exv10w63



 





ARA ALLIANCE, PURCHASE AND PRODUCTION AGREEMENT




BY AND BETWEEN




MARTEK BIOSCIENCES CORPORATION




AND




DSM FOOD SPECIALTIES B.V.




Dated as of April 19, 2004



*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission




 









 








ARA Alliance, Purchase and Production Agreement




TABLE OF CONTENTS




	 	 	 	 	 
	1.
	 	INTRODUCTION	 	  1
	2.
	 	DEFINITIONS	 	  3
	3.
	 	SUPPLY, PRODUCTION AND ORDERS	 	15
	 
	 	3.1 Martek Requirements for ARA Products	 	15
	 
	 	3.2 Production	 	15
	 
	 	3.3 Martek Production	 	17
	 
	 	3.4 DSM Production	 	18
	 
	 	3.5 Martek Three Year Rolling Forecasts; Martek Firm Orders	 	20
	 
	 	3.6 DSM Three Year Rolling Forecasts; DSM Firm Orders	 	21
	 
	 	3.7 Delivery Instructions	 	22
	 
	 	3.8 Shipment	 	22
	 
	 	3.9 Order Fulfillment	 	23
	 
	 	3.10 Limitation on Breach	 	23
	4.
	 	QUALITY AND VERIFICATION	 	25
	 
	 	4.1 Verification of Production	 	25
	 
	 	4.2 Certification of Analysis	 	25
	 
	 	4.3 Specification and Specification Variance Changes	 	26
	 
	 	4.4 Verification of Production when Specifications Change	 	27
	 
	 	4.5 Inspection	 	27
	 
	 	4.6 Manufacturing Changes	 	27
	 
	 	4.7 ARA Product Non-Conformity Procedure; Rework and Destruction	 	28
	 
	 	4.8 Compliance	 	29
	 
	 	4.9 Disclaimers	 	29
	5.
	 	MARKETING	 	31
	 
	 	5.1 Expansion of Fields of Use	 	31
	 
	 	5.2 Customer Contracts	 	31
	 
	 	5.3 Priority of ARA Marketing	 	32
	 
	 	5.4 * Arrangements with * Customers	 	33
	 
	 	5.5 Notification and Challenge Procedure	 	33
	6.
	 	FINANCIAL MATTERS	 	36
	 
	 	6.1 Amounts Payable to DSM	 	36
	 
	 	6.2 Reduction of DSM Costs	 	41
	 
	 	6.3 Deviations from Budget	 	42
	 
	 	6.4 Unabsorbed Costs; Unabsorbed Depreciation Costs	 	43
	 
	 	6.5 Maximum Price to Martek; Equalization Reserve	 	43
	 
	 	6.6 Startup Costs	 	44






*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





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ARA Alliance, Purchase and Production Agreement




	 	 	 	 	 
	 
	 	6.7 Interest Charges for Inventory	 	44
	 
	 	6.8 DSM-Assisted IF Customer Fee	 	45
	 
	 	6.9 Martek Proprietary Technology Royalty	 	45
	 
	 	6.10 [Reserved]	 	45
	 
	 	6.11 Invoices and Payment	 	45
	 
	 	6.12 Margin Protection	 	46
	 
	 	6.13 Renegotiation of Pricing Arrangement	 	47
	 
	 	6.14 Reporting of Production Costs	 	47
	 
	 	6.15 Adjustment for Changes in Extraction and/or RBD Yields	 	47
	 
	 	6.16 Books and Records	 	47
	 
	 	6.17 Technology Transfer Fee	 	48
	 
	 	6.18 Break Up Fee	 	48
	7.
	 	PRODUCT DEVELOPMENTS AND PATENTS	 	49
	 
	 	7.1 R&D Collaboration	 	49
	 
	 	7.2 Intellectual Property Rights	 	52
	 
	 	7.3 Prosecution, Maintenance and Enforcement	 	55
	 
	 	7.4 Intellectual Property Licenses	 	59
	 
	 	7.5 Technology Transfers	 	61
	8.
	 	ORGANIZATION	 	62
	 
	 	8.1 Formation of the Committee	 	62
	 
	 	8.2 Meetings of the Committee	 	62
	 
	 	8.3 Status Reports of the Committee	 	62
	 
	 	8.4 Authority of the Committee	 	62
	 
	 	8.5 Deadlock Within a Committee	 	63
	 
	 	8.6 Deadlock Within the Committee Over Factual Matters	 	63
	 
	 	8.7 Deadlock Within the Committee Over Non-Factual Matters	 	64
	 
	 	8.8 External Communication	 	64
	9.
	 	TERM; TERMINATION; DAMAGES	 	65
	 
	 	9.1 Term	 	65
	 
	 	9.2 Termination for Cause	 	65
	 
	 	9.3 Effect of Expiration and Termination on Intellectual Property Rights	 	67
	 
	 	9.4 Other Effects of Termination; Damages; Cap	 	69
	 
	 	9.5 Limitation of Liability	 	72
	10.
	 	GENERAL	 	73
	 
	 	10.1 [Reserved]	 	73
	 
	 	10.2 Confidential Information	 	73
	 
	 	10.3 Survival	 	73
	 
	 	10.4 Trademarks	 	74
	 
	 	10.5 Disputes; Arbitration	 	74






*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





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ARA Alliance, Purchase and Production Agreement




	 	 	 	 	 
	 
	 	10.6 Regulatory Matters	 	76
	 
	 	10.7 Assignment; Delegation	 	76
	 
	 	10.8 Amendments and Waivers	 	76
	 
	 	10.9 Severability	 	76
	 
	 	10.10 Relationship of the Parties	 	76
	 
	 	10.11 Notices	 	76
	 
	 	10.12 Governing Law	 	78
	 
	 	10.13 Force Majeure	 	78
	 
	 	10.14 No Waivers	 	78
	 
	 	10.15 Entire Agreement	 	78
	 
	 	10.16 Counterparts	 	78
	 
	 	10.17 Guarantees	 	78
	 
	 	10.18 [Reserved]	 	79
	 
	 	10.19 Termination of Prior Alliance Agreement	 	79
	 
	 	10.20 Hierarchy of Documents	 	79







SCHEDULES



	 	 	 
	Schedule 2.12
	 	ARA Assay Procedure
	Schedule 2.17
	 	Biomass Specifications
	Schedule 2.28
	 	Crude Oil Specifications
	Schedule 2.45
	 	DSM Costs
	Schedule 2.50
	 	DSM Patents
	Schedule 2.51
	 	DSM Know-how
	Schedule 2.62
	 	Excluded Subject Matter
	Schedule 2.67
	 	Finished Oil Specifications
	Schedule 2.75
	 	Guaranty Agreement
	Schedule 2.98
	 	Martek Costs
	Schedule 2.101
	 	Martek Patents
	Schedule 2.102
	 	Martek Know-how
	Schedule 2.111 *
	 	Customers
	Schedule 4.2(a)
	 	DSM Certificate of Analysis
	Schedule 4.2(b)
	 	Martek Certificate of Analysis
	Schedule 4.6
	 	Manufacturing Changes
	Schedule 6.15
	 	Yield Assumptions
	Schedule 7.2(a)(i)
	 	Martek Non-Challengeable Patents
	Schedule 7.2(b)(i)
	 	DSM Patent Oppositions
	Schedule 7.2(b)(ii)
	 	Martek Patent Oppositions
	Schedule 10.19
	 	Termination Agreement








*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission




 









 








ARA Alliance, Purchase and Production Agreement




MARTEK BIOSCIENCES CORPORATION

DSM FOOD SPECIALTIES BV




ARA ALLIANCE, PURCHASE AND PRODUCTION AGREEMENT




     This Agreement (the “Agreement”) is made and entered into this 19th day of
April, 2004 (the “Signing Date”), but with an effect as of and as though
entered into on January 1, 2004 (the “Effective Date”) by and between DSM Food
Specialties B.V., a Besloten Vennootschap organized under the laws of the
Netherlands with its principal place of business at A. Fleminglaan 1, 2613 AX
Delft, the Netherlands (“DSM”) and MARTEK BIOSCIENCES CORPORATION, a
corporation organized under the laws of the State of Delaware with its
principal place of business at 6480 Dobbin Road, Columbia, Maryland 21045
(“Martek”) who, intending to be legally bound, hereby agree as follows:



1. INTRODUCTION




     1.1 Martek and DSM have developed certain complementary (and, in some
cases, blocking) technology for the production, refining, and blending of
arachidonic acid for use in infant formula to meet the nutritional needs of
infants and as a potential nutritional supplement and/or food ingredient for
young children, pregnant and lactating women, and adults generally. Martek
owns technology related to the manufacture and use of arachidonic acid and has
certain issued patents and patents pending throughout the world, claiming (a)
certain processes for the manufacture of arachidonic acid, (b) certain
compounds and (c) certain uses; and DSM owns technology related to the
manufacture of arachidonic acid and has certain issued patents and pending
patent applications throughout the world, claiming (a) certain processes for
the manufacture of arachidonic acid, (b) certain formulations for that product,
(c) certain compounds and (d) certain applications. Martek has also obtained
certain governmental regulatory approvals for the use of arachidonic acid in
infant formula.



     1.2 Martek has limited access to capital and only a few product lines and,
consequently, does not have the financial or human resources or the physical
facilities for large, scale- and location-efficient production of fermented
fungal Biomass from which the Crude Oil form of arachidonic acid is extracted.
For a number of years, Martek has relied for such production upon a
fermentation facility in Capua, Italy, which is owned by an Affiliate of DSM.
That facility is no longer sufficient to meet projected demand. Nor, given the
demand from Martek’s customers whose end-users are located in North America and
other non-European locations, will it be cost-efficient or prudent, due to the
need for multiple production sites, to conduct fermentation only in Capua.



     1.3 In substantial part due to the scientific and entrepreneurial efforts
of Martek, the demand from infant formula manufacturers for refined and blended
arachidonic acid that meets the exacting specifications for such a potentially
significant contributor to infant health is growing. However, the full
dimensions and precise pace of that growing demand is not readily knowable and
may well be affected substantially by the development by other companies of


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





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ARA Alliance, Purchase and Production Agreement



competing products and production technologies with respect to arachidonic
acid, other fatty acids, and other substances, and by changing trends in the
production and consumption of infant formula.




     1.4 Additionally, the possible uses and potential competing demands and
sources of supply for arachidonic acid outside the infant formula, young
children, and pregnant or lactating women fields are largely unexplored areas.
Such uses may include (i) nutritional supplements for adults generally and (ii)
products that are not for human consumption, including products for feeding or
otherwise provisioning nutrients to non-human animals.



     1.5 Because of Martek’s limited size and resources and the need to
concentrate its scientific and competitive efforts on the growing demand for
arachidonic acid in the infant formula field and related human consumption
fields, because Martek’s portfolio of intellectual property is generally
focused on those fields, and because Martek’s regulatory approvals and
commercial contracts with respect to arachidonic acid are essentially confined
to the human applications fields, Martek is not well-positioned and is not
likely to pursue other fields of use for arachidonic acid.



     1.6 By contrast, given DSM’s far larger size and resources, DSM’s existing
commercial relationships with prospective customers for non-human uses,
including animal and marine feed products, and DSM’s ability to take advantage
of potential marketing and sales synergies, DSM is positioned to undertake the
significant risks and expenses of developing possible arachidonic acid uses in
those fields.



     1.7 The production and sale of arachidonic acid as contemplated herein
implicates the technology and patent rights of both parties. As a result of
their analyses of each other’s technology portfolios and areas of expertise,
the parties have determined that the cross-licensing of the respective
technology and patent rights is necessary in order to promote critical
cooperation, increase the quality and quantity of output, and most efficiently
utilize the complementary resources of both companies in order to expand and
improve the production of arachidonic acid to meet the growing demand for its
use in infant formula and to satisfy other potential demand.



     1.8 Without the intellectual property cross-licensing and the other rights
and responsibilities provided for in this Agreement, and without the
cooperative information-sharing, the supply commitments, the rolling demand
forecasts, the joint research and development and other provisions herein, the
parties would not be able or willing to expand their production and sales
activities as contemplated herein.



     1.9 Without the intellectual property cross-licensing, the reciprocal
capacity expansion, purchase, and supply relationships, and the other
information-sharing and interdependencies contemplated by this Agreement, DSM
and Martek would not be able or willing to contribute their complementary
resources to cooperative marketing and joint research and development efforts
to expand the applications and fields of use for arachidonic acid.


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





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ARA Alliance, Purchase and Production Agreement




     1.10 The parties desire to enter into this Agreement and to set forth the
terms and conditions of the foregoing.


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





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ARA Alliance, Purchase and Production Agreement




2. DEFINITIONS




     2.1. “ABN” shall mean Advanced Bionutrition Corporation, a Maryland
corporation with offices at 6430 Dobbin Road, Suite C, Columbia, Maryland
21045.



     2.2. “* ARA Agreement” shall mean the License and Supply Agreement between
Martek and * dated as of April 1, 2004.



     2.3. “Actual Consumption Cost” shall have the meaning set forth in Section
6.1(c)(i).



     2.4. “Actual Usage” shall mean that quantity of ARA Products contained in
a Martek Purchase Order for a quarter placed by Martek in accordance with
Section 3.5(c) and actually delivered by DSM to Martek in accordance herewith.



     2.5. “Additional IF Customer Fees” shall have the meaning set forth in
Section 6.8.



     2.6. “Adult Applications Gross Profits” shall mean the combined Gross
Profits realized by DSM and Martek, from DSM’s manufacture of the ARA Products
to Martek’s sales to its customer, less the selling and transaction costs
related to such sales, on the sales of Units of ARA that are ultimately sold
for use in ARA Applications for Adults.



     2.7. “Affiliate” shall mean, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control
with, such Person. A Person shall be deemed to “control” another Person if
such Person possesses, directly or indirectly, the power to direct or cause the
direction of the management or policies of such other Person, whether through
ownership of voting securities, by contract or otherwise.



     2.8. “Agreement” shall have the meaning set forth in the preamble and
shall include the Schedules.



     2.9. “Approved Expansion Plans” shall have the meaning set forth in
Section 6.18(a).



     2.10. “ARA” shall mean the fatty acid called “arachidonic acid”.



     2.11. “ARA Applications for Adults” shall mean products containing ARA
Products that are specifically labeled and/or marketed for persons over twelve
(12) years of age, but shall not include any products containing ARA Products
that are specifically labeled for pregnant and/or lactating women.



     2.12. “ARA Assay Procedure” shall mean the method to determine the content
of ARA in any Biomass, Crude Oil or Finished Oil set forth in Schedule 2.12.


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





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ARA Alliance, Purchase and Production Agreement




     2.13. “ARA Fields of Use” shall mean, with respect to Martek, the Martek
ARA Fields of Use and, with respect to DSM, the DSM ARA Fields of Use.



     2.14. “ARA Products” shall mean Biomass, Soaps, Crude Oil, Finished Oil,
Spent Biomass and ARA produced in any other form and/or made by any process
wherein the ARA content is greater than * of total fatty acids.



     2.15. “ARA Research Project” shall mean any research project that relates
to ARA.



     2.16. “Audited Party” shall have the meaning set forth in Section 6.16(a).



     2.17. “Biomass” shall mean fermentation product containing ARA conforming
to the Specifications set forth in Schedule 2.17.



     2.18. “Blended Product” shall mean a product containing an ARA Product and
one or more other long chain poly unsaturated fatty acids.



     2.19. “Breaching Party” shall have the meaning set forth in Section
9.2(b)(i)(A).



     2.20. “Break Up Fee Account” shall have the meaning set forth in Section
6.18(a).



     2.21. “Budgeted Consumption Cost” shall have the meaning set forth in
Section 6.1(c).



     2.22. “Cap Price” shall have the meaning set forth in Section 6.5.



     2.23. “Capacity Dispute” shall mean the disagreement of the parties as to
whether, pursuant to Section 3.3(c), a DSM Shortfall is projected based on the
Martek Three Year Rolling Forecast and the DSM Three Year Rolling Production
Forecast because Martek disagrees with DSM Three Year Rolling Production
Forecast or otherwise.



     2.24. “cGMPs” shall mean those current good manufacturing practices that
are appropriate for the manufacturer of an ingredient that is used in infant
formulas and foods, feeds and pharmaceuticals and shall specifically include
those FDA regulations pertaining to infant formulas and food ingredients
appearing in the Code of Federal Regulations, Title 21, Parts 106 and 110,
including FDA guidelines related thereto and other FDA interpretations thereof.



     2.25. “Claim” shall have the meaning set forth in Section 4.2(c).



     2.26. “Committee” shall have the meaning set forth in Section 8.1.



     2.27. “Confidential Information” shall have the meaning set forth in Section 10.2.



     2.28. “Crude Oil” shall mean an ARA Product that is collected after
Extraction and that conforms to the Specifications set forth in Schedule 2.28.


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





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ARA Alliance, Purchase and Production Agreement




     2.29. “Cumulative Inflationary Difference” shall have the meaning set
forth in Section 6.1(d)(ii).



     2.30. “Current Year” shall have the meaning set forth in Section 6.1(a).



     2.31. “Customer ARA Production Royalty” shall have the meaning set forth
in Section 6.1(g).



     2.32. “Decision Date” shall have the meaning set forth in Section 5.5(b).



     2.33. “Declining Party” shall have the meaning set forth in Section
7.3(a)(iii).



     2.34. “DHA” shall mean the fatty acid called “docosahexanoic acid”
produced by fermentation or derived from plants.



     2.35. “Disputed Fact” shall have the meaning set forth in Section 8.5.



     2.36. “Disputed Issue” shall have the meaning set forth in Section 8.7.



     2.37. “Down Stream Processing”, or “DSP”, as performed by DSM, shall mean
the process of harvesting, recovery and drying of Biomass.



     2.38. “DSM” shall have the meaning set forth in the preamble.



     2.39. “DSM ARA Fields of Use” shall mean (i) any Feed Products and (ii)
other uses of ARA that are not for human oral consumption or for the purpose
of providing ARA as a nutrient for humans.



     2.40. “DSM ARA Field of Use Royalty” shall have the meaning set forth in
Section 6.9.



     2.41. “DSM-Assisted IF Customer Fee” shall have the meaning set forth in
Section 6.8.



     2.42. “DSM-Assisted Infant Formula Customers” shall have the meaning set
forth in Section 5.1(a).



     2.43. “DSM Budgeted Volume” shall mean the volume of ARA Products that (i)
DSM has forecasted, pursuant to Section 3.6(a), as of November 30 of a Current
Year, to require Martek Services on and (ii) Martek has forecasted to perform
Martek Services on and deliver to DSM in the Succeeding Year.



     2.44. “DSM Confirmation Letter” shall mean DSM’s written confirmation to
Martek of a Martek Purchase Order.


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





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ARA Alliance, Purchase and Production Agreement




     2.45. “DSM Costs” shall mean, for each calendar year, those expenses of
DSM related to production of ARA Products for Martek and its Affiliates,
calculated in accordance with (i) the accounting principles set forth on
Schedule 2.45 and (ii) the process set forth in Article 6.



     2.46. “DSM Extraction Allocation” shall have the meaning set forth in
Section 3.4(a).



     2.47. “DSM Firm Order” shall have the meaning set forth in Section 3.6(a).



     2.48. “DSM Gross Profits” shall have the meaning set forth in Section 9.4(c).



     2.49. “DSM Mark Up” shall have the meaning set forth in Section 6.1(a).



     2.50. “DSM Patents” shall mean (i) all the patents listed on Schedule 2.50
and all corresponding patents worldwide, including any corresponding
supplemental protection certificate, substitution, renewal, division,
continuation, continuation-in-part, inventors’ certificate, reissue,
reexamination, extension, patent of addition, and patent of incorporation, and
all counterparts thereof; and (ii) all patents which issue from applications
listed on Schedule 2.50 or which issue from any corresponding patent
application worldwide, including any regional or national phase application,
regular or provisional application, as well as any continuation,
continuation-in-part, division and renewal thereof.



     2.51. “DSM Proprietary Technology” shall mean, collectively, all (i) DSM
Patents and (ii) all Know-how necessary for or useful to the manufacture,
processing or use of ARA Products, including, but not limited to, the most
efficient and effective fungal strains, that are, (a) as of the Effective Date,
owned by DSM or any DSM Affiliate and set forth on Schedule 2.51 and (b)
disclosed or required to be disclosed to Martek pursuant to Section 7.4(d).



     2.52. “DSM Purchase Order” shall mean the purchase order issued every
quarter by DSM to Martek to confirm the amount indicated in a DSM Firm Order.



     2.53. “DSM R&D Patents” shall have the meaning set forth in Section
7.2(c)(i).



     2.54. “DSM RBD Services Allocation” shall have the meaning set forth in
Section 3.4(b).



     2.55. “DSM Shortfall” shall mean the difference between the amount of ARA
Products requested in a Martek Purchase Order and the amount of ARA Products
actually delivered by DSM to Martek within fifteen (15) days of the date on
which delivery is required hereunder in response to that purchase order; in
each case less the balance, if any, of the Martek Allocation.



     2.56. “DSM Three Year Rolling Forecast” shall have the meaning set forth
in Section 3.6(a).


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





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ARA Alliance, Purchase and Production Agreement




     2.57. “DSM Three Year Rolling Production Forecast” shall have the meaning
set forth in Section 3.5(b).



     2.58. “Effective Date” shall have the meaning specified in the preamble.



     2.59. “Enforcing Party” shall have the meaning set forth in Section 7.3(b).



     2.60. “Equalization Reserve” shall have the meaning set forth in Section 6.5.



     2.61. “Excluded Costs” shall have the meaning set forth in Schedule 2.45
as applicable to DSM Costs and Schedule 2.98 as applicable to Martek Costs.



     2.62. “Excluded Subject Matter” shall consist of the subject matter
covered by (i) all the patents listed on Schedule 2.62 and all corresponding
patents worldwide, including any corresponding supplemental protection
certificate, substitution, renewal, division, continuation,
continuation-in-part, inventors’ certificate, reissue, reexamination,
extension, patent of addition, and patent of incorporation, and all
counterparts thereof; and (ii) all patents which issue from applications listed
on Schedule 2.62 or which issue from any corresponding patent application
worldwide, including any regional or national phase application, regular or
provisional application, as well as any continuation, continuation-in-part,
division and renewal thereof. “Excluded Subject Matter” shall also include all
improvements and know-how related to the patents set forth in (i) and (ii)
above



     2.63. “Extraction” shall mean the process of deriving Crude Oil from
Biomass or fermentation broth, whether concentrated or not.



     2.64. “FCA” shall have the meaning set forth in Incoterms 2000.



     2.65. “FDA” shall mean the US Food and Drug Administration.



     2.66. “Feed Products” shall mean any products (i) for the feeding, or
otherwise provisioning of nutrients, to non-human animals, including, but not
limited to, mammals, fish, and birds and (ii) not intended or marketed for the
purpose of providing ARA as a nutrient for humans.



     2.67. “Finished Oil” shall mean Crude Oil that has been refined, bleached
and deodorized and meets the Specifications set forth on Schedule 2.67.



     2.68. “Fixed Budget Price” shall be determined as specified in Section
6.1(a).



     2.69. “Fixed Costs” shall mean those costs that do not change directly in
proportion to changes in the number of Units of ARA produced and shall include,
but not be limited to, the fixed portions of labor, depreciation, project
costs, energy costs, insurance, local taxes, site service allocations such as
production staff, maintenance, purchasing, quality assurance, and security
services. Fixed Costs shall not include Variable Costs.


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





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ARA Alliance, Purchase and Production Agreement




     2.70. “FMV” shall have the meaning set forth in Section 7.2(c)(iv)(A).



     2.71. “FOB” shall have the meaning set forth in Incoterms 2000.



     2.72. “Force Majeure Event” shall have the meaning set forth in Section 10.13.



     2.73. “Gross Profit” shall mean Net Sales less actual costs of goods of
the ARA Products sold.



