Portions herein identified by ** have
been omitted pursuant to a request for
confidential treatment and have been
filed separately with the Commission
pursuant to Rule 24b-2 of the Exchange
Act of 1934, as amended.
 
AMENDED & RESTATED LICENSE AND DEVELOPMENT AGREEMENT\
 
By
 
and
 
Between
 
** and
 
FIDOPHARM, INC.
 
 
 

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

 
 
TABLE OF CONTENTS
 

       
Page
         
INDEX
         
1.
DEFINITIONS
 
1
       
2.
LICENSE GRANT AND OTHER RIGHTS
 
3
         
2.1
Exclusive License
 
3
 
2.2
Right of Reference
  4  
2.3
Copyrighted Materials
 
4
 
2.4
Exclusive Right of First Negotiation
 
4
         
3.
CONSIDERATION
 
4
         
3.1
Upfront Payment
 
4
 
3.2
Supply Agreement
  4  
3.3
No Additional Consideration
 
5
         
4.
DEVELOPMENT
  5            
4.1
Overview
 
5
 
4.2
Development Plan
 
5
 
4.3
Diligence
 
5
 
4.4
Reporting and Data
 
5
 
4.5
Compliance with Laws
 
5
 
4.6
Access to Records and Facilities
 
6
4.7
Territory Specific Development
 
6
         
5.
PRODUCT REGISTRATION AND COMMERCIALIZATION
 
6
         
5.1
Product Registration
 
6
 
5.2
Registration and Commercialization Plans
 
6
 
5.3
Trademarks
 
6
 
5.4
Cooperation
 
7
 
5.5
Reporting
 
7
         
6.
SUPPLY OF PRODUCTS
 
7
         
6.1
Supply Agreement
 
7
 
6.2
Technology Transfer
 
7
         
7.
PATENTS
  7          
7.1
Prosecution and Maintenance of Patents
 
7
 
7.2
Notification of Infringement
 
7
 
7.3
Enforcement Against Third Parties
 
8
 
7.4
Alleged Infringement of Third Party’s Patents
 
8
         
8.
REPRESENTATIONS, WARRANTIES AND COVENANTS
 
8
         
8.1
** Representations, Warranties and Covenants
 
8
 
8.2
Fidopharm Representations and Warranties
 
10

 
 
 

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

 
 
TABLE OF CONTENTS
(continued)
 

       
Page
 

 
8.3
Regulatory Cooperation
 
10
 
8.4
Compliance with Laws
 
11
         
9.
CONFIDENTIALITY
 
11
         
9.1
Confidentiality; Nondisclosure; Nonuse
 
11
 
9.2
Exception to Confidential Information
 
11
 
9.3
Notification of Mandatory Disclosure
 
12
 
9.4
Patent Application Filing
 
12
 
9.5
Permitted Disclosure to Third Parties
 
12
         
10.
INDEMNIFICATION AND INSURANCE
 
12
         
10.1
** Indemnification Obligations
 
12
 
10.2
Fidopharm’s Indemnification Obligations
 
12
 
10.3
Indemnification Procedure
 
13
 
10.4
Insurance
 
13
         
11.
TERM AND TERMINATION
 
13
         
11.1
Term
 
13
 
11.2
Termination by Fidopharm
 
13
 
11.3
Termination for Breach
 
14
 
11.4
Termination for Bankruptcy, etc
 
14
 
11.5
Termination for Failure
 
14
 
11.6
Effect of Expiration or Termination.
 
15
         
12.
INJUNCTIVE RELIEF AND DISPUTE RESOLUTION
 
15
         
12.1
Equitable Relief
 
15
 
12.2
Dispute Resolution
 
15
         
13.
MISCELLANEOUS
 
16
         
13.1
Force Majeure
 
16
 
13.2
Further Assurances
 
16
 
13.3
Assignment
 
16
 
13.4
Choice of Law
 
16
 
13.5
Notices
 
16
 
13.6
Entire Agreement
 
17
 
13.7
Amendments; Waivers
 
17
 
13.8
Severability
 
17
 
13.9
Independent Contractors
 
17
 
13.10
Counterparts
 
17
 
13.11
Headings
 
17

 
 
ii

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AMENDED & RESTATED LICENSE AND DEVELOPMENT AGREEMENT
 
THIS AMENDED & RESTATED LICENSE AND DEVELOPMENT AGREEMENT (“Agreement”) is made
as of this 22nd day of April 2008 (“Effective Date”), by and between: **, a
company having offices at **(“**”), and Fidopharm, Inc., a company having
offices 777 Township Line Road, Suite 170, Yardley, Pennsylvania 19067
(“Fidopharm”). Fidopharm and **are together referred to as “Parties” and
individually as a “Party”.
 
RECITALS
 
WHEREAS, **is developing ACI-based products for manufacture and
commercialization for veterinary or animal application uses.
 
WHEREAS, the largest market in the world for ACI-based products for veterinary
or animal application uses is the United States.
 
WHEREAS, the Parties agree that Fidopharm has the requisite expertise and
infrastructure to register and commercialize veterinary products in the United
States.
 
WHEREAS, **desires to grant Fidopharm an exclusive license to use its know-how
and under its patent rights to, use, make, have made, market, offer for sale,
import or export and sell ACI-based products for veterinary or animal
application use in the United States, and Fidopharm desires to obtain such
license.
 
AND WHEREAS, **shall cause the JV to execute a supply agreement
contemporaneously with the execution of this Agreement providing for the
exclusive supply of Products to Fidopharm for sale and distribution in the
Territory.
 
NOW, THEREFORE, in consideration of the mutual promises set forth herein, the
Parties, intending to be legally bound, hereby agree as follows:
 
1. DEFINITIONS
 
As used herein, the following terms shall have the respective meanings set forth
below:
 
1.1 “ACI” means (a) Active A and/or (b) Active B. 
 
1.2 “Active A” shall have the meaning on Schedule 1. 
 
1.3 “Active B” shall have the meaning on Schedule 1. 
 
1.4 “Affiliate” means any individual, corporation, company, partnership, trust,
limited liability company, association or other business entity (“Person”) which
directly or indirectly controls, is controlled by or is under common control
with the Party in question. As used in this definition of “Affiliate,” the term
“control” shall mean, as to any Person, (a) direct or indirect ownership of
fifty percent (50%) or more of the voting interests or other ownership interests
in the Person in question (or such lesser percentage which is the maximum
allowed to be owned by such Person in a particular jurisdiction); (b) direct or
indirect ownership of fifty percent (50%) or more of the interest in the income
of the Person in question; or (c) possession, directly or indirectly, of the
power to direct or cause the direction of management or policies of the Person
in question (whether through ownership of securities or other ownership
interests, by contract or otherwise). Notwithstanding the foregoing, the owners
of preferred stock (or common stock issued upon conversion thereof) of a Party
such as financial institutions, venture capital funds and private equity
investors will not be its “Affiliates” for purposes of this Agreement.
 
 
1

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1.5 “Commercial Sale” means sale of Products by Fidopharm or its Affiliates to a
Third Party in the Territory, other than distribution in connection with
clinical trials of Products conducted by Fidopharm.
 
1.6 “Confidential Information” means all secret or confidential proprietary
information or data of a Party provided in written, oral, graphic, video,
computer, electronic or other form to the other Party. 
 
1.7 “Controlled” means, with respect to any intellectual property right or other
intangible property, the possession by license or ownership by a Party (or by an
Affiliate) to grant to the other Party access or a license or sublicense as
provided herein without violating the terms of any written contract with any
Third Party. 
 
