and shall ensure that its Affiliates and their respective
sublicensees will, comply in all respects with Anti-Corruption Laws, Proper
Conduct Practices and all Law in the Development, Manufacturing, and
Commercialization of Licensed Products and performance of its obligations under
this Agreement, including the ICH, GCP, GLP and any Regulatory Authority and
Governmental Authority health care programs having jurisdiction in such Party’s
respective territory, each as may be amended from time to time.
(b) Each Party shall immediately notify the other Party if it has any
information or suspicion that there may be a violation of any Laws (including
Anti-Corruption Laws) in connection with its performance under this Agreement or
the Development or Commercialization of any Licensed Product hereunder. In the
event that either Party has violated or been suspected of violating any of its
obligations, representations, warranties or covenants in Section 10.4(a), such
Party will take reasonable actions to remedy such breach and to prevent further
such breaches from occurring.
(c) Notwithstanding the foregoing, each Party will have the right, upon
reasonable prior written notice and during the other Party’s regular business
hours, to audit the other Party’s books and records in the event that a
suspected violation of any Anti-Corruption Law needs to be investigated (in such
Party’s reasonable, good-faith discretion). Such audit shall be conducted by
such Party’s audit team comprised of qualified auditors who have received
anticorruption training. For clarity, a credible finding, after a reasonable
investigation, of any breach of Section 10.4(a) or 10.4(b) with respect to any
Anti-Corruption Law, shall be deemed a
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material breach of this Agreement and allow the non-breaching Party to terminate
this Agreement in accordance with Section 13.4.
10.5 No Other Representations or Warranties. EXCEPT AS EXPRESSLY STATED IN THIS
AGREEMENT, NO REPRESENTATIONS OR WARRANTIES WHATSOEVER, WHETHER EXPRESS OR
IMPLIED, INCLUDING WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, NON-INFRINGEMENT OR NON-MISAPPROPRIATION OF THIRD PARTY INTELLECTUAL
PROPERTY RIGHTS, ARE MADE OR GIVEN BY OR ON BEHALF OF A PARTY OR ITS AFFILIATES,
AND ALL REPRESENTATIONS AND WARRANTIES, WHETHER ARISING BY OPERATION OF LAW OR
OTHERWISE, ARE HEREBY EXPRESSLY EXCLUDED. FOR CLARITY AND WITHOUT LIMITING THE
FOREGOING, FOAMIX MAKES NO REPRESENTATION OR WARRANTY CONCERNING THE LICENSED
PRODUCTS OR FOAMIX TECHNOLOGY EXCEPT AS EXPRESSLY SET FORTH IN THIS ARTICLE 10.
ARTICLE 11
INDEMNIFICATION

