** **

**Exhibit 10.2**

** **

**LICENSE AGREEMENT**

** **

This agreement (the “Agreement”), dated the 28th day of March 2008(the “Effective Date”), is by and between Cephalon, Inc., a Delawarecorporation (“Cephalon”), and Acusphere, Inc., a Delaware corporation (“Acusphere”).

 

**INTRODUCTION**

** **

1.                                       Acusphere owns the Licensed Patent Rightsand the Licensed Know-How.

 

2.                                       Cephalon is in the business of developingand marketing pharmaceutical products.

 

3.                                       Acusphere and Cephalon are interested inestablishing a licensing relationship pursuant to which Acusphere shall grantCephalon certain rights and licenses under the Licensed Patent Rights andLicensed Know-How.

 

NOW, THEREFORE, Cephalon and Acusphere agree as follows:

 

**Article I**

# **Definitions**

 

When used in this Agreement, each of the following terms shall have themeanings set forth in this Article I:

 

##### Section 1.1                                      “Affiliate”. Affiliate means, with respect to a Party, any Person that controls, iscontrolled by, or is under common control with such Party.  For purposes of this Section 1.1, “control”shall refer to (a) in the case of a Person that is a corporate entity,direct or indirect ownership of fifty percent (50%) or more of the stock orshares having the right to vote for the election of directors of such Personand (b) in the case of a Person that is not a corporate entity, thepossession, directly or indirectly, of the power to direct, or cause thedirection of, the management or policies of such Person, whether through theownership of voting securities, by contract or otherwise.

#####  

##### Section 1.2                                      “AI-850TM”. AI-850TM means a pharmaceutical formulation of the active ingredientpaclitaxel, which utilizes HDDS TechnologyTM, as described in InvestigationalNew Drug Application (“IND”) #63817 .

#####  

##### Section 1.3                                      “AI-850TM Clinical Data”.  AI-850TM Clinical Data means all pre-clinicaland clinical data and databases relating to AI-850TM, including withoutlimitation, raw case report files, final study reports, toxicology reports,regulatory information including IND #63817, and such other information and data as may have been generated during orin connection with the pre-clinical and phase I clinical studies conducted onAI-850TM.

#####  

##### Section 1.4                                      “Bankruptcy Code”.  Bankruptcy Code means 11 U.S.C §§ 101-1330,as amended.

#####  

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##### Section 1.5                                      “Confidential Information”.  Confidential Information means non-publicinformation disclosed by Acusphere to Cephalon relating to the LicensedKnow-How and AI-850TM, but excluding the AI-850TM Clinical Data.

#####  

##### Section 1.6                                      “Control”. Control and cognates thereof means, with respect to any LicensedKnow-How, Patent Rights or Confidential Information, the possession by a Party,whether directly or through Affiliates of such Party, of the ability to grantthe right to access or use, or to grant a license or the right to disclose ortransfer such Licensed Know-How, Patent Rights or Confidential Information,without violating the terms of any agreement or other written arrangement with,or the rights of any Third Party.

#####  

##### Section 1.7                                      “Cover”. Cover and cognates thereof means, with respect to a product, that, butfor a license granted to a Party under a Valid Claim, the Development orCommercialization of such product would infringe such Valid Claim.

#####  

##### Section 1.8                                      “Field”. Field means oncology therapeutics.

#####  

##### Section 1.9                                      “HDDS TechnologyTM”.  HDDS TechnologyTM means that certainproprietary porous matrix drug delivery system owned or Controlled byAcusphere, constituting a porous matrix containing a hydrophobic activeingredient that has an enhanced dissolution rate relative to the unprocessedactive ingredient.

#####  

##### Section 1.10                                “Licensed Know-How”.  Licensed Know-How means all inventions,methods, processes, techniques, improvements, designs, formulae,specifications, and technical, scientific and business information (including,without limitation, all biological, chemical, pharmacological, toxicological,clinical and assay information, data and analyses), whether or not patentable,which are Controlled by Acusphere and which relate to the HDDS TechnologyTM  as used within the Field(including, withoutlimitation, AI-850TM) and in whatever form existing (including, withoutlimitation, paper, notebooks, books, files, ledgers, records, tapes, discs,diskettes, CD-Rom and any other media on which the foregoing can be stored).