1.8 “Development” means research and chemical development activities, including
without limitation toxicology, test method development and stability testing,
process development, formulation development, delivery system development,
quality assurance and quality control development, statistical analysis,
efficacy studies, product performance studies, environmental impact studies,
manufacturing process development and scale-up, regulatory affairs, and product
approval and regulatory activities other than filing for and seeking Product
Registrations. 
 
1.9 “Field” means any and all veterinary or animal application uses. 
 
1.10 “JV” means ** Limited, which shall be the entity responsible for supplying
Products to Fidopharm. 
 
1.11 “Know-How” means any proprietary technical or other information relating to
Products and the make, use or sale of Products, including technology,
experience, formulae, concepts, discoveries, trade secrets, inventions,
modifications, improvements, data (including all chemical, clinical,
toxicological, analytical, and quality control data), results, designs, ideas,
analyses, methods, techniques, assays, research plans, procedures, tests,
processes (including manufacturing processes, specifications and techniques),
laboratory records, reports, summaries, and information contained in submissions
to, and information received from, regulatory authorities, that are Controlled
by **, its Affiliates, JV or Manufacturer as of the Effective Date or during the
Term. 
 
1.12 “Law” or “Laws” means the laws, statutes, rules, codes, regulations,
orders, judgments and/or ordinances of any governmental authority (including
without limitation the Regulatory Authority).
 
1.13 “Manufacturer” shall have the meaning set forth in Schedule 1, which shall
be amended upon the mutual agreement of the Parties.
 
1.14 “Patents” means (a) the patents and patent applications listed in Schedule
2, (b) all patents and patent applications related to Products that may be
obtained, including the make, use or sale of Products and (c) all patents and
patent applications which are divisions, continuations, continuations-in-part,
reissues, renewals, re-examinations, foreign counterparts, substitutions or
extensions of or to any patent applications or patents described in clauses (a)
or (b) of this sentence, that are Controlled by **, its Affiliates, JV or
Manufacturer as of the Effective Date or during the Term. The Parties hereby
acknowledge that there are no Patents as of the Effective Date; provided, that
upon the filing of a Patent application ** shall create a Schedule 2 which shall
be updated as necessary.
 
1.15 “Products” means any product containing ACI as its active chemical
ingredient and which is covered by Patents and/or uses Know-How, including, but
not limited to the following Products: 
 
(a) “Product A” means a product Developed by **(including by any Affiliate of
**or by any Third Party (on behalf of **or its Affiliates)) meeting the
specifications set forth in Schedule 1; and
 
(b) “Product B” means a product Developed by **(including by any Affiliate of **
or by any Third Party (on behalf of **or its Affiliates)) meeting the
specifications set forth in Schedule 1.
 
 
2

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

 
 
1.16 “Product Registration” means, with respect to a Product in a particular
country or territory, the registration or regulatory approval granted by the
applicable governmental authority in such country or territory allowing for such
Product to be marketed, distributed, sold or imported there.
 
1.17 “Regulatory Authority” means the United State’s agency with jurisdiction
over Products. 
 
1.18 “Specifications” means, with respect to a Product, the specifications for
such Product set forth in the Product Registration or as otherwise agreed to by
the Parties.
 
1.19 “Supply Agreement” means that Amended & Restated Manufacture and Supply
Agreement entered into with the JV contemporaneously with this Agreement. 
 
1.20 “Territory” means the United States and all of its states, territories and
protectorates. 
 
1.21 “Third Party” means any entity or person other than ** or Fidopharm or
their respective Affiliates.
 
1.22 “Unit” means a ** of Product. 
 
1.23 Additional Definitions. Each of the following definitions is set forth in
the Section of this Agreement indicated below: 
 
Definition
 
Section
Agreement
 
Preamble
Copyrighted Materials
 
2.3
Costs
 
11.5
Development Data
 
4.4(b)
Development Plan
 
4.2(a)
Effective Date
 
Preamble
Fidopharm
 
Preamble
Force Majeure
 
13.1
Indemnifying Party
 
10.3
Initial Products
 
4.1
Initial Term
 
11.1
**
 
Preamble
Parties
 
Preamble
Party
 
Preamble
Person
 
1.1
Registration and Commercialization Plan
 
5.2
ROFN Notice
 
2.4
Term
 
11.1
Territory Development
 
4.7
Territory Development Costs
 
4.7
Third Party-Patent Infringement Notice
 
7.4
Trademark
  
5.3

 
2. LICENSE GRANT AND OTHER RIGHTS
 
2.1 Exclusive License. 
 
(a) Subject to the terms and conditions of this Agreement, ** hereby grants
Fidopharm an exclusive license, with a right to sublicense, to use the Know-How
and under the Patents to, use, make, have made, market, offer for sale and
import or export Products in the Field in the Territory. For clarity,
Fidopharm’s right to export hereunder shall not include the right to export
Product to end-users or commercial distributors outside of the Territory.
 
 
3

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

 
 
(b) Notwithstanding the license grant above, Fidopharm shall not make or have
Products made and supplied (other than through the JV) for Commercial Sale in
the Territory unless there as been a Failure (as defined in the Supply
Agreement). 
 
2.2 Right of Reference. ** hereby grants Fidopharm the right to access,
reference and use all data and regulatory filings (including all Product
Registrations Controlled by **, its Affiliates, JV and Manufacturer) and
regulatory communications associated with any submissions for the Products to
the extent permitted under applicable Laws. Where required in order for
Fidopharm to obtain such access, ** shall or shall cause the appropriate party
to, as soon as reasonably possible (and in any event no later than thirty (30)
days from the date of Fidopharm’s request), provide the applicable governmental
authority with notice of its consent to such access by Fidopharm in the
appropriate form. In the event that ** grants any Third Party any rights in
Products, (i) ** shall use its best efforts to ensure that any such Third Party
will grant ** a right to access, reference and use any and all data and
regulatory filings related to Products and (ii) ** hereby grants Fidopharm a
right to access, reference and use any and all data and regulatory filings
related to Products which ** has such a right to access; provided, that in any
event ** shall ensure that any such Third Party shall be subject to safety and
adverse event reporting obligations no less stringent than the terms and
conditions contained in Section 8.3 and Fidopharm shall be made aware of any
such safety or adverse events within twenty-four (24) hours of ** being informed
of such an event. ** reserves the right to use such data worldwide in support of
any registration held by it or a Third Party partner. 
 
2.3 Copyrighted Materials. To the extent that ** develops or has developed any
manuals, logos, and other copyrighted works for use with Products (individually
and collectively, the “Copyrighted Materials”), ** hereby grants Fidopharm a
royalty-free, non-exclusive license to use and distribute such Copyrighted
Materials in connection with marketing, promoting, selling or importing Products
in the Field in the Territory. 
 
2.4 Exclusive Right of First Negotiation. Prior to ** granting to a Third Party
a license or similar right (including a co-promotion right or an option to
acquire such license or right) to market, offer for sale, import or export one
(1) or more products containing ACI (other than Products) in the Field in the
Territory, it shall so advise Fidopharm in writing (an “ROFN Notice”). Upon
request by Fidopharm within thirty (30) days after its receipt of the ROFN
Notice, ** and Fidopharm shall discuss the terms and conditions under which **
would grant to Fidopharm rights to market, offer for sale, import or export such
products in the Field in the Territory. If the Parties agree to grant such
rights to Fidopharm, including the terms and conditions of such grant, the
Parties shall prepare and execute an amendment to this Agreement incorporating
such additional rights and terms. If Fidopharm does not so request within the
thirty (30) day period after its receipt of the ROFN Notice, or if the Parties
do not agree in writing on the terms of such additional grant of rights to
Fidopharm within ninety (90) days after the date of the ROFN Notice to
Fidopharm, ** shall be free to grant to one or more Third Parties the right to
market, offer for sale, import or export such products in the Field in the
Territory, on such terms as ** considers appropriate. 
 
