Exhibit 10.10


 


LICENSE AGREEMENT


 


This
License Agreement (“AGREEMENT”) is made as of this 13th day of December, 2004
(the “EFFECTIVE DATE”), by and between ABBOTT LABORATORIES, an Illinois
corporation, with its principal office at 100 Abbott Park Road, Abbott Park,
Illinois 60064 (“ABBOTT”), and ADVANCED LIFE SCIENCES HOLDINGS, INC., a Delaware
corporation, with its principal office at 1440 Davey Road, Woodridge, Illinois
60517 (“ALS”). 


 


WITNESSETH


 


WHEREAS,
Abbott is the holder of certain patent applications and patents (“PATENTS,” as
more fully defined below) relating to the Compounds (as defined below);


 


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


 


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


 


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


 


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


 


1.1                                 “ABBOTT
TECHNOLOGY” means the Patents and Know-How.


 


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


 


1.3                                 “COMPOUND
A” means the compound known as ABT-773, its enantiomers, racemates, isomers and
any pharmaceutically acceptable salt or complex thereof, in its current and any
other formulation, and including any Prodrugs and active metabolites, whether
made before or after the Effective Date.


 


1.4                                 “COMPOUND
B” means the compound known as ABT-210, its enantiomers, racemates, isomers and
any pharmaceutically acceptable salt or complex thereof, in its current and any
other formulation, and including any Prodrugs and active metabolites, whether
made before or after the Effective Date.


 


1.5                                 “COMPOUNDS”
shall mean Compound A and Compound B, collectively.


 





















 


1.6                                 “CONFIDENTIAL
INFORMATION” means any and all information or data relating to either Compound
A or Compound B and/or Product which, in the course of carrying out a provision
of this Agreement, a party discloses to the other party, its employees or
representatives, whether in writing, orally or by observation, including,
without limitation, all scientific, clinical, technical, commercial, financial
and business information and Know-How, and other information or data considered
confidential in nature. Subject to SECTION 7.1 hereof, Abbott shall hold
in confidence and shall not directly or indirectly disclose or provide to any
third party Confidential Information pertaining to Compound A, Compound B or
Abbott Technology without ALS’s prior written consent. Confidential Information
shall not include information or any portion thereof which:


 


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


 


(b)                                 is
subsequently disclosed to the receiving party by an unaffiliated third person
who has the right to make such disclosure;


 


(c)                                  becomes
patented, published or otherwise part of the public domain other than through
the acts of the receiving party; or


 


(d)                                 is
independently developed by or for the receiving party by person(s) having no
knowledge of such information as evidenced by its written records.


 


1.7                                 “EFFECTIVE
DATE” shall have the meaning ascribed to such term in the opening paragraph of
this Agreement.


 


1.8                                 “EXCLUSIVE
LICENSE” means a license that operates to exclude all others, including Abbott.



 


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


or promotions.


 


1.10                           “KNOW-HOW”
means any proprietary technology, information, methods of use, processes,
techniques, ideas or inventions (other than the Patents) owned, possessed or
used by Abbott as of the Effective Date which is directly related to or
directly used in connection with Compound A or Compound B or the manufacture of
Compound A, Compound B and/or Product, including all trade secrets and any
other technical information relating to development, use or sale of Compound A,
Compound B and/or Product, provided that Abbott has the right to license and/or
sublicense to ALS. To the extent that any such Know-How relates to other
compounds in addition to Compound A and/or Compound B, Know-How shall only
include that portion of the Know-How exclusively relating to Compound A and/or
Compound B.


 


2





















 


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


 


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


during the Term:


 


(a)                                  discounts,
including cash discounts, customary trade allowances or rebates actually taken,
governmental rebates, chargebacks, and group purchasing management fees of up
to three percent (3%) for formulary access;


 


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


 


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


 


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


 


With respect to any gross
sales of Product by ALS, by any Affiliates of ALS, or by any sublicensees of
ALS, to unrelated third parties in non-arm’s length transactions, “Net Sales”
per unit of Product shall be determined by using the “Net Sales” per unit of
Product in arm’s length transactions for the same reporting period. 


 


1.13                           “PATENTS”
means the patent applications and patents listed in EXHIBIT A hereto and
any patents issuing upon such patent applications, any amendments thereto,
foreign equivalents in the Territory, and any and all substitutions,
extensions, additions, reissues, re-examinations, renewals, divisions,
continuations, continuations-in-part or supplementary protection certificates
derived from or relating thereto.


 


1.14                           “PHARMACEUTICAL
USES” means any therapeutic use of Compound A, Compound B and/or Product in any
formulation or dosage form for the management of a disease or condition of
humans.


 


3





















 


1.15                           “PRODRUG”
means any compounds which, following administration, are actively converted in
the body to Compound A or Compound B.


 


1.16                           “PRODUCT”
means any formulation containing either Compound A or Compound B.


 


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


 


1.18                           “REGULATORY
AUTHORITY” means the United States Food and Drug Administration (“FDA”) or any
successor entity and its equivalent in other countries of the Territory,
including, but not limited to, EMEA.


 


1.19                           “TERM”
means the period commencing on the Effective Date and ending as set forth in Section 9.1
below.


 


1.20                           “TERRITORY”
means the entire world, except Japan.


 


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


 


2.                                       LICENSE
GRANT. Subject to the terms and conditions of this Agreement, Abbott hereby
grants to ALS an Exclusive License in the Territory, under Abbott Technology,
for all Pharmaceutical Uses, with the right to grant sublicenses pursuant to SECTION 5.5
hereof, to (i) research, develop, make or have made, Compound A, Compound B
and Product(s); (ii) apply for and obtain Regulatory Approvals, all as may
be required to manufacture and commercialize Product(s); and (iii) register,
use, import/export, market, offer to sell and sell, Product(s) and Compound A
and Compound B.


 


3.                                       INFORMATION;
EXCLUSIVITY.


 


3.1                                 DELIVERY
OF INFORMATION/CONSULTATION WITH ABBOTT PERSONNEL.


 


(a)                                  On
or before December 31, 2004, Abbott shall, to the extent it has not
already done so, deliver to ALS the information under Abbott’s and its
Affiliates’ control involving the Compounds constituting Patents and Know-How
excluding any attorney-client privileged information. Abbott shall also,
promptly after the Effective Date, transfer to ALS Abbott’s interests in Investigational
New Drug application no. 57,836, such transfer being subject, in all respects,
to applicable Regulatory Approvals.