11.1 Indemnification by Foamix. Foamix shall defend, indemnify, and hold Cutia
and its Affiliates and their respective officers, directors, employees, and
agents (the “Cutia Indemnitees”) harmless from and against any and all losses,
damages, liabilities, expenses and costs, including reasonable legal expense and
attorneys’ fees (“Losses”) to which any Cutia Indemnitee may become subject as a
result of any claim, demand, action or other proceeding by any Third Party
(collectively, “Claims”) arising out of, based on, or resulting from (a) the
Development, Manufacture, or Commercialization of Licensed Products in the
Foamix Territory (except to the extent that any such activities are conducted by
or on behalf of Cutia or its Affiliates as permitted under this Agreement), (b)
the breach of any of Foamix’s obligations under this Agreement, including
Foamix’s representations, warranties or covenants set forth herein, or (c) the
willful misconduct or negligent acts of any Foamix Indemnitee. The foregoing
indemnity obligation shall not apply to the extent that (i) the Cutia
Indemnitees fail to comply with the indemnification procedures set forth in
Section 11.3 and Foamix’s defense of the relevant Claim is materially prejudiced
by such failure, or (ii) any Claim arises from, is based on, or results from any
activity or occurrence for which Cutia is obligated to indemnify the Foamix
Indemnitees under Section 11.2.
11.2 Indemnification by Cutia. Cutia shall defend, indemnify, and hold Foamix
and its Affiliates and their respective officers, directors, employees, and
agents (the “Foamix Indemnitees”) harmless from and against any and all Losses
to which any Foamix Indemnitee may become subject as a result of any Claims
arising out of, based on, or resulting from (a) the Development, Manufacture, or
Commercialization of Licensed Products by or on behalf of Cutia or its
Affiliates or sublicensees on or after the Effective Date (except to the extent
that any such activities are conducted by or on behalf of Foamix or its
Affiliates as permitted under this Agreement) (including any Third Party
Infringement Actions), (b) the breach of any of Cutia’s obligations under this
Agreement, including Cutia’s representations, warranties, or covenants set forth
herein, (c) actions taken by Cutia as Foamix’s local regulatory agent in the
Cutia Territory,
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or (d) the willful misconduct or negligent acts of any Cutia Indemnitee. The
foregoing indemnity obligation shall not apply to the extent that (i) the Foamix
Indemnitees fail to comply with the indemnification procedures set forth in
Section 11.3 and Cutia’s defense of the relevant Claim is materially prejudiced
by such failure, or (ii) any Claim arises from, is based on, or results from any
activity or occurrence for which Foamix is obligated to indemnify the Cutia
Indemnitees under Section 11.1.
11.3 Indemnification Procedures. The Party claiming indemnity under this Article
11 (the “Indemnified Party”) shall give written notice to the Party from whom
indemnity is being sought (the “Indemnifying Party”) promptly after learning of
such Claim and shall offer control of the defense of such Claim to the
Indemnifying Party. The Indemnified Party shall provide the Indemnifying Party
with reasonable assistance, at the Indemnifying Party’s expense, in connection
with the defense of the Claim for which indemnity is being sought. The
Indemnified Party may participate in and monitor such defense with counsel of
its own choosing at its sole expense; provided, however, the Indemnifying Party
may assume and conduct the defense of the Claim with counsel of its choice. The
Indemnifying Party shall not settle any Claim without the prior written consent
of the Indemnified Party, not to be unreasonably withheld, unless the settlement
involves only the payment of money. So long as the Indemnifying Party is
actively defending the Claim in good faith, the Indemnified Party shall not
settle or compromise any such Claim without the prior written consent of the
Indemnifying Party. If the Indemnifying Party does not assume and conduct the
defense of the Claim as provided above, (a) the Indemnified Party may defend
against, consent to the entry of any judgment, or enter into any settlement with
respect to such Claim in any manner the Indemnified Party may deem reasonably
appropriate (and the Indemnified Party need not consult with, or obtain any
consent from, the Indemnifying Party in connection therewith), and (b) the
Indemnifying Party shall remain responsible to indemnify the Indemnified Party
as provided in this Article 11. Notwithstanding anything contained in the
foregoing to the contrary, the provisions of Section 9.5 shall govern the
defense of any Third Party Infringement Actions. Additionally, in the event that
Foamix has elected to defend any such Third Party Infringement Action, then
Cutia shall not be obligated to indemnify Foamix for any Claims related to such
Third Party Infringement Action; rather, the Parties shall share such Claims
equally.
11.4 Limitation of Liability. NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY
SPECIAL, CONSEQUENTIAL, INCIDENTAL, PUNITIVE, OR INDIRECT DAMAGES ARISING FROM
OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF ANY NOTICE OF THE
POSSIBILITY OF SUCH DAMAGES. IN NO EVENT WILL EITHER PARTY’S TOTAL LIABILITY
UNDER THIS AGREEMENT EXCEED THE AMOUNT PAID OR PAYABLE BY CUTIA TO FOAMIX UNDER
THIS AGREEMENT. NOTWITHSTANDING THE FOREGOING, NOTHING IN THIS SECTION 11.4 IS
INTENDED TO OR SHALL LIMIT OR RESTRICT THE INDEMNIFICATION RIGHTS OR OBLIGATIONS
OF ANY PARTY UNDER SECTION 11.1 OR 11.2, A PARTY’S GROSSLY NEGLIGENT OR
INTENTIONAL BREACH OF THIS AGREEMENT, OR DAMAGES AVAILABLE FOR A PARTY’S BREACH
OF ITS EXCLUSIVITY OBLIGATIONS IN SECTION 2.6 OR ITS CONFIDENTIALITY OBLIGATIONS
IN SECTION 12.
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11.5 Insurance. Each Party shall procure and maintain insurance, including
product liability insurance, adequate to cover its obligations hereunder and
consistent with normal business practices of prudent companies similarly
situated. Such insurance shall not be construed to create a limit of either
Party’s liability with respect to its indemnification obligations under this
Article 11. Each Party shall provide the other Party with written evidence of
such insurance upon request. Each Party shall provide the other Party with
written notice at least thirty (30) days prior to the cancellation, nonrenewal
or material change in such insurance.
ARTICLE 12
CONFIDENTIALITY