3. CONSIDERATION
 
3.1 Upfront Payment. In partial consideration of the grant of rights under this
Agreement and **’s obligations to conduct the Development activities provided
hereunder, Fidopharm shall pay ** an upfront payment of five hundred thousand
dollars (US$500,000) within fourteen (14) days of the Effective Date. 
 
3.2 Supply Agreement. As further consideration of the grant of rights under this
Agreement and its obligations to conduct the Development activities provided
hereunder, Fidopharm shall contemporaneously with this Agreement enter into the
Supply Agreement. 
 
 
4

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

 
 
3.3 No Additional Consideration. ** shall be entitled to no additional
consideration for the grant of rights to Fidopharm under this Agreement and **’s
obligations to conduct the Development activities other than as provided under
this Article 3 and Section 4.7 below. 
 
4. DEVELOPMENT
 
4.1 Overview. ** shall be primarily responsible, at its sole cost except as
otherwise specifically provided herein, for designing and conducting all
Development activities necessary to receive Product Registrations for the
Product A and Product B (together, the “Initial Products”) in accordance with
the Development Plan. Fidopharm shall be responsible, at its sole cost, for
submitting the Product Registrations to the Regulatory Authority.
 
4.2 Development Plan.
 
(a) The Development of the Initial Products shall be governed by a development
plan (the “Development Plan”). The initial Development Plan shall be attached
hereto as Schedule 4.2. The Development Plan shall include options for
‘essentially similar’ and complete clinical package registration data routes
with costings, timelines, stage payments, ** and other elements to be set forth
in the Development Plan.
 
(b) The Development Plan, together with any updates thereto, shall be prepared
and approved as follows from time to time during the Term, each Party shall have
the right to propose amendments to and amend the existing Development Plan;
provided, that in any event ** shall present Fidopharm an updated Development
Plan at least once per calendar year for its review and approval, not to be
unreasonably withheld or delayed. Fidopharm shall have a period of twenty-one
(21) days from the date that the updated Development Plan is received to provide
its approval. If approval or rejection is not provided to ** within such
twenty-one (21)-day period, then the Development Plan shall be deemed approved.
For purposes of clarity, no change to the Development Plan shall be made without
the prior written approval of both Parties.
 
4.3 Diligence. ** shall carry out the Development activities, in strict
accordance with the Development Plan and the timelines set forth therein,
necessary for obtaining the Product Registrations as set forth in this
Agreement, including generating any additional data necessary to obtain Product
Registration specifically for the Territory at Fidopharm’s instruction.
Fidopharm shall file the Product Registrations in accordance with the
Registration and Commercialization Plan based on the data provided by **. 
 
4.4 Reporting and Data.
 
(a) Upon request, ** shall promptly, but in no event later than thirty (30) days
after such request provide Fidopharm with (i) a summary in reasonable detail of
all data generated or obtained from each discrete Development activity performed
under the Development Plan, such as any toxicology study, pharmacokinetics study
or stability study, (ii) a summary of the Development progress against the
projected Development progress set forth in the current Development Plan and
(iii) a final report of the results of each Development activity, together with
all material supporting data.
 
(b) ** shall provide Fidopharm copies of all substantive or material information
with respect to the Development of Products, including clinical data compiled
with respect to Products and all information and data filed with any
governmental authority with respect to Products outside of the Territory, as
soon as reasonably practicable after such information, data or results become
available to or compiled by **, including any drafts and final versions of any
study reports (the “Development Data”). Subject to the terms and conditions of
this Agreement, Fidopharm shall have the right to use the Development Data or
any portion thereof for the purpose of obtaining Product Registrations and
commercializing Products in the Territory.
 
4.5 Compliance with Laws. ** or its agents shall perform its responsibilities
under this Article 4, including those set forth in the Development Plan, in
accordance with all applicable Laws. 
 
 
5

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

 
 
4.6 Access to Records and Facilities. ** shall maintain scientific records, in
sufficient detail and in good scientific manner appropriate for obtaining
Patents and regulatory purposes, which shall fully and properly reflect all work
done and results achieved in the performance of Development under this
Agreement. Fidopharm shall be entitled to have access during regular business
hours and upon reasonable advance notice, to **’s records and facilities
relating to the Development of Products for the purpose of monitoring compliance
with all applicable Laws and other applicable regulatory requirements. In all
Third Party agreements involving the Development of Products, ** shall require
that the Third Parties thereto provide ** with access to such Third Party
facilities and all such data generated by Third Parties. Fidopharm shall have
the right to inspect such facilities on behalf of ** in the event that: 
 
(a) a specific concern is raised regarding Product by any governmental authority
(including the Regulatory Authority);
 
(b) a routine inspection/audit for Regulatory Authority purposes;
 
(c) a routine inspection to confirm compliance with the terms of this Agreement,
including without limitation, the progress of Product Development; or
 
(d) a routine inspection/audit for a Fidopharm customer.
 
For clarity, inspection and audits pursuant to Section 4.6(d) shall be limited
to two (2) separate visits in any twelve (12) month period for each specific
Third Party; provided, that additional reasonable inspections/audits shall be
permitted upon Fidopharm obtaining **’s prior consent, which shall not be
unreasonably withheld, conditioned or delayed. All inspection/audit costs shall
be borne by the Party incurring such costs.
 
4.7 Territory Specific Development. To the extent that additional Development is
necessary solely to obtain the Product Registration in the Territory (“Territory
Development”), ** shall supplement the current Development Plan with a budget
setting forth the reasonable costs for conducting the Territory Development
specific activities (“Territory Development Costs”) and shall submit such
supplement to Fidopharm for its consent and upon approval of such Territory
Development Costs by Fidopharm, Fidopharm shall reimburse such costs as they are
incurred. 
 
5. PRODUCT REGISTRATION AND COMMERCIALIZATION
 
5.1 Product Registration. Fidopharm shall, at its sole expense, use commercially
reasonable efforts to obtain and maintain Product Registrations in accordance
with the Registration and Commercialization Plan. Fidopharm shall be the sole
owner of all Product Registrations in the Territory. For clarity, Fidopharm
shall have the sole right in determining whether or not to obtain and/or
maintain any specific Product Registration in the Territory. 
 
5.2 Registration and Commercialization Plans. No less than thirty (30) days
prior to first Commercial Sale Fidopharm shall provide an annual development
plan for its activities in order to obtain Product Registrations and after first
Commercial Sale Fidopharm shall provide an annual commercialization plan for its
efforts to commercialize Products (the “Registration and Commercialization
Plan”). Fidopharm shall update the Registration and Commercialization Plan
annually and shall provide such updated plan to ** not later than thirty (30)
days before start of each year. The Registration and Commercialization Plan
description shall be agreed between the Parties.
 
5.3 Trademarks. Fidopharm shall have the sole right to determine the
trademark(s) or trade name(s) that Fidopharm shall adopt for use with Products
(the “Trademark”). All goodwill generated through the use of Trademarks by
Fidopharm shall inure to the benefit of Fidopharm. Fidopharm shall own all
Trademarks and shall register and maintain such Trademarks at its sole cost and
discretion. 
 