 


(b)                                 From
the Effective Date until the six (6) month anniversary of the Effective
Date (the “CONSULTATION PERIOD”), Abbott shall make its


 


4





















 


technical
personnel familiar with the development of Compound A and/or Compound B
available to ALS upon its request for reasonable consultation at reasonable
times and places. ; provided, however, that Abbott shall not be obligated to
make any such personnel available at any particular time if in doing so it
would interfere with Abbott’s business operations (the “CONSULTATION SERVICES”).
During the Consultation Period, Abbott shall provide a maximum of one hundred
twenty (120) man hours of Consultation Services (to the extent not utilized under
that certain Option Agreement between Abbott and ALS dated as of October 29,
2004, as amended). The first one hundred and twenty (120) man hours of such Consultation
Services shall be GRATIS to ALS and thereafter, ALS shall pay Abbott $275.00
per hour (the “CONSULTATION RATE”) for such Consultation Services. Abbott shall
provide such Consultation Services on an “as is” basis, without any
representation or warranty as to accuracy, completeness or quality. ALS shall
have sole responsibility for its decision to take or not take any action based
upon such Consultation Services, and for the effect and consequences of such
actions or inactions. If, after the Consultation Period, ALS requires any
additional Consulting Services, ALS shall make a request for such services in
writing. Abbott shall not be obligated to provide such additional Consultation
Services but it shall not unreasonably withhold such Consultation Services from
ALS. Any such additional Consultation Services shall be billed at the Consultation
Rate. ALS agrees to reimburse Abbott for all reasonable out-of-pocket expenses,
if any, incurred by Abbott in providing the Consultation Services. Abbott shall
invoice ALS for such expenses and ALS shall pay such invoices with thirty (30)
days of its receipt thereof.


 


4.                                       PURCHASE
OF ABBOTT INVENTORY OF CLINICAL SUPPLIES, BULK COMPOUND AND CHEMICAL
INTERMEDIATES.


 


4.1                                 PURCHASE
OF INVENTORY. ALS shall purchase approximately 1,125 kg. of bulk Compound A
(the “Inventory”).


 


4.2                                 PURCHASE
PRICE.


 


(a)                                  ALS
shall pay to Abbott, as the purchase price for the Inventory to be purchased
under this ARTICLE 4, the aggregate amount of Ten Million Dollars
($10,000,000), payable as follows: (a) Two Million Dollars ($2,000,000) upon
the execution of this Agreement, (b) Seven Million Dollars ($7,000,000) on
or before May 1, 2005 and (c) One Million Dollars ($1,000,000) on or
before June 30, 2005. Abbott shall ship approximately a pro rata portion of
the Inventory to ALS upon receipt of each of the foregoing payments (i.e.
approximately twenty percent


 


5





















 


(20%)
of the Inventory shall be shipped by Abbott upon receipt of the initial payment
of Two Million Dollars ($2,000,000)) unless otherwise agreed by the parties in writing.


 


4.3                                 TESTING
OF INVENTORY. At any time after the Effective Date, ALS shall have the right to
have its personnel present to witness the removal and testing of samples of the
Inventory. Abbott shall make reasonable efforts to provide ALS with advance
notice of such testing and sampling. ALS shall have the right to review and
take copies of the test records relating to such sampling and testing. Abbott
shall use reasonable commercial efforts to complete the tests described in the Schedule of
Release Specification Tests set forth in EXHIBIT B no later than the December 6,
2004. If, using the tests described in the Schedule of Release
Specification Tests, it is determined that GREATER THAN OR EQUAL TO ninety
percent (90%) of the Inventory meets the release specifications set forth in
the Schedule of Release Specification Tests set forth in Exhibit B,
ALS shall be deemed to have accepted the Inventory. If, in the alternative, it
is determined that LESS THAN ninety percent (90%) of the Inventory meets the
release specifications set forth in the Schedule of Release Specification
Tests set forth in Exhibit B, ALS shall be deemed to have accepted the
Inventory; provided, however, that ALS and Abbott shall thereafter negotiate in
good faith a reduction in the purchase price for the Inventory that is commensurate
with such shortfall in Inventory. ALS shall have the right to submit the
results of the Release Specification Tests set forth in Exhibit B to a
Regulatory Authority.


 


5.                                       DEVELOPMENT/MANUFACTURING/MARKETING/DISTRIBUTION
BY ABBOTT/OTHER.


 


5.1                                 CLINICAL
DEVELOPMENT. ALS shall use commercially reasonable and diligent efforts to
develop the Compounds for one or more treatment indications. For purposes of
this SECTION 5.1(a), development of an indication shall be deemed to have
commenced upon enrollment of the first subject in the first clinical study for
an indication using the formulation selected for clinical development. ALS
shall have sole responsibility for designing, conducting and paying for the
cost of the clinical development of Product and shall use commercially
reasonable efforts to diligently conduct such clinical development.


 


5.2                                 COMMERCIALIZATION.
ALS shall, assuming Regulatory Approval, use commercially reasonable efforts to
commercialize Product in the United States and the European Union by itself or
through its Affiliates and sublicensees, using at least that level of effort as
a pharmaceutical company of comparable size and resources would use with
similar compounds.


 


6





















 


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


 


5.4                                 MANUFACTURING.
ALS and its Affiliates shall have sole responsibility for manufacturing
Product.


 


5.5                                 SUBLICENSING.
ALS may sublicense its rights under this Agreement at any time without obtaining
Abbott’s consent.


 


5.6                                 DISTRIBUTION
BY ABBOTT. If ALS determines that Product should be marketed or distributed by
ALS and a co-marketer or a co-distributor in any country or countries of the
Territory, it shall grant Abbott a “Right of First Negotiation” (as hereinafter
defined) to become the co-marketer or co-distributor with ALS, in such
countries. If ALS determines that Product should be marketed by a sole
distributor in any country or countries of the Territory, it shall grant Abbott
the “Right of First Negotiation” to become the exclusive distributor in such
countries. “RIGHT OF FIRST NEGOTIATION” shall mean the exclusive right, for a
period of ninety (90) days, to negotiate with ALS to agree upon and execute a
definitive agreement to become the co-marketer, co-distributor or exclusive
distributor, as the case may be. ALS and Abbott shall negotiate in good faith
with each other during such period. Such period shall commence on the receipt
of notice by Abbott from ALS that ALS has determined how a Product will be
marketed in any one or more specified countries and specifying whether such
marketing shall be done by co-marketing, co-distribution, or exclusive
distribution. If such ninety (90) day period expires and a definitive agreement
has not been executed with respect to the country or countries specified in
such notice, ALS shall thereafter have no obligation to Abbott with respect to
co-marketing, co-distribution or exclusive distribution in such country or
countries.


 


6.                                       FINANCIALS.


 


6.1                                 MILESTONES.
ALS shall make the following milestone payments to Abbott within twenty (20)
business days of the following events:


 


7





















 


	
  MILESTONE

  	
   

  	
  PAYMENT

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  The earlier to occur of October 31, 2005 or the
  commencement of clinical trials (administration to first patient) of Compound
  A or Compound B by ALS

  	
   

  	
  $

  	
  5,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Submission of an NDA for Compound A or Compound B
  for the United States. In the event that ALS submits an NDA for Compound A or
  Compound B to the European Union prior to submission in the United States,
  ALS shall pay to Abbott one half (1/2) of the milestone due under this term
  upon submission to the European Union and the balance of this milestone shall
  become due upon submission of an NDA for Compound A or Compound B in the
  United States.