#####  

##### Section 1.11                                “Licensed Patent Rights”.  Licensed Patent Rights means (a) thePatent Rights set forth on Exhibit A, and (b) counterparts ofthe Patent Rights set forth on Exhibit A in any country of theworld.

#####  

##### Section 1.12                                “Party”. Party means Cephalon or Acusphere; “Parties” means Cephalon andAcusphere.

#####  

##### Section 1.13                                “Patent Rights”.  Patent Rights means United States and foreignpatents and patent applications and all substitutions, divisions,continuations, continuations-in-part, requests for continued examinations,reissues, reexaminations and extensions thereof.

#####  

##### Section 1.14                                “Person”. Person means any natural person or any corporation, company,partnership, joint venture, firm or other entity, including without limitationa Party.

#####  

##### Section 1.15                                “Third Party”. Third Party means any person or entity other than a Party or any of itsAffiliates.

#####  

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#####  

##### Section 1.16                                “Valid Claim”. Valid Claim means a claim of any issued, unexpired United States orforeign patent, which shall not have been donated to the public, disclaimed,nor held invalid or unenforceable by a court of competent jurisdiction in anunappealed or unappealable decision.

#####  

**Article II**

# **Grant ofLicense; Disclosure of Know-How; Clinical Data**

 

## Section 2.1                                      License Grant.  Subject tothe terms and conditions of this Agreement, Acusphere hereby grants to Cephalonan exclusive, worldwide, royalty-free right and license under the LicensedPatent Rights and the Licensed Know-How for all applications, uses and purposesin the Field, including without limitation, to develop, make, have made, use,offer for sale, sell and import pharmaceutical formulations and products,including AI-850TM.

##  

## Section 2.2                                      Disclosure of Licensed Know-How.   During the term of this Agreement, Cephalon shall have access, asreasonably requested by Cephalon, to personnel of Acusphere and its Affiliatesat reasonable times during normal business hours and upon prior notice fordiscussions relating to regulatory, scientific, medical and other technologycontained in or relating to the Licensed Know-How.  In addition, to the extent reasonablynecessary, Cephalon shall have access to all documents of Acusphere and itsAffiliates identified by Cephalon as important as a result of such discussions.

##  

## Section 2.3                                      Transfer of Pre-Clinical and Clinical Data. Within ten (10) days of the Effective Date, Acusphere shalltransfer to Cephalon, at Acusphere’s sole cost and expense, all preclinical andclinical data related to HDDS TechnologyTM in the Field, including AI-850TMClinical Data,; provided, however, that Acusphere may retain confidentialcopies of the AI-850TM Clinical Data to demonstrate its compliance withapplicable legal requirements.  Duringthe term of this Agreement, Cephalon shall have access, as reasonably requestedby Cephalon, to personnel of Acusphere and its Affiliates at reasonable timesduring normal business hours and upon prior notice for discussions relating toregulatory, scientific, medical and other matters relating to preclinical andclinical data related to HDDS TechnologyTM in the Field, including the AI-850TMClinical Data. In addition, to the extent reasonably requested by Cephalon,Acusphere shall provide access to its, and its Affiliates, facilities,personnel and records in connection with any regulatory filings or submissionsthat Cephalon may make with respect to AI-850TM. After the transfer of the preclinical and clinical data related to HDDSTechnologyTM in the Field, including AI-850 Clinical Data to Cephalon, Acusphereshall have no right, title or interest in such data.

##  

## Section 2.4                                      Sublicensees.  Cephalonshall be entitled to grant one or more sublicenses under the licenses grantedpursuant to Section 2.1.  Suchsublicenses shall be subject and subordinate to the terms and conditions of thisAgreement.

##  

## Section 2.5                                      Section 365(n) of the Bankruptcy Code. All rights and licenses granted under or pursuant to this Agreement are,and shall otherwise be, deemed to be, for purposes of Section 365(n) ofthe Bankruptcy Code, licenses of rights to “intellectual property” as definedunder Section 101(35A) of the Bankruptcy Code.  The Parties shall retain and may fullyexercise all of their respective rights and elections under the BankruptcyCode.