 
6

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

 
 
5.4 Cooperation. ** shall provide (a) reasonable cooperation and support to
Fidopharm in connection with maintenance of the Product Registration and (b) all
information (including Confidential Information) that is reasonably required for
the Development and/or commercialization of Products. Subject to Article 9,
Fidopharm may use such Confidential Information solely for the purpose of
Developing and commercializing Products. 
 
5.5 Reporting. Each Party shall keep the other Party informed of developments
known by it that would reasonably be expected to have a material adverse effect
on any Product or Product Registration, including, but not limited to, the
general regulatory strategy for Products in the Territory.
 
6. SUPPLY OF PRODUCTS.
 
6.1 Supply Agreement. Contemporaneously with the execution of this Agreement
Fidopharm shall enter into the Supply Agreement with the JV. Pursuant to the
terms of the Supply Agreement, the JV shall supply Fidopharm’s requirements of
Products. Notwithstanding the foregoing, as between Fidopharm and **, in the
event of a conflict between the Supply Agreement and this Agreement, Fidopharm’s
rights in regards to the licenses (and any other intellectual property related
to the Products) and Product Registrations related to the Products shall be
governed solely by the terms of this Agreement.
 
6.2 Technology Transfer. In the event that there is a Failure (as defined in the
Supply Agreement) or if this Agreement is terminated pursuant to Section
11.2(b), 11.3 or 11.4, (a) the restrictions set forth in Section 2.1(b) of this
Agreement shall no longer be applicable (which for clarity, means that Fidopharm
shall have the right to manufacture, or have manufactured, Product itself or by
a Third Party) and (b) ** shall undertake, and/or, as necessary, cause the JV
and Manufacturer to undertake, an immediate transfer to Fidopharm or its
designee of all technology and Know-How necessary, useful or used to manufacture
Products. ** shall also make available, or cause to be made available any
individuals who may be useful implementing the manufacturing processes related
to Products. 
 
7. PATENTS
 
7.1 Prosecution and Maintenance of Patents. ** will prosecute and maintain the
Patents at its sole cost in the Territory, using counsel of its choice
reasonably acceptable to Fidopharm and shall not abandon any Patent without the
prior written consent of Fidopharm. During the Term, ** pursuant to this Section
7.1 shall copy Fidopharm, or have Fidopharm copied, on all material or
substantive documents regarding Patents, which are received from or to be filed
in any patent office in the Territory, promptly following receipt from the
patent office and within a reasonable time prior to filing with the patent
office (but not less than thirty (30) days), as applicable, including copies of
each patent application, office action, response to office action, declaration,
information disclosure statement, request for terminal disclaimer, request for
patent term extension and request for reexamination. Fidopharm shall have the
right to comment on the prosecution of such Patents and provide such comments to
**’s patent counsel, and ** shall consider all such comments in good faith. For
the purposes of this Section 7.1, “prosecute and maintain” means, with respect
to a patent, the preparing, filing, prosecuting and maintenance of such patent,
as well as re-examinations, reissues and requests for patent term extensions and
the like with respect to such patent, together with the conduct of
interferences, the defense of oppositions and other similar proceedings and
appeals thereof with respect to a patent, but shall not include enforcement
litigation or the defense of declaratory judgment actions. Also, as used in this
Section 7.1, to “abandon” particular Patent shall include deciding not to defend
against an opposition, not to defend an interference or similar proceeding, not
to pursue an appeal of an adverse decision or not to pursue particular claims,
in each case with respect to such Patent in the United States Patent & Trademark
Office.
 
7.2 Notification of Infringement. The Parties shall promptly inform each other
of any information that comes to their attention involving (a) actual or
apparent infringements or misappropriations of the Patents, by any Third Party
in the Territory, or (b) claims of alleged infringement made by any Third Party
against either Party or its respective Affiliates or sub-licensees resulting
from the Development, manufacture, import, offer for sale, sale or use of
Products.
 
 
7

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7.3 Enforcement Against Third Parties. 
 
(a) Notice. If either Party reasonably believes that a Third Party is conducting
any activities in the Territory that may constitute actual or potential
infringement of the Patents, such Party shall promptly notify the other Party of
such activities.
 
(b) Fidopharm’s First Right to Enforce. Except as otherwise agreed, Fidopharm
shall have the first right to bring and control any action or proceeding under
such Patents in respect to an alleged infringement occurring in the Territory.
If Fidopharm fails to bring an action or proceeding with respect to an alleged
infringement occurring in the Territory within one-hundred-twenty (120) days
following a request by ** to do so, ** shall have the right to bring and control
any such action or proceeding with respect to such Patents.
 
(c) Cooperation. The Parties shall reasonably cooperate with each other in all
actions or proceedings described in this Section 7.3, to the extent pertaining
to an alleged infringement. The non-controlling Party agrees to be joined as a
party plaintiff if necessary to prosecute the action or proceeding and shall
provide all reasonable cooperation (including any necessary use of its name)
required to prosecute such litigation; provided that the controlling Party shall
reimburse the non-controlling Party for out-of-pocket expenses reasonably
incurred in providing such cooperation at the controlling Party’s request. The
non-controlling Party will be entitled to be represented by counsel of its own
choice at its own expense.
 
(d) Recoveries. Any recovery obtained by any Party as a result of any proceeding
described in this Section 7.3, by settlement or otherwise, shall be applied in
the following order of priority: (i) first, to reimburse each Party for all
litigation costs in connection with such proceeding paid by that Party and not
otherwise recovered (on a pro rata basis based on each Party’s respective
litigation costs, to the extent the recovery was less than all such litigation
costs); and (ii) second, the remainder shall be kept by the controlling Party.
 
7.4 Alleged Infringement of Third Party’s Patents. In the event that either
Party is named as a defendant in any legal or other action or proceeding,
including any settlement or negotiation, or learns of any threatened action or
proceeding with respect to any alleged infringement of a Third Party patent or
other proprietary right as a result of Developing, manufacturing, importing,
offering for sale, selling or using Products such Party will promptly notify the
other Party in writing (a “Third Party-Patent Infringement Notice”). The Parties
will closely coordinate regarding any infringement, or alleged infringement, of
Third Party rights related to Products; provided, that in the Territory,
Fidopharm shall have the first right but not the obligation to defend any action
brought by, or negotiate a settlement with, a Third Party claiming any
infringement or potential infringement by Products of such Third Party’s rights.
In the event that Fidopharm elects not to, or fails to, initiate any defense or
settlement within one-hundred-twenty (120) days following its receipt of a Third
Party-Patent Infringement Notice, ** shall have the right to take such steps as
may be considered necessary or appropriate by ** to defend such infringement
claim. Each Party shall render such reasonable assistance as may be requested by
the defending Party in connection with such infringement actions. If one Party
requests the other Party’s reasonable assistance in connection with such
infringement claims or actions, the requesting Party shall reimburse the other
Party for such direct, out-of-pocket expenses as are reasonably incurred during
the course of its providing such requested assistance.
 
8. REPRESENTATIONS, WARRANTIES AND COVENANTS. 
 
8.1 ** Representations, Warranties and Covenants. ** hereby represents, warrants
and covenants to Fidopharm as follows:
 
 
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(a) The execution and delivery by ** of this Agreement and the performance by **
of its obligations hereunder have been duly authorized by all necessary
corporate action on the part of **, and do not conflict with the terms of any
other contract, agreement, arrangement or understanding to which ** is a party.
 