     2.74. “Gross Profits on Other ARA Applications” shall mean the combined
Gross Profits realized by DSM and Martek, from DSM’s manufacture of the ARA
Products to Martek’s sales to its customer, less the selling and transaction
costs related to such sales, on the sales of Units of ARA that are ultimately
sold for use in Other ARA Applications.



     2.75. “Guaranty Agreement” shall mean an agreement in the form set forth
on Schedule 2.75.



     2.76. “IBA Rules” shall have the meaning set forth in Section 10.5(a).



     2.77. “ICC Rules” shall have the meaning set forth in Section 10.5(a).



     2.78. “IP Notice” shall have the meaning set forth in Section 5.5(a).



     2.79. “IP Notice Receipt Date” shall have the meaning set forth in Section 5.5(a).



     2.80. “Improvements” shall have the meaning set forth in Section 7.4(d).



     2.81. “Included ARA Products” shall have the meaning set forth in Section 5.5(a).



     2.82. “Infant Formula Product” shall mean a human breast milk substitute
formulated industrially in accordance with applicable Codex Alimentarius and/or
FDA standards or other applicable regulatory bodies (a) to satisfy the total
normal nutritional requirements of infants from birth up to between four (4)
and six (6) months of age and adapted to their physiological characteristics or
fed in addition to other foods to infants up to approximately one (1) year of
age and older or (b) to satisfy the total normal nutritional requirements of
infants born prematurely, as well as nutritional requirements of infants with
special dietary needs.



     2.83. “Infringed Party” shall have the meaning set forth in Section 9.2(a)(ii).



     2.84. “Infringing Party” shall have the meaning set forth in Section 9.2(a)(i)(B).



     2.85. “Joint Know-how” shall have the meaning set forth in Section 7.2(c)(ii).



     2.86. “Joint Patents” shall have the meaning set forth in Section 7.2(c)(ii).


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





9









 








ARA Alliance, Purchase and Production Agreement




     2.87. “Joint Proprietary Technology” shall mean, collectively, the Joint
Patents and the Joint Know-how.



     2.88. “Know-how” shall mean all know-how and technology (including, but
not limited to, manufacturing and production processes, formulations and
techniques, research and development information, methodology, drawings,
specifications, designs, plans, proposals and technical data) related to ARA.



     2.89. “Know-how Records” shall have the meaning set forth in Section 7.5(c).



     2.90. “Lead Party” shall have the meaning set forth in Section 7.3(a)(i).



     2.91. “Leader “ shall have the meaning set forth in Section 8.1.



     2.92. “Manufacturing Party” shall have the meaning set forth in Section 4.4.



     2.93. “Martek” shall have the meaning set forth in the preamble.



     2.94. “Martek Allocation” shall have the meaning set forth in Section 3.1(b).



     2.95. “Martek ARA Fields of Use” shall mean all ARA fields of use other
than the DSM ARA Fields of Use.



     2.96. “Martek Budgeted Volume” shall mean the volume of ARA Products that
(i) Martek has forecasted, pursuant to Section 3.5(a), as of November 30 of a
Current Year, to purchase from DSM during the Succeeding Year and (ii) DSM has
forecasted to produce and deliver to Martek in such Succeeding Year.



     2.97. “Martek Confirmation Letter” shall mean Martek’s written
confirmation to DSM of a DSM Purchase Order.



     2.98. “Martek Costs” shall mean, for each calendar year, those expenses of
Martek related to providing Martek Services to DSM and its Affiliates
calculated in accordance with (i) the accounting principles set forth on
Schedule 2.98 and (ii) the process set forth in Article 6.



     2.99. “Martek Expansion” shall have the meaning set forth in Section
3.3(c).



     2.100. “Martek Firm Order” shall have the meaning set forth in Section
3.5(a).



     2.101. “Martek Patents” shall mean (i) all the patents listed on Schedule
2.101 and all corresponding patents worldwide, including any corresponding
supplemental protection certificate, substitution, renewal, division,
continuation, continuation-in-part, inventors’ certificate, reissue,
reexamination, extension, patent of addition, and patent of incorporation, and
all counterparts thereof; and (ii) all patents which issue from applications
listed on Schedule 2.101 or which issue from any corresponding patent
application worldwide, including any


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





10









 








ARA Alliance, Purchase and Production Agreement



regional or national phase application, regular or provisional
application, as well as any continuation, continuation-in-part, division and
renewal thereof.




     2.102. “Martek Proprietary Technology” shall mean, collectively, (i) all
Martek Patents and (ii) all Know-how necessary for or useful to the
manufacture, processing or use of ARA Products that are, (a) as of the
Effective Date, owned by Martek or any Martek Affiliate and set forth on
Schedule 2.102, and (b) disclosed or required to be disclosed hereunder to DSM
pursuant to Section 7.4(d) including without limitation technology for the
Extraction and RBD processing steps contemplated in Section 3.



     2.103. “Martek Purchase Order” shall mean the purchase order issued every
quarter to confirm the amount indicated in a Martek Firm Order.



     2.104. “Martek R&D Patents” shall have the meaning set forth in Section
7.2(c)(i).



     2.105. “Martek Services” shall mean Extraction and/or RBD services
performed hereunder by or for Martek for DSM, as requested by DSM in a DSM
Purchase Order.



     2.106. “Martek Shortfall” shall mean the difference between the amount of
Crude Oil or Finished Oil, as applicable, requested in a DSM Purchase Order
based on the yield assumptions set forth in Schedule 6.15 and the amount of
Crude Oil or Finished Oil, as applicable, actually delivered by Martek to DSM
within fifteen (15) days of the date on which delivery is required hereunder in
response to that purchase order; in each case less the balance, if any, of the
DSM RBD Services Allocation or DSM Extraction Allocation, as applicable.



     2.107. “Martek Three Year Rolling Forecast” shall have the meaning set
forth in Section 3.5(a).



     2.108. “Martek Three Year Rolling Services Forecast” shall have the
meaning set forth in Section 3.6(b).



     2.109. “Material Breach” shall have the meaning set forth in Section
9.2(b)(i)(A).



     2.110. “Material Failure” shall have the meaning set forth in Section
9.2(b)(i)(A).



     2.111. “* Customers” shall mean the Martek customers with * as specified
on Schedule 2.111.



     2.112. “Nestec” shall mean Nestec Ltd., a corporation organized under the
laws of Switzerland, with offices at Avenue Nestle 55, CH 1800, Vevey,
Switzerland.



     2.113. “Net Revenues” shall mean the gross monies received from
sublicensing the Joint Proprietary Technology to a non-affiliated third party
minus commissions, delivery costs, sales tax and credits for refunds and
returns directly related thereto.


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





11









 








ARA Alliance, Purchase and Production Agreement




     2.114. “Net Sales” shall mean gross monies including royalties (except the
Customer ARA Production Royalty) received from sales of ARA Products minus
commissions, delivery costs, sales tax and credits for refunds and returns
directly related to such sales.



     2.115. “New R&D Inventions” shall have the meaning set forth in Section
7.2(c).



     2.116. “Non-Breaching Party” shall have the meaning set forth in Section
9.2(b)(i)(B).



     2.117. “Notifying Party” shall have the meaning set forth in Section
5.5(a).



     2.118. “Other ARA Applications” shall mean ARA Products that are
ultimately sold for use in the Martek ARA Fields of Use, other than for Infant
Formula Products, Products for Babies and ARA Applications for Adults.



     2.119. “Out of Scope Customer” shall have the meaning set forth in Section
5.2.



     2.120. “Patent Expenses” shall have the meaning set forth in Section
7.3(a)(i).



     2.121. “Patent Proponent Party” shall have the meaning set forth in
Section 7.3(a)(ii).



     2.122. “Patent Protection Process” shall have the meaning set forth in
Section 7.3(a)(i).



     2.123. “Performance Standards” shall have the meaning set forth in Section
6.1(b).



     2.124. “Person” shall mean any individual, partnership, limited liability
company, joint venture, firm, corporation, association, business, trust,
unincorporated organization or other enterprise or form of organization and any
governmental authority.



     2.125. “Phase I Belvidere Build-out” shall mean the production capacity
put in place by DSM at its Belvidere facility, consisting of * fermentation
vessels, each capable of approximately * liters of gross fermentation volume
and the related DSP and support capacity that together create the Practical
Capacity for the Belvidere facility for 2004 and 2005 as is set forth in
Section 6.1(f).



     2.126. “PPI” shall mean the US Producer Price Index for code PC UOMFG as
published by the Bureau of Labor Statistics of the United States Department of
Labor.



     2.127. “Practical Capacity” shall mean, that portion of the Technical
Capacity that, as determined by the Committee, is reasonably available for the
production of ARA products, after taking into consideration the current
production resources and organizational structure available for ARA Products
that have been established by DSM and agreed to by both Martek and DSM. The
Practical Capacity is the basis upon which to calculate the Fixed Costs per
Unit of ARA. “Practical Capacity” shall not include any production capacity
for ARA Products established or used for the purpose of manufacturing ARA
Products for DSM for sales into DSM’s ARA Fields of Use.


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





12









 








ARA Alliance, Purchase and Production Agreement




     2.128. “Production Start-Up Costs” shall have the meaning set forth in
Section 6.6.



     2.129. “Production Technology” shall mean any New R&D Inventions necessary
for or useful to the manufacture of ARA in any biomass.



     2.130. “Products for Babies” shall mean any products specifically labeled
and/or marketed for babies, toddlers, infants and/or children up to three (3)
years of age, other than Infant Formula Products.



     2.131. “Profit Sharing Fee” shall have then meaning set forth in Section 6.1(i).



     2.132. “Project Leader” shall have the meaning set forth in Section 7.1(c)(ii).



     2.133. “Project Plan” shall have the meaning set forth in Section 7.1(c)(ii).



     2.134. “Proponent Party” shall have the meaning set forth in Section 7.1(c)(i).



     2.135. “R&D” shall mean research and development.



     2.136. “R&D Collaboration Goals” shall have the meaning set forth in
Section 7.1(a).



     2.137. “R&D Committee” shall have the meaning set forth in Section 7.1(b).



     2.138. “R&D Contribution” shall have the meaning set forth in Section 7.1(f).



     2.139. “R&D Leader” shall have the meaning set forth in Section 7.1(b).



     2.140. “RBD” shall mean the combined processes of refining, bleaching and
deodorizing Crude Oil.



     2.141. “Responding Party” shall have the meaning set forth in Section
5.5(a).



     2.142. “Returned Material” shall have the meaning set forth in Section
4.7(c).



     2.143. “Section 9.2(a) Material Breach” shall have the meaning set forth
in Section 9.2(a)(i)(B).



     2.144. “Signing Date” shall have the meaning specified in the preamble.



     2.145. “Soaps” shall mean all solid matter recovered immediately following
the alkali refining of Crude Oil.



     2.146. “Specifications” shall mean: (a) the product specifications for the
respective ARA Products, as set forth on Schedules 2.17, 2.28, and 2.67, as
applicable, which shall be deemed in all cases to require compliance with
cGMPs, and the requirements for kosher certification by the Orthodox Union and
for Halal certification by the Islamic Food and Nutrition


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





13









 








ARA Alliance, Purchase and Production Agreement



Council of America or any other organization agreed upon by the parties
for all of a party’s respective facilities and the facilities of any
subcontractor that are used to manufacture, produce and/or package any ARA
Products; (b) quality control methods and methods of analysis with respect to
Biomass, Crude Oil and Finished Oil; and (c) other requirements and
specifications for ARA Products as set forth in this Agreement, as amended from
time to time by the Committee pursuant to Section 8 or otherwise by mutual
agreement of the parties.




     2.147. “Specification Variances” shall mean the variances from the
Specifications as set forth in the Specifications for the ARA Products, as
amended from time to time by the Committee pursuant to Section 8.4(b) or
otherwise by mutual agreement of the parties.



     2.148. “Spent Biomass” shall mean the material remaining after Extraction
(such as through the use of hexane) has been completed.



     2.149. “Spent Biomass Order” shall have the meaning set forth in Section
3.2(d).



     2.150. “Sublicensable Technology” shall have the meaning set forth in
Section 7.2(c)(iv).



     2.151. “Sublicensing Notice” shall have the meaning set forth in Section
7.2(c)(iv).



     2.152. “Sublicensing Requester” shall have the meaning set forth in
Section 7.2(c)(iv).



     2.153. “Succeeding Year” shall have the meaning set forth in Section
6.1(a).



     2.154. “Technical Capacity” shall mean, DSM’s maximum calculated
production capacity of ARA Products as determined by the Committee after taking
into consideration the in-place production capacity potentially available for
production of ARA Products and the current technologies used by the parties for
the production of ARA Products. The Technical Capacity is the basis to
calculate the depreciation costs per Unit of ARA. Technical Capacity shall not
include any production capacity for ARA Products established or used for the
purpose of supplying ARA products to DSM for sales into DSM’s ARA Fields of
Use.



     2.155. “Termination Notice” shall have the meaning set forth in 5.5(c).



     2.156. “Testing Party” shall have the meaning set forth in Section 4.4.



     2.157. “Third Party Toll Manufacturers” shall mean a third party toll
manufacturer whose business activity includes serving as a toll manufacturer
and (A) on behalf of DSM, (i) ferments ARA Products, (ii) performs RBD services
using Martek Proprietary Technology and/or Joint Proprietary Technology, or
(iii) performs Extraction services using Martek Proprietary Technology and/or
Joint Proprietary Technology and (iv) whose entire output of ARA Products
and/or ARA Products upon which RBD and/or Extraction services has been
performed is purchased by DSM, or (B) on behalf of Martek, (i) ferments ARA
Products using DSM Proprietary Technology and/or Joint Proprietary Technology,
or (ii) performs Extraction


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





14









 








ARA Alliance, Purchase and Production Agreement



services using DSM Proprietary Technology and/or Joint Proprietary
Technology and (iii) whose entire output of ARA Products is purchased by
Martek.




     2.158. “Total Refundable Costs” shall have the meaning set forth in
Section 7.1(f).



     2.159. “Transfer Procedures” shall have the meaning set forth in Section
8.4(a).



     2.160. “Unabsorbed Costs” shall mean that part of the Fixed Costs per Unit
of ARA, including depreciation costs related to the Practical Capacity, that
are incurred by DSM but that are not recovered by DSM because the Actual Usage
is lower than the Practical Capacity.



     2.161. “Unabsorbed Depreciation Costs” shall mean that part of the
depreciation costs related to the Technical Capacity, that are incurred by DSM
but that are not recovered by DSM because the Practical Capacity is less than
the Technical Capacity.



     2.162. “Unit of ARA” shall mean that quantity of any ARA Product that
contains one (1) kilogram of pure ARA as determined by the applicable ARA Assay
Procedure set forth in Schedule 2.12.



     2.163. “Unit of DHA” shall mean that quantity of any product that contains
one (1) kilogram of pure DHA as determined by AOCS Ce 1b-89 or as otherwise
mutually agreed by the parties.



     2.164. “Variable Costs” shall mean those costs that change directly in
proportion to changes in the number of Units of ARA produced, and shall
include, but not be limited to: raw and intermediate materials, packaging,
operations performed elsewhere, transportation, the variable portion of waste
and effluent disposal or treatment, and the variable portion of energy costs.
Variable Costs shall not include Fixed Costs.



     2.165. * shall mean * having a * that are identified by mutual agreement
between * pursuant to that certain *.



     2.166. “Cap” shall have the meaning set forth in Section 9.4(e).



     2.167. “Liable Party” shall have the meaning set forth in Section 9.4(e).



     2.168. “Losses” shall have the meaning set forth in Section 9.4(e).


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





15









 








ARA Alliance, Purchase and Production Agreement




3. SUPPLY, PRODUCTION AND ORDERS




     3.1. Martek Requirements for ARA Products.



          (a) Martek and its Affiliates will have the right to produce an unlimited
amount of ARA Products directly or through one or more Third Party Toll
Manufacturers.



          (b) Except as otherwise expressly set forth in Section 3.3, Martek agrees
that neither it nor any of its Affiliates shall sell, directly or indirectly,
in any calendar year, a combined aggregate quantity of ARA Products that
contains more than forty thousand (40,000) Units of ARA, as adjusted pursuant
to Section 3.1(b)(i), that are not derived from ARA Products that Martek has
purchased from DSM pursuant to this Agreement (the “Martek Allocation”).




     (i) In the event of a DSM Shortfall during any calendar year,
the Martek Allocation for that calendar year will be increased,
during the calendar year in which such DSM Shortfall has occurred,
by the number of Units of ARA necessary to meet such DSM Shortfall,
and the Martek Allocation will automatically revert for the next
calendar year to ARA Products containing forty thousand (40,000)
Units of ARA that are not derived from ARA Products Martek has
purchased from DSM pursuant to this Agreement, except as otherwise
specified herein.



          (c) Except as otherwise expressly set forth in this Agreement, Martek
shall purchase all of its requirements for ARA Products from DSM.
Notwithstanding anything to the contrary contained in this Agreement, the
parties agree that where (i) Martek has developed an ARA Product wherein the
ARA content is greater than * and up to * of total fatty acids, (ii) the
primary product in such ARA Product is not ARA and (iii) the Martek Allocation
has been first fully used to sell such ARA Product, the parties will agree to
negotiate in good faith the terms on which to permit Martek to sell such ARA
Product; provided that such ARA Product shall only be sold by Martek inside the
Martek ARA Fields of Use and the sale of Units of ARA contained in such ARA
Product shall be subject to the Profit Sharing Fee set forth in Section 6.1(i)
herein and such other terms the parties may agree upon.



     3.2. Production.



          (a) The parties acknowledge that DSM currently has fermentation and Down
Stream Processing production facilities in Capua, Italy and that certain Third
Party Toll Manufacturers perform Extraction services in Europe on behalf of
DSM. It is understood and agreed that DSM will establish a fermentation and
DSP production facility as soon as commercially practicable following the
Signing Date in Belvidere, New Jersey. Martek agrees not to sell any of the
Martek Allocation through December 31, 2004, except in the event of a DSM
Shortfall and only to the extent of such DSM Shortfall provided that it is
purchasing from DSM on a quarterly basis ARA Products that represent the entire
output of the Capua facility (exclusive of the output of the fermentation unit
at Capua known as *, up to a maximum of ARA


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





16









 








ARA Alliance, Purchase and Production Agreement



Products containing * Units of ARA. Martek agrees not to sell any of the
Martek Allocation from January 1, 2005 through December 31, 2006, unless it is
purchasing from DSM on a quarterly basis ARA Products that represent the entire
output of the Capua facility (exclusive of the output of the fermentation unit
at Capua known as *), up to a maximum of ARA Products containing * Units of ARA
per calendar year. Beginning on January 1, 2007, DSM shall use its commercially
reasonable efforts to allocate production between the Capua and US production
facilities so as to provide Martek with ARA Products at the lowest cost to
Martek, taking into consideration production costs, freight, foreign exchange
rates, customs duties and other relevant factors.




          (b) DSM agrees that it will provide fermentation and DSP for the ARA
Products produced by DSM in Europe and the United States. Subject to Section
3.3(a), Martek agrees that it will itself or through one or more subcontractors
perform RBD services for the ARA Products produced by DSM in Europe and in the
United States for both the Martek ARA Fields of Use and the DSM ARA Fields of
Use. At a time and subject to terms and conditions mutually agreed upon by the
parties, Martek will establish (at its own cost) one or more facilities in
Europe to perform RBD services for the ARA Products produced by DSM in Europe.
DSM agrees that, except as otherwise expressly set forth in Section 3.4(b),
neither it nor any of its Affiliates shall procure or accept any RBD services
from any Person other than Martek.



          (c) Subject to Section 3.3(a) Martek will itself or through a third party
perform Extraction for the Biomass produced by DSM in the United States and,
except as otherwise permitted in Section 3.4(a), DSM agrees that neither it nor
any of its Affiliates shall perform, or have performed for it (other than by
Martek and its Affiliates), directly or indirectly, Extraction on any Biomass
produced by DSM in the United States. The parties anticipate that Martek may
establish, in its sole discretion and at its own cost, one or more facilities
in Europe to perform Extraction of the Biomass produced by DSM in Europe,
subject to DSM’s existing agreements with Third Party Toll Manufacturers and
taking into consideration the applicable notice periods for termination of such
toll arrangements. The parties agree that, until such time that Martek is
capable of performing Extraction in Europe for the Biomass produced by DSM in
Europe, DSM and its Affiliates will have the right, either directly or through
one or more Third Party Toll Manufacturers to perform an unlimited amount of
Extraction on Biomass produced by DSM in Europe. Except as otherwise expressly
set forth in Section 3.4(a), DSM agrees that, after such time as Martek is
capable of performing Extraction in Europe for the Biomass produced by DSM in
Europe, neither it nor any of its Affiliates shall perform, or have performed
for it, directly or indirectly, in any calendar year, Extraction on Biomass
produced by DSM in Europe to sell (to Martek or for DSM ARA Fields of Use) a
quantity of Crude Oil that is greater than that permitted pursuant to the DSM
Extraction Allocation.



          (d) Two (2) weeks before the beginning of each calendar quarter, DSM may
place an order with Martek for the amount (by weight or percent of total) of
Spent Biomass (the “Spent Biomass Order”) produced during such calendar quarter
at Martek’s facilities and at Martek’s Third Party Toll Manufacturers that DSM
desires. For each calendar quarter for which Martek receives a Spent Biomass
Order from DSM, Martek shall transport to and store for DSM


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





17









 








ARA Alliance, Purchase and Production Agreement



at Martek’s production facilities an amount of Spent Biomass equal to the
lesser of (i) the amount specified in such Spent Biomass Order or (ii) the
total aggregate amount of Spent Biomass that Martek and such Third Party Toll
Manufacturers produce during such quarter. DSM shall arrange for the Spent
Biomass that is the subject of a Spent Biomass Order to be removed from
Martek’s premises no later than thirty (30) days following the end of the
related calendar quarter, otherwise Martek shall have the right to dispose of
such Spent Biomass. DSM shall pay all third party costs and shall reimburse
Martek within forty-five (45) days of receipt of invoice from Martek for all of
its direct costs in connection with the storage at and transportation from
Martek’s production facilities of Spent Biomass that is the subject of a Spent
Biomass Order including but not limited to direct costs related to salvaging
Spent Biomass, but otherwise DSM shall not pay Martek or any Third Party Toll
Manufacturer for such Spent Biomass; such storage and transportation costs
shall not be included as DSM Costs. It is understood and agreed that Martek
shall have the right to destroy or discard any Spent Biomass that is not the
subject of a Spent Biomass Order or that Martek in its sole discretion
determines is hazardous to store.




     3.3. Martek Production.



          (a) Subject to Martek’s rights under Section 5.5(d), Martek shall be
entitled to produce ARA Products at either its own facility or at a Third Party
Toll Manufacturer that shall be reasonably acceptable to DSM. Martek may
produce such ARA Products at a Third Party Toll Manufacturer using the DSM
Proprietary Technology and/or Production Technology, provided that such Third
Party Toll Manufacturer shall be reasonably acceptable to DSM taking into
consideration all the facts and circumstances, including without limitation
DSM’s proprietary interests in the DSM Proprietary Technology and/or Production
Technology. Martek will obtain written approval from DSM prior to using the
DSM Proprietary Technology and/or Production Technology at such Third Party
Toll Manufacturer for the production of such ARA Products. Upon DSM’s
acceptance of any such Third Party Toll Manufacturer, Martek shall take all
reasonable measures including but not limited to non-compete agreements
concerning ARA with such Third Party Toll Manufacturers to protect DSM’s
proprietary interests in the DSM Proprietary Technology and/or Production
Technology while such DSM Proprietary Technology and/or Production Technology
is being used by such Third Party Toll Manufacturer. Notwithstanding the
foregoing, Martek shall discontinue using the DSM Proprietary Technology and/or
Production Technology at such Third Party Toll Manufacturer if at any time
following discussions with DSM either Martek or DSM reasonably determines that
the continued use by such Third Party Toll Manufacturer of DSM Proprietary
Technology and/or Production Technology would be reasonably likely to pose a
threat to DSM’s proprietary interests in such DSM Proprietary Technology and/or
Production Technology; the party making such determination shall notify the
other party immediately upon making such determination and Martek shall give
DSM all reasonable assistance in connection with any efforts by DSM to protect
DSM’s proprietary interests in such DSM Proprietary Technology and/or
Production Technology. In the event that Martek manufactures such ARA Products
at its own facilities or at any Third Party Toll Manufacturer solely for
purposes of responding to a DSM Shortfall using the DSM Proprietary Technology
and/or Production Technology, DSM will assist Martek at Martek’s request by
providing reasonable ARA manufacturing assistance to Martek and Martek


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





18









 








ARA Alliance, Purchase and Production Agreement



shall reimburse DSM for DSM’s reasonable costs and expenses incurred in
connection with providing such assistance.