  	
   

  	
  $

  	
  10,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Receipt of Regulatory Approval of Compound A or
  Compound B in the United States. In the event that ALS receives Regulatory
  Approval of Compound A or Compound B in the European Union prior to receipt
  of Regulatory Approval in the United States, ALS shall pay to Abbott one half
  (1/2) of the milestone due under this term upon Regulatory Approval in the
  European Union and the balance of this milestone shall become due upon
  receipt of Regulatory Approval of Compound A or Compound B in the United
  States.

  	
   

  	
  $

  	
  30,000,000

  	
   

  



 


6.2                                 ROYALTY
PAYMENTS.


 


(a)                                  RUNNING
ROYALTY. Beginning with the First Commercial Sale by ALS, any Affiliates or
sublicensees of ALS, ALS shall pay to Abbott, on a country-by-country basis, a royalty
of (i) nineteen percent (19%) on Net Sales, with respect to which, but for
the license granted hereunder, the manufacture, use or sale of Product would
infringe a Valid Claim in such country. and (ii) nine and one-half percent
(9.5%) on Net Sales for all other countries; provided, however, that ALS shall
not be obligated to pay any royalties for countries in which all Valid Claims
have expired; and provided further, however, that (A) ALS shall only be
obligated to make payments under this Section 6.2(a)(ii), on a
country-by-country basis for a period of seven (7) years from the date of
the First Commercial Sale in each such country and (B) ALS shall not be
obligated to pay the nine and one-half percent (9.5%) royalty established in Section 6.2
(a)(ii) in a given country in the event that all Covering Claims are
deemed invalid by the judicial authority in such country effective as of the
date that the last Covering Claim is finally deemed invalid. For purposes of
this Section 6.2(a), the term “Covering Claim” shall mean a claim
contained in any of the Patents that would be infringed but for the Exclusive License
granted hereunder.


 


8





















 


(b)                                 ROYALTY
REPORTS AND PAYMENTS. Beginning with the First Commercial Sale anywhere in the
Territory, within forty-five (45) days after the end of each calendar quarter,
ALS shall prepare and deliver to Abbott a report detailing the calculation of
Net Sales in the Territory, on a country-by-country basis, for such just ended
quarter along with the calculation of royalties due thereon pursuant to SECTION 6.2(a) above.
Each report shall be accompanied by full payment in U.S. dollars of the
royalties shown thereon to be due. In the event that conversion from foreign
currency is required in calculating a royalty payment hereunder, the exchange rate
used shall be the average of the bid and ask rates in effect at the end of the
last business day of the applicable quarter for which royalties are calculated,
as reported by THE WALL STREET JOURNAL (Midwest Edition), or a substantially
similar global publication if THE WALL STREET JOURNAL (Midwest Edition) is no longer
published.


 


(c)                                  BOOKS
AND RECORDS/AUDIT RIGHTS. ALS shall keep, and shall cause its Affiliates and
sublicensees to keep, books and records accurately showing all Products manufactured,
used or sold under the terms of this Agreement. The relevant portions of such
books and records shall be open to inspection by representatives of (i) Abbott
and (ii) either or both of the two (2) third parties that Abbott
certifies that had as of the Effective Date of the Option Agreement between
Abbott and ALS a legitimate financial interest in either of the Compounds, at
Abbott’s cost, solely for the purposes of determining the correctness of the
royalties payable under this Agreement. Such audit, conducted no more than one
time per calendar year, shall be during normal business hours after reasonable
advance notice and subject to customary confidentiality provisions. In the event
an audit shows a deficiency to be due, ALS shall immediately pay such
deficiency along with the reasonable costs and expenses of the audit if the deficiency
is more than five percent (5%) of the amount due during such audited period. If
the audit shows that an excess was paid, ALS may deduct the amount of such excess
from the next payment due. Such books and records shall be preserved for a
period of at least three (3) years after the date of the royalty payment
to which they pertain, and no audit may be conducted with respect to royalties
due in any calendar year that is more than two (2) years preceding the
calendar year in which the audit is being conducted. Books and records for a
given calendar year may only be audited once. Any third party exercising its
audit rights under this Section 6.2 shall enter into a confidentiality
agreement with terms no less stringent than those contained in this Agreement.


 


(d)                                 WITHHOLDING
TAXES ON ROYALTIES. Where any sum due to be paid to Abbott hereunder is subject
to any withholding or similar tax,


 


9





















 


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


 


7.                                       REPRESENTATIONS,
WARRANTIES AND COVENANTS.


 


7.1                                 REPRESENTATIONS
AND WARRANTIES OF ABBOTT. Abbott represents and warrants that:


 


(a)                                  it
is duly organized, validly existing and in good standing under the laws of
Illinois, that it has full corporate power and authority to enter into this Agreement
and to carry out its provisions, and that there are no outstanding agreements,
assignments or encumbrances in existence to which Abbott is a party or otherwise
bound that are inconsistent with the provisions of this Agreement.


 


(b)                                 the
Patents have not been, and will not be, knowingly obtained by Abbott through
any activity, omission or representation that would limit or destroy the
validity of the Patents or cause the Patents to be deemed unenforceable;


 


(c)                                  there
are no actions pending or, to the knowledge of Abbott, threatened against
Abbott before any court, relating to the Abbott Technology;


 


(d)                                 Abbott
has no knowledge of the Abbott Technology being infringed by others; and the
Abbott Technology comprises all of the patents and patent applications owned by
or licensed to Abbott or its Affiliates that claim either Compound A or
Compound B, their use or manufacture;


 


(e)                                  all
of the Inventory to be purchased in accordance with ARTICLE 4 hereof (i) was
manufactured in accordance with Abbott’s internal specifications, (ii) when
delivered hereunder to ALS will meet Abbott’s release specifications for use in
human clinical trials, and (iii) was manufactured in accordance with FDA
Current Good Manufacturing Practices as defined in 21 C.F.R. Part 210;


 


10





















 


(f)                                    it
has authorized the execution and delivery this Agreement and the performance of
its obligations hereunder and that the execution, delivery and performance of
this Agreement by it does not require the consent, approval or authorization of
or notice to, or filing or registration with, any governmental agency or Regulatory
Authority;


 


(g)                                 except
for the Compounds, it currently has not entered in any stage of human clinical
trials, any compound that would fall in the ketolide antibiotic class as such
term is commonly used;


 


(h)                                 it
is the sole owner or exclusive licensee of all patent applications and patents
within the Patents, provided that no representation is made under this Section 7.1(h) (i) regarding
the content, scope, validity or enforceability of such applications or patents
or any intellectual property rights relating thereto or (ii) that
engagement in the activities described in such applications or patents does not
or would not infringe the rights of any third party;


 


(i)                                     none
of its patent counsel, commercial counsel or executive officers with
responsibility for pharmaceutical matters have knowledge (without having conducted
any investigation or inquiry) of any third party rights necessary to develop,
make, use or sell Compound A or Compound B in the Territory; and


 


(j)                                     it
has not received written notice from any third party that the manufacture or
sale of the Compounds infringes the rights of any third party.