12.1 Confidentiality. Each Party agrees that, during the Term and for a period
of ten (10) years thereafter, it shall keep confidential and shall not publish
or otherwise disclose and shall not use for any purpose other than as provided
for in this Agreement (which includes the exercise of any rights or the
performance of any obligations hereunder or thereunder) any Confidential
Information of the other Party, except to the extent expressly agreed in writing
by the Parties. The foregoing confidentiality and non-use obligations shall not
apply to any portion of the other Party’s Confidential Information that the
receiving Party can demonstrate by competent written proof:
(a) was already known to the receiving Party or its Affiliate, other than under
an obligation of confidentiality, at the time of disclosure by the other Party;
(b) was generally available to the public or otherwise part of the public domain
at the time of its disclosure to the receiving Party;
(c) became generally available to the public or otherwise part of the public
domain after its disclosure and other than through any act or omission of the
receiving Party or its Affiliate in breach of this Agreement;
(d) was disclosed to the receiving Party or its Affiliate without any
confidentiality obligations by a Third Party who, to the Party’s knowledge, had
a legal right to make such disclosure and who did not obtain such information
directly or indirectly from the other Party; or
(e) was independently discovered or developed by the receiving Party or its
Affiliate without use of or reference to the other Party’s Confidential
Information, as evidenced by a contemporaneous writing.
For purposes of this Section 12.1(b)–(c), Confidential Information disclosed
under this Agreement shall not be deemed to be within such exceptions unless
such information is readily accessible to the public in a written publication,
and such exceptions shall not include information the substance of which must be
pieced together from a number of different publications or other sources.
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12.2 Authorized Disclosure. Notwithstanding the obligations set forth in Section
12.1, a Party may disclose the other Party’s Confidential Information and the
terms of this Agreement to the extent:
(a) such disclosure is reasonably necessary (i) for the filing or prosecuting of
Patent rights as contemplated herein; (ii) to comply with the requirements of
Regulatory Authorities with respect to obtaining and maintaining Regulatory
Approval of Licensed Product; or (iii) for the prosecuting or defending
litigation as contemplated herein;
(b) such disclosure is reasonably necessary to its or its Affiliate’s employees,
agents, consultants, contractors, licensees or sublicensees on a need-to-know
basis for the sole purpose of performing its obligations or exercising its
rights hereunder; provided that in each case, the disclosees are bound by
written obligations of confidentiality consistent with those contained in this
Agreement;
(c) such disclosure is reasonably necessary to any bona fide potential or actual
investor, acquiror, merger partner, or other financial or commercial partner for
the sole purpose of evaluating or carrying out an actual or potential
investment, acquisition or other business relationship; provided that in
connection with such disclosure, such Party shall inform each disclosee of the
confidential nature of such Confidential Information and require each disclosee
to treat such Confidential Information as confidential; or
(d) such disclosure is reasonably necessary to comply with Laws, including
regulations or rules promulgated by applicable securities commissions (or other
securities regulatory authorities), security exchanges, court order,
administrative subpoena or order.
Notwithstanding the foregoing, in the event a Party is required to make a
disclosure of the other Party’s Confidential Information pursuant to Section
12.2(a) or 12.2(d), such Party shall promptly notify the other Party of such
required disclosure, to the extent that it is legally authorized or permitted to
so, and shall use reasonable efforts to obtain, or to assist the other Party in
obtaining, a protective order preventing or limiting the required disclosure.
12.3 Publicity; Terms of Agreement.
(a) The Parties agree that the terms of this Agreement are the Confidential
Information of both Parties, subject to the special authorized disclosure
provisions set forth in this Section 12.3.
(b) The Parties have agreed upon in principle the initial press release to
announce the execution of this Agreement in substantially the form attached
hereto as Exhibit E, which shall be finalized upon mutual agreement by the
Parties before release. After such initial press release, if either Party
desires to make a public disclosure concerning the terms of this Agreement, such
Party shall give reasonable prior advance notice of the proposed text of such
disclosure to the other Party for its prior review and approval (except as
otherwise provided herein), which approval shall not be unreasonably withheld,
conditioned, or delayed. A Party commenting on such a proposed disclosure shall
provide its comments, if any, within ten (10)
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Business Days after receiving the proposed disclosure for review (or such
shorter period of time as necessitated by regulatory requirements). Each Party
may make a press release or other public disclosure regarding the achievement of
the milestone, the achievements of Regulatory Approval in the Cutia Territory as
they occur or the occurrence of other events that affect either Party’s rights
or obligations under this Agreement, in each case subject only to the review
procedure set forth in the preceding sentences. In relation to the other Party’s
review of such an announcement, such other Party may make specific, reasonable
comments on such proposed press release within the prescribed time for
commentary. Neither Party is required to seek the permission of the other Party
to repeat any information regarding the terms of this Agreement that has already
been publicly disclosed by such Party, or by the other Party, in accordance with
this Section 12.3.
(c) Either or both Parties or their Affiliates may be obligated to file under
Laws a copy of this Agreement with Governmental Authorities, including the U.S.
Securities and Exchange Commission (the “SEC”). Each Party and its Affiliates
may make such a required filing, provided that it requests confidential
treatment of the commercial terms and sensitive technical terms hereof and
thereof to the extent such confidential treatment is reasonably available. In
the event of any such filing, each Party will provide the other Party with a
copy of this Agreement marked to show provisions for which such Party or its
Affiliate intends to seek confidential treatment and shall reasonably consider
and incorporate the other Party’s timely comments thereon to the extent
consistent with the legal requirements, with respect to the filing Party or
Affiliate, governing disclosure of material agreements and material information
that must be publicly filed.
(d) Each Party may disclose the existence and terms of this Agreement to bona
fide potential or actual investors, advisors, lenders, and research
collaborators, provided each such entity is bound by confidentiality obligations
no less stringent than this Article 12.
12.4 Technical Publication. Cutia may not publish peer reviewed manuscripts, or
provide other forms of public disclosure, including abstracts and presentations,
of results of studies carried out under the Development Plan, or otherwise
pertaining to the Licensed Products or Foamix Licensed Know-How, without the
prior written consent of Foamix.
12.5 Equitable Relief. Each Party acknowledges that its breach of this Article
12 will cause irreparable harm to the other Party, which cannot be reasonably or
adequately compensated in damages in an action at law. By reasons thereof, each
Party agrees that the other Party shall be entitled, in addition to any other
remedies it may have under this Agreement or otherwise, to seek preliminary and
permanent injunctive and other equitable relief to prevent or curtail any actual
or threatened breach of the obligations relating to Confidential Information set
forth in this Article 12 by the other Party.
ARTICLE 13
TERM AND TERMINATION