 

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## Section 2.6                                      Right of First Negotiation. Acusphere retains all of rights to any Patent Rights relating to theHDDS TechnologyTM in the Field that are created by Acusphere or its Affiliatesafter the Effective Date (“New Patent Rights”). Each time Acusphere files a patent application contained in the NewPatent Rights, Acusphere shall notify Cephalon in writing.  During the period beginning upon Cephalon’sreceipt of each such notice and ending one hundred eighty (180) days thereafter(the “Option Period”), Cephalon shall have the option to notify Acusphere inwriting that it desires to enter into an exclusive license to such New PatentRights.  If Cephalon so notifiesAcushere, then for a period of ninety (90) days after such notice, Acusphereshall exclusively negotiate with Cephalon in good faith a definitive agreementfor such exclusive license containing customary representations, warranties,covenants and agreements, satisfactory in form and substance to the Parties.

##  

## Section 2.7                                      License Payment.  As fullconsideration for the licenses granted in Section 2.1, within five (5) daysafter the Effective Date, Cephalon shall make a one-time license payment bywire transfer of immediately available funds to Acusphere of Ten Million U.S.Dollars ($10,000,000).

##  

## Section 2.8                                      No Royalties.  Upon paymentof the amount set forth in Section 3.1, the licenses granted in Section 2.1shall be fully paid-up.  No royaltypayments shall be due in connection with the Licensed Patent Rights or theLicensed Know-How.

##  

**Article III**

# **IntellectualProperty Protection and Related Matters**

 

## Section 3.1                                      Prosecution and Maintenance of LicensedPatent Rights.

##  

### (a)                                  Right to Prosecute and Maintain. Acusphere shall have the first right and option to file and prosecuteany patent applications and to maintain any patents included in the LicensedPatent Rights.  Acusphere shall , withrespect to those Licensed Patent Rights that constitute patent applications, (i) provideall draft patent applications to Cephalon sufficiently in advance of filing forCephalon to have a reasonable opportunity to comment thereon and shall takesuch comments into consideration in the application filed; (ii) promptlyfurnish Cephalon with copies of all substantive communications betweenAcusphere and applicable patent offices relating to such patent applications, andtake Cephalon’s comments and suggestions into consideration when framingresponses and submissions to such patent offices; (iii) keep Cephalonadvised of the status of actual and prospective patent filings included in theLicensed Patent Rights.  Acusphere shallgive Cephalon the opportunity to provide comments upon and make requests ofAcusphere concerning the preparation, filing, prosecution, protection andmaintenance of those Licensed Patent Rights constituting patent applications,and shall consider such comments and requests in good faith; provided, however,that final decision-making authority shall vest in Acusphere.  If Acusphere declines the option to file andprosecute any such patent applications or maintain any such patents, it shallgive Cephalon reasonable notice to this effect, sufficiently in advance topermit Cephalon to undertake such filing, prosecution and/or maintenancewithout a loss of rights.  ThereafterCephalon may notify Acusphere that it wishes to acquire such patent and/or patentapplications, in which case, Acusphere shall, for no additional consideration,assign all of its rights, title and interest in and to such patent and/or 

 

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### patentapplication to Cephalon, and Cephalon may file and prosecute such patentapplications and/or maintain such patent in its sole discretion.

###  

### (b)                                 Costs and Expenses. Each Party shall bear its own costs and expenses in preparing, filing,prosecuting and maintaining Licensed Patent Rights.

###  

### (c)                                  Cooperation. Each Party agrees to cooperate with the other with respect to thefiling, prosecution and maintenance of patents and patent applications pursuantto this Section 5.1, including without limitation:

###  

#### (i)                                     the execution of all such documents andinstruments and the performance of such acts as may be reasonably necessary inorder to permit the other Party to file, prosecute or maintain patents andpatent applications as provided for in Section 4.1(a); and

####  

#### (ii)                                  making its employees, agents and consultantsreasonably available to the other Party (or to the other Party’s authorizedattorneys, agents or representatives), to the extent reasonably necessary toenable the prosecuting Party to file, prosecute or maintain patents and patentapplications as provided for in Section 4.1(a).

####  

## Section 3.2                              Third Party Infringement.

##  

### (a)                                  Notifications of Competitive Infringement. Each Party agrees to notify the other Party when it becomes aware of thereasonable probability of infringement of the Licensed Patent Rights in theField (“Competitive Infringement”).