          (b) In the event DSM Shortfalls occur for * as a result of a Force Majeure
Event or otherwise or are projected for the * (based on DSM’s Three Year
Rolling Production Forecast under Section 3.5(b) and the Martek Three Year
Rolling Forecast), the Martek Allocation shall be increased accordingly until
such time which * following the date that DSM notifies Martek in good faith in
writing that it is able to meet Martek’s then current Three Year Rolling
Forecast. Martek will use its commercially reasonable efforts to shorten *
period and purchase as much ARA Products as commercially reasonable from DSM
during such period.



          (c) In the event (i) DSM Shortfalls are projected (based on DSM’s Three
Year Rolling Production Forecast and the Martek Three Year Rolling Forecast) or
occur for * as a result of a Force Majeure Event or otherwise, (ii) Martek has
requested in writing that DSM expand its ARA production capacities by a
specified volume, (iii) Martek has offered to guarantee to DSM that DSM would
recoup its investment in so expanding its ARA production capacities by such
volume, through the DSM Mark Up received on purchase orders by Martek for ARA
Products over a period of * and (iv) DSM has not commenced construction to
expand, within * of Martek’s written request (or such longer period as the
parties may agree), its ARA production capacities by at least the specified
volume or if DSM fails to proceed with diligence in such expansion or fails to
complete such expansion within * of such commencement, then Martek shall be
entitled to expand its ARA production capacity and/or subcontract production of
ARA Products to one or more third parties by the specified volume (the “Martek
Expansion”), provided that Martek provides DSM with written notice prior to
commencing construction and commences construction of such expansion or enters
into a subcontracting arrangement within * of its written request as referred
to under (ii) herein and, in the case of expansion activities, pursues them to
completion with diligence and completes such expansion within * months of such
commencement.



          (d) Any Martek Expansion shall permanently add to the Martek Allocation
unless there is a Capacity Dispute related to such Martek Expansion. If a
Capacity Dispute occurs the parties shall attempt, in good faith, to agree upon
the amount of the DSM Shortfall expected pursuant to Section 3.3(c). If the
parties reach agreement upon the amount of such DSM Shortfall and Martek
proceeds with a Martek Expansion pursuant to Section 3.3(c), the then current
Martek Allocation shall be permanently increased by the amount of such DSM
Shortfall. If the parties cannot resolve the Capacity Dispute, the parties
shall proceed to arbitration pursuant to Section 10.5 and the arbitrators shall
determine whether, pursuant to Section 3.3(c), a DSM Shortfall is projected,
and the extent of such DSM Shortfall. In making such determination, the
arbitrators shall only consider the facilities dedicated to ARA production,
technology, processes, formulas, and expertise that were in existence at the
time the Capacity Dispute first arose and the technology, processes and
formulas that were reasonably contemplated and known by the Committee at the
time of the Capacity Dispute. The Martek Allocation shall be permanently
increased by the amount of the DSM Shortfall as so determined by the
arbitrators.


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





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ARA Alliance, Purchase and Production Agreement




          (e) In the event that after such a Martek Expansion, Martek’s demand for
ARA Products decreases resulting in a decrease of required production capacity,
such decrease shall be shared pro rata by the parties.



     3.4. DSM Production.



          (a) The parties agree that, at and after such time that Martek is capable
of performing Extraction in Europe for the Biomass produced by DSM in Europe,
DSM and its Affiliates will have the right, either directly or through one or
more Third Party Toll Manufacturers, to continue to perform Extraction of
Biomass to produce an unlimited amount of Crude Oil. DSM agrees that neither it
nor any of its Affiliates shall sell, directly or indirectly, in any calendar
year, a combined aggregate quantity of ARA Products that contains more than the
greater of (i) forty thousand (40,000) Units of ARA or (ii) the Crude Oil
requirements for the DSM ARA Fields of Use (the “DSM Extraction Allocation”) as
adjusted pursuant to this Section 3.4(a), that are not derived from ARA
Products upon which Martek performed Extraction services pursuant to this
Agreement. In the event of a Martek Shortfall, related to Martek’s provision of
Extraction services to DSM, during any calendar year, the DSM Extraction
Allocation for that calendar year will be increased, during the calendar year
in which such Martek Shortfall has occurred, by the number of Units of ARA
necessary to meet such Martek Shortfall, and the DSM Extraction Allocation will
automatically revert for the next calendar year to an amount of Crude Oil equal
to the greater of (i) forty thousand (40,000) Units of ARA or (ii) the Crude
Oil requirements for the DSM ARA Fields of Use. In the event Martek Shortfalls,
related to Martek’s provision of Extraction services to DSM, occur for * as a
result of a Force Majeure Event or otherwise or are projected for the * based
on Martek’s Three Year Rolling Services Forecast under Section 3.6(b) and the
DSM Three Year Rolling Forecast for Extraction services under Section 3.6(a),
the DSM Extraction Allocation shall be increased accordingly until such time
which is * following the date that Martek notifies DSM in good faith in writing
that it is able to meet DSM’s then current Three Year Rolling Forecast for
Extraction services. DSM will use its commercially reasonable efforts to
shorten * period and purchase as much extraction services as commercially
reasonable from Martek during such period. In the event of a Martek Shortfall
and upon DSM’s written request, Martek shall return to DSM the portion of ARA
Products delivered by DSM pursuant to Section 3.8(b) on which Martek has not
yet performed Extraction services.



          (b) DSM and its Affiliates will have the right, either directly or through
one or more Third Party Toll Manufacturers, to perform RBD services on an
unlimited amount of Crude Oil. Except as expressly set forth below, DSM agrees
that in any calendar year neither it nor its Affiliates shall sell a combined
aggregate quantity of Finished Oil into any DSM ARA Field of Use that contains
more than forty thousand (40,000) Units of ARA (the “DSM RBD Services
Allocation”) that are not derived from ARA Products that Martek performed RBD
services on pursuant to this Agreement. In the event of a Martek Shortfall,
related to Martek’s provision of RBD services to DSM, during any calendar year,
the DSM RBD Services Allocation for that calendar year will be increased,
during the calendar year in which such Martek Shortfall has occurred, by the
number of Units of ARA necessary to meet such Martek Shortfall, and the DSM


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





20









 








ARA Alliance, Purchase and Production Agreement



RBD Services Allocation will automatically revert for the next calendar
year to an amount of Finished Oil equal to forty thousand (40,000) Units of ARA
except as otherwise specified herein. In the event Martek Shortfalls, related
to Martek’s provision of RBD services to DSM, occur for * as a result of a
Force Majeure Event or otherwise or are projected for the * based on Martek’s
Three Year Rolling Services Forecast under Section 3.6(b) and the DSM Three
Year Rolling Forecast under Section 3.6(a) for RBD services, the DSM RBD
Services Allocation shall be increased accordingly until such time which is *
following the date that Martek notifies DSM in good faith in writing that it is
able to meet DSM’s then current Three Year Rolling Forecast for RBD services.
DSM will use its commercially reasonable efforts to shorten * and purchase as
much RBD services as commercially reasonable from Martek during such period. In
the event of a Martek Shortfall and upon DSM’s written request, Martek shall
return to DSM the portion of ARA Products delivered by DSM pursuant to Section
3.8(b) on which Martek has not yet performed RBD services.




          (c) Subject to DSM’s rights under Section 5.5(d), DSM shall be entitled to
perform such RBD Services at either its own facility or at a Third Party Toll
Manufacturer that shall be reasonably acceptable to Martek. DSM may perform
such services at a Third Party Toll Manufacturer using the Martek Proprietary
Technology and/or Production Technology, provided that such Third Party Toll
Manufacturer shall be reasonably acceptable to Martek taking into consideration
all the facts and circumstances, including without limitation Martek’s
proprietary interests in the Martek Proprietary Technology and/or Production
Technology. Upon Martek’s acceptance of any such Third Party Toll Manufacturer,
DSM shall take all reasonable measures to protect Martek’s proprietary
interests in the Martek Proprietary Technology and/or Production Technology
while such Martek Proprietary Technology and/or Production Technology is being
used by such Third Party Toll Manufacturer. Notwithstanding the foregoing, DSM
shall discontinue using the Martek Proprietary Technology and/or Production
Technology at such Third Party Toll Manufacturer if at any time following
discussions with Martek either Martek or DSM reasonably determines that the
continued use by such Third Party Toll Manufacturer of such Martek Proprietary
Technology and/or Production Technology would be reasonably likely to pose a
threat to Martek’s proprietary interests in such Martek Proprietary Technology
and/or Production Technology; the party making such determination shall notify
the other party immediately upon making such determination and DSM shall give
Martek all reasonable assistance in connection with any efforts by Martek to
protect Martek’s proprietary interests in such Martek Proprietary Technology
and/or Production Technology. In the event that DSM performs such RBD Services
at its own facilities, or at any Third Party Toll Manufacturer solely for
purposes of responding to a Martek Shortfall using the Martek Proprietary
Technology and/or Production Technology, Martek will assist DSM at DSM’s
request by providing reasonable ARA manufacturing assistance to DSM and DSM
shall reimburse Martek for Martek’s reasonable costs and expenses incurred in
connection with providing such assistance.



          (d) The parties agree that at any time during the term of this Agreement
DSM shall have the right to create and use a “DSM Expansion” in regard to RBD
Services and Extraction on terms and conditions substantially similar to those
that are set forth in Section 3.3(c) and (d) in respect of the Martek
Expansion.


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





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ARA Alliance, Purchase and Production Agreement




     3.5. Martek Three Year Rolling Forecasts; Martek Firm Orders.



          (a) Two months prior to the first day of each calendar quarter, Martek
will submit to DSM a good faith forecast of Martek’s demand of ARA Products,
broken down by ARA Product, for each of the following twelve (12) quarters
(each, a “Martek Three Year Rolling Forecast”), which shall include (i) a firm
order by Martek of ARA Products, broken down by ARA Product, for each month
during the first calendar quarter covered by such Martek Three Year Rolling
Forecast (a “Martek Firm Order”) and (ii) Martek’s good faith estimate of
Martek’s demand for ARA Products, broken down by ARA Product, for each of the
following eleven (11) quarters covered by such Martek Three Year Rolling
Forecast.



          (b) One month prior to the first day of each calendar quarter, DSM will
submit to Martek a good faith forecast of DSM’s production capabilities of ARA
Products, broken down by ARA Product, for each of the following twelve (12)
quarters (“DSM Three Year Rolling Production Forecast”).



          (c) No later than two (2) weeks prior to the first day of each calendar
quarter, Martek shall issue a Martek Purchase Order to DSM for ARA Products for
that quarter that shall be no less than the amount indicated in the related
Martek Firm Order. Each Martek Purchase Order shall include delivery
instructions that satisfy the requirements of Section 3.7. No later than one
(1) week prior to the first day of each calendar quarter, DSM will issue a DSM
Confirmation Letter to Martek indicating the extent to which DSM accepts such
Martek Purchase Order.



          (d) DSM shall use its good faith efforts to deliver the amount of ARA
Products ordered in a Martek Purchase Order and shall be entitled to deliver up
to an additional ten percent (10%) of such amount so ordered, provided that the
amount delivered by DSM in the next succeeding calendar quarter pursuant to a
Martek Purchase Order for that quarter shall be reduced by such additional
amount, unless otherwise requested by Martek. In the event that Martek’s
demand for ARA Products substantially and persistently exceeds the Martek Three
Year Rolling Forecast the parties shall use their commercially reasonable
efforts to make arrangements to meet such extra demand.



          (e) It is understood and agreed that, in the event that Martek shall issue
a Martek Purchase Order for ARA Products in an amount greater than that set
forth in the related Martek Firm Order, DSM shall have the right, but not the
obligation, to accept such Martek Purchase Order to the extent of such greater
amount.



          (f) The parties acknowledge that Martek’s orders and forecasts for ARA
Products set forth in this Section 3.5 shall not include those ARA Products
upon which DSM requests Martek to perform Martek Services pursuant to Section
3.6.


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





22









 








ARA Alliance, Purchase and Production Agreement




     3.6. DSM Three Year Rolling Forecast; DSM Firm Orders.



          (a) Two months prior to the first day of each calendar quarter, DSM will
submit to Martek a good faith forecast of DSM’s demand for Martek Services,
broken down by Extraction and RBD Services, for each of the following twelve
(12) quarters (each, a “DSM Three Year Rolling Forecast”), which shall include
(i) a firm order by DSM for Martek Services, broken down by Extraction and RBD
Services, for each month during the first calendar quarter covered by such DSM
Three Year Rolling Forecast (a “DSM Firm Order”) and (ii) DSM’s good faith
estimate of DSM’s demand for Martek Services, broken down by Extraction and RBD
Services, for each of the following eleven (11) quarters covered by such DSM
Three Year Rolling Forecast.



          (b) One month prior to the first day of each calendar quarter, Martek will
submit to DSM a good faith forecast of Martek Services capabilities, broken
down by Extraction and RBD Services, for each of the following twelve (12)
quarters (“Martek Three Year Rolling Services Forecast”).



          (c) No later than two (2) weeks prior to the first day of each calendar
quarter, DSM shall issue a DSM Purchase Order to Martek for Martek Services,
broken down by Extraction and/or RBD Services, for that quarter that shall be
no less than the amount indicated in the related DSM Firm Order. Each DSM
Purchase Order shall include delivery instructions that satisfy the
requirements of Section 3.7. No later than one (1) week prior to the first day
of each calendar quarter, Martek will issue a Martek Confirmation Letter to DSM
indicating the extent to which Martek accepts such DSM Purchase Order.



          (d) Martek shall use its good faith efforts to perform the Martek Services
ordered in a DSM Purchase Order and to deliver the resulting ARA Products to
DSM no later than thirty (30) days after delivery by DSM to Martek of the ARA
Products upon which Martek will perform the Martek Services.



          (e) It is understood and agreed that, in the event that DSM shall issue a
DSM Purchase Order for Martek Services in an amount greater than that set forth
in the related DSM Firm Order, Martek shall have the right, but not the
obligation, to accept such DSM Purchase Order to the extent of such greater
amount.



     3.7. Delivery Instructions.



          (a) Martek shall submit delivery instructions to DSM for all quantities of
ARA Products subject to Martek Purchase Orders placed in accordance with
Section 3.5. Such delivery instructions shall be included in the Martek
Purchase Orders and shall identify (i) the quantity of ARA Products required,
(ii) the required delivery date, (iii) the address to which the shipment shall
be delivered, and (iv) any other applicable shipping instructions.



          (b) DSM shall submit delivery instructions to Martek for all quantities of
ARA Products that are to be produced through the Martek Services and subject to
a DSM


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





23









 








ARA Alliance, Purchase and Production Agreement



Purchase Order placed in accordance with Section 3.6. Such delivery
instructions shall be included in the DSM Purchase Orders and shall identify
(i) the quantity of ARA Products to be produced through Martek Services based
on the yield assumptions as referred to in Schedule 6.15, (ii) the required
delivery date, (iii) the address to which the shipment shall be delivered, and
(iv) any other applicable shipping instructions.




     3.8. Shipment.



          (a) Subject to the provisions of Sections 3.5(c) and 3.5(d), during a
month, DSM shall deliver quantities of ARA Products covered by the Martek
Purchase Order for the month on the later of (i) the last business day of the
month or (ii) ten (10) days after receipt of delivery instructions from Martek.
All such shipments shall be FOB or FCA, as applicable, DSM’s (or DSM’s Third
Party Toll Manufacturer’s) facility. For purposes hereof, each order shall be
deemed to have been “delivered”, and risk of loss with respect to each such
shipment shall pass from DSM to Martek, upon delivery of the shipment by DSM to
a carrier agreed upon by the Committee for transport to the location specified
in the Martek Purchase Order. DSM shall retain title to all shipments of ARA
Products covered by the Martek Purchase Order until payment is received,
whereupon title shall pass to Martek.



          (b) In addition, DSM shall deliver to Martek additional quantities of ARA
Products sufficient for Martek to perform the Martek Services requested by DSM
pursuant to a DSM Purchase Order and all such quantities delivered shall be
clearly identified by DSM and distinguished from ARA Products delivered
pursuant to Section 3.8(a). The roundtrip shipment cost of all such shipments
shall be borne by DSM. For purposes hereof, each order shall be deemed to have
been “delivered”, and risk of loss with respect to each such shipment shall
pass from DSM to Martek, upon delivery of the shipment by DSM to a carrier
agreed upon by the Committee for transport to the location specified in the DSM
Purchase Order and shall pass back to DSM upon delivery of the ARA Products to
such carrier following the performance by Martek of the Martek Services
thereon. DSM shall at all times retain title to all ARA Products that are
provided for purposes of Martek performing Martek Services.



          (c) Subject to the provisions of Sections 3.6(c) and 3.6(d), during a
month, Martek shall deliver quantities of ARA Products covered by the DSM
Purchase Order for the month on the later of (i) the last business day of the
month or (ii) ten (10) days after receipt of delivery instructions from DSM.
All orders shall be shipped FOB or FCA, as applicable, Martek’s (or Martek’s
Third Party Toll Manufacturer’s) facility. For purposes hereof, each order
shall be deemed to have been “delivered”, and risk of loss with respect to each
shipment shall pass from Martek to DSM, upon delivery of the shipment by Martek
to a carrier agreed upon by the Committee for transport to the location
specified in the DSM Purchase Order.



     3.9. Order Fulfillment.



          (a) DSM shall be responsible for, and shall retain the authority to
exercise its own discretion, in planning and arranging for supplies of ARA
Products from any subcontractors


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





24









 








ARA Alliance, Purchase and Production Agreement



to fulfill DSM’s supply obligations to Martek hereunder. In such cases
where Production Technology is intended to be used by a Third Party Toll
Manufacturer, DSM will obtain Committee approval before proceeding.




          (b) Subject to Section 3.3(a), Martek shall be responsible for, and shall
retain the authority to exercise its own discretion for, the performance of any
Martek Services by any subcontractors to fulfill Martek’s Service obligations
to DSM hereunder.



     3.10. Limitation on Breach.



          (a) The parties understand and agree that, despite Martek’s commercially
reasonable efforts to provide accurate forecasts for its subsequent orders of
ARA Products and DSM’s commercially reasonable efforts to ensure that a
sufficient amount of ARA Products are produced based on such forecasts and
orders, it is likely that at times the demand by Martek for ARA Products from
DSM may exceed the ability of DSM to supply such ARA Products. Martek and DSM
hereby agree that DSM will not be in breach of this Agreement if, despite its
good faith efforts, DSM fails from time to time to deliver the quantity of ARA
Products ordered by Martek; provided that DSM is operating its facilities at a
capacity at such time that is at or near Practical Capacity and delivers to
Martek substantially all of the ARA Products that DSM produces at such time,
subject to the provisions of Section 5.3.



          (b) The parties understand and agree that, despite DSM’s commercially
reasonable efforts to provide accurate forecasts for its subsequent orders for
Martek Services and Martek’s commercially reasonable efforts to ensure that it
meets the demand for Martek Services based on such forecasts and orders, it is
likely that at times the demand by DSM for Martek Services may exceed the
ability of Martek to supply such Martek Services. Martek and DSM hereby agree
that Martek will not be in breach of this Agreement if, despite its good faith
efforts, Martek fails from time to time to perform the Martek Services ordered
by DSM; provided that Martek is operating its facilities at production capacity
or near production capacity at such time.


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





25









 








ARA Alliance, Purchase and Production Agreement




4. QUALITY AND VERIFICATION




     4.1. Verification of Production. The parties shall perform the
ringtesting procedures as agreed upon by the Committee to confirm the accuracy
of any relevant quality control assay procedure (including without limitation
the ARA Assay Procedure).



     4.2. Certification of Analysis.



          (a) For each DSM shipment of Crude Oil or Biomass ordered by Martek and
delivered by DSM pursuant to Section 3.8(a) or Section 3.8(b), DSM shall
furnish to Martek within fourteen (14) days after shipment a certificate of
analysis in the forms attached hereto as Schedule 4.2(a) and signed by DSM’s
relevant QA/QC officer, which certifies the actual content of those components
of the Crude Oil or Biomass that are identified in the Specifications, as
applicable.




     (i) If DSM does not furnish the signed certificate of analysis
within fourteen (14) days after shipment of ARA Products ordered by
Martek pursuant to a Martek Purchase Order, the amount of such
shipment for which no signed certificate of analysis was delivered
shall to the extent that such amount brings the total of the
shipment below what has been set forth in the Martek Purchase Order
be immediately deemed to be a DSM Shortfall for the calendar year
and the Martek Allocation shall be increased accordingly in
accordance with the provisions of Sections 3.1(b) and 3.3. If
Martek determines such shipment to be acceptable after such
fourteen (14) day period, the Martek Allocation shall be
automatically reduced by the lesser of (i) the amount by which the
Martek Allocation was increased in respect of such shipment or (ii)
the difference between the then current Martek Allocation for such
calendar year and the total number of Units of ARA that Martek and
its Affiliates have sold during such calendar year that were not
derived from ARA Products purchased from DSM. In the event DSM
provides Martek with a draft or unsigned version of a certificate
of analysis to facilitate Martek’s determination of whether or not
it will accept or reject the related shipment, Martek shall
promptly consult with DSM and make such determination.




     (ii) If DSM does not furnish the signed certificate of
analysis within fourteen (14) days after shipment of ARA Products
delivered by DSM pursuant to Section 3.8(b), Martek may delay its
performance of the Martek Services until the applicable certificate
of analysis is furnished.



          (b) For each Martek shipment of ARA Products produced by the Martek
Services, Martek shall furnish to DSM within fourteen (14) days after shipment
a certificate of analysis in the form attached hereto as Schedule 4.2(b) and
signed by Martek’s relevant QA/QC officer, which certifies the actual content
of those components of the ARA Products that are identified in the
Specifications, as applicable. If Martek does not furnish the signed
certificate of


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





26









 








ARA Alliance, Purchase and Production Agreement



analysis within fourteen (14) days after shipment of such ARA Products,
the amount of such shipment shall be immediately deemed to be a Martek
Shortfall for the calendar year and the DSM RBD Services Allocation and/or DSM
Extraction Allocation, as applicable, shall be increased accordingly in
accordance with the provisions of Section 3.4. If DSM determines such shipment
to be acceptable after such fourteen (14) day period, the DSM RBD Services
Allocation and/or DSM Extraction Allocation, as applicable, shall be
automatically reduced by the lesser of (i) the amount by which the DSM RBD
Services Allocation and/or DSM Extraction Allocation, as applicable, was
increased in respect of such shipment or (ii) the difference between the then
current DSM RBD Services Allocation and/or DSM Extraction Allocation, as
applicable, for such calendar year and the total number of Units of ARA that
are in ARA Products on which DSM and its Affiliates have performed RBD and/or
Extraction services, as applicable, during such calendar year. In the event
Martek provides DSM with a draft or unsigned version of a certificate of
analysis to facilitate DSM’s determination of whether or not it will accept or
reject the related shipment, DSM shall promptly consult with Martek and make
such determination.