13.1 Term. The term of this Agreement shall commence upon the Effective Date
and, unless earlier terminated pursuant to this Article 13, shall remain in
effect until the expiration of the Royalty Term of the last Licensed Product on
a Region-by-Region basis (the “Term”). Upon
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the expiration (but not early termination) of this Agreement for all Licensed
Products in a Region, the licenses granted hereunder by Foamix to Cutia shall
become non-exclusive, fully paid-up, royalty-free, and perpetual for such
Region.
13.2 Termination by Cutia. Cutia may terminate this Agreement in its entirety
(a) at any time for convenience upon ninety (90) days’ prior written notice
given to Foamix, or (b) upon prior written notice given to Foamix if a
Regulatory Authority in the Cutia Territory has ordered Cutia to stop all sales
of Licensed Products in the Cutia Territory due to a safety concern; provided,
however, that Cutia has, for a period of ninety (90) days prior to the provision
of such notice by Cutia, used Commercially Reasonable Efforts to resolve such
safety concern.
13.3 Termination by Foamix. Foamix may terminate this Agreement in its entirety
upon sixty (60) days’ prior written notice to Cutia, if Cutia or its Affiliates
or their respective sublicensees (directly or indirectly, individually or in
association with any other Person) challenges the validity, enforceability or
scope of any Foamix Licensed Patent in a litigation or other court proceeding,
unless during such sixty (60)-day period the subject challenge is permanently
dismissed or withdrawn and is not thereafter reinstituted or continued; provided
that in the event Cutia’s sublicensee initiates such challenge, Foamix may not
terminate this Agreement if (i) Cutia successfully causes such sublicensee to
withdraw such challenge within such sixty (60)-day period, or (ii) Cutia
successfully terminates such sublicense and provides written evidence of such
termination to Foamix within such sixty (60)-day period.
13.4 Termination for Breach. Each Party may terminate this Agreement in its
entirety immediately upon written notice to the other Party if the other Party
materially breaches its obligations under this Agreement and, after receiving
written notice identifying such material breach in reasonable detail, fails to
cure such material breach within sixty (60) days from the date of such notice;
provided that, such cure period shall be extended for up to an additional sixty
(60) days upon the breaching Party providing a written plan that reasonably
demonstrates the need for such additional time and continuing to use
Commercially Reasonable Efforts to cure such breach. If either Party disputes
(a) whether such material breach has occurred, or (b) whether the defaulting
Party has cured such material breach, the Parties shall promptly resolve the
Dispute under Article 14. During the pendency of such a Dispute, all of the
terms and conditions of this Agreement remain in effect and the Parties shall
continue to perform all of their respective obligations hereunder.
13.5 Termination Due to Bankruptcy. Either Party may terminate this Agreement
if, at any time, the other Party files in any court or agency pursuant to any
statute or regulation of any state, country or jurisdiction, a petition in
bankruptcy or insolvency or for reorganization or for an arrangement or for the
appointment of a receiver or trustee of that Party or of its assets, or if the
other Party proposes a written agreement of composition or extension of its
debts, or if the other Party is served with an involuntary petition against it,
filed in any insolvency proceeding, and such petition is not dismissed within
sixty (60) days after the filing thereof, or if the other Party proposes or
becomes a Party to any dissolution or liquidation, or if the other Party makes
an assignment for the benefit of its creditors.
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13.6 Effect of Termination. Upon any termination of this Agreement, the
following shall apply (in addition to any other rights and obligations under
this Agreement with respect to such termination):
(a) Licenses. All licenses and other rights granted by Foamix to Cutia under
this Agreement shall terminate, including all sublicenses granted by Cutia
unless such sublicenses are assumed by Foamix pursuant to Section 2.1(c), which
shall survive such termination.
(b) Wind-Down. Cutia shall (i) responsibly wind-down, in accordance with
accepted pharmaceutical industry norms and ethical practices, any on-going
clinical studies for which it has responsibility hereunder in which patient
dosing has commenced and (ii) at Foamix’s written election, (A) transfer to
Foamix or its designee any such clinical studies to the extent permitted under
Laws and accepted pharmaceutical industry norms and ethical practices, or (B) if