###  

### (b)                                 Infringement Action. Within forty-five (45) days (or longer if the Parties mutually agree) ofbecoming aware of Competitive Infringement, Acusphere shall have the right toinstitute an infringement suit or take other appropriate action that itbelieves is reasonably required to protect the Licensed Patent Rights from suchCompetitive Infringement.  If Acusphereelects to bring suit against an infringer, Acusphere shall keep Cephalonreasonably informed of the progress of the action and give Cephalon areasonable opportunity in advance to consult with Acusphere and offer its viewsabout major decisions affecting the litigation. Acusphere shall consider those views in good faith, but shall have theright to control the action.  IfAcusphere elects to bring suit against an infringer and Cephalon is joined as aparty in such suit (which it shall do if so requested by Acusphere), Cephalonshall have the right to approve counsel selected by Acusphere to represent theParties, which approval shall not be unreasonably withheld, conditioned ordelayed.  The expenses of such suit orsuits that Acusphere elects to bring, including any reasonable out-of-pocketexpenses of Cephalon incurred in connection therewith, shall be paid forentirely by Acusphere.  If Acusphere doesnot take action in the prosecution, prevention, or termination of anyCompetitive Infringement and has not commenced negotiations with the infringerfor the discontinuance of such Competitive Infringement within forty-five (45)days (or longer if the Parties mutually agree) of becoming aware of CompetitiveInfringement, Cephalon may elect to do so. If Cephalon elects to bring suit against such infringer and Acusphere isjoined as a party in such suit (which it shall do if so requested by Cephalon),Acusphere shall have the right to approve counsel selected by Cephalon torepresent the Parties, which approval shall not be unreasonably withheld,conditioned or delayed.  The expenses ofsuch suit or suits that Cephalon elects to bring, including any reasonableout-of-

###  

### 5

### 

###  

### pocketexpenses of Acusphere incurred in connection therewith, shall be paid forentirely by Cephalon.  Neither Partyshall compromise or settle any litigation in a manner that imposes anyobligation on the other Party or that otherwise adversely impacts thedevelopment or commercialization of pharmaceutical products related to HDDSTechnologyTM in the Field, or the patents or patent applications included in theLicensed Patent Rights without the prior written consent of the other Party,which consent shall not be unreasonably withheld, conditioned or delayed.

###  

### (c)                                  Recoveries.  Any recoveryobtained by any Party as a result of any proceeding described in this Section 4.2or from any claim asserted in a proceeding described in Section 4.3, bysettlement or otherwise, shall be applied in the following order of priority:

###  

#### (i)                                     first, to reimburse each Party for alllitigation costs in connection with such proceeding paid by that Party and nototherwise recovered (on a pro rata basis based on each Party’s respectivelitigation costs, to the extent the recovery was less than all such litigationcosts); and

####  

#### (ii)                                  second, to the Party instituting suchproceeding.

####  

## Section 3.3                                      Infringement of Third Party Patents. If a claim alleging infringement of Third Party patents is made againstCephalon, then Cephalon shall defend against such a claim at its cost andexpense, but Acusphere may be represented in such event by legal counsel in anadvisory capacity at its own expense. Cephalon shall keep Acusphere informed of the status of the case.

##  

## Section 3.4                                      Cooperation. In the event that either Cephalon or Acusphere takes action pursuant to Section 4.2or Section 4.3 above, the other Party shall cooperate with the Party soacting to the extent reasonably possible.

##  

**Article IV**

# **Confidentiality**

 

## Section 4.1                                      Confidential Information. All Confidential Information disclosed by Acusphere to Cephalon duringthe term of this Agreement shall not be used by Cephalon except in connectionwith the activities contemplated by this Agreement (including, withoutlimitation, the licenses granted pursuant to Section 2.1), shall bemaintained in confidence by Cephalon (except to the extent reasonably necessaryin connection with regulatory filings relating to AI-850TM and/or relating topracticing the Licensed Patent Rights or Licensed Know-How in the Field; forthe filing, prosecution and maintenance of Patent Rights; or to develop andcommercialize products Covered by the Licensed Patent Rights or LicensedKnow-How in the Field), and shall not otherwise be disclosed by Cephalon to anyother person, firm, or agency, governmental or private (except consultants,advisors and Affiliates in accordance with Section 5.2), without the priorwritten consent of Acusphere, except to the extent that the ConfidentialInformation:

##  

### (a)                                  was known or used by Cephalon or itsAffiliates prior to its date of disclosure to Cephalon; or

 

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### (b)                                 either before or after the date of thedisclosure to Cephalon is lawfully disclosed to Cephalon or its Affiliates bysources other than Acusphere rightfully in possession of the ConfidentialInformation; or

###  

### (c)                                  either before or after the date of thedisclosure to Cephalon becomes published or generally known to the publicthrough no fault or omission on the part of Cephalon; or

###  

### (d)                                 is independently developed by or forCephalon or its Affiliates without reference to or reliance upon theConfidential Information; or

###  

### (e)                                  is required to be disclosed by Cephalonor its Affiliates to comply with applicable laws or regulations, to defend orprosecute litigation or to comply with legal process.