 


7.2                                 REPRESENTATIONS
AND WARRANTIES OF ALS. ALS represents and warrants that:


 


(a)                                  it
is duly organized, validly existing and in good standing under the laws of
Delaware, that it has full corporate power and authority to enter into this Agreement
and to carry out its provisions, and that there are no outstanding agreements,
assignments or encumbrances in existence to which ALS is a party or otherwise
bound that are inconsistent with the provisions of this Agreement;


 


(b)                                 it
has authorized the execution and delivery of this Agreement and the performance
of its obligations hereunder; and


 


(c)                                  the
execution, delivery and performance of this Agreement by it does not require
the consent, approval or authorization of or notice to, or filing or registration
with, any governmental agency or Regulatory Authority. 


 


11





















 


7.3                                 INDEMNIFICATION
BY ALS. ALS shall indemnify and hold Abbott, its Affiliates and their
respective directors, officers, employees and agents harmless from and against
any and all liabilities, actions, suits, claims, demands, prosecutions,
damages, costs, expenses or money judgments finally awarded (including
reasonable legal fees and costs of investigation and litigation) (collectively,
“LIABILITIES”) incurred by or instituted or rendered against or suffered by
Abbott to the extent such Liabilities result from a third party claim arising
from the sale, distribution, transportation, handling or use of Compound A or
Compound B or Product(s) in the Territory by ALS, its Affiliates, agents or
sublicensees or any health care professional, patient or other third party, or
from the willful misconduct or the negligent acts or omissions of ALS, its
Affiliates, their agents or sublicensees or ALS’s breach of this Agreement,
except to the extent such third party claims arise out of the negligence or
willful misconduct of Abbott, or any of its Affiliates or any of their
respective directors, officers, employees and agents. Abbott shall give ALS
prompt notice in writing of any such claim or lawsuit and permit ALS to undertake
sole control of the defense and settlement thereof at ALS’s expense. In any
such claim or lawsuit:


 


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


 


(b)                                 Any
settlement for which Abbott intends to seek or has sought indemnification
hereunder from ALS shall not be binding upon ALS without the written consent of
ALS.


 


7.4                                 INDEMNIFICATION
BY ABBOTT. Abbott shall indemnify and hold ALS, its Affiliates and their
respective directors, officers, employees and agents harmless from and against
any and all Liabilities incurred by or instituted or rendered against or
suffered by ALS to the extent such Liabilities result from a third party claim
arising from the willful misconduct or the negligent acts or omissions of
Abbott, its Affiliates, their agents or sublicensees, or Abbott’s breach of
this Agreement, except to the extent such third party claims arise out of the
negligence or willful misconduct of ALS, or any of its Affiliates or any of
their respective directors, officers, employees and agents. ALS shall give
Abbott prompt notice in writing of any such claim or lawsuit and permit Abbott
to undertake sole control of the defense and settlement thereof at Abbott’s
expense. In any such claim or lawsuit:


 


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


 


(b)                                 Any
settlement for which ALS intends to seek or has sought indemnification
hereunder from Abbott shall not be binding upon Abbott without the written
consent of Abbott.


 


12





















 


 


7.5                                 REPORTABLE
ADVERSE EVENTS. Each party warrants that it shall advise the other of any
serious adverse events relating in any way to the Compounds or the Product as
and when such serious adverse events are reported or reportable by it to the
Regulatory Authorities.


 


7.6                                 COMPLIANCE
WITH LAW. In its activities relating to this Agreement, each party covenants to
the other party that it shall comply with all applicable laws, rules and
regulations.


 


7.8                                 LIMITATION.
EXCEPT FOR THE EXPRESS WARRANTIES IN THIS ARTICLE 7, NEITHER PARTY MAKES
ANY WARRANTIES, EXPRESS OR IMPLIED, IN FACT OR BY OPERATION OF LAW, STATUTORY
OR OTHERWISE. EACH PARTY SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. EXCEPT FOR AMOUNTS FINALLY
AWARDED FOR INDEMNIFICATION FOR THIRD PARTY LIABILITIES UNDER SECTIONS 7.3 AND
7.4 ABOVE, NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY HERETO OR TO ANY
THIRD PARTY FOR ANY SPECIAL, CONSEQUENTIAL, EXEMPLARY OR INCIDENTAL DAMAGES
(INCLUDING LOST OR ANTICIPATED PROFITS RELATING TO THE SAME) ARISING FROM ANY
CLAIM RELATING TO THIS AGREEMENT, WHETHER SUCH CLAIM IS BASED ON CONTRACT, TORT
(INCLUDING NEGLIGENCE) OR OTHERWISE, EVEN IF AN AUTHORIZED REPRESENTATIVE OF
SUCH PARTY IS ADVISED OF THE POSSIBILITY OR LIKELIHOOD OF SAME.


 


8.                                       CONFIDENTIALITY
AND NON-DISCLOSURE.


 


8.1                                 NONDISCLOSURE.
Neither party shall use or disclose any Confidential Information received by it
from the other party pursuant to this Agreement without the prior written
consent of the other. This obligation will continue for a period of seven (7) years
after termination of this Agreement or expiration of the Term.


 


8.2                                 RESTRICTION.
Each party shall restrict dissemination of Confidential Information of the
other party to those of its employees, Affiliates, contractors, agents and
sublicensees (if any) who have a need therefore in carrying out their
functions. Neither party shall obtain any right of any kind to the Confidential
Information of the other party by virtue of this Agreement, except as granted
under this Agreement.


 


8.3                                 RESTRICTION
EXEMPTIONS. Nothing contained in this ARTICLE 8 or SECTION 1.4 shall
be construed to restrict the parties from using or disclosing Confidential
Information solely to the extent and solely as required:


 


(a)                                  for
regulatory, tax or customs reasons;


 


(b)                                 for
audit purposes;


 


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


 


13





















 


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


 


(e)                                  as
required by ALS in connection with a private or public financing.


 


9.                                       TERM
AND TERMINATION.


 


9.1                                 The
Term of this Agreement shall continue in effect until the last to expire of the
Patents unless earlier terminated as provided in this ARTICLE 9. Upon the
expiration of the Term, ALS shall have a non-exclusive, perpetual and
irrevocable license under Abbott’s Know-How, without any further payment
obligation to Abbott, except for the payment obligations accruing prior to such
date and the indemnification obligations under SECTION 7.3.


 


9.2                                 ALS
shall have the right, without cause, to terminate this Agreement upon sixty
(60) days’ written notice, at the end of which the termination shall be
effective. Before such termination becomes effective, ALS shall pay all
payments and royalties which may have become due prior to the effective date of
such termination. Upon such termination, ALS shall assign and deliver without
charge, and Abbott shall be entitled to retain for its own use, all materials
(Compounds, bulk and processed clinical material), studies and information
relating to the Compounds.


 


9.3                                 Either
party may terminate this Agreement by giving to the other party prior written
notice of not less than thirty (30) days in the case of a monetary breach and
of not less than ninety (90) days in the event the other party shall commit a
non-monetary material breach of this Agreement, and such breaching party shall
fail to cure such breach during such thirty (30) or ninety (90) day period, as
applicable. No such cancellation and termination shall release the breaching
party from any obligations hereunder incurred prior thereto. If, in any dispute
submitted for resolution pursuant to Section 13.8, the neutral determines
that there has been a material breach of the Agreement, the breaching party
shall not be entitled to an additional cure period, but rather, the
non-breaching party may immediately terminate this Agreement.