          (c) DSM shall not be liable to Martek if Martek begins to process or
delivers to a customer any ARA Products before Martek has received a signed
certificate of analysis from DSM; provided however, notwithstanding Section
4.2(a) DSM shall be entitled to request Martek to perform Martek Services on
ARA Products prior to receipt by Martek of the related signed certificate of
analysis, in which event if Martek performs such Martek Services on such ARA
Products then DSM shall assume liability to the extent the ARA Products do not
conform to the related Specifications. DSM shall be under no obligation to
replace, or to refund to Martek the purchase price of, any ARA Products if
Martek has so processed or sold such ARA Product to a customer before Martek
has received a signed certificate of analysis from DSM. In addition, Martek
shall indemnify, defend and hold harmless DSM, its Affiliates and their
respective directors, officers, employees and agents from and against all
actions, proceedings, costs, damages and claims (each, a “Claim”), including
reasonable counsel fees, that may be asserted against or incurred or suffered
by any such Person arising out of or relating to any action taken by Martek
with respect to any ARA Products before Martek has received such a certificate
of analysis from DSM, including without limitation processing or delivery to a
customer of ARA Products, whether such Claim is based upon a theory of
negligence, strict liability or otherwise.



          (d) Martek shall not be liable to DSM if DSM delivers to a customer any
ARA Products upon which Martek performed Martek Services before DSM has
received a signed certificate of analysis from Martek. Martek shall be under
no obligation to replace, or to refund to DSM the cost of Martek Services
associated with the production of any ARA Products if DSM has so sold such ARA
Products to a customer before DSM has received a signed certificate of analysis
from Martek. In addition, DSM shall indemnify, defend and hold harmless
Martek, its Affiliates and their respective directors, officers, employees and
agents from and against all Claims, including reasonable counsel fees, that may
be asserted against or incurred or suffered by any such Person arising out of
or relating to any action taken by DSM with respect to any ARA Products upon
which Martek performed Martek Services before DSM has received such a
certificate of analysis from Martek, including without limitation delivery to a
customer of


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





27









 








ARA Alliance, Purchase and Production Agreement



such ARA Products, whether such Claim is based upon a theory of
negligence, strict liability or otherwise.




     4.3. Specification and Specification Variance Changes. The parties
acknowledge and agree that the Specifications and the Specification Variances
may be subject to change from time to time. Martek and DSM shall bring any
required or requested changes to the Specifications or the Specification
Variances to the attention of the Committee in writing as soon as reasonably
practicable. The Committee shall have the authority to approve or reject any
such changes, it being understood and agreed that all changes that are
reasonable in nature to make, taking into account all the facts and
circumstances, shall be approved by the Committee. Upon written approval by
the Committee of any such required or requested changes, the Committee shall
then determine the terms, including DSM Costs and/or the Martek Costs and
delivery dates applicable to ARA Products which will meet the proposed
Specification or Specification Variance changes. Each of Martek and DSM agrees
to use its commercially reasonable efforts to accommodate any requested changes
at reasonable costs. Upon agreement by the Committee on such terms Martek or
DSM, as the case may be, shall implement the necessary adjustments in
accordance therewith, and, in the case of a change in Specifications, the
parties shall follow the procedure set forth in Section 4.4 for verifying that
quantities of ARA Product produced satisfy such changed Specifications.



     4.4. Verification of Production when Specifications Change. In the event
that the Committee approves a change to the Specifications pursuant to Section
4.3, the party whose ARA Product specifications have changed (the
“Manufacturing Party”) shall deliver to the other party (the “Testing Party”) a
quantity of ARA Product prepared to satisfy the changed Specifications. Such
delivery shall be made in accordance with a schedule and in quantities and on
terms determined by the Committee, which quantities shall be sufficient in all
cases to enable the Testing Party to verify that the quantities of ARA Product
provided satisfy the applicable changed Specifications. The Testing Party
shall thereupon subject the delivered quantities of ARA Product to the testing
and analysis procedures agreed upon by the Committee to verify that the
individual quantities satisfy the applicable changed Specifications. If any
quantity of ARA Product fails to satisfy the applicable changed Specifications,
the Testing Party shall so notify the Manufacturing Party. Any dispute between
the parties regarding the quality of any ARA Product thus supplied shall be
resolved by a binding determination of a third party testing facility as agreed
upon by the Committee. In case it is resolved that any quantity of ARA Product
thus supplied by the Manufacturing Party fails to satisfy the applicable
changed Specifications, the Manufacturing Party shall adjust its manufacturing
process or take other appropriate action and provide a replacement quantity of
ARA Product for testing and analysis by the Testing Party. The process shall
continue until the Testing Party determines that all quantities of ARA Product
provided by the Manufacturing Party satisfy the applicable changed
Specifications. The Testing Party shall be responsible for its own testing
costs which shall be considered Excluded Costs.



     4.5. Inspection. Upon reasonable notice during regular working hours,
each of DSM and Martek and their respective customers may inspect the
manufacturing facilities of the other party and any subcontractor(s) in order
to inspect the manufacture of ARA Products,


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





28









 








ARA Alliance, Purchase and Production Agreement



examine samples of ARA Products and review quality control and
manufacturing procedures for the purpose of verifying the quality of ARA
Products.




     4.6. Manufacturing Changes. DSM shall promptly notify the Committee of
any major change to any manufacturing procedure for ARA Products and, in the
case of proposed major changes, shall not apply such change to the manufacture
of ARA Products without the prior approval of the Committee. Martek shall
promptly notify the Committee of any major change to any Extraction or RBD
process and, in the case of proposed major changes, shall not apply such change
to the Extraction or RBD process without the prior approval of the Committee.
In the event of a major change of which the Committee had not been previously
notified, the Committee shall meet as promptly as possible after notification
thereof to determine what, if any, action is necessary or advisable in
connection therewith. Listed on Schedule 4.6 are certain changes that the
parties consider as of the Effective Date to be major changes for purposes of
this Section 4.6. The Committee shall have the authority to modify such
Schedule from time to time in its discretion and otherwise shall be the arbiter
of which changes constitute major changes for purposes of this Section 4.6.
Each party shall describe in writing to the Committee any change to any
manufacturing procedure (in the case of DSM) or any change in Extraction or RBD
Services (in the case of Martek), in each case other than major changes, upon
the request of the other party or otherwise at the next succeeding quarterly
meeting of the Committee.



     4.7. ARA Product Non-Conformity Procedure; Rework and Destruction.



          (a) If either party determines or has reason to believe that any shipment
of ARA Products does not conform with the applicable Specifications, that party
will give prompt written notice thereof to the other party, which notice shall
include a description of the nonconformity. Any dispute between the parties
regarding whether or not a shipment conforms with the applicable Specifications
shall be resolved by a binding determination of a third party testing facility
as agreed upon by the Committee.



          (b) If any shipment of ARA Products does not conform to the applicable
Specifications but is within the applicable Specification Variances, the party
that ordered such shipped products shall consider in good faith, whether it
will accept such shipment as-is. If the ordering party agrees to accept such
shipment as-is, such ordering party shall notify the producing party of such
acceptance and shall pay such producing party the applicable invoice price (in
accordance with the terms of this Agreement) for the shipment.



          (c) If any shipment of ARA Products does not conform with the applicable
Specifications and is not accepted by the ordering party, such ordering party
shall return such shipment to the producing party at such producing party’s
request and expense (the “Returned Material”). If the ordering party
authorizes the producing party to rework such shipment, such producing party
shall be entitled to rework such shipment and such ordering party shall accept
such reworked shipment provided that it meets the applicable Specifications, in
which case only the costs and expenses related to the initial production, and
not the rework, of the Returned


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





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ARA Alliance, Purchase and Production Agreement



Material, shall be included in DSM Costs or Martek Costs, as applicable,
or in the calculation by such producing party of its actual production costs.
If such reworked shipment continues to fail to meet the applicable
Specifications but is within the applicable Specification Variances, the
ordering party shall consider in good faith, whether it will accept such
shipment as-is. If such ordering party agrees to accept such shipment as-is,
such ordering party shall notify the producing party of such acceptance, in
which case the costs and expenses related to the rework of the Returned
Material shall be borne by the party doing such rework and such costs and
expense shall be considered Excluded Costs. The parties agree to work together
in good faith to co-develop rework procedures that allow rejected ARA Products
to be re-processed into ARA Products that meet the Specifications.




          (d) In the event that the ordering party does not authorize the producing
party to rework the Returned Material or if such producing party does not
exercise its right to provide a reworked shipment or is unable to provide a
reworked shipment that meets the Specifications within a reasonable time after
such producing party’s receipt of the notice of nonconformity, such ordering
party shall have no obligation to pay the producing party for the nonconforming
ARA Products or cost of Martek Services associated with the production of such
ARA Products (as applicable) and, if payment has already been made, such
ordering party shall be entitled to an immediate refund of the price of the
nonconforming shipment. In such event, the producing party shall use its
commercially reasonable efforts to replace the nonconforming ARA Products with
a substitute shipment that meets the Specifications and such producing party
shall be free to dispose of the Returned Material as it determines, consistent
with the terms of this Agreement, including by selling it (to the extent
permitted) in its respective ARA Field of Use or destroying it.



     4.8. Compliance.



          (a) DSM represents and warrants that it shall obtain and maintain, and
shall ensure that its subcontractors obtain and maintain, all licenses,
permits, approvals, clearances and notifications that may be required by law in
connection with the manufacture and packaging of ARA Products for Martek. DSM
further represents and warrants that (i) the Specifications for ARA Products to
be produced as a result of Martek performing Martek Services for DSM shall
comply with all applicable laws, rules and regulations, (ii) all quantities of
ARA Products that DSM supplies to Martek hereunder shall be manufactured in
conformity with all applicable laws, rules and regulations and shall fully
satisfy the Specifications, provided that DSM shall have delivered to Martek a
signed certificate of analysis indicating that such quantities of ARA Products
meet the Specifications, and (iii) DSM shall exercise commercially reasonable
efforts to keep its facilities that are used in the manufacture of ARA Products
in good working order and available for the production of ARA Products pursuant
to this Agreement.



          (b) Martek represents and warrants that it shall obtain and maintain, and
shall ensure that its subcontractors obtain and maintain, all licenses,
permits, approvals, clearances and notifications that may be required by law in
connection with the Extraction, RBD, manufacturing, packaging, or production of
ARA Products for DSM. Martek further represents


*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





30









 








ARA Alliance, Purchase and Production Agreement



and warrants that (i) the Specifications for ARA Products to be produced
by DSM for Martek shall comply with all applicable laws, rules and regulations
and (ii) all Martek Services shall be performed in conformity with all
applicable laws, rules and regulations and the ARA Products delivered as a
result thereof shall fully satisfy the Specifications, provided that Martek
shall have delivered to DSM a signed certificate of analysis indicating that
such quantities of ARA Products meet the Specifications, and (iii) Martek shall
exercise commercially reasonable efforts to keep its facilities, that are used
in the manufacture of ARA Products in good working order and available for the
production of ARA Products pursuant to this Agreement.




     4.9. Disclaimers.



          (a) THE LIMITED WARRANTY SET FORTH HEREIN IS EXCLUSIVE AND IN LIEU OF, AND
DSM HEREBY DISCLAIMS, ALL OTHER WARRANTIES REGARDING THE PRODUCTS PRODUCED FOR
MARTEK HEREUNDER, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION ANY IMPLIED
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.



     (b) THE LIMITED WARRANTY SET FORTH HEREIN IS EXCLUSIVE AND IN LIEU OF, AND
MARTEK HEREBY DISCLAIMS, ALL OTHER WARRANTIES REGARDING THE PRODUCTS PRODUCED
AND SERVICES PERFORMED FOR DSM HEREUNDER, EXPRESS OR IMPLIED, INCLUDING WITHOUT
LIMITATION ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE.


(c) Patent Warranty Disclaimers. THE PARTIES ACKNOWLEDGE THAT NEITHER PARTY IS
GRANTED ANY RIGHTS UNDER ANY PATENTS OR PATENT APPLICATIONS FILED IN THE NAME
OF OR ON BEHALF OF THE OTHER PARTY OR ITS AFFILIATES EXCEPT THOSE SET FORTH IN
SECTION 7.4. EACH PARTY EXPRESSLY DISCLAIMS ANY WARRANTY TO THE OTHER PARTY OR
ANY THIRD PARTY AS TO THE SCOPE, VALIDITY OR ENFORCEABILITY OF ANY OF THE
INTELLECTUAL PROPERTY RIGHTS LICENSED HEREUNDER.



*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of
the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the
Securities and Exchange Commission





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ARA Alliance, Purchase and Production Agreement




5. MARKETING




     5.1. Expansion of Fields of Use.



          (a) DSM agrees to use its commercially reasonable efforts, including
marketing efforts, to assist Martek in entering into license agreements, on
terms acceptable to Martek in Martek’s sole discretion, with Infant Formula
Product customers in such territories as DSM and Martek may from time to time
agree upon in writing (the “DSM-Assisted Infant Formula Customers”). In order
to qualify as a DSM-Assisted Infant Formula Customer, (i) such customer must
either be identified by Martek or identified by DSM and approved by Martek and
(ii) Martek must approve in writing DSM’s pursuing of such potential customer
and (iii) the customer must either enter into a license agreement with Martek
or place its first order for Infant Formula Products within twenty-four (24)
months of Martek’s written approval to DSM to pursue such DSM-Assisted Infant
Formula Customer or such longer period to which Martek agrees in writing.



          (b) In view of DSM’s global marketing network, Martek agrees that should
it or any of its Affiliates consider utilizing a third party marketing and/or
sales force for sales of ARA Products, Martek shall, before entering into a
binding agreement with any other third party with respect thereto, give DSM
written notice thereof and shall present and consider with DSM in good faith
whether or not DSM could be of assistance in such marketing and sales efforts.



          (c) DSM shall use its good faith efforts to identify to Martek any DSM
customer that indicates to DSM an interest in any ARA Product that is available
from Martek in the Martek ARA Fields of Use and Martek shall use its good faith
efforts to identify to DSM any Martek customer that indicates to Martek an
interest in any ARA Product that is available from DSM in the DSM ARA Fields of
Use.



          (d) DSM and Martek agree to explore together new market opportunities for
additional uses of ARA including applications that may involve combining ARA
with DHA and/or other nutrients, but shall be under no obligation to continue
such explorations for any specific length of time nor shall the parties be
under any obligation to enter into any arrangement regarding any such new
market opportunities beyond the arrangements set forth herein. Martek shall use
commercially reasonable efforts to market products combining ARA and Martek’s
microbial DHA products developed pursuant to Article 7 of this Agreement where,
in Martek’s reasonable belief, such products are safe, efficacious, and have a
potential return on investment of * or greater.



     5.2. Customer Contracts. From and after the Signing Date, each
party and its Affiliates shall notify each of their respective customers prior
to any sale to such a customer of ARA Products that (a) any ARA Products sold
to such customer are subject to intellectual property licenses that prohibit
such customer from selling or using such ARA Products outside such notifying
party’s ARA Fields of Use and (b) such customer will not be able to purchase
ARA Products from such party or any of its Affiliates if any sale or use by
such customer of such



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



32









 








ARA Alliance, Purchase and Production Agreement




ARA Products is outside such notifying party’s ARA Fields of Use. The
parties shall cooperate in good faith to identify any customer that uses or
sells ARA Products purchased from a party or any of its Affiliates outside such
notifying party’s ARA Fields of Use (“Out of Scope Customer”). Where it is
determined by agreement of the parties or pursuant to the arbitration
provisions of Section 10.5 that a party has sold, or that an Affiliate of a
party has sold, the ARA Products to an Out of Scope Customer, the party shall
either promptly stop such sale or use of ARA Products by such customer or make,
or cause such Affiliate to make, no further sales of ARA Products to such
customer, it being understood and agreed that any failure to stop such sale of
ARA Products or to make, or cause such Affiliate to make, no such further sales
shall be deemed to be a breach of a material term of this Agreement, unless
applicable law shall prohibit such party or Affiliate from stopping such sale
or use of ARA Products by such customer or from ceasing to make such further
sales of ARA Products to such customer.



     5.3. Priority of ARA Marketing.



          (a) It is understood and agreed that the parties will first meet the
demands for ARA Products for Infant Formula Products before supplying ARA
Products to any other Martek ARA Field of Use or to any DSM ARA Field of Use,
until such time as the production of ARA Products reaches ARA Products
containing * Units of ARA per month. Once the production of ARA Products
reaches ARA Products containing * Units of ARA per month, the parties agree
that they will supply ARA Products, first, in an amount of ARA Products
containing * Units of ARA per year for use in connection with new product
and/or new ARA Field of Use development in accordance with this Agreement;
second, to meet the forecasted demands for ARA Products for Infant Formula
Products; and third, in accordance with the methodology for allocating any
surplus ARA Products which methodology shall be determined by the Committee on
or before the first anniversary of the Effective Date.



          (b) Upon the request of either party, the number of Units of ARA in ARA
Products to be supplied per year for use in connection with new product and/or
new ARA Field of Use development shall be increased as follows as the
production capacity for ARA Products reaches the capacities set forth below, it
being understood and agreed that the Committee shall have the authority to
modify such amounts from time to time:



	 	 	 
	 	 	Units of ARA per Annum
	Monthly Production Capacity
	 	New ARA Product/Field of Use

	* Units of ARA

	 	* Units of ARA
	* Units of ARA

	 	* Units of ARA
	* Units of ARA

	 	* Units of ARA







          (c) Each party shall be entitled to fifty percent (50%) of the total
number of Units of ARA per year allocated for use in connection with new
product and/or new ARA Field



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



33









 








ARA Alliance, Purchase and Production Agreement




of Use development, provided that each party shall have the right to use all or
a portion of such fifty percent (50%) in any manner it deems fit within its own
ARA Field of Use, whether for existing ARA Products or new ARA Products.



     5.4. * Arrangements with *Customers.



          (a) DSM hereby agrees to accept the * pricing for ARA Products as set
forth in Section 5.4(b) (i) when and if Martek enters into * arrangements with
* pursuant to that certain * between them * to order quantities of ARA Products
* solely for inclusion in Infant Formula Products that will be sold * in
certain * and (ii) to meet its obligations to * Customers.



          (b) DSM agrees (i) to accept Martek Purchase Orders for specified
quantities of ARA Products for which the delivery instructions provided by
Martek in accordance with Section 3.8(a) specify that the ARA Products
delivered pursuant to such Purchase Orders will be included in an Infant
Formula Product that will be sold by * Customers * in one or more * and,
together with DHA supplied by Martek, must comprise * of any and all Omega-3
and Omega-6 long chain polyunsaturated fatty acids (i.e., fatty acids other
than linolenic acid, gammalinolenic acid and alphalinolenic acid that contain
at least * and at least * in any Infant Formula Product sold by * Customers as
applicable in the *, and (ii) notwithstanding Section 6.1 of the Agreement, to
accept as payment in full for the ARA Products subject to each such Martek
Purchase Order an amount equal to the greater of (A) * or (B) *.
Notwithstanding the foregoing, DSM shall not be required to accept in any
calendar year Martek Purchase Orders for ARA Products for * Customers at such *
in an amount * of the * that are the subject of Martek’s Purchase Orders *. To
the extent that such Martek Purchase Orders * the * and the then current *
for such * within forty-five (45) days of the end of such calendar year.



          (c) Martek shall (i) require * Customer, on whose behalf Martek orders
ARA Products at the price set forth in Section 5.4(b), to maintain complete and
adequate books and records of all sales of ARA Products ordered at such price,
(ii) reserve and, in Martek’s discretion, exercise the right to audit such
books and records to enable Martek to verify that all such quantities of ARA
Products are included only in Infant Formula Products that are sold only in *,
and (iii) shall take such steps which are reasonable to ensure that such
quantities of ARA Products are included only in Infant Formula Products that
are sold in *.



     5.5. Notification and Challenge Procedure.



          (a) Notwithstanding anything to the contrary set forth elsewhere in this
Agreement, prior to any sale by a party (the “Notifying Party”) or any of its
Affiliates of ARA Products into the other party’s ARA Fields of Use (the
“Responding Party”), the Notifying Party shall provide written notice thereof
to the Responding Party three (3) years before commencing any such sale (“IP
Notice”), which notice shall include a list of such ARA Products (“Included ARA
Products”). During such three (3) year period, the Notifying Party shall not
commence such sales. The date that the Responding Party receives such IP
Notice shall hereinafter be referred to as the “IP Notice Receipt Date.” The
Responding Party shall have the right to



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



34









 








ARA Alliance, Purchase and Production Agreement




proceed to arbitration pursuant to Section 10.5 of this Agreement, for the
purpose of determining whether the Notifying Party will be legally entitled to
sell the Included ARA Products into any of the ARA Fields of Use of the
Responding Party without infringing the intellectual property rights or
Know-how of the Responding Party as further set forth in Section 5.5(b) below,
by giving written notice to the Notifying Party of its intent to proceed to
arbitration, and subsequently initiating such arbitration, within six (6)
months of the IP Notice Receipt Date. Whether or not such right to arbitrate
is exercised, the Responding Party shall have the right to terminate the
Agreement as further set forth in Section 5.5(c) below. If the Responding
Party does not proceed to arbitration within six (6) months of the IP Notice
Receipt Date, the Notifying Party shall be permitted to sell the Included ARA
Products into any of the Responding Party’s ARA Fields of Use only after the
date which is three (3) years after the IP Notice Receipt Date. Any breach of
any of the provisions of this Section shall constitute a material breach of
the Agreement.



          (b) In the case of arbitration pursuant to 5.5(a), the Notifying Party
shall not sell any ARA Products into any of the Responding Party’s ARA Fields
of Use except in accordance with Section 5.5(b)(ii), and shall have the burden
of establishing by clear and convincing evidence that its potential sale of the
Included ARA Products into any of the Responding Party’s ARA Fields of Use
would not infringe upon the Responding Party’s intellectual property rights or
Know-how on the Decision Date. The date on which the arbitrators deliver their
decision to the parties shall hereinafter be referred to as the “Decision
Date.”




     (i) If the arbitrators determine that the Notifying Party will
not be legally entitled to sell the Included ARA Products into any
of the Responding Party’s ARA Fields of Use, then any subsequent
sale of any Included ARA Products by the Notifying Party into any
of the Responding Party’s ARA Fields of Use shall be conclusively
deemed to be an infringement of the Responding Party’s intellectual
property rights and/or Know-how for purposes of any arbitration or
legal proceeding between the Responding Party and the Notifying
Party related to such sale unless and until there is a material
change in the intellectual property rights or Know-how of either
party in which event either party shall be entitled to commence the
process set forth in Section 5.5(a) again.




     (ii) If the arbitrators determine that the Notifying Party
will be legally entitled to sell the Included ARA Products into any
of the Responding Party’s ARA Fields of Use, such sales shall
commence no earlier than (A), if the Agreement has not been
terminated prior to the Decision Date, the date three (3) years
following the Decision Date or (B), if the Agreement has
been terminated prior to the Decision Date, the date three (3)
years following the date of such termination.




     (iii) During the pendency of the arbitration pursuant to
5.5(a), the Notifying Party shall respect the arbitration process
and shall not itself sell, and



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



35









 








ARA Alliance, Purchase and Production Agreement




shall cause its Affiliates not to sell, any ARA Products into the
Responding Party’s ARA Fields of Use except in accordance with
Section 5.5(b)(ii).



          (c) The Responding Party’s right to terminate the Agreement pursuant to
5.5(a) shall be exercisable by providing the Notifying Party with a written
notice of termination (“Termination Notice”), such Termination Notice to be
delivered (i) any time up to the date six (6) months after the Decision Date if
the Responding Party commences arbitration in accordance with 5.5(a) or
(ii) at any time within one (1) year the IP Notice Receipt Date if the
Responding Party does not commence arbitration in accordance with 5.5(a). In
either case, the Termination Notice must (i) set forth an effective date for
the termination that is no earlier than the date three (3) years after the IP
Notice Receipt Date and (ii) be delivered to the Notifying Party at least six
(6) months prior to such effective date.