###  

## Section 4.2                                      Employee, Consultant and Advisor Obligations. Cephalon agrees that it and its Affiliates shall provide ConfidentialInformation received from Acusphere only to its and their respective employees,consultants and advisors who have a need to know such Confidential Information.

##  

## Section 4.3                                      Term.  Allobligations of confidentiality imposed under this Article V shall expireten (10) years following termination or expiration of this Agreement.

##  

**Article V**

# **Representations and Warranties**

 

## Section 5.1                                      Representations of Authority. Cephalon and Acusphere each represents and warrants to the other that asof the Effective Date it has full right, power and authority to enter into thisAgreement and to perform its respective obligations under this Agreement.

##  

## Section 5.2                                      Consents.  Cephalon andAcusphere each represents and warrants that as of the Effective Date allnecessary consents, approvals and authorizations of all government authoritiesand other persons required to be obtained by such Party in connection withexecution, delivery and performance of this Agreement have been obtained.

##  

## Section 5.3                                      No Conflict.  Cephalon andAcusphere each represents and warrants that, as of the Effective Date, theexecution and delivery of this Agreement and the performance of such Party’sobligations hereunder (a) do not conflict with or violate any requirementof applicable laws or regulations and (b) do not conflict with, violate orbreach or constitute a default of, or require any consent under, anycontractual obligations of such Party, except such consents as have beenobtained as of the Effective Date.

##  

## Section 5.4                                      Employee, Consultant and Advisor Obligations. Cephalon and Acusphere each represents and warrants that, as of theEffective Date, each of its and its Affiliates’ employees, consultants andadvisors has executed an agreement or has an existing obligation under lawobligating such employee, consultant or advisor to maintain the confidentialityof Confidential Information to the extent required under Article V.

##  

## 7

## 

##  

## Section 5.5                                      Litigation.  Acusphererepresents and warrants that there is no pending or, to its knowledge,threatened litigation against it relating to AI-850TM, except as disclosed in Exhibit Aattached hereto.

##  

## Section 5.6                                      Intellectual Property.  Acusphererepresents and warrants to Cephalon that, as of the Effective Date, (a) Acusphereowns the entire right, title and interest in and to the Licensed Patent Rightsand Licensed Know-How, (b) Acusphere has the right to grant to Cephalonthe rights and licenses under the Licensed Patent Rights and Licensed Know-Howgranted in this Agreement, (c) none of the Licensed Patent Rights wasfraudulently procured from the relevant governmental patent granting authority,(d) as of the Effective Date, there is no claim or demand of any Personpertaining to, or any proceeding which is pending or threatened, that assertsthe invalidity, misuse or unenforceability of the Licensed Patent Rights orchallenges Acusphere’s ownership of the Licensed Patent Rights or LicensedKnow-How or makes any adverse claim with respect thereto, and, to the knowledgeof Acusphere, there is no basis for any such claim, demand or proceeding, (e) tothe knowledge of Acusphere, as of the Effective Date, the Licensed PatentRights are not being infringed and the Licensed Know-How is not being used byany Third Party, (f) to the knowledge of Acusphere, AI-850TM and theprocess used to make AI-850TM does not infringe any Third Party Patent Rights,except as disclosed in writing to Cephalon, and (g) the Licensed Patent Rights include all of the Patent RightsControlled by Acusphere on the Effective Date which Cover the HDDS TechnologyTMin the Field or, in the case of patent applications included in the PatentRights, claims if issued,  would Coverthe HDDS TechnologyTM in the Field .

##  

## Section 5.7                                      No Warranties.  EXCEPT ASOTHERWISE EXPRESSLY SET FORTH HEREIN, THE PARTIES MAKE NO REPRESENTATIONS ANDEXTEND NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED.