reasonably practicable and not adverse to patient safety, complete such trials
and Foamix shall reimburse Cutia its reasonable, out-of-pocket costs associated
therewith. For clarity, except as provided for above, Cutia may transfer to
Foamix or its designee or wind-down any ongoing clinical trials prior to the
date of termination in accordance with accepted pharmaceutical industry norms
and ethical practices and Cutia will be responsible for any costs associated
with such transfer or wind-down.
(c) Regulatory Materials; Data. Unless this Agreement is terminated by Cutia
pursuant to Section 13.4 or Section 13.5, Cutia shall (i) provide and assign to
Foamix or its designee all Regulatory Materials, including Regulatory Approvals,
for the Licensed Products to the extent possible under Law in the Cutia
Territory, (ii) promptly provide and assign to Foamix all Data, including
pharmacovigilance data, generated by or on behalf of Cutia, and (iii) promptly
return or destroy (and certify such destruction in writing), at Foamix’s
election, all Confidential Information of Foamix.
(d) Transition Assistance. Upon Foamix’s reasonable request, (i) Cutia shall
provide such assistance as may be reasonably necessary or useful for Foamix to
continue the Development, Manufacture, and Commercialization of Licensed
Products in the Cutia Territory, to the extent Cutia or its Affiliate is then
performing or having performed such activities, including upon the reasonable
request of Foamix, assigning (or using Commercially Reasonable Efforts to amend
as appropriate) any agreements or arrangements Cutia or its Affiliate have with
any Third Party for the Development, Manufacture, distribution, or
Commercialization of Licensed Products; and (ii) Cutia shall provide Foamix with
copies of any promotional and marketing materials generated by or on behalf of
Cutia with respect to Licensed Products prior to the effective date of
termination. Cutia shall reimburse Foamix’s costs and expenses in connection
with such transition assistance, unless this Agreement is terminated by Cutia
pursuant to Section 13.4 or Section 13.5.
(e) Inventory. In the event that this Agreement is terminated in its entirety,
Foamix may purchase any and all of the inventory of Licensed Products held by
Cutia or its Affiliates or sublicensees as of the date of termination, at a
price equal to the transfer price paid by Cutia to Foamix for such inventory.
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(f) Intellectual Property. Unless this Agreement is terminated by Cutia pursuant
to Section 13.4 or Section 13.5, with respect to all Patents, Product Marks, and
other intellectual property rights Controlled by Cutia that are necessary for
the Development, Manufacture, or Commercialization of Licensed Products prior to
the effective date of termination, for good and valuable consideration, the
receipt of which is hereby acknowledged, Cutia hereby grants to Foamix,
effective upon the effective date of termination: (i) to the maximum extent
permitted by Law, a worldwide, exclusive, perpetual, royalty-free license, with
the right to sublicense through multiple tiers, under such Patents, Product
Marks, and other intellectual property rights to make, have made, import, use,
offer for sale, sell, or otherwise exploit the Licensed Products, and (ii) to
the extent the foregoing exclusive license is not permitted by Law, a worldwide,
non-exclusive, perpetual, royalty-free license, with the right to sublicense
through multiple tiers, under such Patents, Product Marks, and other
intellectual property rights to make, have made, import, use, offer for sale,
sell, or otherwise exploit the Licensed Products.
13.7 Survival. Any expiration or termination of this Agreement shall not affect
rights or obligations of the Parties under this Agreement that have accrued
prior to the date of expiration or termination. Notwithstanding anything to the
contrary, the following provisions shall survive any expiration or termination
of this Agreement: Sections 2.4 (No Implied Licenses), 8.5 (Payment Method;
Foreign Exchange), 8.6 (Interest on Late Payments), 8.7 (Records; Audits), 8.8
(Taxes), 9.1 (Ownership; License Grants), 10.5 (No Other Representations or
Warranties), 13.6 (Effects of Termination), 13.7 (Survival), and 13.8
(Termination Not Sole Remedy), and Articles 1 (Definitions) (to the extent such
terms are used in other surviving provisions), 11 (Indemnification) (to the
extent the cause of action for such indemnification obligation arose prior to
the effective date of expiration or termination), 12 (Confidentiality), 14
(Dispute Resolution), and 15 (Miscellaneous).
13.8 Termination Not Sole Remedy. Termination is not the sole remedy under this
Agreement and, whether or not termination is effected and notwithstanding
anything contained in this Agreement to the contrary, all other remedies shall
remain available except as agreed to otherwise herein.
ARTICLE 14
DISPUTE RESOLUTION