(b) Except as set forth herein, no consent, approval, order or authorization of,
or registration, qualification, designation, declaration or filing with, any
federal, state or local governmental authority is required on the part of ** in
connection with the valid execution, delivery and performance of this Agreement.
 
(c) ** is and will be in compliance through the term of this Agreement in all
material respects with all Laws applicable to its performance under this
Agreement.
 
(d) There is no action or proceeding pending or threatened against ** that
questions the validity of this Agreement or any action taken by ** in connection
with the execution of this Agreement.
 
(e) In regards to intellectual property:
 
(i) ** has not knowingly infringed any Third Party patent rights in developing
Products. In the event that ** becomes aware of any Third Party patents rights
being infringed, or potentially being infringed, by the development, manufacture
or commercialization of a Product, ** shall notify Fidopharm of such
infringement or potential infringement within twenty-four (24) hours of gaining
such knowledge.
 
(ii) as of the Effective Date, there are no pending proceedings in any court or
arbitration, administrative or other tribunal which are concerned with the
validity or ownership of any of the Patents or Know-How. Without derogation from
the foregoing, there are no oppositions, revocation, cancellation, invalidation
or rectification proceedings pending in relation to any of the Patents or
Know-How in any court. No Third Party has notified ** or any ** Affiliate of its
intention to bring any such proceedings.
 
(iii) ** has not and no ** Affiliate has received any written complaints or
threats and there are no pending proceedings or claims, alleging that the
exploitation of the Patents or Know-How infringe or would infringe the
intellectual property rights of any Person;
 
(iv) Details of the Patents are set out in Schedule 2 and all the details are
correct. Without derogation from the generality of the foregoing, the Patents
are subsisting and all applications for Patents indicated in Schedule 2 as
pending are pending. The legal and beneficial owner or applicant for
registration of each of the Patents specified in Schedule 2 is correctly stated;
 
(v) The Patents and Know-How are the only intellectual property rights owned by,
licensed to or used by ** or its Affiliates in relation to Products and to the
best of **’s knowledge no intellectual property rights other than the Patents or
Know-How are required in order to Develop, manufacture, use, import and/or sell
or commercialize Products in the Territory;
 
(vi) All actions required to be taken before the Effective Date for the
prosecution and maintenance of the Patents (including all applicable fees due
and payable before such date) have been taken or paid; and
 
(vii) The Patents are not and, during the Term, will not become subject to any
encumbrance or lien in favor of any Third Party that is inconsistent with or
otherwise restricts the rights and sublicenses granted to Fidopharm hereunder.
 
(f) In regards to Development:
 
(i) ** **
 
 
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(ii) All trials related to Products have been carried out and will be carried
out in accordance with all relevant Laws;
 
(iii) Neither ** nor any ** Affiliate is engaged in any litigation, opposition
or arbitration proceedings affecting or relating to Products, the Patents,
Know-How (including but not limited to claims relating to product liability) as
plaintiff or defendant and there are no such proceedings pending or threatened
by or against ** or any ** Affiliate and ** is not aware of facts or
circumstances likely to give rise to any such proceedings; and
 
(iv) No injunction has been granted against ** or its Affiliates in connection
with Products, the Patents or Know-How.
 
(g) Neither ** or any ** Affiliate has nor will provide (directly or indirectly)
any Third Party access or rights to use its Know-How (including, without
limitation, use of any data or under any Patents) for Development, regulatory
approval or commercialization of any product containing Active A at a
concentration range between **and **weight/volume.
 
(h) As of the Effective Date, neither it nor its Affiliates has been debarred or
is subject to debarment and neither ** nor any of its Affiliates will use in any
capacity, in connection with the Development or commercialization of Products,
any Person who has been debarred pursuant to Section 306 of the United States
Federal Food, Drug and Cosmetic Act, or who is subject of a conviction described
in such section. Further, ** agrees to inform Fidopharm in writing immediately
if it or any Person who is performing services hereunder is debarred or is the
subject of a conviction described in Section 306, or if any action, suit, claim,
investigation or legal administrative proceeding is pending or, to the best of
**’s knowledge, is threatened, relating to the debarment of **, its Affiliates
or any Person used in any capacity by ** or its Affiliates in connection with
the Development or commercialization of Products.
 
8.2 Fidopharm Representations and Warranties. Fidopharm hereby represents and
warrants to ** as follows:
 
(a) The execution and delivery by Fidopharm of this Agreement and the
performance by Fidopharm of its obligations hereunder have been duly authorized
by all necessary corporate action on the part of Fidopharm, and do not conflict
with the terms of any other contract, agreement, arrangement or understanding to
which Fidopharm is a Party.
 
(b) Except as set forth herein, no consent, approval, order or authorization of,
or registration, qualification, designation, declaration or filing with, any
federal, state or local governmental authority is required on the part of
Fidopharm in connection with the valid execution, delivery and performance of
this Agreement, where the failure to obtain any of the foregoing would not have
a material adverse impact on the ability of Fidopharm to meet its obligations
hereunder.
 
(c) Fidopharm is and will be in material compliance throughout the Term with all
of the applicable Laws relating to Products in the Territory.
 
8.3 Regulatory Cooperation.
 
(a) The Parties shall disclose to each other all reports or other knowledge they
receive with respect to adverse experiences, and reports of mislabeling,
stability failures or microbiological contamination.
 
(b) In addition to and without limiting the requirements of Section 8.3(a)
above, Fidopharm and ** agree, throughout the duration of this Agreement, to
notify the other Party immediately of any information concerning any serious or
unexpected side effect, injury, toxicity or sensitivity reaction, or any
unexpected incidents, and the severity thereof, associated with the clinical
uses, studies, investigations, tests and marketing of Products, whether or not
determined to be attributable to Products. Each Party shall cooperate with the
other to resolve any complaints received by either Party with respect to
Products.
 
 
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(c) Each of Fidopharm and ** shall promptly deliver to the other all material
correspondence that such Party may receive, directly or indirectly, from
regulatory authorities in jurisdictions where such Party (or its sublicensees,
distributors, or sub-distributors) has rights to market Products, except for
procedural, nonsubstantive communications which do not relate to the safety or
efficacy of Products. Fidopharm and ** shall also immediately notify the other
Party about any information such Party receives regarding any threatened or
pending action by a governmental agency that may affect the safety and efficacy
claims of Products or the continued marketing, promotion, distribution, sale or
manufacture of Products. Upon receipt of any such information, the Parties shall
consult in an effort to arrive at a mutually acceptable procedure for taking
appropriate action, provided that nothing contained herein shall be construed as
restricting either Party’s right to make a timely report of such matter to any
governmental or regulatory agency or take other action that it deems to be
appropriate or required by applicable law or regulation. It is Fidopharm’s
responsibility to report adverse events in accordance with local Laws and
requirements to governmental or regulatory agencies in the Territory.
 
(d) Without limiting the foregoing, it is also understood that each Party may
notify any of its Affiliates, licensees, distributors or sub-licensees of any
incident or event reported by either Party under this Section 8.3. In addition,
each Party shall, and shall require its respective Affiliates to: (i) to the
extent permissible under time constraints and reporting requirements, provide to
the other Party in advance of initial or periodic submission to the applicable
regulatory authorities any and all adverse event reports from clinical trials
and commercial experiences with Products; (ii) provide such adverse event
reports to the other Party contemporaneously with the provision of such reports
to the applicable regulatory authority; and (iii) adhere to all requirements of
applicable Laws which relate to the reporting and investigation of adverse
events and keep the other Party informed of such events. If a Party contracts
with a Third Party for any research to be performed by such Third Party on
Products, that Party shall require such Third Party to report to the contracting
Party the information set forth above.
 