##  

**Article VI**

# **Term andTermination**

 

## Section 6.1                                      Term.  ThisAgreement shall become effective as of the Effective Date, may be terminated asset forth in this Article VII, and otherwise remains in effect until theexpiration of all of the Patent Rights included within the Licensed PatentRights.

##  

## Section 6.2                                      Termination For Material Breach. Upon any material breach of this Agreement by either Party (in suchcapacity, the “Breaching Party”), the other Party may terminate this Agreementby providing sixty (60) days’ written notice to the Breaching Party, specifyingthe material breach.  The terminationshall become effective at the end of the sixty (60) day period unless theBreaching Party cures such breach during such sixty (60) day period.

##  

## Section 6.3                                      Survival.  Uponexpiration or termination of this Agreement for any reason, nothing in thisAgreement shall be construed to release either Party from any obligations thatmatured prior to the effective date of expiration or termination; and thefollowing provisions shall expressly survive any such expiration ortermination:  Article II, Section 3.2,Article V, Section 8.1, Section 8.2 and Section 8.15.

##  

## 8

## 

##  

**Article VII**

# **MiscellaneousProvisions**

 

## Section 7.1                                      Indemnification.

##  

### (a)                                  Cephalon.  Cephalonagrees to defend Acusphere, its Affiliates and their respective directors,officers, employees and agents at Cephalon’s cost and expense, and shallindemnify and hold harmless Acusphere and its Affiliates and their respectivedirectors, officers, employees and agents from and against any liabilities,losses, costs, damages, fees or expenses arising out of any Third Party claimrelating to (i) any breach by Cephalon of any of its representations,warranties or obligations pursuant to this Agreement or (ii) personalinjury, property damage or other damage resulting from the development orcommercialization in the Field by Cephalon or its Affiliates or sublicensees ofa product Covered by any of the Licensed Patent Rights.

###  

### (b)                                 Acusphere.  Acusphereagrees to defend Cephalon, its Affiliates and their respective directors,officers, employees and agents at Acusphere’s cost and expense, and shallindemnify and hold harmless Cephalon and its Affiliates and their respectivedirectors, officers, employees and agents from and against any liabilities,losses, costs, damages, fees or expenses arising out of any Third Party claimrelating to (i) any breach by Acusphere of any of itsrepresentations, warranties or obligations pursuant to this Agreement or (ii) personalinjury, property damage or other damage resulting from the development orcommercialization outside the Field by Acusphere or its Affiliates orsublicensees of a product Covered by any of the Licensed Patent Rights.

###  

### (c)                                  Claims for Indemnification. A person entitled to indemnification under this Section 8.1 (an “IndemnifiedParty”) shall give prompt written notification to the person from whomindemnification is sought (the “Indemnifying Party”) of the commencement of anyaction, suit or proceeding relating to a Third Party claim for which indemnificationmay be sought or, if earlier, upon the assertion of any such claim by a ThirdParty (it being understood and agreed, however, that the failure by anIndemnified Party to give notice of a third-party claim as provided in this Section 8.1(c) shallnot relieve the Indemnifying Party of its indemnification obligation under thisAgreement except and only to the extent that such Indemnifying Party isactually damaged as a result of such failure to give notice).  Within thirty (30) days after delivery of suchnotification, the Indemnifying Party may, upon written notice thereof to theIndemnified Party, assume control of the defense of such action, suit,proceeding or claim with counsel reasonably satisfactory to the IndemnifiedParty.  If the Indemnifying Party doesnot assume control of such defense, the Indemnified Party shall control suchdefense.  The Party not controlling suchdefense may participate therein at its own expense; providedthat,if the Indemnifying Party assumes control of such defense and the IndemnifiedParty reasonably concludes, based on advice from counsel, that the IndemnifyingParty and the Indemnified Party have conflicting interests with respect to suchaction, suit, proceeding or claim, the Indemnifying Party shall be responsiblefor the reasonable fees and expenses of counsel to the Indemnified Party solelyin connection therewith; provided, however, that in no eventshall the Indemnifying Party be responsible for the fees and expenses of morethan one counsel for all Indemnified Parties. The Party controlling such defense shall keep the other Party advised ofthe status of such action, suit, proceeding or claim and the defense thereofand shall consider 

 

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### recommendationsmade by the other Party with respect thereto. The Indemnified Party shall not agree to any settlement of such action,suit, proceeding or claim without the prior written consent of the IndemnifyingParty, which shall not be unreasonably withheld, delayed or conditioned.  The Indemnifying Party shall not agree to anysettlement of such action, suit, proceeding or claim or consent to any judgmentin respect thereof that does not include a complete and unconditional release ofthe Indemnified Party from all liability with respect thereto or that imposesany liability or obligation on the Indemnified Party without the prior writtenconsent of the Indemnified Party.