 


9.4                                 Either
party may terminate this Agreement on thirty (30) days notice if the other
party passes a resolution or a court of competent jurisdiction makes an order
for its winding up; or ceases its business operations.


 


14





















 


9.5                                 Abbott
may terminate this Agreement immediately if ALS, directly or indirectly,
commences or participates in any proceedings in order to have any of the
Patents declared invalid in any country.


 


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


 


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


 


9.8                                 Upon
any termination or expiration of this Agreement, each party shall promptly
return to the other party all written Confidential Information of such other
party, and all copies thereof (retaining one copy of the Confidential
Information of the other in its confidential files for archival purposes only),
which is not covered by a paid-up license or other rights specified herein
surviving such termination or expiration. Further, upon termination of this
Agreement in whole or in part, except upon termination of this Agreement by ALS
pursuant to Sections 9.3 or 9.4 above, ALS shall act promptly to ensure a
smooth transition of rights to Abbott, including but not limited to the
transfer of any and all relevant Regulatory Approvals to Abbott.


 


10.                                 INFRINGEMENT
OF PATENTS BY THIRD PARTY. In the event of an actual or suspected infringement
of a Patent by a third party, the following shall apply:


 


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


 


10.2                           ALS’S
RIGHT TO BRING INFRINGEMENT ACTION.


 


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


 


(i)                                     Abbott
shall notify ALS of its intention to bring an action or proceeding prior to
filing the same and in sufficient time to allow ALS the opportunity to discuss
with Abbott the choice of counsel for such matter. Abbott shall keep ALS timely
informed of material developments in the prosecution or settlement of such
action or proceeding. Abbott shall be responsible for all fees and expenses of
any action or proceeding against infringers which Abbott initiates. ALS shall
cooperate fully at its expense by joining as a party plaintiff if reasonably
requested to do so


 


15





















 


by
Abbott or if required to do so by law to maintain such action or proceeding and
by executing and making available such documents as Abbott may reasonably
request. ALS may be represented by counsel in any such legal proceedings, at
ALS’s own expense.


 


(ii)                                  If
Abbott elects not to exercise such first right it shall notify ALS of its
determination in writing. Thereafter, ALS shall have the right, at its
discretion, to institute and prosecute an action or proceeding to abate such
infringement and to resolve such matter by settlement or otherwise. ALS shall
keep Abbott timely informed of material developments in the prosecution or settlement
of such action or proceeding. ALS shall be responsible for all fees and
expenses of any action or proceeding against infringers which ALS initiates.
Abbott shall cooperate fully by joining as a party plaintiff if reasonably requested
to do so by ALS or if required to do so by law to maintain such action and by
executing and making available such documents as ALS may reasonably request.
Abbott may be represented by counsel in any such action, at its own expense.


 


(b)                                 ALS’S
USE OF PROCEEDS. All amounts of every kind and nature recovered from an action
or proceeding of infringement brought by ALS shall belong to ALS, and shall be
used first to reimburse ALS for its documented and actual costs of prosecution,
including attorneys’ fees, expert fees and all other related expenses, second to
reimburse Abbott for its documented and actual costs if it is represented by
counsel in the proceedings, and the balance shall thereafter be treated as Net
Sales.


 


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


 


11.                                 INFRINGEMENT
OF THIRD PARTY RIGHTS; ALS DEFENSE OF SUIT. If Abbott, its Affiliates, ALS, its
Affiliates, sublicensees, distributors or other customers are sued or
threatened with suit by a third party alleging infringement in one or more
countries of the Territory of such party’s patents or other intellectual
property rights that are alleged to cover the manufacture, use, sale, import.
export or distribution of one or more Products, Abbott or ALS, whichever is
applicable, will promptly notify the other in writing and provide a copy of the
lawsuit or claim. The party being sued or threatened with suit shall control
the defense in any such claim or suit.


 


16





















 


Such party shall have the
right to settle any such suit, including the right to grant one or more
sublicenses with the other party’s prior written approval, which approval shall
not unreasonably be withheld, provided that ALS shall not otherwise have the
right to surrender, limit or adversely affect any rights to the Patents. ABBOTT
MAKES NO WARRANTIES AND SPECIFICALLY DISCLAIMS ANY WARRANTIES REGARDING THE
NON-INFRINGEMENT BY THE PRODUCTS OF THIRD PARTY RIGHTS.


 


12.                                 PATENT
PROSECUTION AND MAINTENANCE; PATENT COSTS; PATENT TERM EXTENSION.


 


12.1                           DISCLOSURE
OF PATENTS/APPLICATIONS TO ALS. Within thirty (30) days following the Effective
Date, Abbott shall, to the extent not previously disclosed, disclose to ALS the
complete text of, and all other information in its possession or control
directly related to (a) all patent applications included in the Patents
filed anywhere in the Territory; and (b) all patents included in the
Patents as well as all information in Abbott’s, its Affiliates and its patent
counsel’s possession concerning the institution or possible institution of any
interference, opposition, reexamination, reissue, revocation, nullification or
any official proceeding involving an issued patent included in the Patents
anywhere in the Territory. ABBOTT MAKES NO WARRANTIES AND SPECIFICALLY
DISCLAIMS ANY WARRANTIES REGARDING THE PATENTABILITY OF PENDING PATENT
APPLICATIONS.


 


12.2                           PROSECUTION
AND MAINTENANCE. Abbott shall file, prosecute and maintain all of the Patents
in Abbott’s name, including oppositions and interferences. In the event that
Abbott determines to abandon any patent application that is included in the
Patents or to no longer maintain any patent that is included within the
Patents, Abbott shall give ALS ninety (90) days prior written notice before
taking any action or inaction in furtherance of such determination during which
time ALS shall have the right but not the obligation to assume the prosection of
such patent application or the maintenance of such patent. Abbott and ALS shall
consult and cooperate with each other, and Abbott shall keep ALS reasonably
informed, with respect to the prosecution and maintenance of the Patents
hereunder. Abbott will provide ALS with copies of all material correspondence
sent to or received from the United States Patent and Trademark Office in
connection with the prosecution and maintenance of the Patents. Abbott shall
provide copies in a timely manner to allow ALS an opportunity, if it so elects,
to review and comment on Abbott’s proposed patent strategy.


 


17





















 


13.                                 MISCELLANEOUS.


 


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


 


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


 


	
  If to ALS:

  	
   

  	
  Advanced Life
  Sciences Holdings, Inc.