8.4 Compliance with Laws. Both Parties shall comply in all material respects
with all applicable Laws with respect to the supply, Development, testing,
marketing, promotion, storage, import, distribution and sale of Products.
 
9. CONFIDENTIALITY
 
9.1 Confidentiality; Nondisclosure; Nonuse. During the Term, and for ten (10)
years after the termination of this Agreement, each Party shall keep
confidential the other Party’s Confidential Information and, except as expressly
permitted herein, shall not disclose such Confidential Information to any Third
Party in any manner whatsoever, in whole or in part, without first obtaining the
other Party’s prior written consent to such disclosure. The standard of care
required of each Party in protecting the confidentiality of the other Party’s
Confidential Information shall be at least as strict as the same standard of
care that the receiving Party uses in protecting its own Confidential
Information, but in no event shall either Party use less than a reasonable
standard of care. Neither Party shall use any Confidential Information of the
other Party for any purpose other than to perform its obligations under this
Agreement or as otherwise authorized under this Agreement. The receiving Party
shall ensure that its employees, representatives, and agents comply with this
provision, and shall be responsible for any breach by such employees,
representatives, or agents.
 
9.2 Exception to Confidential Information. The foregoing obligations of
confidentiality, nondisclosure and nonuse shall not apply to any Confidential
Information (a) which is now public knowledge or which hereafter becomes public
knowledge through no breach of this Agreement by the receiving Party; (b) which
the receiving Party received without restriction from an independent Third
Party; (c) which the receiving Party can demonstrate was already in its
possession at the time of receipt from the disclosing Party and not subject to
another agreement between the Parties; or (d) which the receiving Party can
demonstrate was independently developed by the receiving Party in the course of
work by the officers, directors, employees, consultants or agents of itself or
of its Affiliates, subsidiaries or related companies without the aid, use or
application of Confidential Information of the disclosing Party.
 
 
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9.3 Notification of Mandatory Disclosure. Each Party may use or disclose
Confidential Information of the other Party to the extent such use or disclosure
is reasonably necessary in complying with applicable Laws or required by
governmental authorities or pursuant to a court order or otherwise submitting
information to governmental authorities in connection with clinical trials or
applying for Product Registrations, negotiating or making a permitted sublicense
or otherwise exercising its rights hereunder; provided that if a Party is
required under applicable Laws or court order to make any such disclosure of the
other Party’s Confidential Information, it shall (i) give prompt written notice
to the disclosing Party of the proposed disclosure, and allow the disclosing
Party at least fourteen (14) business days to object to all or any portion of
the disclosure before it is disclosed; (ii) provide written notice of disclosure
immediately thereafter, if advance notice is not possible; (iii) minimize the
extent of such disclosure, to the extent possible; and (iv) seek confidential
treatment of such information prior to its disclosure, it being understood that
any information so disclosed shall otherwise remain subject to the limitations
on use and disclosure hereunder. 
 
9.4 Patent Application Filing. Notwithstanding anything to the contrary, if a
disclosing Party has not filed a necessary Patent application with respect to
any applicable Confidential Information, it may require the receiving Party to
delay the proposed authorized or required disclosure (to the extent the
disclosing Party may legally do so), for up to ninety (90) days, to allow for
the filing of such an application.
 
9.5 Permitted Disclosure to Third Parties. Except as expressly permitted in this
Agreement, neither Party shall disclose this Agreement or any terms of this
Agreement to any Third Party without the prior written consent of the other
Party; except that such consent shall not be required for disclosure to actual
or prospective investors, collaboration partners or the other party in a
proposed investment, merger, acquisition or a similar transaction, or to a
Party’s accountants, attorneys and other professional advisors (provided that
such disclosures shall be subject to continued confidentiality obligations at
least as strict as is set forth herein). To the extent that either Party
determines that it or the other Party is required to file or register this
Agreement or a notification thereof to comply with the requirements of an
applicable stock exchange or NASDAQ regulation or any governmental authority,
including without limitation the U.S. Securities and Exchange Commission, such
Party shall promptly inform the other Party thereof. Prior to making any such
filing, registration or notification, the Parties shall agree on the provisions
of this Agreement for which the Parties shall seek confidential treatment, it
being understood that if one Party determines to seek confidential treatment for
a provision for which the other Party does not, then the Parties will use
reasonable efforts in connection with such filing to seek the confidential
treatment of any such provision. The Parties shall cooperate, each at its own
expense, in such filing, registration or notification, including without
limitation such confidential treatment request, and shall execute all documents
reasonably required in connection therewith. 
 
10. INDEMNIFICATION AND INSURANCE
 
10.1 **’s Indemnification Obligations. ** shall indemnify and hold Fidopharm
harmless from and against any direct costs, expenses (including, without
limitation, reasonable attorneys’ fees) or damages which arise from breach by **
of any of its representations, covenants, warranties or obligations set forth
herein, including, without limitation, any claims in connection with (i) failure
of Products supplied by ** to meet the Specifications, or (ii) any breach of its
representations, warranties or covenants hereunder, except to the extent such
damages are caused by or arise from (x) the gross negligence or willful
misconduct of Fidopharm; or (y) any matter as to which Fidopharm has agreed to
indemnify ** hereunder.
 
10.2 Fidopharm’s Indemnification Obligations. Fidopharm shall indemnify and hold
** harmless from and against any direct costs, expenses (including, without
limitation, reasonable attorneys’ fees) or damages which arise from the breach
by Fidopharm of any of its representations, covenants, warranties or obligations
set forth herein or from the marketing, sale or distribution of Products by
Fidopharm and its Affiliates, distributors and permitted sublicensees, except to
the extent such damages were caused by or arise from (i) the gross negligence or
willful misconduct of **; or (ii) any matter as to which ** has agreed to
indemnify Fidopharm hereunder.
 
 
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10.3 Indemnification Procedure.
 
(a) Promptly after the receipt by any Party hereto of notice of (a) any claim or
(b) the commencement of any action or proceeding, such Party shall, if a claim
with respect thereto is to be made against any Party obligated to provide
indemnification pursuant to Section 10.1 or 10.2 hereof (the “Indemnifying
Party”), give such Indemnifying Party written notice of such claim or the
commencement of such action or proceeding. Such Indemnifying Party shall have
the right, at its option, to compromise or defend, subject to Section 10.3(c)
below, at its own expense and by its own counsel, any such matter involving the
asserted liability of the Party seeking such indemnification. Such notice, and
the opportunity to compromise or defend, shall be a condition precedent to any
liability of the Indemnifying Party under the indemnification provisions of
Section 10.1 or 10.2. In the event that any Indemnifying Party shall undertake
to compromise or defend any such asserted liability, it shall promptly notify
the Party seeking indemnification of its intention to do so, and the Party
seeking indemnification agrees to cooperate fully with the Indemnifying Party
and its counsel in the compromise of, or defense against, any such asserted
liability. In any event, the indemnified Party shall have the right, at its own
expense, to participate in the defense of such asserted liability, provided,
that the Indemnifying Party’s counsel shall make all final decisions concerning
the defense or, subject to Section 10.3(c) below, compromise or settlement of
such litigation.
 