14.1 Disputes; Internal Resolution. It is the objective of the Parties to
establish procedures to facilitate the resolution of any and all disputes that
may arise out of or in connection with this Agreement (each a “Dispute”) in an
expedient manner by mutual cooperation. To accomplish this objective, the
Parties agree that, except as otherwise provided in Section 3.3, in the event of
such a Dispute, including any alleged breach under this Agreement or any issue
relating to the interpretation or application of this Agreement, and the Parties
are unable to resolve such Dispute within thirty (30) days after such Dispute is
first identified by either Party in writing to the other, the Parties shall
refer such Dispute to the Executive Officers for attempted resolution by good
faith negotiations within thirty (30) days after such notice is received. If the
dispute is not resolved within such thirty (30) days, either Party may commence
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arbitration with respect to the subject matter of the Dispute and with respect
to any other claims it may have and thereafter neither Party will have any
further obligation under this Section 14.1. Any Dispute concerning the propriety
of the commencement of the arbitration or the applicability of the Agreement to
arbitrate shall be finally settled by the arbitral tribunal. Notwithstanding the
foregoing, and without waiting for the expiration of any such thirty (30)-day
periods, Foamix and Cutia may each apply to any court of competent jurisdiction
for appropriate interim or provisional relief, as necessary to protect the
rights or property of that Party.
14.2 Arbitration; Governing Law.
(a) Arbitration. Subject to Section 14.1, all Disputes, including existence,
validity, interpretation, performance, breach or termination thereof, shall be
submitted to and finally resolved by arbitration administered by the
International Court of Arbitration of the International Chamber of Commerce
(ICC) under the Rules of Arbitration of the International Chamber of Commerce
(the “Rules”). The seat, or legal place, of arbitration shall be Hong Kong. The
language of the arbitration shall be English. The arbitration shall be conducted
by a tribunal of three (3) arbitrators. Each Party shall nominate one (1)
arbitrator, and the two (2) party nominated arbitrators shall jointly nominate,
within fifteen (15) days of the second arbitrator’s appointment, the third
arbitrator who shall serve as the presiding arbitrator and shall be of neutral
nationality. Each arbitrator must have significant business or legal experience
in the pharmaceutical business. An arbitrator shall be deemed to meet this
qualification unless a Party objects within ten (10) days after the arbitrator
is nominated. The Parties shall engage in discovery of information and evidence
that is or might be relevant to the claims, defenses, and issues in the Dispute,
including by means of discovery in the form of requests for documents (including
electronically stored information). After conducting any hearing and taking any
evidence deemed appropriate for consideration, the arbitrators shall render
their award within six (6) months of the final arbitration hearing or the final
post-hearing submissions unless the Parties jointly request an extension, or the
arbitral tribunal determines in a reasoned decision that the interest of justice
or the complexity of the case requires that such a limit be extended. The
arbitral tribunal shall not have the power to award damages excluded pursuant to
Section 11.4 of this Agreement, and any arbitral award that purports to award
such damages is expressly prohibited.
(b) Arbitral Award. The award shall be final and binding, and the Parties
undertake to carry out the award without delay. Judgment on the award so
rendered may be entered in any court of competent jurisdiction. Each Party shall
bear one-half (½) of all ICC administrative costs and the fees and costs of the
arbitrators. Notwithstanding the foregoing, each Party shall bear its own
attorneys’ fees, expert or witness fees, and any other fees and costs, and no
such fees or costs will be shifted to the other Party. The existence and content
of the arbitral proceedings and any rulings or awards shall be kept confidential
by the Parties and members of the arbitral tribunal except (i) to the extent
that disclosure may be required of a party to fulfill a legal duty, protect or
pursue a legal right, or enforce or challenge an award in bona fide legal
proceedings before a state court or other judicial authority, (ii) with the
consent of all Parties, (iii) where needed for the preparation or presentation
of a claim or defense in this arbitration, (iv)
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where such information is already in the public domain other than as a result of
a breach of this clause, or (v) by order of the arbitral tribunal upon
application of a Party.
(c) Governing Law. This Agreement and all Disputes shall be governed by and
construed in accordance with the laws of the State of New York, USA, without
giving effect to any choice of law rules or principles.
ARTICLE 15
MISCELLANEOUS