  1440 Davey Road

  Woodridge, Illinois 60517

  Attn:  Michael T. Flavin, Ph.D.,

            Chairman
  and Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
  With copy to:

  	
   

  	
  Winston &
  Strawn, LLP

  35 West Wacker Drive

  Chicago, IL 60601

  Attn:  Thomas P. Fitzgerald

  
	
   

  	
   

  	
   

  
	
  If to Abbott:

  	
   

  	
  Abbott
  Laboratories

  100 Abbott Park Road

  Department 309; Building AP30

  Abbott Park, Illinois 60064-3537

  
	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
  Abbott
  Laboratories

  100 Abbott Park Road

  Department 322; Building AP6D

  Abbott Park, Illinois 60064-6049

  Attn:  Divisional Vice President,
  Domestic Legal

  



 


13.3                           APPLICABLE
LAW/COMPLIANCE. This Agreement shall be governed by and construed in accordance
with the laws of the State of Illinois, excluding its conflict of laws
provision. Each party hereto shall comply with all applicable laws, rules,
ordinances, guidelines, consent decrees and regulations of any federal, state
or other governmental authority.


 


13.4                           ENTIRE
AGREEMENT. This Agreement and the attachments (Exhibits) contain the entire
understanding of the parties with respect to the subject matter hereof. All
express or implied agreements and understandings, either oral or written,
heretofore made are


 


18





















 


expressly merged in and
made a part of this Agreement. This Agreement may be amended, or any term
hereof modified, only by a written instrument duly executed by both parties
hereto.


 


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


 


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


 


13.7         ASSIGNMENT.
Neither party may, without prior written consent of the other, assign this
Agreement or transfer its interest or any part thereof under this Agreement to
any third party except that either party may assign this Agreement without such
consent (i) to the surviving entity in a merger or consolidation involving
such party; (ii) to a third party that acquires all or substantially all
of the assets or the business of such party to which this Agreement pertains;
or (iii) to any Affiliate of that party and such party hereby guarantees
the performance by such Affiliate. A sale of shares of stock shall not
constitute an assignment in violation of this section. For purposes of this Article 14,
the term “Affiliate” means any corporation, company, partnership, joint venture
and/or other entity which controls, is controlled by, or is under common
control of either party hereto. For purposes of this definition, control shall
mean direct or indirect ownership of more than fifty percent (50%) of the stock
or participating shares entitled to vote for the election of directors (but
only as long as such ownership exists).


 


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


 


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


 


13.10       PUBLICITY.
No press release or other public announcement shall be made by either party
concerning the execution of this Agreement or the fact that ALS has licensed
the Compounds from Abbott, without the prior written consent of the non—disclosing
party, which


 


19





















 


consent may be withheld
in the non-disclosing party’s sole discretion. Neither party shall use the name
of the other party, its officers, employees or agents without the other party’s
prior written consent, except where the name of the other party must be
disclosed as a matter of law. ALS anticipates that it will make an initial
public offering of its securities during the Option Term and that disclosure of
a summary of the terms of this Agreement may be required to be included in a
registration statement to be filed with the Securities and Exchange Commission
pertaining to such initial public offering. If, in good faith, counsel for ALS
determines that such disclosure is required, ALS shall give Abbott written
notice thereof not less than thirty (30) days prior to the making of any such
filing, together with a draft of the disclosure ALS intends to make regarding
this Agreement. Abbott shall have fifteen (15) days to review and comment on
the draft of the disclosure. ALS shall use all reasonable efforts to
incorporate Abbott’s comments. Should either party wish to make a disclosure or
be required by law to make a disclosure under circumstances other than those described
above, the disclosing party shall submit a copy of the proposed disclosure to
the other party for review. The non—disclosing party shall have three (3) weeks
to review and comment on the content of such disclosure. In the case of a
disclosure required by law, the disclosing party, subject to legal requirements,
shall use all reasonable efforts to accommodate the non—disclosing party’s
comments. For non—routine matters like an emergency, special circumstance, or
other situation where the law compels a disclosure in less than three (3) week’s
time, the non-disclosing party agrees to use commercially reasonable efforts to
provide its review and comment in order to meet the disclosing party’s
timetable.


 


 


[SIGNATURE PAGE FOLLOWS]


 


20





















 


[SIGNATURE PAGE TO LICENSE AGREEMENT ]


 


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


 


 


	
  ABBOTT
  LABORATORIES

  	
  ADVANCED LIFE
  SCIENCES

  HOLDINGS, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Jeffrey M.
  Leiden, Ph.D.

  	
   

  	
  By:

  	
  /s/ Michael T.
  Flavin, Ph.D.

  	
   

  
	
  Name:

  	
  Jeffrey M.
  Leiden, M.D., Ph.D.

  	
   

  	
  Name: Michael T.
  Flavin, Ph.D.

  
	
  Its:

  	
  President and
  Chief Operating Officer,

  Pharmaceutical Products Group

  	
  Its:

  	
  Chairman and
  Chief Executive

  Officer

  
						



 


21





















 


EXHIBIT A


 


PATENTS AND PATENT APPLICATIONS


 


(SEE ATTACHED.)


 


A-1





















 


EXHIBIT B


 


SCHEDULE OF RELEASE SPECIFICATION TESTS


 


	
  1.  Assay by HPLC

  	
   

  	
  Not less than
  950 mcg/mg on the anhydrous basis

  
	
   

  	
   

  	
   

  
	
  2.  Impurities/Related Substances (by HPLC)

  	
   

  	
  Report results
  for 2-epimer (RRT About 0.91)

  Not more than 2.00% of cis-A195773 (RRT about 1.10)

  Not more than 5.00% total impurities

  No other single unknown impurity greater that 1.00%

  No other single known impurity greater than 1.50%

  
	
   

  	
   

  	
   

  
	
  3.  Moisture (Karl Fischer)

  	
   

  	
  Not more than
  2.0%

  
	
   

  	
   

  	
   

  
	
  4.  X-Ray Diffraction

  	
   

  	
  Report pattern
  observed

  
	
   

  	
   

  	
   

  
	
  5.  Physical Examination

  	
   

  	
  Appearance:
  Powder; some soft lumps may be present Color: White to light tan

  



 


B-1





















 


EXHIBIT C


 


ALTERNATIVE DISPUTE RESOLUTION


 


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


 


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


 


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


 


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


 


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


 


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


 


(c) Each
party shall number the candidates in order of preference (with the number one (1) signifying
the greatest preference) and shall deliver the list to the CPR within seven (7) days
following receipt of the list of candidates. If a party believes a conflict of
interest exists regarding any of the candidates, that party shall provide a written
explanation of the conflict to the CPR along with its list


 


C-1





















 


showing
its order of preference for the candidates. Any party failing to return a list
of preferences on time shall be deemed to have no order of preference.


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


Each
party shall be permitted to take up to a maximum of two (2) depositions of
no more than five (5) hours each. Notwithstanding the foregoing, except as
expressly set forth in subparagraphs 4(a) - 4(d) no further discovery
shall be required or permitted by any means, including depositions,
interrogatories, requests for admissions, or production of documents.