(b) Each of the Parties hereto shall be entitled to be represented at any
proceedings brought against the other Party under this Article 10 by its own
counsel, at its own expense, and shall cooperate fully with the other Party in
any such proceeding, provided it is adequately reimbursed for its out-of-pocket
costs and expenses, excluding attorneys’ fees.
 
(c) Neither Party may settle a claim described in this Article 10 in a manner
which would impose upon the other Party any monetary obligation or require such
other Party to submit to an injunction or otherwise limit its rights, in each
case, without the prior written consent of such other Party, which consent shall
not be unreasonably withheld, conditioned, or delayed.
 
10.4 Insurance. The Parties shall each maintain insurance in amounts
commercially reasonable for the veterinary pharmaceutical industry commensurate
with their rights and obligations hereunder. 
 
11. TERM AND TERMINATION
 
11.1 Term. The initial term of this Agreement shall begin on the Effective Date
and shall continue for ten (10) years after the first Commercial Sale (the
“Initial Term”) unless earlier terminated pursuant to this Article 11. At the
expiration of the Initial Term, the term of this Agreement shall automatically
renew for successive five (5) year periods (the Initial Term and all such
renewal periods, the “Term”) unless written notice of non-renewal is provided by
Fidopharm to ** at least sixty (60) days prior to the applicable renewal date. 
 
11.2 Termination by Fidopharm. 
 
(a) Fidopharm shall have the right to terminate this Agreement without cause and
without penalty upon ninety (90) days prior written notice to **, provided, that
such period shall be extended for a reasonable period (not to exceed another
sixty (60) days) in order to effect the transfer of Product Registrations
pursuant to Section 11.6(e). For clarity, any early, without cause termination
by Fidopharm ahead of Product registration deems all fees / costs paid to ** as
not refundable. Should such a termination by Fidopharm occur during the
implementation of the Development Plan, Fidopharm shall be liable for all
reasonable non-cancelable ongoing costs, solely in regards to the Territory,
necessary to complete the then current Development activities; provided, that **
shall immediately terminate such ongoing commitments as soon as possible and
shall not incur any non-necessary expenses in effectuating such termination.
 
 
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(b) In the event that Fidopharm terminates the Supply Agreement pursuant to
Section 12.2 or 12.3 therein, Fidopharm shall have the right to terminate this
Agreement immediately and without penalty upon written notice to **.
 
11.3 Termination for Breach. In the event of any material default by either
Party in the performance of any of the terms and conditions of this Agreement,
the other Party may terminate this Agreement upon ninety (90) days’ written
notice; provided that (i) if during such ninety (90) day period the Party
against whom the material default is claimed cures such default, (ii) if such
breach cannot be cured within such ninety (90) day period, such Party takes
reasonable steps to commence and proceeds diligently thereafter to cure such
default and, in fact, cures such default within a reasonable period of time, or
(iii) if such default is cured in any other manner satisfactory to the other
Party as a substitute for full performance, then this Agreement will continue in
full force and effect until it expires as provided herein.
 
11.4 Termination for Bankruptcy, etc. Either Party shall be entitled to
terminate this Agreement immediately:
 
(a) if any creditor of the other Party or any other person levies or attempts to
levy any distress, execution, sequestration or other process over the business
assets of the other Party or an encumbrancer takes or attempts to take
possession of the business or assets of the other Party;
 
(b) if a petition shall be presented for the winding up of the other Party or if
a meeting is convened for the purpose of passing a resolution for the winding up
of the other Party;
 
(c) if a receiver, administrative receiver, manager, trustee or administrator
shall be appointed over all or any part of the business or assets of the other
Party;
 
(d) if the other Party or any director or creditor of such other Party shall
present a petition to the court for an administrative order in respect of such
other Party;
 
(e) if the other Party shall convene a meeting of its creditors or shall make
any proposal for or enter into any compromise, composition or scheme of
arrangement with its creditors or make any assignment for the benefit of its
creditors;
 
(f) if the other Party shall be deemed to be unable to pay its debts within the
meaning of any relevant insolvency law or any relevant insolvency decree or
regulation (or any statutory amendment or reenactment thereof); or
 
(g) if any event analogous to the foregoing shall occur under the laws of any
relevant jurisdiction.
 
11.5 Termination for Failure. In the event ** fails to provide (a) the necessary
technical and regulatory batches needed for Product Registration in the
Territory for the Initial Products within the agreed to timeline in the
Development Plan; or (b) provide by December 31, 2008 (i) shelf life data under
accelerated conditions demonstrating **-month and **-month accelerated stability
for Product A and Product B and (ii) clinical efficacy of Product B, each from
an independent lab reasonably acceptable to Fidopharm, and reasonable
acceptability of **of Product A and Product B ** by Fidopharm based on
commercial viability of Products, Fidopharm shall have the right to terminate
this Agreement immediately and upon such termination ** shall reimburse any
payments made to it under this Agreement and one hundred percent (100%) of the
cost and expenses expended by Fidopharm to Develop, register and commercialize
Products in the Territory up to five hundred thousand dollars ($500,000),
including all costs and expenses for obtaining the Product Registrations
(together with the upfront payment, the “Costs”); provided, that in the event **
has accomplished (x) subsection (i) of Section (b) above, the reimbursement
shall be reduced by forty percent (40%) of the Costs, and/or (y) subsection (ii)
of Section (b) above, the reimbursement shall be reduced by another forty
percent (40%) of the Costs and/or (z) Section (a) above, the reimbursement shall
be reduced by another twenty (20%) of the Costs.
 
 
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11.6 Effect of Expiration or Termination.
 
(a) No expiration or termination of this Agreement pursuant to this Article 11
shall relieve either Party of obligations accrued to such date of expiration or
termination or of obligations which continue by the terms hereof beyond such
expiration or termination, including, but not limited to, any payment
obligations hereunder. Articles 1, 9, 10 and 13 and Sections 2.4, 5.3, 6.2, 8.1,
8.2 and this Section 11.6 shall survive the termination or expiration of this
Agreement
 
(b) In the event that this Agreement expires or is terminated pursuant to
Section 11.2(b), 11.3 or 11.4 the licenses granted hereunder to Fidopharm shall
become irrevocable, royalty-free, non-exclusive licenses, with the right to
grant sublicenses, to market, promote and sell Products in the Field in the
Territory.
 
(c) Within thirty (30) days following the termination of this Agreement, each
Party shall destroy, delete (as to Confidential Information stored in electronic
format) or return to the other Party all Confidential Information of the other
Party, and shall provide the other Party written certification of such
destruction or return.
 
(d) After termination of this Agreement, Fidopharm shall cease using or selling
Products pursuant to the license grant herein (for clarity, the preceding shall
not limit Fidopharm’s rights pursuant to the licenses granted under Section
11.6(b)); provided, however, that Fidopharm may continue to sell in the ordinary
course of business for a period of twelve (12) months reasonable quantities of
Products which are manufactured and in Fidopharm’s normal inventory at the date
of termination; provided that such Product had been ordered in-line with
Fidopharm’s forecast.
 
(e) In the event of termination of this Agreement by Fidopharm pursuant to
Section 11.2(a), Fidopharm shall (i) transfer to ** all rights, title and
interests in and to the Product Registration and (ii) take such other steps
requested by **, all of the foregoing at **’s sole cost and expense, to effect
the transfer. Fidopharm will provide all reasonable support, at **’s reasonable
cost, to facilitate the transfer of such Product Registrations in a timely
manner.
 