15.1 Entire Agreement; Amendment. This Agreement, including the Exhibits hereto,
sets forth the complete, final and exclusive agreement and all the covenants,
promises, agreements, warranties, representations, conditions and understandings
between the Parties hereto with respect to the subject matter hereof and
supersedes, as of the Effective Date, all prior and contemporaneous agreements
and understandings between the Parties with respect to the subject matter
hereof, including the Confidentiality Agreement. The foregoing shall not be
interpreted as a waiver of any remedies available to either Party as a result of
any breach, prior to the Effective Date, by the other Party of its obligations
under the Confidentiality Agreement. There are no covenants, promises,
agreements, warranties, representations, conditions or understandings, either
oral or written, between the Parties other than as are set forth in this
Agreement. No subsequent alteration, amendment, change or addition to this
Agreement shall be binding upon the Parties unless reduced to writing and signed
by an authorized officer of each Party.
15.2 Force Majeure. Both Parties shall be excused from the performance of their
obligations under this Agreement to the extent that such performance is
prevented by force majeure and the nonperforming Party promptly provides notice
of the prevention to the other Party. Such excuse shall be continued only for so
long as (a) the condition constituting force majeure continues and (b) the
nonperforming Party takes all reasonable efforts to remove the condition. For
purposes of this Agreement, force majeure includes conditions beyond the
reasonable control of the applicable Party, which may include an act of God,
war, civil commotion, terrorist act, labor strike or lock-out, epidemic, failure
or default of public utilities or common carriers, destruction of production
facilities or materials by fire, earthquake, storm or like catastrophe, action
or inaction of any Governmental Authority, and failure of plant or machinery.
Notwithstanding the foregoing, a Party shall not be excused from making payments
owed hereunder because of a force majeure affecting such Party. If a force
majeure persists for more than ninety (90) days, then the Parties will discuss
in good faith the modification of the Parties’ obligations under this Agreement
in order to mitigate the delays caused by such force majeure.
15.3 Notices. Any notice required or permitted to be given under this Agreement
shall be in writing, shall specifically refer to this Agreement, and shall be
addressed to the appropriate Party at the address specified below or such other
address as may be specified by such Party in writing in accordance with this
Section 15.3, and shall be deemed to have been given for all purposes (a) when
received, if hand-delivered or a reputable courier service, (b) five (5)
Business
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Days after mailing, if mailed by first class certified or registered airmail,
postage prepaid, return receipt requested, (c) or upon receipt if sent by
electronic mail, provided that such notice is also sent by a reputable courier
service or first class certified or registered airmail, postage prepaid, return
receipt requested.
If to Foamix:    Foamix Pharmaceuticals Ltd.
2 Holzman Street,
Rehovot Science Park
Rehovot Israel
Attn: General Counsel