          (d) Notwithstanding anything in the Agreement to the contrary, upon the IP
Notice Receipt Date:




     (i) the Responding Party’s purchase and/or supply obligations
under Article 3 shall be terminated and shall instead become
purchase and/or supply rights, as the case may be, but the
Notifying Party’s obligation to purchase or supply under Article 3
shall continue;




     (ii) the Responding Party’s (but not the Notifying Party’s)
production or sales allocation (i.e. the DSM Extraction Allocation
/ DSM RBD Services Allocation or Martek Allocation, as applicable)
under Article 3 shall become unlimited;




     (iii) If DSM is the Responding party: (i) DSM’s obligation set
forth in Section 3.2(a) to allocate production between Capua and US
production to provide Martek with the lowest cost, (ii) the
parties’ obligation set forth in Section 5.3 to first meet demands
for Infant Formula Products before supplying ARA Products to any
DSM ARA Field of Use and (iii) DSM’s obligation set forth in
Section 5.4 to accept the * pricing for * customers, shall
terminate (such obligations to continue unaffected if Martek is the
Responding Party);




     (iv) If Martek is the Responding Party, Martek’s payment
obligations, under Sections 6.4 (Unabsorbed Costs, Unabsorbed
Depreciation Costs), 6.6 (Startup Costs), and 6.18 (Break Up Fee)
shall terminate (such payment obligations to continue unaffected if
DSM is the Responding Party); and




     (v) the Responding Party shall have the right to sublicense
the Notifying Party’s proprietary technology (either Martek
Proprietary Technology or DSM Proprietary Technology, as
applicable) and the Production Technology to any Third Party Toll
Manufacturers without the prior approval of or acceptance by the
Notifying Party (and the Notifying Party’s right to so sublicense
shall



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



36









 








ARA Alliance, Purchase and Production Agreement




continue to be subject to the prior approval or acceptance
requirements set forth herein).



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



37









 








ARA Alliance, Purchase and Production Agreement




6. FINANCIAL MATTERS (COSTS, PAYMENTS, ROYALTIES)




     6.1. Amounts Payable .



          (a) For each Unit of ARA that has been shipped pursuant to a Martek
Purchase Order to the address specified in the delivery instructions contained
in such Martek Purchase Order and that has been accepted by Martek, Martek
shall pay to DSM the Fixed Budget Price per Unit of ARA as determined below and
subject to the limitations and adjustments set forth herein. For the avoidance
of doubt, the parties acknowledge that Martek shall not be charged for ARA
Products delivered by DSM to Martek for purposes of Martek performing the
Martek Services for DSM.



          Except as otherwise set forth in Sections 6.1(e) and 6.1(f), prior to
November 30 of each then current year (the “Current Year”), the Committee shall
prepare, based on the Martek Budgeted Volume and the actual DSM cost
information reported by DSM to Martek pursuant to Section 6.14(b), an annual
budget for the next succeeding calendar year (the “Succeeding Year”) and shall
determine a “Fixed Budget Price” per Unit of ARA to be applicable during such
Succeeding Year. Such Fixed Budget Price per Unit of ARA shall equal the sum
of the DSM Costs per Unit of ARA for such Succeeding Year and the mark up per
Unit of ARA to be charged by DSM (the “DSM Mark Up”).



          For purposes of computing such Fixed Budget Price, such DSM Costs per Unit
of ARA and DSM Mark Up shall be determined as follows:




     (i) The DSM Costs per Unit of ARA for the Succeeding Year
shall be based on the actual DSM Costs per Unit of ARA for the
first nine months of the Current Year as adjusted for the Budgeted
Consumption Cost for the Succeeding Year pursuant to Section
6.1(c), the cost of DSM’s failure to meet the Performance Standards
for the Current Year pursuant to Section 6.1(b), and adjustments
pursuant to Section 6.15 and as further adjusted by the Martek
Budgeted Volume as well as the Practical Capacity for the
Succeeding Year, cost reductions pursuant to Section 6.2, and
changes anticipated by the Committee in Variable Costs and in Fixed
Costs, including but not limited to inflationary changes and salary
changes, for the Succeeding Year.




     (ii) The DSM Mark Up per Unit of ARA shall initially be
determined in accordance with Section 6.1(e) and Section 6.1(f) and
shall be thereafter adjusted annually in accordance with Section
6.1(d), Section 6.2 and, if applicable, Section 6.12 and/or Section
6.15.



The parties agree that the Fixed Budget Price per Unit of ARA, the DSM cost per
Unit of ARA and the DSM Mark Up per Unit of ARA shall be calculated separately
*.



          (b) For each year during the term of this Agreement, the Committee shall
agree to certain standards for the production of ARA Products by DSM and the
performance of



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



38









 








ARA Alliance, Purchase and Production Agreement




the Martek Services by Martek (“Performance Standards”). The Performance
Standards for DSM for 2004 shall be as set forth in Schedule 2.45. The
Performance Standards for Martek for 2004 shall be as set forth in Schedule
2.98. The Performance Standards shall include, but shall not be limited to,
standards for the level of fermentation productivity and the success rate of
fermentations. Any costs associated with failure by DSM to achieve the
Performance Standards during a calendar year shall not be considered in the DSM
Costs when the Committee calculates the Fixed Budget Price for the Succeeding
Year; provided, however, the Committee may explicitly decide otherwise. Any
costs associated with failure by Martek to achieve the Performance Standards
during a calendar year shall not be considered in the Martek Costs when the
Committee determines the Martek Costs for the Succeeding Year pursuant to
Section 6.1(k); provided, however, the Committee may explicitly decide
otherwise.



          (c) Notwithstanding the above, the parties agree that Martek shall be
responsible for one hundred percent (100%) of the actual costs for rate
adjustments billed by third parties to DSM for raw materials, utilities and
third party toll manufacturer services (other than services from Third Party
Toll Manufacturers), in connection with DSM’s production of ARA Products for
Martek shipped pursuant to a Martek Purchase Order. Prior to November 30 of
each calendar year, the parties shall prepare a budget setting forth an
estimate of the rates that DSM will be charged during the Succeeding Year for
raw materials, utilities and third party toll manufacturer services (other than
services from Third Party Toll Manufacturers) that DSM will use to make one (1)
Unit of ARA (the “Budgeted Consumption Cost”). At the end of each calendar
quarter during such Succeeding Year:




     (i) DSM shall determine the actual rates charged to DSM for
raw materials, utilities and third party toll manufacturer services
(other than services from Third Party Toll Manufacturers) used to
produce one (1) Unit of ARA (the “Actual Consumption Cost”) during
such quarter; and




     (ii) Within forty-five (45) days of the end of each such
calendar quarter, DSM shall provide a statement to Martek of the
difference, if any, between the Budgeted Consumption Cost and
Actual Consumption Cost for such calendar quarter. This difference
will then be multiplied by the actual number of Units of ARA
shipped and invoiced to Martek during the quarter and such amount
shall be paid to DSM (where the Actual Consumption Cost exceeds the
Budgeted Consumption Cost) or refunded to Martek (where the Actual
Consumption Cost is less than Budgeted Consumption Cost) by the end
of the following calendar quarter. Notwithstanding the foregoing,
Martek shall have the right to request that, for any calendar year
during the term of this Agreement, DSM lock-in a fixed price for
all or a portion of its raw material, utility and third party toll
manufacturer services (other than services from Third Party Toll
Manufacturers) costs to be incurred by DSM (if possible) in
connection with producing ARA Products for Martek. DSM shall
lock-in such fixed prices if Martek and DSM agree on an amount for
such prices.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



39









 








ARA Alliance, Purchase and Production Agreement




          (d) The DSM Mark Up shall be adjusted for inflationary increases in the
PPI at the beginning of each calendar year, beginning January 1, 2005, as
follows, if applicable:




     (i) The DSM Mark Up shall be increased by the percentage
increase in the PPI from January 1 of the previous calendar year
through December 31 of the previous calendar year, but such
increase shall be no greater than the percentage that Martek has
increased its prices for ARA Products to its customers during the
same period.




     (ii) Notwithstanding the above, if the cumulative percentage
increase in the DSM Mark-Up resulting from an adjustment pursuant
to Section 6.1(d) from January 1, 2004 to the beginning of any
calendar year is less than the cumulative percentage increase in
the PPI from January 1, 2004 through the beginning of any calendar
year and such difference (the “Cumulative Inflationary Difference”)
amounts to * or greater, then the parties will negotiate in order
to give DSM an additional increase in the DSM Mark-Up for
inflation, but in no case shall the inflationary adjustment to the
DSM Mark-up be less than *.



          (e) The Fixed Budget Price per Unit of ARA produced at DSM’s Capua
facility for 2004 is *, consisting of a DSM Mark Up per Unit of ARA of * and
DSM Costs per Unit of ARA of *. This Fixed Budget Price for Capua production
for 2004 is based on the production by DSM and purchase by Martek of ARA
Products in the form of Crude Oil. For 2004, the Martek Budgeted Volume for ARA
Products purchased by Martek from DSM produced at the Capua facility is * Units
of ARA. For 2004, the Technical Capacity for DSM’s Capua facility is * Units of
ARA. For 2004, the Practical Capacity for DSM’s Capua facility is * Units of
ARA. The prices set forth in this Section 6.1(e) are based on the yield
assumptions set forth in Schedule 6.15. Should actual yields of Units of ARA,
from Crude Oil through Finished Oil, differ from such assumptions, on a
quarterly basis, within forty five (45) days of the end of each calendar
quarter, the Committee shall agree upon a final statement of the number of
actual Units of ARA (based on such actual yields) shipped to Martek during the
preceding quarter along with a reconciliation of this amount to the amount
actually billed to Martek during that quarter and shall, as applicable, (i)
issue an invoice to Martek for the number of Units of ARA shipped greater than
that billed multiplied by the applicable Fixed Budget Price per Unit of ARA or
(ii) issue a credit to Martek for the number of Units of ARA shipped less than
that billed multiplied by the applicable Fixed Budget Price per Unit of ARA.
Notwithstanding anything to the contrary contained herein, the Fixed Budget
Price per Unit of ARA for the first * Units of ARA produced at DSM’s Capua
facility shall be *.



          (f) The Fixed Budget Price per Unit of ARA produced at DSM’s Belvidere
facility for 2004 is *, comprising a DSM Mark Up per Unit of ARA of * and DSM
Costs per Unit of ARA of *. The Fixed Budget Price per Unit of ARA produced at
DSM’s Belvidere facility for 2005 is *, comprising a DSM Mark Up per Unit of
ARA of * and DSM Costs per Unit of ARA of *. For 2004 and 2005, the Martek
Budgeted Volume for ARA Products purchased by Martek from DSM produced at the
Belvidere facility is * Units of ARA and *



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



40









 








ARA Alliance, Purchase and Production Agreement




Units of ARA, respectively. For 2004 and 2005, the Technical Capacity for
DSM’s Belvidere facility is * Units of ARA and * Units of ARA, respectively.
For 2004 and 2005, the Practical Capacity for DSM’s Belvidere facility is *
Units of ARA and * Units of ARA, respectively. Should the parties agree to an
expansion for the Belvidere facility beyond the Belvidere Phase I Build-out,
then the foregoing numbers and the Fixed Budget Price per Unit of ARA for 2005
will be adjusted to reflect the additional capacity as agreed upon by the
parties. The prices set forth in this Section 6.1(f) are based on the yield
assumptions set forth in Schedule 6.15. Should actual yields of Units of ARA,
from Biomass through Finished Oil, differ from such assumptions, on a quarterly
basis, within forty-five (45) days of the end of each calendar quarter, the
Committee shall agree upon a final statement of the number of actual Units of
ARA (based on such actual yields) shipped to Martek during the preceding
quarter along with a reconciliation of this amount to the amount actually
billed to Martek during that quarter and shall, as applicable, (i) issue an
invoice to Martek for the number of Units of ARA shipped greater than that
billed multiplied by the applicable Fixed Budget Price per Unit of ARA or (ii)
issue a credit to Martek for the number of Units of ARA shipped less than that
billed multiplied by the applicable Fixed Budget Price per Unit of ARA.



          (g) If, during the term of this Agreement, any Martek customer that is
permitted by contract with Martek to produce ARA Products in fact produces its
own ARA Products, then Martek shall pay to DSM, on a quarterly basis, * of any
royalties and any other related income received by Martek from such customer in
such calendar quarter that are directly attributable to such customer produced
quantity of ARA Products (the “Customer ARA Production Royalty”). Martek shall
pay DSM any Customer ARA Production Royalty within forty-five (45) days
following the end of the quarter in which such royalties and any other related
income are received by Martek.



          (h) In case DSM outsources production of ARA Products to a Third Party
Toll Manufacturer pursuant to the terms of this Agreement :




     (i) in such cases where limitations of the DSM production
facilities result in a lower output than the Technical Capacity
agreed upon by the Committee, notwithstanding any provision to the
contrary contained in this Agreement, unless the Committee decides
otherwise, Martek shall be charged no more per Unit of ARA produced
by such Third Party Toll Manufacturer than the Fixed Budget Price
per Unit of ARA produced at DSM’s own facilities.




     (ii) in such cases where increased volume demand by Martek
results in a total demand by Martek which is higher than the
Technical Capacity of DSM, and expansion by DSM is not considered
as a realistic option, notwithstanding any provision to the
contrary contained in this Agreement, if the Committee decides,
pursuant to this Agreement, that DSM shall supply the incremental
volume by outsourcing the production to a Third Party Toll
Manufacturer, then, unless the Committee decides otherwise, the
total mark-up per Unit of ARA charged to DSM by the Third Party
Toll Manufacturer plus the DSM Mark Up per



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



41









 








ARA Alliance, Purchase and Production Agreement




Unit of ARA charged by DSM to Martek shall not exceed the then
current DSM Mark Up per Unit of ARA for a Unit of ARA produced at
DSM’s own facilities.



          (i) Notwithstanding anything to the contrary set forth above, for those
Units of ARA in ARA Products that Martek sells to customers that are sold for
use for other than Infant Formula Products and/or Products for Babies, Martek
shall pay to DSM, a fee (the “Profit Sharing Fee”) equal to the following:




     (i) * of Adult Applications Gross Profits, plus




     (ii) * of Gross Profits on Other ARA Applications, less




     (iii) The DSM Mark Up per such Units of ARA



Where Martek sells such ARA Units in combination with Units of DHA for use in
ARA Applications for Adults and Other ARA Applications, the Adult Applications
Gross Profits or Gross Profits on Other ARA Applications, as applicable, shall
be equal to the Gross Profits on the Units of ARA (from DSM’s manufacture of
the ARA Products to Martek’s sales to its customer, less the selling and
transaction costs related to such sales) that are ultimately sold for use in
such ARA Applications for Adults or Other ARA Applications, as applicable,
based on the average selling price in the Martek ARA Field of Use for similar
Units of ARA sold alone (but in similar quantities as the combined product) and
not in combination with Units of DHA.



Such Profit Sharing Fee shall be paid to DSM on a quarterly basis within
forty-five (45) days following the end of the quarter in which such Adult
Applications Gross Profits or Gross Profits on Other ARA Applications, as
applicable, are received by Martek.



          (j) In case of new non-fermentation technology to produce ARA Products the
Parties will negotiate in good faith to the extent ARA Products are produced
with such new technology, a new economic arrangement that will maintain their
relative economic position as under the fermentation technology as reflected
elsewhere in this Agreement.



          (k) For each Unit of ARA upon which Martek has performed the Martek
Services and that has been shipped pursuant to a DSM Purchase Order to the
address specified in the delivery instructions contained in such DSM Purchase
Order and that has been accepted by DSM, DSM shall pay to Martek the Martek
Costs per Unit of ARA calculated in accordance with Schedule 2.98 plus a *
markup. Unless otherwise agreed to by the parties, the Martek Costs per Unit of
ARA for a Succeeding Year will be agreed to by the Committee by November 30 of
each Current Year and shall be based on the DSM Budgeted Volume for the
Succeeding Year and the actual Martek Costs per Unit of ARA for the first three
(3) calendar quarters of the Current Year. The Martek Costs for RBD Services
per Unit of ARA for 2004 and 2005 shall not exceed *.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



42









 








ARA Alliance, Purchase and Production Agreement




          (l) Notwithstanding anything to the contrary contained in this Agreement,
in determining the Fixed Budget Price for a Succeeding Year for Units of ARA
produced at Belvidere, such Fixed Budget Price shall not be increased or
decreased by more then * per year due to any change in non-ARA production at
DSM’s Belvidere facility.



     6.2. Reduction of DSM Costs.



          (a) Reductions in DSM Costs per Unit of ARA resulting from the efforts of
an ARA Research Project jointly funded by the parties, pursuant to Section
7.1(c), shall be shared equally by Martek and DSM from the date such savings
are achieved by reducing the then applicable DSM Costs per Unit of ARA by one
hundred percent (100%) of such reduction in DSM Costs per Unit of ARA and
increasing the DSM Mark Up by fifty percent (50%) of such reduction in DSM
Costs per Unit of ARA.



          (b) Reductions in DSM Costs per Unit of ARA resulting from an ARA Research
Project presented to, but not approved by, the Committee for joint funding by
the parties pursuant to Section 7.1(c) shall be applied one hundred percent
(100%) to the Proponent Party solely funding such ARA Research Project. If DSM
is such Proponent Party, resultant reductions in DSM Costs per Unit shall, from
the date such savings are achieved, reduce the then applicable DSM Costs per
Unit of ARA by one hundred percent (100%) of such reduction in DSM Costs per
Unit of ARA and increase the DSM Mark Up per Unit of ARA by one hundred percent
(100%) of such reduction in DSM Costs per Unit of ARA. If Martek is such
Proponent Party, resultant reductions in DSM Costs per Unit shall, from the
date such savings are achieved, reduce the then applicable DSM Costs per Unit
of ARA by one hundred percent (100%) of such reduction in DSM Costs per Unit of
ARA but shall not increase the DSM Mark Up per Unit of ARA.



          (c) Notwithstanding anything to the contrary contained herein, (i)
reasonable rate changes, as agreed to by the Committee, in Variable Costs and
Fixed Costs including but not limited to inflationary changes and salary
changes and (ii) reductions in DSM Costs per Unit of ARA due to volume
increases based upon agreed upon extensions of production facilities resulting
in increased capacity, shall not be taken into account when adjusting the DSM
Mark Up pursuant to this Section 6.2.



          (d) Reductions in DSM Costs per Unit of ARA resulting from other causes
shall not reduce DSM Costs per Unit of ARA in the calendar year such reduction
occurs, but, for subsequent calendar years, such cost reductions shall be
shared equally by Martek and DSM by reducing the then applicable DSM Costs per
Unit of ARA by one hundred percent (100%) of such reduction in DSM Costs per
Unit of ARA and increasing the DSM Mark Up by fifty percent (50%) of such
reduction in DSM Costs per Unit of ARA.



          (e) Any such cost reduction shall be computed separately for ARA Products
produced at DSM’s Capua facility and at DSM’s Belvidere facility. When
calculating the amount



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



43









 








ARA Alliance, Purchase and Production Agreement




of cost reductions at each such facility, such calculation should be based
on the agreed Practical Capacity for such facility.



          (f) Notwithstanding the above, the parties agree that the equivalent (in
Euros or Dollars, as applicable) of the first * of reductions in the DSM Costs
per Unit of ARA below the DSM Costs per Unit of ARA set forth in Section 6.1(e)
and Section 6.1(f) above (as determined separately for production of ARA
Products at DSM’s Belvidere and Capua facilities) will not result in any
adjustment to the DSM Mark Up per Unit of ARA.



          (g) The parties acknowledge that it may be difficult to allocate
reductions in DSM Costs and agree that the Committee shall, in good faith,
determine the proper allocation of such cost reductions.



          (h) In the event that any reduction in the DSM Cost per Unit of ARA, that
has caused the DSM Mark Up per Unit of ARA to be increased, shall cease to be
realized in a future calendar year, then for the next succeeding calendar year,
the DSM Mark Up per Unit of ARA shall be reduced in accordance with the higher
DSM Costs per Unit of ARA.



     6.3. Deviations from Budget.



          (a) If the volume of ARA Products actually ordered by Martek in Martek
Purchase Orders during a Current Year varies by * from the Martek Budgeted
Volume used in determining the Fixed Budget Price for such Current Year
pursuant to Section 6.1(a):




     (i) Where such variation exceeds the Martek Budgeted Volume
and if DSM decides to supply Martek any or all of such additional
volume of ARA Products, Martek shall pay the same Fixed Budget
Price it would pay for its orders of ARA Products that were within
the Martek Budgeted Volume; and




     (ii) Where such variation falls below the Martek Budgeted
Volume and DSM has been unable to cover such variation by (A)
selling an equivalent volume of ARA Products in DSM’s ARA Fields of
Use or (B) finding an alterative use for the unused Practical
Capacity caused by such variation, Martek shall pay the Unabsorbed
Costs to DSM in accordance with Section 6.4(a).



          (b) If the volume of ARA Products actually ordered by Martek in Martek
Purchase Orders during a Current Year varies by * from the Martek Budgeted
Volume used in determining the Fixed Budget Price for such Current Year
pursuant to Section 6.1(a):




     (i) Where such variation exceeds the Martek Budgeted Volume,
and if DSM decides to supply Martek any or all of such additional
volume of ARA Products, Martek shall have the benefit of the
dilution of the aggregate fixed costs, if any, on the incremental
volume ordered by Martek *; and



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



44









 








ARA Alliance, Purchase and Production Agreement





     (ii) Where such variation falls below the Martek Budgeted
Volume and DSM has been unable to cover such variation by (A)
selling an equivalent volume of ARA Products in DSM’s ARA Fields of
Use or (B) finding an alternative use for the unused Practical
Capacity caused by such variation, Martek shall pay to DSM the
Unabsorbed Costs in accordance with Section 6.4(a).



          (c) In the case where, pursuant to Section 6.3(b)(i), Martek shall have
the benefit of the dilution of the aggregate fixed costs for the incremental
volume of ARA Products that exceeds the Martek Budgeted Volume by *, the
Committee shall, within sixty (60) days of the end of the applicable Current
Year, recalculate what the Fixed Budget Price per Unit of ARA for the Current
Year would have been, based on the increased volume of ARA Products actually
purchased by Martek that exceeds the Martek Budgeted Volume by * during such
Current Year. If such recalculated Fixed Budget Price per Unit of ARA is less
than the Fixed Budget Price per Unit of ARA charged to Martek during such
Current Year, DSM shall refund to Martek, within ninety (90) days of the end of
such Current Year, the difference between what Martek actually paid to DSM
during such Current Year for ARA Products and the amount it would have paid to
DSM at the recalculated Fixed Budget Price per Unit of ARA.



     6.4. Unabsorbed Costs; Unabsorbed Depreciation Costs.



          (a) For a period of up to * from DSM first incurring DSM Unabsorbed
Costs, Martek shall pay to DSM, on a quarterly basis, all of DSM’s Unabsorbed
Costs, provided that DSM shall be obligated to use its commercially reasonable
efforts to find an alternative use for its unused Practical Capacity or
otherwise mitigate such unabsorbed costs before calculating its Unabsorbed
Costs for such quarter. Martek shall not pay any DSM Mark Up on any Unabsorbed
Costs. If, during or after * DSM has reduced its Practical Capacity in
accordance with Martek’s Actual Usage and DSM subsequently incurs DSM
Unabsorbed Costs based on Martek’s Actual Usage declining even further, then a
* shall commence and shall apply only to Unabsorbed Costs resulting from such
further reductions in Martek’s Actual Usage.



          (b) Martek shall pay to DSM, on a quarterly basis, DSM’s Unabsorbed
Depreciation Costs. Martek shall pay no DSM Mark Up on such Unabsorbed
Depreciation Costs.



          (c) DSM shall send Martek an invoice after the end of each quarter that
shall set forth any payments due from Martek for any Unabsorbed Costs and/or
Unabsorbed Depreciation in respect of such quarter and Martek shall pay each
such invoice within forty-five (45) days of its receipt thereof.