 


C-2





















 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


8. The
neutral shall be paid a reasonable fee plus expenses. These fees and expenses,
along with the reasonable legal fees and expenses of the prevailing party
(including all


 


C-3





















 


expert
witness fees and expenses) the fees and expenses of a court reporter, and any
expenses for a hearing room, shall be paid as follows:


 


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


 


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


 


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


 


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


 


C-4





















 


FIRST AMENDMENT TO LICENSE AGREEMENT


 


This
FIRST AMENDMENT TO LICENSE AGREEMENT (this “Amendment”) is entered into as of
this 27th day of April, 2005 by and between Advanced Life Sciences Holdings, Inc.,
a Delaware corporation (“ALS’) and Abbott Laboratories, an Illinois corporation
(“Abbott”) to amend the terms of that certain License Agreement dated December 13,
2004 between Abbott and ALS (the “Agreement”).


 


BACKGROUND


 


A.            The
Agreement provides that certain amounts are to be paid by ALS to Abbott in the
months of May and June 2005.


 


B.            ALS has
requested, and Abbott has agreed to a change in the payment terms for such
amounts.


 


C.            The
parties wish to amend the Agreement to reflect the change in the payment terms.


 


1.             INCORPORATION
OF AGREEMENT. All capitalized terms which are not defined herein shall have the
same meanings as set forth in the Agreement, and the Agreement, to the extent
not inconsistent with this Amendment is incorporated herein by this reference
as though the same was set forth in its entirety. To the extent any terms and
provisions of the Agreement are inconsistent with the amendment set forth in
Paragraph 2 below, such terms and provisions shall be deemed superseded hereby.
Except as specifically set forth herein, the Agreement shall remain in full
force and effect and its provisions shall be binding on the parties hereto.


 


2.             AMENDMENT
OF THE AGREEMENT. Paragraph 4.2(a) shall be replaced in its entirety as
follows:


 


(a)           ALS shall
pay to Abbott, as the purchase price for the Inventory to be purchased under
this ARTICLE 4, the aggregate amount of Ten Million Dollars ($10,000,000),
payable as follows: (a) Two Million Dollars ($2,000,000) upon the execution
of this Agreement, (b) Eight Million Dollars ($8,000,000) on the earlier
to occur of: (i) five (5) days after the closing of ALS’ initial
public offering of securities or, (ii) September 1, 2005. Abbott
shall ship approximately a pro rata portion of the Inventory to ALS upon receipt
of each of the foregoing payments (i.e. approximately twenty percent (20%) of
the Inventory shall be shipped by Abbott upon receipt of the initial payment of
Two Million Dollars ($2,000,000)) unless otherwise agreed by the parties in
writing.


 





















 


3.             EFFECTUATION.
The amendment to the Agreement contemplated by this Amendment shall be deemed
effective as of the date first written above upon the full execution of this
Amendment and without any further action required by the parties hereto. There
are no conditions precedent or subsequent to the effectiveness of this
Amendment.


 


4.             COUNTERPARTS.
This Amendment may be executed in two 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. One or more counterparts of this Amendment may be
delivered by facsimile, with the intention that delivery by such means shall
have the same effect as delivery of an original counterpart thereof.


 


IN
WITNESS WHEREOF, the parties hereto have duly executed this Amendment as of the
date first above written.


 


 


	
  ABBOTT
  LABORATORIES

  	
  ADVANCED LIFE

  SCIENCES HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ James L.
  Tyree

  	
   

  	
  By:

  	
  /s/ Michael T.
  Flavin, M.D.

  	
   

  
	
  Name:

  	
  James L. Tyree

  	
  Name:

  	
  Michael T.
  Flavin, M.D.

  
	
  Its:

  	
  Vice President,
  Global Licensing/

  	
  Its:

  	
  Chairman and
  Chief

  
	
   

  	
  New Business
  Development

  	
   

  	
  Executive
  Officer

  
								



 





















 


AMENDED AND RESTATED


 


SECOND AMENDMENT TO LICENSE AGREEMENT


 


This
SECOND AMENDMENT TO THE LICENSE AGREEMENT (this “AMENDMENT”) is entered into as
of this 2nd day of August, 2005 by and between Advanced Life Sciences Holdings, Inc.,
a Delaware corporation (“ALS”) and Abbott Laboratories, an Illinois corporation
(“ABBOTT”) to amend the terms of that certain License Agreement dated December 13,
2004 between Abbott and ALS (the “AGREEMENT”). This Amendment amends and
restates that certain Second Amendment to License Agreement, dated as of August 1,
2005, in its entirety.


 


BACKGROUND


 


A.            Abbott
and ALS entered into the Agreement on December 13, 2004 (the “EFFECTIVE DATE”).


 


B.            The
Agreement provides ALS with an exclusive worldwide license (except in Japan) to
certain patent applications and patents relating to the Compounds.


 


C.            Abbott
has requested and ALS has agreed to delete all references to Compound B
throughout the entire Agreement along with any associated rights or
obligations.


 


D.            The
Agreement provides that certain amounts are to be paid by ALS to Abbott upon
achieving certain milestone events.


 


E.             Both ALS
and Abbott desire to change the payment terms for those amounts due upon
certain milestone events.


 


F.             The
Agreement provides that ALS shall pay to Abbott royalty payments on Net Sales
of any Product.


 


G.            ALS has
requested and Abbott has agreed to change the amount of that certain royalty on
Net Sales.


 


H.            The
parties wish to amend the Agreement to, among other things, reflect the changes
outlined above.


 


1.     INCORPORATION OF
THE AGREEMENT. All capitalized terms which are not defined herein shall have
the same meanings as set forth in the Agreement, and the Agreement, to the
extent not inconsistent with this Amendment, is incorporated herein by this
reference as though the same was set forth in its entirety. To the extent any
terms and provisions of the Agreement are inconsistent with the amendments set
forth in Paragraph 2 below, such terms and provisions shall be deemed
superseded hereby. Except as specifically set forth herein, the Agreement shall
remain in full force and effect and its provisions shall be binding on the
parties hereto.


 


2.     AMENDMENT OF THE
AGREEMENT. The Agreement is hereby amended as follows:


 


a.     CHANGE IN
DEFINITIONS.


 


i.      Section 1.4
is hereby deleted in its entirety.


 


ii.     All
references to Compound B in Sections 1.5, 1.6, 1.10, 1.14, 1.15, and 1.16 are
hereby deleted.


 





















 


b.     CHANGE IN LICENSE
GRANT. SECTION 2 of the Agreement is hereby deleted in its entirety and
shall be replaced with the following:


 


“Subject
to the terms and conditions of this Agreement, Abbott hereby grants to ALS an
Exclusive License in the Territory, under Abbott Technology, for all
Pharmaceutical Uses, with the right to grant sublicenses pursuant to SECTION 5.5
hereof, to (i) research, develop, make or have made, Compound A and
Product(s); (ii) apply for and obtain Regulatory Approvals, all as may be
required to manufacture and commercialize Product(s); and (iii) register,
use, import/export, market, offer to sell and sell, Compound A and Product(s).”


 


c.     CHANGE IN
REFERENCES TO COMPOUND B. All references to Compound B in Sections 3, 6, and 7
any Exhibits attached to the Agreement are hereby deleted along with any
associated rights or obligations.