with copies to (which shall not constitute notice):

        Cooley LLP
11951 Freedom Drive #1500
        Reston, VA 20190
        Attn: Kenneth Krisko

If to Cutia:    Cutia Therapeutics (HK) Limited
        UNIT 402, 4/F FAIRMONT HSE
NO 8 COTTON TREE DRIVE ADMIRALTY
HONG KONG
Attn: CEO

with copies to (which shall not constitute notice):
Greenberg Traurig LLP
One International Place, Suite 2000
Boston, MA 02110
Attention: Fang Xie

15.4 No Strict Construction; Headings. This Agreement has been prepared jointly
by the Parties and shall not be strictly construed against either Party.
Ambiguities, if any, in this Agreement shall not be construed against any Party,
irrespective of which Party may be deemed to have authored the ambiguous
provision. The headings of each Article and Section in this Agreement have been
inserted for convenience of reference only and are not intended to limit or
expand on the meaning of the language contained in the particular Article or
Section. Except where the context otherwise requires, the use of any gender
shall be applicable to all genders, and the word “or” is disjunctive but not
necessarily exclusive. The term “including” as used herein means including,
without limiting the generality of any description preceding such term.
15.5 Assignment. Neither Party may assign or transfer this Agreement or any
rights or obligations hereunder without the prior written consent of the other
Party, except that either Party may make such an assignment, in whole or in
part, without the other Party’s consent (a) to an Affiliate of such Party or (b)
to a Third Party in connection with a Change of Control. Any permitted assignee
shall assume all obligations of its assignor under this Agreement. Any
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assignment or attempted assignment by either Party in violation of the terms of
this Section 15.5 shall be null, void and of no legal effect.
15.6 Performance by Affiliates. Each Party may discharge any obligations and
exercise any right hereunder through any of its Affiliates. Each Party hereby
guarantees the performance by its Affiliates of such Party’s obligations under
this Agreement, and shall cause its Affiliates to comply with the provisions of
this Agreement in connection with such performance. Any breach by a Party’s
Affiliate of any of such Party’s obligations under this Agreement shall be
deemed a breach by such Party, and the other Party may proceed directly against
such Party without any obligation to first proceed against such Party’s
Affiliate.
15.7 Further Actions. Each Party shall execute, acknowledge and deliver such
further instruments, and to do all such other acts, as may be necessary or
appropriate in order to carry out the purposes and intent of this Agreement.
15.8 Severability. If any one or more of the provisions of this Agreement is
held to be invalid or unenforceable by any court of competent jurisdiction from
which no appeal can be or is taken, the provision shall be considered severed
from this Agreement and shall not serve to invalidate any remaining provisions
hereof. The Parties shall make a good faith effort to replace any invalid or
unenforceable provision with a valid and enforceable one such that the
objectives contemplated by the Parties when entering this Agreement may be
realized.
15.9 No Waiver. Any delay in enforcing a Party’s rights under this Agreement or
any waiver as to a particular default or other matter shall not constitute a
waiver of such Party’s rights to the future enforcement of its rights under this
Agreement, except with respect to an express written and signed waiver relating
to a particular matter for a particular period of time.
15.10 Independent Contractors. Each Party shall act solely as an independent
contractor, and nothing in this Agreement shall be construed to give either
Party the power or authority to act for, bind, or commit the other Party in any
way. Nothing herein shall be construed to create the relationship of partners,
principal and agent, or joint-venture partners between the Parties.
15.11 English Language. This Agreement was prepared in the English language,
which language shall govern the interpretation of, and any dispute regarding,
the terms of this Agreement.
15.12 Counterparts. This Agreement may be executed in one (1) or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. The signatures of all the
Parties do not need to be on the same counterpart for it to be effective.
Delivery of an executed counterpart’s signature page of this Agreement, by
electronic mail in portable document format (.pdf) or by any other electronic
means intended to preserve the original graphic and pictorial appearance of a
document, has the same effect as delivery of an executed original of this
Agreement.
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15.13 Rights in Bankruptcy. All rights and licenses granted under or pursuant to
this Agreement by one Party to the other Party are, and otherwise will be deemed
to be, for purposes of Section 365(n) of the U.S. Bankruptcy Code or comparable
provision of applicable bankruptcy or insolvency laws, licenses of right to
“intellectual property” as defined under Section 101 of the U.S. Bankruptcy Code
or comparable provision of applicable bankruptcy or insolvency laws. Each Party
will retain and may fully exercise all of its rights and elections under the
U.S. Bankruptcy Code or comparable provision of applicable bankruptcy or
insolvency laws. The Parties further agree that, in the event of the
commencement of a bankruptcy proceeding by or against a Party to this Agreement
under the U.S. Bankruptcy Code or comparable provision of applicable bankruptcy
or insolvency laws, the other Party will be entitled to a complete duplicate of
(or complete access to, as appropriate) any such intellectual property and all
embodiments of such intellectual property, and same, if not already in its
possession, will be promptly delivered to it (i) upon any such commencement of a
bankruptcy or insolvency proceeding upon its written request therefor, unless
the bankrupt Party elects to continue to perform all of its obligations under
this Agreement, or (ii) if not delivered under (i) above, following the
rejection of this Agreement by or on behalf of the bankrupt Party upon written
request therefor by the other Party.
{Signature Page Follows}

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In Witness Whereof, the Parties have executed this License Agreement in
duplicate originals by their duly authorized officers as of the Effective Date.
Foamix Pharmaceuticals Ltd.

By:/s/ David Domzalski
Name: David Domzalski
Title: Chief Executive Officer
Cutia Therapeutics (HK) Limited

By: /s/ Chung Sau Yin
Name: Chung Sau Yin
Title: Director

By:/s/ David Domzalski By: /s/ Chung Sau Yin

Name: David Domzalski Name: Chung Sau Yin 

Title: Chief Executive Officer Title: Director

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Exhibit A

Foamix Licensed Patents

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Exhibit B
Initial Transfer of Foamix Licensed Know-How

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Exhibit 10.1

Exhibit C
Initial Development Plan

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Exhibit 10.1

Exhibit D
Supply Agreement Terms

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Exhibit E
Press Release

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