     6.5. Maximum Price to Martek; Equalization Reserve. Notwithstanding
anything to the contrary herein, in the event that the average Fixed Budget
Price per Unit of ARA and/or average cost to Martek per Unit of ARA in any
Current Year (such average cost per Unit of ARA shall equal the sum of (i) the
average Fixed Budget Price per Unit plus (ii) the total of any Unabsorbed Costs
and Unabsorbed Depreciation Costs divided by the number of Units of ARA



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



45









 








ARA Alliance, Purchase and Production Agreement




purchased by Martek during such year) exceeds at any time * (the “Cap Price”),
Martek shall only be required to pay to DSM the Cap Price per Unit of ARA, and
the remaining amount shall be recorded in a book entry account maintained by
DSM for the purpose of tracking all differences between the Cap Price and what
Martek would have paid to DSM absent the Cap Price (the “Equalization
Reserve”). For those portions of the Fixed Budget Price which are specified
herein to be paid in Euro’s, for purposes of calculating the Cap Price, such
Euros shall be converted to Dollars based upon the average exchange rate over
the preceding quarter. The Cap Price shall be adjusted as of the first day of
each calendar year by a percentage equal to the percentage change in the PPI
between such first day of the calendar year and the first day of the preceding
calendar year. For purposes of calculating such Cap Price adjustment, the
starting point for each year will be the adjusted Cap Price of the immediately
preceding year. In the event that the average Fixed Budget Price per Unit of
ARA and/or average cost to Martek per Unit of ARA (after taking into
consideration the cost to Martek of any Unabsorbed Costs and Unabsorbed
Depreciation Costs) in any subsequent calendar year is less than the then
current Cap Price and there is a positive balance in the Equalization Reserve,
then, within thirty (30) days of the end of such calendar year, Martek shall
pay to DSM the lesser of (i) the amount in the Equalization Reserve or (ii) an
amount equal to (A) the number of Units of ARA purchased in such subsequent
calendar year multiplied by (B) the difference between the then current Cap
Price and the average cost to Martek per Unit of ARA (after taking into
consideration the cost to Martek of any Unabsorbed Costs and Unabsorbed
Depreciation Costs) in such subsequent calendar year. Any such amount so paid
by Martek shall serve to reduce the Equalization Reserve. Notwithstanding the
above, where Martek is paying DSM the Cap Price on a Unit of ARA as a result of
declines in Martek’s volume demands for ARA Products, Martek will pay to DSM an
additional amount equal to one-half of Martek’s Gross Profit on the sale of
such Units of ARA to its customers. Any such additional amount shall reduce the
Equalization Reserve, but in no event shall Martek pay to DSM more that it
would per Unit of ARA pursuant to Section 6.12. Except as provided in Section
9.4(c), Martek shall have no obligation upon expiration or termination of this
Agreement to pay DSM any amount in the Equalization Reserve.



     6.6. Startup Costs. The parties acknowledge and agree that DSM
will be likely to incur certain costs in connection with the commencement of
operations of expansions at DSM’s Belvidere facility as well as expansions of
production of ARA Products at new sites. These costs are likely to include
costs that are directly related to certain inefficiencies in producing ARA
Products at a new production facility (including, for example, batches of
Biomass that do not meet the relevant Specifications) and other costs (the
“Production Startup Costs”). The parties agree that during 2004 and 2005, DSM
shall be responsible for, and not charge to Martek, up to * of Production
Startup Costs related to the Phase 1 Belvidere Build-out and such costs shall
be an Excluded Cost. Martek shall reimburse DSM, in twelve (12) equal
quarterly installments, the amount that the actual Production Startup Costs
incurred by DSM for the Phase 1 Belvidere Build-out exceed *, but in no event
shall the total amount to be reimbursed by Martek pursuant hereto exceed one
million US Dollars ($1,000,000.00). DSM shall also be responsible for, and not
charge to Martek, Production Startup Costs related to the Phase 1 Belvidere
Build-out that are in excess of * and such costs shall be an Excluded Cost.
Production Startup Costs for expansions other than for the Phase I Belvidere
Build-out that are agreed to and approved by the



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



46









 








ARA Alliance, Purchase and Production Agreement




Committee shall be billed separately to Martek in a manner agreed upon by
the Committee and any such Production Startup Costs shall be an Excluded Cost.



     6.7. Interest Charges for Inventory. Either party may request from
time to time that the other party maintain an inventory of ARA Products for the
sole purpose of fulfilling Martek Purchase Orders or DSM Purchase Orders, as
applicable. If a party agrees to maintain such inventory, then such party
shall charge the other party interest on the Fixed Budget Price or fees for
Martek Services as set forth in Section 6.1(k), as applicable, that would be
paid for such inventory for the period that such party maintains such inventory
at an annualized rate of interest equal to the average Euribor rate plus three
percent (3%) for such period.



     6.8. DSM-Assisted IF Customer Fee. Martek will pay DSM * of the
license fees paid by DSM-Assisted Infant Formula Customers to Martek or any of
its Affiliates (the “DSM-Assisted IF Customer Fee”) and Martek will pay to DSM
an additional amount equal to * of the Net Sales of ARA Products by Martek and
its Affiliates to such DSM-Assisted Infant Formula Customers (the “Additional
IF Customer Fees”). Martek shall pay DSM any DSM-Assisted IF Customer Fees,
within forty-five (45) days following the end of the quarter in which Martek or
any such Affiliate receives such DSM-Assisted IF Customer Fee and any
Additional IF Customer Fees within forty-five (45) days following the end of
the quarter in which Martek or any such Affiliate receives payment for the Net
Sales to such DSM-Assisted Infant Formula Customers.



     6.9. Martek Proprietary Technology Royalty. With respect to any
ARA Product sold by DSM or any DSM Affiliate to a third party that is not an
Affiliate of either DSM or Martek in the DSM ARA Field of Use after the Signing
Date, DSM will pay Martek a royalty of * on the Net Sales of such ARA Product
in the DSM ARA Field of Use during the first three (3) years following its
commercial introduction into the DSM ARA Field of Use, and thereafter, for the
term of this Agreement, shall pay Martek a * royalty on the Net Sales of such
ARA Product (the “DSM ARA Field of Use Royalty”); provided, however, that the
DSM ARA Field of Use Royalty shall not exceed * of DSM’s Gross Profit on such
sales. DSM shall pay Martek any DSM ARA Field of Use Royalties quarterly,
within forty-five (45) days following the end of the quarter. *. In such
cases where DSM reduces the price of the products referred to in this Section
6.9 as an incentive for a DSM customer to purchase other DSM products, the DSM
ARA Field of Use Royalty shall be based on the non-reduced price.



     6.10 [Reserved]



     6.11. Invoices and Payment.



          (a) DSM shall invoice Martek for each Martek Purchase Order no earlier
than the date on which such order is shipped, and Martek shall remit all
payments due to DSM within thirty (30) days following the later of (i) the
invoice date for such shipment and (ii) the receipt by Martek of a signed
certificate of analysis from DSM relating to such shipment, provided that the
total aggregate amount of unpaid invoices during any given month shall not at
any time exceed



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



47









 








ARA Alliance, Purchase and Production Agreement




one-hundred fifty percent (150%) of the average monthly total invoices
sent by DSM to Martek during the three (3) months immediately preceding such
month.



          (b) All ARA Products produced at DSM’s Capua facility will be billed and
paid for in Euros and all ARA Products produced at DSM’s Belvidere facility
will be billed and paid in US Dollars except that one-half of the DSM Mark Up
on ARA Products produced at DSM’s Belvidere facility will be billed and paid
for in Euros. DSM shall charge Martek interest (from the due date of the
payment until the date such payment is actually received by DSM) on payments
that are more than fifteen (15) days late at an annualized rate of interest
equal to the Euribor rate in effect as of the first day of such quarter plus
three percent (3%).



          (c) Martek shall invoice DSM for each DSM Purchase Order no earlier than
the date on which such order is shipped, and DSM shall remit all payments due
to Martek within thirty (30) days following the later of (i) the invoice date
for such shipment and (ii) the receipt by DSM of a signed certificate of
analysis from Martek relating to such shipment.



          (d) All ARA Products upon which Martek Services have been performed will
be billed and paid for in US Dollars. Martek shall charge DSM interest (from
the due date of the payment until the date such payment is actually received by
Martek) on payments that are more than fifteen (15) days late at an annualized
rate of interest for each quarter equal to the Euribor rate in effect as of the
first day of such quarter plus three percent (3%).



          (e) Amounts due from one party to the other pursuant to Section
7.2(c)(iv)(B) shall be paid within forty-five (45) days following the end of
each quarter.



          (f) Except as otherwise expressly provided herein, all amounts to be paid
by a party to the other under this Agreement shall be due and payable within
thirty (30) days of the invoice date in respect thereof. All amounts due and
payable and not paid within the applicable grace period shall bear interest for
each quarter or portion thereof at an annualized rate of interest equal to the
Euribor rate in effect as of the first day of such quarter plus three percent
(3%), calculated from the due date of the payment until the date such payment
is actually received by the receiving party.



     6.12. Margin Protection.



          (a) Martek and DSM shall share data on Gross Profits on sales of ARA
Products and future expectations of declines in Gross Profit per Unit of ARA,
if applicable, in the quarterly meetings of the Committee. If the average Gross
Profit per Unit of ARA in US Dollars received by Martek and its Affiliates on
sales of a Unit of ARA falls below the DSM Mark Up per Unit of ARA for a period
of two (2) consecutive calendar quarters, Martek shall give DSM prompt written
notice thereof, whereupon the parties agree that the DSM Mark Up per Unit of
ARA shall be reduced as of the day of notification to an amount that would be
equal to the average Gross Profit in US Dollars received by Martek and its
Affiliates on sales of a Unit of ARA after the adjustment for such reduction in
the DSM Mark Up per Unit of ARA.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



48









 








ARA Alliance, Purchase and Production Agreement




          (b) For the purposes of calculating Martek’s Gross Profit in this Section
6.12, (i) Martek agrees that it will not include in the calculation any ARA
Products sold by Martek to its customers at a reduced price as an incentive for
the Martek customers to purchase other Martek products and (ii) to the extent
that the ARA Products are Blended Products, then the Gross Profit per Unit of
ARA in such ARA Products will be determined by multiplying (A) the Gross Profit
in US Dollars received by Martek and its Affiliates on sales of the Blended
Product by (B) a fraction where the numerator is the number of Units of ARA in
the Blended Product and the denominator is the total number of units of fatty
acids in the Blended Product, but in no event shall such amount be less than
the Gross Profit on ARA Products where ARA Products are sold as single product.



     6.13. Renegotiation of Pricing Arrangement. Prior to August 31,
2014, the parties will review the pricing and the DSM Mark Up for ARA Products
and use their good faith efforts to renegotiate such prices effective on August
31, 2014. If renegotiation is unsuccessful, pricing will be changed so that
the parties share equally in the Gross Profit per each Unit of ARA sold (from
the manufacture and delivery of ARA Products to its sale to a direct customer
of Martek or DSM) effective August 31, 2014.



     6.14. Reporting of Production Costs.



          (a) Within forty-five (45) days of the end of each calendar quarter during
the term of this Agreement, Martek shall provide DSM an accounting of the
actual Martek Costs per Unit of ARA for such calendar quarter.



          (b) Within forty-five (45) days of the end of each calendar quarter during
the term of this Agreement, DSM shall provide Martek an accounting of the
actual DSM Costs per Unit of ARA for such calendar quarter.



     6.15. Adjustment For Changes in Extraction and/or RBD Yields. The
DSM Costs per Unit of ARA and the DSM Mark Up per Unit of ARA are based on the
average standard extraction and RBD yields set forth in Schedule 6.15. The
Fixed Budget Price per Unit of ARA shall be adjusted by agreement of the
Committee to reflect changes in such yields due to changes in the Biomass or
Crude Oil.



     6.16. Books and Records.



          (a) Each party shall maintain complete and accurate records of its
production costs, income, sales of ARA products, capital costs, Production
Start-Up Costs and other information reasonably necessary to verify that such
party is complying with its obligations under this Agreement. The parties each
shall have the right, upon reasonable prior written notice, through an
independent public accounting firm reasonably acceptable to the other party, to
examine the other party’s books, records and accounts relating to the
performance of its obligations under this Agreement. Such audit right shall be
exercisable by a party, in regard to the books records and accounts related to
a calendar year, by delivery of written notice to the



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



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other party (the “Audited Party”) within six (6) months after the end of such
calendar year of its desire to have such an audit conducted; provided, however,
that an Audited Party shall have the right, exercisable by delivery of written
notice to the other party, to postpone the commencement of the audit until the
Audited Party shall have completed its own internal accounting review with
respect to such calendar year.



          (b) A party’s books, records and accounts being examined pursuant to
Section 6.16(a) shall be deemed to be a complete and final statement of costs,
fees and prices for the year subject to audit upon delivery of such books,
records and accounts to the appointed independent public accounting firm and
may not be amended, revised or supplemented at any time following such date for
purposes of such audit except for changes, either favorable or unfavorable to
either party, as a result of findings or inquiries by the appointed independent
public accounting firm. All information regarding a party’s business received
in any such examination shall be held in confidence. The expenses of such
audits shall be borne by the party requesting such audit. Any overpayment or
underpayment by one party of the amounts that the other party was entitled to
receive under this Agreement shall be promptly refunded to or paid by such
other party, as the case may be, with annualized interest for such period at
the average Euribor rate plus three percent (3%) calculated from the date(s) of
the overpayment or underpayment until the date of refund or payment in
accordance herewith. If any such audit establishes an aggregate overbilling or
underpayment by one party during the period covered by the audit by five
percent (5%) or more of the amounts to which the other party was entitled, then
such overbilled or underpaid party shall be reimbursed by the other party for
the expenses of the audit. The parties each shall be prohibited from accessing
the other party’s books, records and accounts and any privileged documents
examined by the accountant, and may receive only an accounting report from the
auditor.



     6.17. Technology Transfer Fee. In consideration of the licenses
granted by DSM to Martek herein and the transfer of technologies pursuant to
the provisions of Section 7.5(b), Martek shall pay to DSM a one-time non
refundable fee of ten million US Dollars ($10,000,000.00), four million US
Dollars ($4,000,000.00) of which shall be payable within five (5) days of the
Signing Date, four million US Dollars ($4,000,000.00) of which shall be payable
on November 2, 2004 and two million US Dollars ($2,000,000.00) of which shall
be payable on November 2, 2005.



     6.18. Break Up Fee.



          (a) In the event that DSM desires to expand its ARA production capacity,
it shall have the right to provide Martek with a detailed proposal of such
expansion plans for Martek’s review. If Martek provides its written approval
to DSM for such proposed expansion plans (“Approved Expansion Plans”), then
fifty percent (50%) of the actual capital costs of the Approved Expansion Plans
(provided they are not materially changed from those approved by Martek) shall
be added to a book entry account maintained by DSM for such purposes (the
“Break Up Fee Account”). DSM shall maintain a separate subaccount of the Break
Up Fee Account for each Approved Expansion Plan. The parties hereby agree that
the plans for the



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



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Phase 1 Belvidere Build-out constitute Approved Expansion Plans and that
the Phase 1 Belvidere Build-out subaccount of the Break Up Fee Account shall
reflect a balance in respect thereof of *



          (b) The balance in a subaccount of the Break Up Fee Account for an
expansion shall be reduced (but not below zero) by * for each * of DSM Mark Up,
or equivalent thereof, received by DSM from Martek in respect of ARA Products
produced from the expansion capacity that generated such subaccount.



          (c) Upon any expiration of this Agreement or a termination of this
Agreement by DSM for cause pursuant to Section 9.2 or 5.5 when Martek is the
Notifying Party, Martek shall pay to DSM the balance in each subaccount of the
Break Up Fee Account within forty-five (45) days of any such expiration or
termination.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



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7. PRODUCT DEVELOPMENTS AND PATENTS




     7.1. R&D Collaboration.



          (a) The R&D Collaboration Goals. Each Party acknowledges and agrees that
it shall endeavor in good faith to cooperate with the other party in accordance
with the terms set forth herein to jointly define and conduct research projects
that have a reasonable likelihood of developing (i) new or improved production
processes for ARA Products, (ii) new or improved ARA Product formulations,
(iii) new or improved ARA Product usages, and (iv) other ARA improvements or
new developments mutually agreed upon by the parties, which may include
clinical trials (the “R&D Collaboration Goals”). At the fifth (5th) anniversary
of the Signing Date each party will evaluate the R&D collaboration and the
parties will decide in their sole discretion whether and mutually how to
proceed with any future R&D collaboration



          (b) The R&D Committee. Promptly after the Signing Date, the Committee
shall form a committee which shall consist of four (4) members with appropriate
scientific and marketing knowledge and expertise in the area of ARA Product
production and applications and related technological areas: two (2) members
shall be appointed by Martek and two (2) members shall be appointed by DSM (the
“R&D Committee”). Each party shall identify one of the members that it
appoints to the R&D Committee as its “R&D Leader.” If either party decides at
any time to replace its designated R&D Leader or its other R&D Committee
members, it may do so by written notice to the other party’s R&D Leader. The
R&D Committee shall meet promptly upon its appointment by the Committee, and
thereafter at least quarterly, for the purpose of defining potential research
projects in furtherance of the R&D Collaboration Goals. The R&D Committee
shall meet at such place as it may reasonably select, in person or by
conference call as the R&D Committee decides.



          (c) Research Project Proposals.




     (i) Each party agrees that, prior to funding any ARA Research
Project, it shall submit such research project to the R&D Committee
for review. The respective parties may submit any proposed ARA
Research Project to the R&D Committee through its R&D Leader. (The
submitting party shall hereinafter be referred to as the “Proponent
Party”.) The R&D Committee shall consider each proposed ARA
Research Project in good faith in view of both parties’ commercial
interests and the R&D Collaboration Goals. All proposed ARA
Research Projects shall be put to a vote of the R&D Committee
members pursuant to the voting procedures for the Committee that
are described in Article 8 of this Agreement. In the event that
certain R&D Committee members request that certain changes or
amendments be made to the ARA Research Project as proposed by the
Proponent Party, the Proponent Party shall in good faith consider
and attempt to incorporate or address such requests.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



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     (ii) If the R&D Committee members unanimously approve a
proposed ARA Research Project, the Proponent Party shall submit to
the Committee for approval a detailed description of the proposed
ARA Research Project and expected benefits, an estimate of the
projected cost of the project, a proposal regarding the parties’
respective responsibilities in conducting the research, a list of
potential subcontractors and consultants that may be used in
connection with the project (including an estimate of the proposed
scope of work and fees for each such subcontractor and consultant),
a person of appropriate skill to serve as the leader of the
approved ARA Research Project (the “Project Leader”) and any other
information relevant to an evaluation of the proposed ARA Research
Project (a “Project Plan”) with an indication that the R&D
Committee has approved the ARA Research Project. Notwithstanding
the approval of the R&D Committee, the Committee shall have final
approval authority over the proposed ARA Research Project including
but not limited to the budget for the ARA Research Project.




     (iii) If a proposed ARA Research Project is not unanimously
approved by the R&D Committee, the Proponent Party shall have the
option of submitting a Project Plan for such ARA Research Project
to the Committee, with an indication that the R&D Committee did not
approve the project. If a proposed ARA Research Project is not
approved unanimously by the Committee, the Proponent Party shall
have the option of resubmitting a Project Plan for such ARA
Research Project to the Committee, with an indication that the
Committee previously had rejected the project. The parties’
respective R&D Leaders shall then have an opportunity to present
their respective views on the merits or drawbacks of the proposed
project for consideration by the Committee as well as any proposed
modifications to the Project Plan that would render the rejected
plan acceptable. The Committee shall promptly (taking into
account, if appropriate, the time sensitive nature of the proposed
project) review each Project Plan submitted by the Proponent Party
and shall determine unanimously whether to proceed with the
proposed ARA Research Project, either as proposed or in a modified
format, in view of both parties’ commercial interests and the R&D
Collaboration Goals.




     (iv) Each party shall treat the Project Plan, and any
information relating to discussions of a proposed ARA Research
Project in connection with this Section 7.1(c), as Confidential
Information in accordance with Section 10.2 hereto.



          (d) Management of Approved Research Project. The Project Leader promptly
shall assemble a project team for the implementation of the ARA Research
Project. The Project Leader shall be responsible for managing the
implementation of the ARA Research Project as set out in the Project Plan as
approved by the Committee. The Project Leader shall also have authority and
responsibility for the following (without limitation):



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



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     (i) Managing and allocating the funds designated by the
Committee for the ARA Research Project in accordance with Section
7.1(f) hereto;




     (ii) Liaising with the Committee to provide regular updates,
at least quarterly, of the team’s progress;




     (iii) Requesting, if appropriate, additional funds from the
Committee; and




     (iv) Engaging subcontractors or consultants to assist with
the ARA Research Project, provided such subcontractors and
consultants were previously identified in the proposed Project Plan
and are engaged on terms that are consistent with the estimates set
forth in the proposed Project Plan. The Project Leader shall
ensure that any subcontractor or consultant engaged in connection
with the joint ARA Research Project shall agree in writing to
assign to both parties all intellectual property rights in any
inventions, improvements or technologies that such subcontractor or
consultants develop in connection thereto and comply with
confidentiality obligations that are no less restrictive than those
set forth herein.



          (e) Use of the Parties’ Employees, Facilities and Resources. Each party
shall provide the Project Leader with all reasonable cooperation necessary or
beneficial to each approved ARA Research Project, including without limitation,
providing reasonable access to facilities, providing employees of appropriate
skill level to serve on the project team, and otherwise assisting with the ARA
Research Project. Each party shall use its commercially reasonable efforts to
promptly disclose to the other party any technologies within its possession (to
the extent it has the right to do so), that are relevant or useful to an
approved Project Plan, and hereby grants, subject to any third party
restrictions then in effect, to the other party a royalty-free license
(sublicensable only to Affiliates and to subcontractors that have been approved
by the Committee in connection with approving the Project Plan) to use such
technologies, to the extent necessary to fulfill the goals of the Project Plan.
In employing each party’s facilities, employees, and resources, the Project
Leader shall endeavor to avoid any undue disruptions and intrusions in the
parties’ other independent research projects.



          (f) Funding of Approved Research Project. For each calendar year during
the first five (5) years of the Agreement, the parties will contribute equally,
in an amount up to * annually (* for each party) of the amount paid by Martek
to DSM for ARA Products in the previous calendar year, towards funding approved
Project Plans (the “R&D Contribution”). Unless otherwise agreed to by the
Committee, * of such amount shall be allocated to Project Plans approved for
the purpose of developing new or improved uses for ARA Products (which may
include products outside Infant Formula Products and Products for Babies, and
clinical trials). DSM’s share of the R&D Contribution will not be included in
DSM Costs, and Martek’s



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



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ARA Alliance, Purchase and Production Agreement




share of the R&D Contribution will not be included in Martek Costs. The
Committee shall determine, in its reasonable discretion, at the time of
approval of a specific Project Plan, the amount of funds to allocate to the
pursuit of each such project, provided, however, that in no event shall the
Committee approve, without the prior written consent of the parties hereto, any
Project Plan that will cause the total amount of funds allocated to all joint
ARA Research Projects undertaken by the parties in connection with this Section
7.1 in any given calendar year to exceed * of the total amount paid by Martek
to DSM for the supply of ARA Products during the immediately preceding calendar
year in accordance with Section 6.1 hereto.



          Within thirty (30) days of the end of each calendar quarter, the parties
shall submit to each other a statement (including all reasonable supporting
documentation necessary to establish the use of resources and expenses) of
their costs in providing employees, facilities or other resources in connection
with all joint ARA Research Projects undertaken in accordance with this Section
7.1(f) during the preceding calendar quarter. Unless the parties agree
otherwise in writing, each party’s costs for the use of their employees,
facilities or other resources shall be determined in accordance with the
Project Plan. In no event shall each party’s respective refundable costs
exceed the amounts that were approved in advance of the project unless such
extra amounts were previously approved by the Committee (the total approved
allocation for such ARA Research Project, the “Total Refundable Costs”).