###  

## Section 7.2                                      Governing Law.  ThisAgreement shall be construed and the respective rights of the Partiesdetermined according to the substantive laws of the State of Delaware, USA,notwithstanding the provisions governing conflict of laws under such Delawarelaw to the contrary.

##  

## Section 7.3                                      Assignment.  Neither Partymay assign this Agreement in whole or in part without the consent of the otherParty, except if such assignment occurs in connection with the sale or transferof all or substantially all of the business and assets of such Party.  Notwithstanding the foregoing, (a) eitherParty may assign its rights (but not its obligations) pursuant to thisAgreement in whole or in part to an Affiliate of such Party and (b) Cephalonmay assign the license rights to the Licensed Patent Rights granted pursuant toSection 2.1 hereof without the consent of Acusphere.  .

##  

## Section 7.4                                      Entire Agreement; Amendments. This Agreement constitutes the entire agreement between the Parties withrespect to the subject matter hereof, and supersedes all previous arrangementswith respect to the subject matter hereof, whether written or oral.  Any amendment or modification to thisAgreement shall be made in writing signed by both Parties.

##  

## Section 7.5                                      Notices.

##  

Notices to Acusphere shall be addressed to:

 

Acusphere, Inc.

500 Arsenal Street

Waterton, MA  02472

Attention: ChiefExecutive Officer

 

with a copy, which shall not constitute notice, to:

 

Goodwin ProcterLLP

53 State Street

Boston, MA 02109

Attention:  Lawrence S. Wittenberg

 

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Notices to Cephalon shallbe addressed to:

 

Cephalon, Inc.

41 Moores Road

Frazer, PA 19355

Attention: General Counsel

 

with a copy, which shall not constitute notice, to:

 

Wilmer Cutler Pickering Hale and Dorr LLP

60 State Street

Boston, MA 02109

Attention:  Steven D. Barrett

 

AnyParty may change its address by giving notice to the other Party in the mannerherein provided.  Any notice required orprovided for by the terms of this Agreement shall be in writing and shall be (a) sentby registered or certified mail, return receipt requested, postage prepaid, (b) sentvia a reputable overnight or international express courier service, or (c) personallydelivered, in each case properly addressed in accordance with the paragraphabove.  The effective date of noticeshall be the actual date of receipt by the Party receiving the same.

 

## Section 7.6                                      Force Majeure.  No failure oromission by the Parties hereto in the performance of any obligation of thisAgreement shall be deemed a breach of this Agreement or create any liability ifthe same shall arise from any cause or causes beyond the control of theParties, including, but not limited to, the following: acts of God; acts oromissions of any government; any rules, regulations or orders issued by anygovernmental authority or by any officer, department, agency or instrumentalitythereof; fire; storm; flood; earthquake; accident; war; rebellion;insurrection; riot; and invasion.  TheParty claiming force majeure shall notify the other Party with notice of theforce majeure event as soon as practicable, but in no event longer than ten (10) businessdays after its occurrence, which notice shall reasonably identify suchobligations under this Agreement and the extent to which performance thereofwill be affected.

##  

## Section 7.7                                      Public Announcements.  Any publicannouncements or publicity with respect to the execution of this Agreementshall be agreed upon by the Parties in advance of such announcement.

##  

## Section 7.8                                      Independent Contractors.  It isunderstood and agreed that the relationship between the Parties hereunder isthat of independent contractors and that nothing in this Agreement shall beconstrued as authorization for either Acusphere or Cephalon to act as agent forthe other.

##  

## Section 7.9                                      No Strict Construction.  ThisAgreement has been prepared jointly and shall not be strictly construed againstany Party.

##  

## Section 7.10                                Headings.  The captionsor headings of the sections or other subdivisions hereof are inserted only as amatter of convenience or for reference and shall have no effect on the meaningof the provisions hereof.