12. INJUNCTIVE RELIEF AND DISPUTE RESOLUTION
 
12.1 Equitable Relief. Notwithstanding anything to the contrary in this
Agreement, either Party will have the right to seek temporary injunctive relief
or the ordering of specific performance in any court of competent jurisdiction
as may be available to such Party under the laws and rules applicable in such
jurisdiction with respect to any matters arising out of the other Party’s
performance of or failure to perform its obligations under this Agreement.
 
12.2 Dispute Resolution. In the event the Parties are unable to resolve any
controversy or claim arising from this Agreement (“Dispute”), the Parties will
submit such Dispute to arbitration under the rules of the American Arbitration
Association, as the same may be amended by mutual agreement of the Parties. The
Dispute shall be submitted to an expert panel in the pertinent field for binding
arbitration. Such expert panel may be mutually agreed by the Parties, but if no
such agreement is reached within ten (10) days after the written notice from one
Party to the other, then each Party shall promptly select one expert, and those
two (2) shall select a third expert, the three (3) of whom shall comprise the
expert panel. The arbitrator(s) shall determine what discovery will be
permitted, based on the principle of limiting the cost and time which the
parties must expend on discovery; provided, the arbitrator(s) shall permit such
discovery as they deem necessary to achieve an equitable resolution of the
dispute. Both Parties will cooperate in providing fully to each other all
requested information and documents relating to the arbitration proceedings,
except for information and documents subject to any privilege. The place of any
arbitration proceedings shall be New York, New York or such other location as
the Parties may mutually agree. During the arbitration proceedings, except for
the matter that is in dispute and under arbitration, this Agreement shall
continue to be implemented by both Parties. Unless the expert panel for good
cause determines otherwise, each Party shall bear one-half of the fees and
expenses of the experts and shall bear its own costs and attorneys’ fees in
connection with the arbitration proceeding; provided that the arbitrator(s) may
in their discretion award to the prevailing party the costs and expenses
incurred by the prevailing party in connection with the arbitration proceeding.
The decision and/or award rendered by the arbitrator(s) shall be written, final
and non-appealable and may be entered in any court of competent jurisdiction.
The provisions of this subsection shall not prohibit either Party from seeking
equitable relief to restrain any breach or threatened breach of this Agreement
at any time in any court of competent jurisdiction as may be available to such
Party under the laws and rules applicable in such jurisdiction. The arbitral
proceedings and all pleadings and written evidence shall be in the English
language. Any written evidence originally in a language other than English shall
be submitted in English translation accompanied by the original or true copy
thereof.
 
 
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13. MISCELLANEOUS
 
13.1 Force Majeure. Neither Party hereto shall be liable for damages, nor shall
this Agreement be terminable or cancelable by reason of any delay or default in
such Party’s performance hereunder (other than the payment of monies due and
owing to a Party under this Agreement) if such default or delay is caused by
acts of God, acts of public enemies, war or insurrection, civil commotion,
destruction of production facilities or materials by earthquake, fire, flood or
storm, epidemics, labor disputes or strikes, or failure of public utilities
(“Force Majeure”). Each Party shall endeavor to resume its performance hereunder
as soon as reasonably possible if such performance is delayed or interrupted by
reason of Force Majeure.
 
13.2 Further Assurances. Each of the Parties shall, from time to time during the
term of this Agreement, upon request by the other, execute and deliver all such
further documents or instruments as may be required in order to give effect to
the purpose and intent of this Agreement. 
 
13.3 Assignment. Neither Party shall assign this Agreement without the prior
written consent of the other Party, provided, that either Party may assign this
Agreement without the prior written consent of the other Party (a) to an
Affiliate or (b) to a party in connection with the sale or transfer of
substantially all of its assets with respect to the business to which this
Agreement is related to such party. Any permitted assignee shall assume all
obligations of its assignor under this Agreement. Any purported assignment in
violation of this Section 13.3 shall be void. No assignment shall relieve either
Party of responsibility for the performance of any accrued obligation that such
Party then has hereunder.
 
13.4 Choice of Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, USA, without giving effect
to its principles of conflicts of laws. The Parties hereby submit to the
exclusive jurisdiction of, and waive any venue objections against, federal and
state courts of competent jurisdiction in the State of Delaware in any
litigation or dispute arising out of this Agreement. The prevailing party in any
dispute or legal action regarding the subject matter of this Agreement shall be
entitled to recover attorney’s fees and costs.
 
13.5 Notices. Any notice, request or other communication required or permitted
by this Agreement to be given by any Party to another Party shall be in writing
and either mailed by registered or certified mail, return receipt requested, by
express delivery service or by facsimile transmission, addressed to such Party,
Attention: the Managing Director, at its address indicated in the preamble or to
such other address as such Party previously may have designated by like written
notice. Notice shall be deemed to have been given upon receipt. Facsimile
transmission numbers for the Parties are as follows:
 
 
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If to Fidopharm:
Fidopharm, Inc.
777 Township Line Road, Suite 170
Yardley, PA 19067
United States of America
Attn: **
Tel:
Fax:
with a copy to:
Morgan, Lewis & Bockius
1701 Market Street
Philadelphia PA, 19103
United States of America
Attn: Fahd M.T. Riaz, Esq.
Tel: (215) 963-5372
Fax: (215) 963-5001

If to **:
**
**
with a copy to:
**

 
13.6 Entire Agreement. This Agreement constitutes the entire agreement between
the Parties with respect to the subject matter hereof and supersedes all prior
written or oral agreements or understandings regarding the subject matter hereof
or in conflict with its terms, including but not limited to, the License and
Development Agreement entered into by the Parties on February 15, 2008. This
Agreement will be construed as if it were drafted jointly by the Parties and
shall not be strictly construed against either Party.
 
13.7 Amendments; Waivers. No modification of any of the terms of this Agreement
shall be deemed valid unless it is in writing and signed by the Party against
whom such modification is sought to be enforced. The failure of either Party to
insist upon the strict performance of any term of this Agreement or the waiver
by either Party of any breach under this Agreement shall not prevent the
subsequent strict enforcement of such term nor be deemed a waiver of any
subsequent breach.
 
13.8 Severability. In the event any court declares illegal or unenforceable, as
written or applied, any provision of this Agreement, such provision shall be
severed and the remaining provisions of this Agreement shall continue in full
force and effect as if such provision had been deleted or made inapplicable to
the situations to which such provision cannot be legally applied. The Parties
shall use their best efforts to agree upon a valid and enforceable provision as
a substitute for the severed provision, taking into account the intent of this
Agreement.
 
13.9 Independent Contractors. Each Party is an independent contractor under this
Agreement. Nothing contained in this Agreement is intended nor is to be
construed so as to constitute ** or Fidopharm as partners or joint venturers
with respect to this Agreement. Neither Party shall have any express or implied
right or authority to assume or create any obligations on behalf of or in the
name of the other Party, or to bind the other Party to any other contract,
agreement or undertaking with any Third Party or Affiliate.
 
13.10 Counterparts. This Agreement may be executed by fax and in one or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.
 
13.11 Headings. The headings used in this Agreement have been inserted for
convenience of reference only and do not define or limit the provisions hereof.
 
*** Remainder of Page Intentionally Left Blank; Signature Page Follows ***
 
 
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the
Effective Date.

FIDOPHARM, INC.
 
/s/ **
Name: **
Title: President & CEO
   
/s/ **
Name: **
Title: CEO

 
 
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SCHEDULE 1

**
 
 
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SCHEDULE 2

Patents

No Patents exist as of the Effective Date.
 
 
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SCHEDULE 4.2
 
**
 
 
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