          Each party shall be responsible for fifty percent (50%) of the Total
Refundable Costs and the parties shall meet quarterly and use their
commercially reasonable efforts to reach a final determination of the amount of
refundable costs incurred by each party. The party that incurred the lower
amount of refundable costs shall pay the other party fifty percent (50%) of the
difference between the relative refundable costs incurred by the respective
parties within thirty (30) days following the final determination of refundable
costs for the quarter. In the event a dispute arises between the parties
regarding their respective rights of payment and collection hereunder, the
parties shall use their commercially reasonable efforts to negotiate a
resolution through the Committee, and if a resolution cannot be reached by the
Committee within thirty (30) days, either party may elect to submit the issue
to a neutral mediator pursuant to Section 8.6 and, if such mediation fails to
resolve the issue, either party may submit the issue to binding arbitration
pursuant to Section 10.5.



          (g) R&D Intellectual Property Rights. The parties’ respective
intellectual property rights in any inventions, improvements, or technologies
invented or created as a result of any joint ARA Research Project are set forth
in Section 7.2(c) and Section 7.4(d) hereto.



     7.2. Intellectual Property Rights.



          (a) Validity of Certain Patents of the Parties. From the Effective Date
to the stated expiration date of this Agreement (regardless of any earlier
termination),




     (i) DSM acknowledges and agrees that (A) Martek’s patents
(including those of its Affiliates) listed on Schedule 7.2(a)(i)
and Schedule 2.62,



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



55









 








ARA Alliance, Purchase and Production Agreement




(B) any patents which issue from the applications listed on
Schedule 7.2(a)(i) and Schedule 2.62, and (C) all related family
members of the patents listed on Schedule 7.2(a)(i) and Schedule
2.62, issued under the laws of any country, shall be presumed valid
and enforceable and, to the maximum extent permitted under
applicable law, DSM agrees not to, and shall cause each of its
Affiliates not to, challenge the validity or enforceability of such
patents, through any legal action or proceeding of any nature
whatsoever, including, but not limited to, any action in federal
district court seeking to declare the invalidity of such patents,
and




     (ii) Martek acknowledges and agrees that (A) DSM’s patents
(including those of its Affiliates) listed on Schedule 2.50, (B)
any patents which issue from the applications listed on Schedule
2.50, and (C) all related family members of the patents listed on
Schedule 2.50, issued under the laws of any country, shall be
presumed valid and enforceable and, to the maximum extent permitted
under applicable law, Martek agrees not to, and shall cause each of
its Affiliates not to, challenge the validity or enforceability of
such patents, through any legal action or proceeding of any nature
whatsoever, including, but not limited to, any action in federal
district court seeking to declare the invalidity of such patents.



It is understood and agreed that Schedule 7.2(a)(i), Schedule 2.62, and
Schedule 2.50 may be amended and updated from time to time after the Signing
Date with the written consent of the parties to include patents filed, acquired
or licensed by each of the parties or to delete patents that are no longer
valid. It is further understood and agreed that a Notifying Party that
challenges the scope of a Responding Party’s patents, but not their validity or
enforceability, pursuant to Section 5.5 will not be deemed to be in violation
of this Section.



          (b) Oppositions. Promptly after the Signing Date: (i) DSM shall, and shall
cause each of its Affiliates to withdraw or cancel the actions set forth on
Schedule 7.2(b)(i) opposing any patents owned by Martek or any of its
Affiliates that are useful or related to ARA to the extent that it acquired the
rights to such actions from Hoffman La-Roche Ltd. or otherwise has rights to
authorize such actions; and (ii) Martek shall, and shall cause each of its
Affiliates to, withdraw or cancel the actions set forth in Schedule 7.2(b)(ii)
opposing any patents owned by DSM or any of its Affiliates that are useful or
related to ARA to the extent that it has rights to directly or indirectly
authorize such actions.



          (c) R&D Intellectual Property Rights. Subject to the licenses granted in
Sections 7.4(a) and 7.4(b) hereto, intellectual property rights in any
inventions, improvements, or technologies conceived or reduced to practice
during the term of this Agreement pursuant to an approved Project Plan (“New
R&D Inventions”) shall be as follows:




     (i) Any patents that issue from a patent application filed by
a Patent Proponent Party (as defined below) in accordance with
Section 7.3(a)(iii) shall be



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



56









 








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owned solely by the Patent Proponent Party (“Martek R&D
Patents” or “DSM R&D Patents”, as the case may be).




     (ii) Subject to clause (i) above, the parties shall jointly
own any patents that may issue on any New R&D Inventions (each
party having an equal and undivided one half ownership interest
without a right of accounting, except as expressly provided herein)
(“Joint Patents”) and all other intellectual property rights in New
R&D Inventions regardless of which parties’ employees invented or
created such New R&D Invention (“Joint Know-how”). Each party
shall, and shall cause its employees, consultants, and contractors
to, execute any and all documents required in order that each party
shall own and, if applicable, shall be registered as the owner of
the New R&D Invention in accordance with Section 7.2(c). All
rights in and to the New R&D Inventions shall be subject to this
Agreement.




     (iii) For the avoidance of doubt, (A) each of Martek and its
Affiliates shall have (1) the exclusive right to use all Joint
Proprietary Technology within the Martek ARA Fields of Use, (2) the
non-exclusive right to use all Joint Proprietary Technology outside
of the DSM ARA Fields of Use subject to Section 7.2(c)(iv)(A), and
(3) no right to use, make or have made, offer to sell, sell,
import, or otherwise exploit, or permit others to use, make or have
made, offer to sell, sell, or otherwise exploit the Joint
Proprietary Technology in DSM’s ARA Fields of Use and (B) each of
DSM and its Affiliates shall have (1) the exclusive right to use
all Joint Proprietary Technology within the DSM ARA Fields of Use,
(2) the non-exclusive right to use all Joint Proprietary Technology
outside of the Martek ARA Fields of Use subject to Section
7.2(c)(iv)(A), and (3) no right to use, make or have made, offer to
sell, sell, import, or otherwise exploit, or permit others to use,
make or have made, offer to sell, sell, or otherwise exploit the
Joint Proprietary Technology in Martek’s ARA Field of Use.
Notwithstanding the foregoing, nothing contained in this Agreement
shall extend DSM’s rights to the Excluded Subject Matter outside
the DSM ARA Fields of Use. Moreover, unless expressly agreed upon
by the parties, subject to Section 10.4 hereto, nothing herein
shall be deemed to grant either party any rights in any trademarks
or previously existing copyrighted work of the other party,
notwithstanding the use of such materials in any approved Project
Plan. Notwithstanding the foregoing neither party shall sublicense
Production Technology without the other party’s prior written
consent except pursuant to Sections 3.3(a) and 5.5(d).




     (iv) If either party is in serious negotiations with a
non-Affiliate third party regarding the sublicensing of its rights
to the Joint Proprietary Technology in an area where it has
non-exclusive rights to such Joint Proprietary Technology in
accordance with Section 7.2(c)(iii)(A)(2) or 7.2(c)(iii)(B)(2)
(“Sublicensable Technology”), such party shall provide written
notice to the other party of such negotiations. If such party
decides to sublicense its rights pursuant to such



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



57









 








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negotiations (such party to hereinafter be referred to as the
“Sublicensing Requester”), then the Sublicensing Requester must
provide the other party prior written notice summarizing the
proposed sublicensing arrangement for the Sublicensable Technology
(“Sublicensing Notice”).




     (A) The non-requesting party shall have the right to
prevent such sublicense by (1) within thirty (30) days of
receiving the Sublicensing Notice, notifying the Sublicensing
Requester of its disapproval of the sublicense and its desire
to have the exclusive right to sublicense the Joint
Proprietary Technology outside the DSM ARA Fields of Use and
the Martek ARA Fields of Use and (2) committing within thirty
(30) days of the determination of the fair-market value
(“FMV”) of such exclusive right to pay to the Sublicensing
Requester the FMV, which is to be determined pursuant to
agreement of the parties or pursuant to Section 8.6 if
agreement is not reached within ten (10) days.




     (B) If the non-requesting party does not notify the
Sublicensing Requester of its disapproval within thirty (30)
days from receiving the Sublicensing Notice or does not pay
the FMV of the sublicense to the Sublicensing Requester
within thirty (30) days from receiving the FMV amount, the
Sublicensing Requester shall have the right to proceed with
such sublicense on substantially the same terms and
conditions as set forth in the Sublicensing Notice and the
Sublicensing Requester shall pay the other party, as
applicable, (1) * of the Net Revenues the Sublicensing
Requester receives from the sublicensee which are not the
result of the Sublicensing Requester selling a product to the
sublicensee, and (2) * of the Net Sales the
Sublicensing Requester receives from the sublicensee which
are the result of the Sublicensing Requester selling a
product to the sublicensee, provided, however, that such
total amount shall not exceed * of the Sublicensing
Requester’s Gross Profit on such sales.




     (C) If the non-requesting party does not exercise its
right to obtain exclusive rights to the Sublicensable
Technology as set forth in Section 7.2(c)(iv)(A) and the
Sublicensing Requester proceeds with the sublicensing
arrangement for the Sublicensable Technology as set forth in
the Sublicensing Notice, the Sublicensing Requester does not
need to follow the procedures set forth in Section 7.2(c)(iv)
again if it desires to enter into another sublicensing
arrangement for the same Sublicensable Technology; however,
if the Sublicensing Requester does not proceed with the
sublicensing arrangement as set forth in the Sublicensing
Notice and then subsequently desires to sublicense the same
Sublicensable Technology to another potential sublicensee,
the Sublicensing Requester



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



58









 








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must follow the procedures set forth in Section
7.2(c)(iv) again, including issuing a new Sublicensing
Notice.



     7.3. Prosecution, Maintenance and Enforcement.



          (a) Prosecution and Maintenance of New R&D Patents.




     (i) To the extent that a party desires to file an application
for a patent claiming or describing a New R&D Invention, the party
seeking to file the application shall inform the other party of its
desire to file for patent protection and submit a request to the
R&D Committee for permission to file the application for such
invention. If a majority of the R&D Committee members are unable
to agree on whether to pursue patent protection at all or in any
particular jurisdiction, the matter shall be referred to the
Committee, which shall make a final determination whether to file
the application. In the event that the R&D Committee or the
Committee, as the case may be, decides to pursue patent protection
for a particular invention in one or more jurisdictions, the R&D
Committee or the Committee, as the case may be, shall, designate
the party with the most knowledge of the New R&D Invention (as
determined by the unanimous agreement of the R&D Committee or the
Committee, as the case may be) as the lead party (“Lead Party”) who
will take primary responsibility for the preparation, filing,
prosecution, and maintenance of any patents related to such New R&D
Invention (“Patent Protection Process”). The non-lead party shall
provide all reasonable cooperation and assistance in connection
with the Patent Protection Process. The Lead Party will ensure
that the non-lead party is kept informed of the status of and has
an opportunity to review and comment on all aspects of the Patent
Protection Process, including, but not limited to, copying the
non-lead party on all patent related communications such as patent
applications, office actions, and responses and allowing the
non-lead party ten (10) business days to review and comment upon
the specifications, claims, and responses to office actions prior
to their submission to the appropriate patent office. The Lead
Party shall use all reasonable efforts to incorporate and address
the non-lead party’s comments. Notwithstanding the foregoing, final
decisions regarding the specification claims and responses to
office actions shall be made by the Lead Party. The applications
shall be prepared, filed and prosecuted, and maintenance fees paid
through an attorney or agent chosen by the Lead Party. Except as
set forth in Section 7.3(a)(iii) below, each party shall pay fifty
percent (50%) of all expenses incurred hereafter pursuant to the
Patent Protection Process (“Patent Expenses”) according to the
following procedure. On a quarterly basis the Lead Party will
provide the non-lead party with an invoice for Patent Expenses
reporting the amount of Patent Expenses incurred, the purpose of
incurring such Patent Expenses, and the amount of Patent Expenses
owed by the non-lead party. The non-lead party will reimburse on a
quarterly basis the Lead Party within thirty (30) days of receiving
an invoice for Patent Expenses from the Lead Party.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



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If the Lead Party anticipates extraordinary expenses arising
from the Patent Protection Process, then the Lead Party will
provide the non-lead party with full details and together the
parties will determine a mutually acceptable course of action prior
to incurring such expenditures. Both parties recognize that one
party may incur certain legal expenses regarding the New R&D
Invention and/or patent rights relating to matters pertaining
solely to such party, and, in such circumstances, such expenses
will not be considered Patent Expenses, unless otherwise decided by
the Committee. The Lead Party will maintain adequate records
showing all Patent Expenses incurred, which will be made available
to the non-lead party upon reasonable notice.




     (ii) Notwithstanding Section 8.5 or Section 8.6, in the event
that the Committee is deadlocked on whether to file a patent
application for a particular invention in one or more jurisdictions
(i.e., where half of the Committee members are in favor of pursuing
patent protection and half the Committee members are opposed), the
party whose Committee members voted in favor of pursuing patent
protection (the “Patent Proponent Party”) shall have the right to
independently file a patent application covering such invention at
its own costs and expense, and the other party shall provide all
reasonable cooperation and assistance in connection therewith,
including without limitation, ensuring that any of its employees
who may be inventors under such patent application shall be joined
as inventors thereto, and shall cause such employees to assign in
writing their entire interest in such invention to the Patent
Proponent Party. In such event, the patent shall be treated as an
Improvement made by the Patent Proponent Party and shall be subject
to the license provisions of Section 7.4(d). Notwithstanding the
foregoing, any decisions by the Patent Proponent Party regarding
whether to pursue patent protection or the scope of the applicable
patent claims being sought shall take into consideration the legal
and commercial interests of the other party, including without
limitation the other party’s interest in avoiding disclosure of
confidential information or technology in connection with its
activities in their respective ARA Fields of Use.




     (iii) If, in one or more countries, (A) the Lead Party shall
at any time decide not to prepare, file, prosecute or maintain any
such patent application for any such New R&D Invention or (B)
either party does not pay its share of the expenses related to the
foregoing matters (in either situation, the “Declining Party”), the
other party may, at its own expense, prepare, file, prosecute or
maintain any such patent application in such country or countries.
In such event, the Declining Party hereby assigns its interest in
and to the New R&D Invention (but only with respect to such country
or countries as applicable) underlying such patent application, and
such application in such country or countries to the other party
and such party hereby grants the Declining Party a license to use
such patents in accordance with the parties’ respective rights in
Sections 7.4(a) and 7.4(b).



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



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          (b) Independent Enforcement. Notwithstanding anything to the contrary
herein, each party shall have the right at any time to independently enforce,
at its own cost and expense and in the manner as it chooses in its sole
discretion, any intellectual property rights that (i) it exclusively owns or
(ii) owns jointly with the other party with respect to infringements that are
occurring within its respective ARA Fields of Use (such party, the “Enforcing
Party”). The party that is not the Enforcing Party shall provide all
reasonable cooperation in connection with any actions taken by the Enforcing
Party in connection with pursuing a suspected infringer in the Enforcing
Party’s ARA Fields of Use, including without limitation allowing itself to be
joined as a party to any lawsuit brought by the Enforcing Party against such
infringer, provided that the Enforcing Party compensates the other party for
any costs reasonably associated therewith.



          (c) Joint Enforcement. Each party agrees to promptly notify the other
party of any suspected infringement of any patent or other intellectual
property right (other than trademark rights) of either party that relates to
ARA, including without limitation any patent covering any New R&D Inventions.
Promptly upon notification of a suspected infringement, the Committee shall
meet to evaluate whether to take any action against such third party infringer.
In evaluating whether to pursue a particular third party infringer, the
Committee shall consider both parties’ current and future commercial and legal
interests, including without limitation, the cost of pursuing the claim, the
likelihood that either party will become the subject of a counterclaim and the
relative likelihood of success of the claims to be asserted. In the event that
the Committee decides that a particular action, including without limitation
legal action against the third party, initiation of settlement discussions or
other action aimed at causing cessation of the infringement by the third party,
should be taken against the third party infringer, the parties shall cooperate
to promptly undertake such action. Unless the Committee agrees otherwise, the
party in whose ARA Field of Use the infringing activity is occurring shall be
responsible for all costs associated with any such action. In the event that
the infringement is occurring in both party’s ARA Fields of Use, the parties
shall share the costs of such action in proportion to the ARA related profits
derived by each party at or around the time of the infringement. In the event
that one of the parties wishes to settle the dispute with the suspected
infringer that would not involve the complete and unqualified cessation of the
infringing activity, the matter shall be referred to the Committee for
evaluation. Unless and until the Committee affirmatively decides to settle an
infringement action, neither party shall, without the prior consent of the
other party, grant any license to, or enter into a prospective settlement
agreement with, the infringing party.



          (d) Proceeds of Infringement Actions. The Enforcing Party shall be
entitled to all proceeds from any independent action taken by it in accordance
with Section 7.3(b) hereto. In the event an award of monetary damages is
granted in an action with respect to either party’s patents relating to the
manufacture, processing or use of ARA in connection with actions taken in
accordance with Section 7.3(c) hereto, the parties shall apply the award as
follows: Initially the award shall be used to reimburse the parties for their
actual out-of-pocket expenses (including attorneys fees) that have been
incurred by or in connection with such action, provided that if the award is
insufficient to reimburse both parties for all of their out of pocket expenses,
the award shall be distributed in proportion to each party’s relative expenses
in connection with the action. Once the parties have been reimbursed for their
respective out of pocket expenses, the remaining



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



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portions of the award shall be divided between the parties, within thirty
(30) days after collection of the award, in proportion to the lost profits of
each party resulting from the infringement in accordance with whichever of the
following formulas is appropriate under the circumstances:




	(i)	 	Proceeds from Infringement Actions in any Martek ARA Field of Use.
	 
	 	 	Martek’s share = A /(A + B) and DSM’s share = B /(A + B)
	 
	 	 	where:
	 
	 	 	(1) A = Martek’s lost Gross Profit on and unrecovered
fixed costs for sales for Units of ARA on the Units of
ARA sold by the infringer and, if applicable to the
infringing transactions, lost royalty income or license
income; and
	 
	 	 	(2) B = DSM’s lost DSM Mark Up on and unrecovered fixed
costs for Units of ARA on the Units of ARA sold by the
infringer and, if applicable to the infringing
transactions, any lost DSM-Assisted IF Customer Fees,
Profit Sharing Fee and other royalties or license
income.
	 
	(ii)	 	Proceeds from Infringement Actions in any DSM ARA Field of Use.
	 
	 	 	Martek’s share = A/(A + B) and DSM’s share = B/(A + B)
	 
	 	 	where:
	 
	 	 	(1) A = Martek’s lost DSM ARA Field of Use Royalties or
any Martek Services margin, as applicable on sales of
Units of ARA by the infringer; and
	 
	 	 	(2) B = DSM’s lost Gross Profit on and unrecovered
fixed costs for Units of ARA on the Units of ARA sold
by the infringer and, if applicable to the infringing
transactions, any lost DSM-Assisted IF Customer Fees,
Profit Sharing Fee and other royalties or license
income.





          It is the intent of the parties that the foregoing formulas will estimate
the lost profits suffered by each party by the infringing activity.



          (e) Defensive Patent Actions. Notwithstanding anything to the contrary
herein, in the event that either party to this Agreement becomes a defendant in
any lawsuit in any jurisdiction, the defendant party shall have the right, in
its entire and sole discretion, to bring a counter-claim or counter-suit based
on the infringement of any Joint Patent against any party to the extent that
such counter-claim or counter-suit is reasonably likely to cause or bring about
a



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



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settlement of the dispute to which the party to this Agreement has become
a defendant. The defendant party shall notify the other party in writing of
its intention to exercise its right under the immediately preceding sentence
and such other party shall provide all necessary cooperation and assistance, at
the requesting party’s cost and expense, associated with the defendant party’s
counterclaim or counter-suit.



     7.4. Intellectual Property Licenses.



          (a) License of Martek Proprietary Technology. Subject to the provisions
of Section 9.3, Martek hereby grants to DSM a perpetual, exclusive (including
as to Martek), worldwide, non-assignable, sublicensable (to the extent
permitted in Section 7.4(c) below) license under the Martek Proprietary
Technology, the Martek R&D Patents, the Excluded Subject Matter and any
amendments and updates thereof to make, use, have made, import, sell and offer
for sale ARA Products and ARA Products combined with other products in the
DSM ARA Fields of Use and to make ARA Products for delivery to Martek and to
perform Extraction and RBD processing, in each case only to the extent
permitted herein, subject to the rights granted to * under the * ARA Agreement.
The foregoing license shall be royalty-bearing solely as provided in Article 6
herein. DSM hereby guarantees that each of its Affiliates and any Third Party
Toll Manufacturer that shall become a sublicensee of DSM pursuant to Section
7.4(c) of this Agreement with respect to the Martek Proprietary Technology,
Excluded Subject Matter, and/or Martek R&D Patents and shall abide by the
restrictions set forth in this Agreement in respect of any such sublicensed
Martek Proprietary Technology, Excluded Subject Matter, and/or Martek R&D
Patents.



          (b) License of DSM Proprietary Technology. Subject to the provisions of
Section 9.3, DSM hereby grants to Martek a perpetual, exclusive (including as
to DSM), worldwide, non-assignable, sublicensable (to the extent permitted in
7.4(c) below) license under the DSM Proprietary Technology and the DSM R&D
Patents to make, use, have made, import, sell and offer for sale ARA Products
in the Martek ARA Fields of Use and to perform Extraction and RBD services, in
each case only to the extent permitted herein. The foregoing license shall be
royalty-bearing solely as provided in Article 6 herein. Martek hereby
guarantees that each of its Affiliates and any Third Party Toll Manufacturer
that shall become a sublicensee of Martek pursuant to Section 7.4(c) of this
Agreement with respect to the DSM Proprietary Technology and/or DSM R&D Patents
and shall abide by the restrictions set forth in this Agreement in respect of
any such sublicensed DSM Proprietary Technology and/or DSM R&D Patents.



          (c) Toll Manufacturers and Affiliates. The licensed rights in Sections
7.4(a) and 7.4(b) above may be sublicensed by a party to its Affiliates but may
not be sublicensed by such party to any third party, including Third Party Toll
Manufacturers, without the prior written consent of the other party, provided,
however, (i) in the event of a DSM Shortfall, Martek shall be entitled to
sublicense the licensed rights granted in Section 7.4(b) to one or more Third
Party Toll Manufacturers in accordance with the requirements of Section 3.3(a)
for the sole purpose of responding, and only for so long as necessary to
respond, to such DSM Shortfall and (ii) in the event of a Martek Shortfall, DSM
shall be entitled to sublicense the licensed rights granted in



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



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Section 7.4(a) to one or more Third Party Toll Manufacturers in accordance
with the requirements of Section 3.4(c) for the sole purpose of responding, and
only for so long as necessary to respond, to such Martek Shortfall.



          (d) Improvements. To the extent that either party or any of its Affiliates
creates any improvements or enhancements to the DSM Proprietary Technology, the
Martek Proprietary Technology, the Excluded Subject Matter or any New R&D
Inventions, pursuant to an approved Project Plan or in the performance of any
of the parties’ respective obligations under this Agreement or any other
innovation, process or technique that improves the production, processing or
use of ARA Products, including without limitation the patents of a Proponent
Party referred to in Section 7.3(a)(iii) (“Improvements”) at any time during
the term of this Agreement, it promptly shall disclose and transfer pursuant to
Section 7.5 such improvements or enhancements to the other party. In addition,
with respect to all Improvements that are not New R&D Inventions, each party
hereby grants, or shall cause such Affiliate to grant, to the other party,
effective as of the date that such Improvement is created or developed, a
license to use such Improvements in accordance with the parties’ respective
rights in Sections 7.4(a) and 7.4(b) with respect to the underlying technology
or invention.