 


d.     CHANGE IN
MILESTONE PAYMENTS. SECTION 6.1 of the Agreement is hereby deleted in its
entirety and shall be replaced with the following:


 


“The
milestone payments are independent, nonrefundable, and are not creditable
against any other amounts due under the agreement:


 


	
  MILESTONE

  	
   

  	
  PAYMENT

  	
   

  
	
  The earlier to
  occur of October 31, 2005 or the commencement of clinical trials
  (administration to first patient) of Compound A by ALS

  	
   

  	
  $

  	
  5,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Submission of an
  NDA for Compound A for the United States. In the event that ALS submits an
  NDA for Compound A to the European Union prior to submission in the United
  States, ALS shall pay to Abbott one half (1/2) of the milestone due under this
  term upon submission to the European Union and the balance of this milestone
  shall become due upon submission of an NDA for Compound A in the United
  States.

  	
   

  	
  $

  	
  10,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Receipt of
  Regulatory Approval of Compound A in the United States. In the event that ALS
  receives Regulatory Approval of Compound A in the European Union prior to
  receipt of Regulatory Approval in the United States, ALS shall pay to Abbott
  one half (1/2) of the milestone due under this term upon Regulatory Approval
  in the European Union and the balance of this milestone shall become due upon
  receipt of Regulatory Approval of Compound A in the United States.

  	
   

  	
  $

  	
  30,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Upon reaching
  Net Sales of $200,000,000 for the Product.

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Upon reaching
  Net Sales of $400,000,000 for the Product.

  	
   

  	
  $

  	
  5,000,000”

  	
   

  



 


e.     CHANGE IN
ROYALTY PAYMENTS. SECTION 6.2(a)(i) of the Agreement is hereby
deleted in its entirety and shall be replaced with the following:


 


“nineteen
percent (19%) on Net Sales of up to $100,000,000; eighteen percent (18%) on Net
Sales of $100,000,000.01 to $200,000,000; and seveteen percent (17%) on Net
Sales of $200,000,000.01 and above, with respect to which, but for the license
granted hereunder, the manufacture, use or sale of Product would infringe a
Valid Claim in such country, and”


 


3.     EFFECTUATION.
The amendment to the Agreement contemplated by this Amendment shall be deemed
effective as of the date first written above upon the full execution of this
Amendment and without any further action required by the parties hereto. There
are no conditions precedent or subsequent to the effectiveness of this
Amendment.


 


4.     COUNTERPARTS.
This Amendment may be executed in two 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. One or more counterparts of this Amendment may be
delivered by facsimile, with the intention that delivery by such means shall
have the same


 





















 


effect as delivery of an original counterpart thereof.


 


[SIGNATURE PAGE FOLLOWS]


 





















 


[SIGNATURE PAGE TO AMENDED AND RESTATED SECOND AMENDMENT

TO THE LICENSE AGREEMENT]


 


IN
WITNESS WHEREOF, the parties hereto have duly executed this Amendment as of the
date first above written.


 


	
  ABBOTT
  LABORATORIES

  	
  ADVANCED LIFE
  SCIENCES HOLDINGS, INC.

  
	
   

  	
   

  
	
  By:

  	
  /s/ James L.
  Tyree

  	
   

  	
  By:

  	
  /s/ Michael T.
  Flavin, Ph.D.

  	
   

  
	
  Name:

  	
  James L. Tyree

  	
  Name: Michael T.
  Flavin, Ph.D.

  
	
  Its:

  	
  Vice President,
  Global

  	
  Its: Chairman
  and Chief Executive Officer

  
	
   

  	
  Licensing/New
  Business

  Development

  	
   

  
						



 





















 


THIRD AMENDMENT TO LICENSE AGREEMENT


 


This THIRD AMENDMENT
TO THE LICENSE AGREEMENT (this “Amendment”) is entered into as of this
10th day of August, 2005 by and between Advanced Life Sciences Holdings, Inc.,
a Delaware corporation (“ALS”) and Abbott Laboratories, an Illinois
corporation (“Abbott”) to amend the terms of that certain License
Agreement dated December 13, 2004 between Abbott and ALS (the “Agreement”).


 


BACKGROUND


 


A.    Abbott and ALS entered into the Agreement on December 13,
2004.


 


B.    The Agreement provides ALS with an exclusive
worldwide license (except in Japan) to certain patent applications and patents
relating to the Compound.


 


C.    The Agreement provides that certain amounts are
to be paid by ALS to Abbott upon achieving certain milestone events.


 


D.    Both ALS and Abbott desire to change the payment
terms for those amounts due upon  a
certain milestone event in exchange for ALS issuing Abbott shares of its common
stock in a concurrent offering to ALS’s initial public offering.


 


E.     The parties wish to amend the Agreement to,
among other things, reflect the changes outlined above.


 


1.     Incorporation of the Agreement. 
All capitalized terms which are not defined herein shall have the same
meanings as set forth in the Agreement, and the Agreement, to the extent not
inconsistent with this Amendment, is incorporated herein by this reference as
though the same was set forth in its entirety. 
To the extent any terms and provisions of the Agreement are inconsistent
with the amendments set forth in Paragraph 2 below, such terms and provisions
shall be deemed superseded hereby. 
Except as specifically set forth herein, the Agreement shall remain in
full force and effect and its provisions shall be binding on the parties
hereto.


 


2.     Amendment of the Agreement.  Section 6.1
of the Agreement is hereby amended by deleting “$5,000,000” as the first
payment in the chart of milestone obligations and inserting “$2,000,000” in
lieu thereof.


 


3.     Effectuation.  This
Amendment shall be deemed effective as of the date first written above upon
satisfaction of the following conditions precedent:


 


a.     ALS and Abbott shall have executed and delivered
counterpart signature pages to this Amendment; and


 


b.     In consideration for the amendment to Section 6.1
set forth above, ALS shall have delivered to Abbott a stock certificate
representing 600,000 shares of common stock, par value $0.01 per share, of ALS
(the “Certificate”).


 


4.     Counterparts.  This
Amendment may be executed in two 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.  One or more
counterparts of this Amendment may be delivered by facsimile, with the
intention that delivery by such means shall have the same effect as delivery of
an original counterpart thereof.


 





















 


[Signature Page to Third Amendment to
the License Agreement]


 


IN WITNESS WHEREOF,
the parties hereto have duly executed this Amendment as of the date first above
written.  Abbott, by its signature below,
acknowledges its receipt of the Certificate.


 


 


	
  ABBOTT
  LABORATORIES

  	
  ADVANCED
  LIFE SCIENCES HOLDINGS, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ JAMES L.
  TYREE

  	
   

  	
  By:

  	
  /s/ MICHAEL T.
  FLAVIN

  	
   

  
	
  Name:

  	
  James L. Tyree

  	
  Name:

  	
  Michael T.
  Flavin, Ph.D.

  
	
  Its:

  	
  Vice President,
  Global Licensing/

  	
  Its:

  	
  Chairman and
  Chief Executive Officer

  
	
   

  	
  New Business
  Development