 

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## Section 7.11                                No Implied Waivers; Rights Cumulative. No failure on the part of Acusphere or Cephalon to exercise, and nodelay in exercising, any right, power, remedy or privilege under thisAgreement, or provided by statute or at law or in equity or otherwise, shallimpair, prejudice or constitute a waiver of any such right, power, remedy orprivilege or be construed as a waiver of any breach of this Agreement or as anacquiescence therein, nor shall any single or partial exercise of any suchright, power, remedy or privilege preclude any other or further exercisethereof or the exercise of any other right, power, remedy or privilege.

##  

## Section 7.12                                Severability.  If, underapplicable law or regulation, any provision of this Agreement is invalid orunenforceable, or otherwise directly or indirectly affects the validity of anyother material provision(s) of this Agreement (such invalid orunenforceable provision, a “Severed Clause”), this Agreement shall endureexcept for the Severed Clause.  TheParties shall consult one another and use reasonable efforts to agree upon avalid and enforceable provision that is a reasonable substitute for the SeveredClause in view of the intent of this Agreement.

##  

## Section 7.13                                Execution in Counterparts. This Agreement may be executed in counterparts, each of whichcounterparts, when so executed and delivered, shall be deemed to be anoriginal, and all of which counterparts, taken together, shall constitute oneand the same instrument.

##  

## Section 7.14                                No Third Party Beneficiaries. No person or entity other than Acusphere, Cephalon and their respectiveAffiliates and permitted assignees hereunder shall be deemed an intendedbeneficiary hereunder or have any right to enforce any obligation of thisAgreement.

##  

## Section 7.15                                No Consequential Damages. NEITHER PARTY HERETO WILL BE LIABLE FOR INDIRECT, INCIDENTAL,CONSEQUENTIAL, SPECIAL, EXEMPLARY OR PUNITIVE DAMAGES ARISING OUT OF THISAGREEMENT OR THE EXERCISE OF ITS RIGHTS HEREUNDER, OR FOR LOST PROFITS ARISINGFROM OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF ANY NOTICE OFSUCH DAMAGES.  NOTHING IN THIS SECTION 8.15IS INTENDED TO LIMIT OR RESTRICT THE INDEMNIFICATION RIGHTS OR OBLIGATIONS OFEITHER PARTY WITH RESPECT TO THIRD PARTY CLAIMS.

##  

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IN WITNESS WHEREOF, the Parties have executed thisAgreement as of the date first set forth above.

 
|   | **CEPHALON, INC.**                                                   |
|--------|----------------------------------------------------------------------|
|   |                                                                 |
|   | By:                                                             | /s/ Martin Reeves |
|   |                                                                 |
|   | Name:                                                           | Martin Reeves |
|   |                                                                 |
|   | Title:  VP,  Business Development & Strategic Planning |
|   |                                                                 |
|   | **ACUSPHERE, INC.**                                                  |
|   |                                                                 |
|   | By:                                                             | /s/Sherri C. Oberg |
|   |                                                                 |
|   | Name:                                                           | Sherri C. Oberg |
|   |                                                                 |
|   | Title: President & CEO                                      |
|        |                                                                      |  |  |

 

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**Exhibit A**

 

**Pending and Issued Licensed PatentRights as of the Effective Date**

 
| **Our Reference** | ** ** | **U.S. Patent No.** | ** ** | **U.S. Serial No.** | ** ** |
|-------------------|------------|---------------------|------------|---------------------|------------|
| ACU 109*          |       | 6,395,300           |       | 09/433,486          |       |
| ACU 109 DIV*      |       | 6,645,528           |       | 09/694,407          |       |
| ACU 109 DIV (2)*  |       | 6,932,983           |       | 09/706,045          |       |
| ACU 109 CIP       |       |                |       | 10/053,929          |       |
| ACU 109 CIP DIV   |       |                |       | 10/924,642          |       |
| ACU109CIPDIV(2)   |       |                |       | 10/928,886          |       |
| ACU110            |       | 6,610,317           |       | 09/798,824          |       |
| ACU110REISSUE     |       |                |       | 11/213,257          |       |

 

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*** The European counterpart of these patents, EP 1180020, hasbeen granted in Europe and is subject to opposition proceedings in the EuropeanPatent Office.**

 

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