          (e) DHA License. DSM hereby grants to Martek a royalty free,
non-exclusive, non-assignable, non-sublicensable license under the DSM Patents,
as the same may be amended from time to time, to make, use, sell, offer for
sale and import products that include DHA and/or other microbial oils for the
term of this Agreement. Notwithstanding the provisions of Section 9.3(c) the
license granted herein shall become royalty bearing at fair market value in the
event DSM terminates the Agreement pursuant to Section 9.2(a) or 9.2(b).



     7.5. Technology Transfers.



          (a) Technology Transfer to DSM. Within thirty (30) days after the Signing
Date, Martek shall (i) commence with the transfer to DSM of documents and any
biological material relating to the Martek Proprietary Technology and shall
complete such transfer within one hundred eighty (180) days after the Signing
Date, (ii) use its commercially reasonable efforts to assist DSM to exploit the
Martek Proprietary Technology as soon as reasonably practicable, and (iii)
provide to DSM technology services, in the case of (ii) or (iii) in accordance
with the applicable Transfer Procedures, if any. Within thirty (30) days after
the discovery of any Improvement, the creating party shall transfer such
Improvement to the other party pursuant to the procedure described above.
Martek hereby represents and warrants to DSM that (i) the Martek Proprietary
Technology and such technology services constitute all of the intellectual
property and technology services of Martek reasonably necessary to enable DSM
to exercise its rights under the licenses granted to it in Section 7.4(a) and
(ii) Martek has the right to grant all licenses granted hereunder to DSM,
subject to the disclaimer in Section 4.9(c) and subject to the rights referred
to in Section 6.1(g) of certain of Martek’s Infant Formula Product customers to
produce or have produced ARA Products.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



64









 








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          (b) Technology Transfer to Martek. Within thirty (30) days after the
Signing Date, DSM shall (i) commence with the transfer to Martek of documents
and any biological material relating to the DSM Proprietary Technology and
shall complete such transfer within one hundred eighty (180) days after the
Signing Date, (ii) use its commercially reasonable efforts to assist Martek to
exploit the DSM Proprietary Technology as soon as reasonably practicable, and
(iii) provide to Martek technology services, in the case of (ii) or (iii) in
accordance with the applicable Transfer Procedures, if any. Within thirty (30)
days after the discovery of any Improvement, the creating party shall transfer
such Improvement to the other party pursuant to the procedure described above.
DSM hereby represents and warrants to Martek that (i) the DSM Proprietary
Technology and such technology services constitute all of the intellectual
property and technology services of DSM reasonably necessary to enable Martek
to exercise its rights under the licenses granted to it in Section 7.4(b) and
(ii) DSM has the right to grant all licenses granted hereunder to Martek,
subject to the disclaimer in Section 4.9(c).



          (c) Audit Rights. Both parties shall, during the course of this
Agreement, maintain complete and accurate records, files, books, accounts, and
other documents and sources of information related to the Know-how utilized in
the manufacture of ARA Products (“Know-how Records”), including, but not
limited to, records related to standard operating procedures, system
validation, and tests performed. Either party may, upon its request, during
reasonable business hours and after reasonable advance notice to the other
party, inspect the other party’s facilities for compliance with this Agreement,
and to inspect, copy, and audit the Know-how Records. The parties agree to
cooperate with such audits, including providing all reasonable assistance in
connection therewith, and promptly remedy any audit findings that relate to the
parties’ compliance with this Agreement.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



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ARA Alliance, Purchase and Production Agreement




8. ORGANIZATION (COMMUNICATION, COMMITTEES)




     8.1 Formation of the Committee. Not later than fifteen (15) days
after the Signing Date, the parties shall form a steering committee (the
“Committee”) which shall consist of four (4) members: two (2) appointed by
Martek and two (2) appointed by DSM. Each party shall identify one of the team
members it has appointed as its “Leader.” In addition to its four (4) members,
each party may send non-participating, nonvoting observers to each meeting of
the Committee. If either party decides at any time to replace its designated
Leader or its other Committee member, it may do so by written notice to the
other party’s Leader. The Committee shall have the authority to appoint other
committees charged with responsibility for the performance of certain functions
under this Agreement, including without limitation marketing, R&D, production
and logistics, and quality assurance/quality control. The Committee shall have
authority over any committee formed pursuant to this Section 8.1 and veto
rights over any committee decision, provided, however, that the Committee shall
not be required to review all committee decisions. Any such committee shall be
obligated to report to the Committee at the quarterly meeting of the Committee.
Any committee decision involving a financial matter shall require the unanimous
approval of the Committee.



     8.2 Meetings of the Committee. The Committee shall meet at such
times and places as it may select but, in any event, it shall meet at least
once per calendar quarter. Meetings of the Committee shall be in person, by
conference call, by proxy or a combination thereof, as the Committee decides.
Each party shall have one (1) vote in the Committee. Decisions of the
Committee shall be by a unanimous vote. The decisions and agreements of the
Committee shall be formalized in minutes which shall be signed by each party’s
Leader at the next meeting for confirmation.



     8.3 Status Reports of the Committee. The Leaders shall report to
each other quarterly, or as otherwise mutually agreed upon, regarding the
status of the parties’ respective obligations under this Agreement, any
anticipated problems (resolved or unresolved), and any indication of delay in
fixed or tentative schedules. The Leaders shall also report to each other as
circumstances require regarding any special issues, including production
problems or unexpected developments in each party’s ARA Fields of Use.



     8.4 Authority of the Committee.



     (a) The Committee shall be responsible for overseeing the collaboration
under this Agreement, for monitoring the parties’ adherence to the terms hereof
and for agreeing on or determining any matters that are to be agreed on or
determined by the Committee pursuant to this Agreement. In particular, the
Committee shall, in good faith, mutually address, among other things, the
following: (i) financial matters (including without limitation whether
reductions in DSM Costs per Unit of ARA should trigger a change in the DSM Mark
Up); (ii) production matters, including proposed or actual changes to either
party’s production processes, determination of the Technical Capacity and
Practical Capacity, modifications to the Performance Standards and review of
any forecast for purposes of capacity planning and



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




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ARA Alliance, Purchase and Production Agreement




determination of the Units of ARA per year for use in
connection with new product and/or new ARA Field of Use development in
accordance with Section 5.3; (iii) quality assurance and quality control
matters, including discussion, consideration and approval of the Specifications
and the Specification Variances and any changes proposed to either of the
foregoing; (iv) the procedures for transferring technology between the parties
(the “Transfer Procedures”); and (v) patent matters.



          (b) It is understood and agreed that the Committee shall have the
authority to determine the Specifications and Specification Variances
acceptable for new ARA Products. The Committee shall have the authority to
make appropriate changes that are reasonable in nature, taking into account all
the facts and circumstances, to the preparation and submission of any forecasts
and the procedures for shipment and order fulfillment set forth herein with
respect to any new ARA Products that are subject to the terms of this
Agreement.



          (c) Except as set forth in Sections 6.1(e) and (f), the Committee shall
determine the annual Technical Capacity and the Practical Capacity separately
for DSM’s Belvidere and Capua plants.



     8.5 Deadlock Within a Committee. In the event of a deadlock with respect
to any factual or scientific matter (a “Disputed Fact”) within any committee
formed by the Committee, including the R&D Committee, or any Disputed Issue the
committee shall take such Disputed Fact or Disputed Issue to the Committee for
resolution.



     8.6 Deadlock Within the Committee Over Factual Matters.



          (a) In the event of a deadlock within the Committee with respect to any
Disputed Fact, either Leader may deliver a written request to the other Leader
that the Disputed Fact be resolved by one or more third party experts. The
Leaders shall use their good faith commercially reasonable efforts to agree
upon a single third party expert to resolve the Disputed Fact within fifteen
(15) days of such written request. If a single third party expert is agreed
upon within such period, such expert shall have a period of no more than thirty
(30) days following his or her appointment during which to reach a conclusion
with respect to the Disputed Fact. The conclusion of the third party expert
with respect to the Disputed Fact shall be in writing and shall be final and
binding on the Committee and the parties.



          (b) If the Leaders have not reached agreement on a single third party
expert within such fifteen (15) day period, then each Leader shall have five
(5) days following the expiration of such fifteen (15) day period within which
to appoint one third party expert unaffiliated with either of the parties or
any of their respective Affiliates, and the two third party experts so
appointed shall, in turn, appoint a third, third party expert unaffiliated with
either of the parties or any of their respective Affiliates within twenty (20)
days of the later of them to be appointed. The conclusion of a majority of the
third party experts with respect to the Disputed Fact shall be in writing and
shall be final and binding on the Committee and the parties.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




67









 








ARA Alliance, Purchase and Production Agreement




          (c) It shall be a condition of the appointment of each third party expert
appointed in accordance with the provisions of this Section 8.6 that he or she
agree (i) to abide by the terms, including the time periods, in this Section
8.6 and (ii) to enter into a nondisclosure agreement acceptable to the parties
pursuant to which he or she agrees to treat all information that he or she
receives, reviews or otherwise is made aware of in connection with a proceeding
under this Section 8.6 in the strictest of confidence.



          (d) The parties shall share equally all costs associated with the
appointment of any third party expert pursuant to this Section 8.6.



     8.7 Deadlock Within the Committee Over Non-Factual Matters. In the event
of a deadlock within the Committee with respect to any matter other than a
factual or scientific matter (a “Disputed Issue”), either Leader may deliver a
written request to the other Leader that the Leaders attempt to resolve the
Disputed Issue with the assistance of a neutral mediator. The Leaders shall
use their good faith commercially reasonable efforts to agree upon a mediator
within fifteen (15) days of such written request. Such mediator shall, within
ten (10) days of the appointment, recommend in writing a procedure for
resolving the Disputed Issue. The members of the Committee shall use their
good faith efforts to resolve the Disputed Issue with the assistance of the
mediator. Notwithstanding the foregoing, any member of the Committee shall be
free to reject the recommendation, if any, of the mediator. Either party shall
be entitled to have any Disputed Issue resolved by arbitration pursuant to
Section 10.5.



     8.8 External Communication. Neither party shall release any communication
to the general public (including any press release or other publication)
without the consent of the other party (such consent not to be unreasonably
withheld) where it would be reasonably apparent to a third party recipient of
such communication that the communication makes reference to such other party,
whether by name or otherwise, or to any material term of this Agreement. The
party reviewing the communication shall have ten (10) days from the receipt of
the proposed communication to review and approve such communication; if the
reviewing party does not notify the other party within such ten (10) day period
of its disapproval of the communication, in whole or in part, the communication
shall be deemed approved in its entirety. Notwithstanding the foregoing, where
time is of the essence and it would not be practical or advisable to take the
time to attempt to obtain the consent of the other party, a party making such
communication shall not be required to obtain the consent of such other party
where outside legal counsel to the party making such communication reasonably
believes and has so advised such party that such communication is necessary in
the carrying out of its disclosure obligations under applicable law or the
listing standards of any stock exchange or listing service on which the
communicating party’s securities are quoted. The final version of the
communication as well as the confirmation of such outside legal advice will be
promptly provided to the other party for information.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




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9. TERM; TERMINATION; DAMAGES




     9.1 Term. The term of this Agreement shall commence upon the Effective
Date and shall remain in effect until and expire upon the fifteenth (15th)
anniversary of the Effective Date unless otherwise terminated in accordance
with Section 5.5 or this Article 9. Martek and DSM shall use reasonable
commercial efforts to negotiate in good faith an extension of the Agreement, as
amended, in a form acceptable to both parties prior to the end of the tenth
(10th) anniversary of the Effective Date. Notwithstanding anything to the
contrary contained herein, neither party shall be obligated to enter into any
such extension of the Agreement, as amended.



     9.2 Termination for Cause.




          (a) In the event that:




     (i) It shall be determined, (A) whether by arbitration
pursuant to Section 10.5 or by admission of fault in writing with
reference to this Section 9.2(a), (1) that DSM is deemed pursuant
to the third sentence of Section 5.2 to have breached the
provisions of Section 5.2 where the Out Of Scope Customer is
selling ARA Products for use in or using ARA Products for Infant
Formula Product applications or (2) that DSM or any of its
Affiliates has breached this Agreement by selling ARA Products
containing in excess of two hundred (200) Units of ARA for use in
Infant Formula Product applications except as authorized by Section
5.5, or (B) whether by arbitration pursuant to Section 10.5 or by
admission of fault in writing with reference to this Section
9.2(a), (1) that Martek is deemed pursuant to the third sentence of
Section 5.2 to have breached the provisions of Section 5.2 where
the Out Of Scope Customer is selling ARA Products for use in or
using ARA Products for Feed Products or (2) that Martek or any of
its Affiliates has breached this Agreement by selling ARA Products
containing in excess of two hundred (200) Units of ARA for use in
Feed Products except as authorized by Section 5.5 (any of which, a
“Section 9.2(a) Material Breach” and the party determined to have
committed such Section 9.2(a) Material Breach, the “Infringing
Party”); and




     (ii) The other party (the “Infringed Party”) delivers written
notice to the Infringing Party stating that if the Infringing Party
again commits the same Section 9.2(a) Material Breach a second time
that the Infringed Party might exercise its right to terminate this
Agreement pursuant to this Section 9.2(a) (which shall not be a
binding commitment on the part of the Infringed Party); and




     (iii) It shall be determined, whether by arbitration pursuant
to Section 10.5 or by admission of fault in writing with reference
to this Section 9.2(a), that the Infringing Party has committed the
same Section 9.2(a) Material Breach a second time at any time
following the date ninety (90) days after the date of delivery of
the notice described in Section 9.2(a)(ii) but prior to the date
three (3)



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




69









 








ARA Alliance, Purchase and Production Agreement





years after the determination by arbitration or by admission
of fault described in Section 9.2(a)(i);



then the Infringed Party shall have the right to terminate this Agreement
effective on delivery of written notice to the Infringing Party within one
hundred twenty (120) days following the date on which such second determination
shall have been made.



If the Infringing Party continues to engage in the activity or inactivity that
constitutes a Section 9.2(a) Material Breach for more than thirty (30) days (or
such longer period as the parties may agree in writing) after the date on which
it shall be determined by arbitration or admission of fault pursuant to Section
9.2(a)(i) that such activity or inactivity constituted a Section 9.2(a)
Material Breach, such continued activity or inactivity shall constitute a
second breach of this Agreement by the Infringing Party for the purposes of
Section 9.2(a)(iii). For the avoidance of doubt, the failure by the Infringing
Party to cure a Section 9.2(a) Material Breach that, by its very nature, cannot
be cured shall not in and of itself constitute a second breach of this
Agreement for purposes of this Section 9.2(a).



          (b) In the event that:




     (i) It shall be determined, whether by arbitration pursuant to
Section 10.5 or by admission of fault in writing with reference to
this Section 9.2(b),




     (A) that a party (the “Breaching Party”) failed to
perform a material obligation or covenant of this Agreement
that results in the other party’s suffering material damages
(a “Material Failure”) or otherwise breached a material term
of this Agreement that results in the other party’s suffering
material damages (a “Material Breach”), other than a Section
9.2(a) Material Breach, and




     (B) that such Material Failure or Material Breach
continued without being ceased, cured, remedied or repaired
for a period of thirty (30) days after written notice thereof
had been given to the Breaching Party by the other party (the
“Non-Breaching Party”);




     (ii) Thereafter, the Non-Breaching Party delivers written
notice to the Breaching Party stating that if the Breaching Party
commits the same Material Failure or the same Material Breach a
second time within a period of three (3) years after the
determination by arbitration or by admission of fault described in
Section 9.2(b)(i), that the Non-Breaching Party might exercise its
right to terminate this Agreement pursuant to this Section 9.2(b)
(which shall not be a binding commitment on the part of the
Non-Breaching Party); and




     (iii) It shall be determined, whether by arbitration pursuant
to Section 10.5 or by admission of fault in writing with reference
to this Section 9.2(b), (A) that the Breaching Party committed the
same Material Failure or the same



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




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Material Breach a second time following the date of delivery
of the notice described in Section 9.2(a)(ii) but within the three
(3) year period set forth therein and (B) that such Material
Failure or Material Breach continued without being ceased, cured,
remedied or repaired for a period of thirty (30) days after written
notice thereof had been given to the Breaching Party by the
Non-Breaching party;



then the Non-Breaching Party shall have the right to terminate this Agreement
effective on delivery of written notice to the Breaching Party within one
hundred twenty (120) days following the date on which such second determination
shall have been made. It is understood and agreed that if the Breaching Party
continues to engage in the activity or inactivity that constitutes a Material
Failure or a Material Breach pursuant to Section 9.2(b)(i) for more than sixty
(60) days (or such longer period as the parties may agree in writing) after the
date on which it shall be determined by arbitration or admission of fault
pursuant to Section 9.2(b)(i) that such activity or inactivity constituted a
Material Failure or Material Breach, such continued activity or inactivity
shall be considered for the purposes of Section 9.2(b)(iii) as committing the
same Material Failure or Material Breach a second time. For the avoidance of
doubt, the failure by the Breaching Party to cure a Material Failure or
Material Breach that, by its very nature, cannot be cured shall not in and of
itself constitute a second breach of this Agreement for purposes of this
Section 9.2(b).



          (c) In addition, in the event that either party (i) generally does not pay
its debts as such debts become due, (ii) admits in writing its inability to pay
its debts generally, (iii) makes an assignment for the benefit of creditors,
(iv) commences a voluntary case under the federal bankruptcy laws, as now or
hereafter constituted, or any other federal, state or foreign bankruptcy,
insolvency or other similar law, (v) consents to the appointment of or taking
possession by a receiver, liquidator, trustee, custodian, or sequestrator (or
other similar official) of such party or of any substantial part of its
property, or (vi) takes board or shareholder action intended or likely to
result in any event described in clauses (i) through (vi) of this subsection,
or in the event there shall be entered in respect of either party a decree or
order for relief by a court having jurisdiction in the premises in an
involuntary case under the federal bankruptcy laws, as now or hereafter
constituted, or any other applicable federal, state or foreign bankruptcy,
insolvency or other similar law, or appointing a receiver, liquidator, trustee,
custodian, or sequestrator (or other similar official) of such party or of any
substantial part of its property, or ordering the winding up or liquidation of
its affairs, and any such decree or order shall continue unstayed in effect for
a period of sixty (60) consecutive days, then the other party and the other
party only) shall have the right to terminate this Agreement.



     9.3 Effect of Expiration and Termination on Intellectual Property Rights.



          (a) Upon the expiration of this Agreement, the licenses granted to each
party in accordance with Article 7 hereto shall survive in full force and
effect in perpetuity, provided that all licenses and all rights to Joint
Proprietary Technology granted thereunder shall become non-exclusive and
royalty free and the right to sublicense shall not require any consent pursuant



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




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to Section 7.4(c) and the right to sublicense Joint Proprietary Technology
shall not require any consent pursuant to Section 7.2(c)(iii).



          (b) Upon the termination of this Agreement by the Responding Party
pursuant to Section 5.5, the licenses granted to the Responding Party in
accordance with Article 7, hereto shall survive in full force and effect in
perpetuity, provided that all licenses and all rights to Joint Proprietary
Technology granted to Responding Party thereunder shall become royalty free and
effective as of the fifteenth (15th) anniversary of the Effective Date such
licenses and all rights to the Joint Proprietary Technology granted thereunder
shall become non-exclusive, the right of the Responding Party to sublicense
shall not require any consent pursuant to Section 7.4(c), and the right of the
Responding Party to sublicense Joint Proprietary Technology shall not require
any consent pursuant to Section 7.2(c)(iii). In addition , the licenses
granted to the Notifying Party in accordance with Article 7 shall terminate on
the effective date of termination of this Agreement provided that all rights to
Joint Proprietary Technology granted to Notifying Party thereunder shall become
royalty free and effective as of the fifteenth (15th) anniversary of the
Effective Date (a) all rights to the Joint Proprietary Technology granted
thereunder shall become non-exclusive and (b) the right of the Notifying Party
to sublicense Joint Proprietary Technology shall not require any consent
pursuant to Section 7.2(c)(iii).



          (c) Upon the termination of this Agreement for cause in accordance with
Section 9.2(a) or Section 9.2(b) hereof: (i) the licenses granted to each of
the parties in accordance with Article 7 hereto shall survive in full force and
effect in perpetuity, provided that such licenses granted thereunder shall
become royalty free (except as otherwise provided in Section 9.4(d)(iii) and
Section 7.4(e)), (ii) effective as of the fifteenth (15th) anniversary of the
Effective Date such licenses and all rights to Joint Proprietary Technology
granted thereunder shall become non-exclusive, (iii) the right of the parties
to sublicense shall not require any consent pursuant to Section 7.4(c), and
(iv) the right of the parties to sublicense Joint Proprietary Technology shall
not require any consent pursuant to Section 7.2(c)(iii).



          (d) Upon the termination of this Agreement for cause in accordance with
Section 9.2(c) hereof, the licenses granted to each party in accordance with
Article 7 hereto shall survive in full force and effect in perpetuity, provided
that all licenses and all rights to Joint Proprietary Technology granted
thereunder shall become non-exclusive and royalty free and the right to
sublicense shall not require any consent pursuant to Section 7.4(c) and the
right to sublicense Joint Proprietary Technology shall not require any consent
pursuant to Section 7.2(c)(iii).



          (e) Upon the expiration or termination of this Agreement pursuant to
Section 5.5, for cause pursuant to Section 9.2 or upon the cessation of the
parties’ joint research collaboration in accordance with Section 7.1(a), unless
the parties otherwise agree in writing, all ongoing research projects
undertaken in accordance with Section 7.1 hereto shall immediately terminate.
Each party shall cooperate with the other party to exchange information and
materials related to any ongoing research project, and shall fully inform the
other party of any results from such research project not already disclosed to
the R&D Committee.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




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          (f) Notwithstanding anything to the contrary herein, (i) upon the
termination of this Agreement for any reason other than for cause in accordance
with Section 9.2(c), each party shall have (A) the exclusive right to enforce
any patents that it owns exclusively and (B)
the exclusive right to enforce any patents that it owns jointly with the
other party in its respective ARA Field of Use until the fifteenth (15th)
anniversary of the Effective Date and (ii) upon the expiration of this
Agreement or the termination of this Agreement for cause in accordance with
Section 9.2(c), or after the fifteenth (15th) anniversary of the Effective
Date, each party shall have the exclusive right to enforce any patents that it
owns exclusively and the right to enforce any patents that it owns jointly with
the other party.



     9.4 Other Effects of Termination; Damages; Cap.



          (a) In the event that Martek has the right to terminate this Agreement
pursuant to Section 9.2(a) or Section 9.2(b) and exercises such right, DSM
covenants and agrees that neither it nor any of its Affiliates shall compete
with Martek or any Martek Affiliate in the Martek ARA Fields of Use until the
earlier of the date three (3) years after the date of such termination and the
fifteenth (15th) anniversary of the Effective Date.



          (b) In the event that DSM has the right to terminate this Agreement
pursuant to Section 9.2(a) or Section 9.2(b) and exercises such right, Martek
covenants and agrees that neither it nor any of its Affiliates shall compete
with DSM or any DSM Affiliate in the DSM ARA Fields of Use until the earlier of
the date three (3) years after the date of such termination and the fifteenth
(15th) anniversary of the Effective Date.



          (c) It is understood and agreed by the parties that, in the event Martek
fails to perform any obligation or covenant or otherwise breaches any term of
this Agreement or if DSM exercises any right it may have to terminate this
Agreement pursuant to Section 9.2(a) or Section 9.2(b), DSM shall be entitled
to damages sufficient to place DSM in as good a position as it would have been
in if there had been no breach or termination and the Agreement had been fully
performed, taking into consideration the net amount of losses caused and gains
prevented, in excess of the savings made possible, by the breach or termination
and, in calculating such damages as they relate to lost DSM Mark Up in the
event DSM exercises any such right to terminate this Agreement pursuant to
Section 9.2(a) or Section 9.2(b), DSM’s damages based on sales it otherwise
would have made to Martek and its Affiliates through the fifteenth (15th)
anniversary of the Effective Date shall be determined on the following basis:




     (i) If the date of termination is prior to August 31, 2014,
then DSM’s lost profits on sales of ARA Products to Martek and its
Affiliates as a result of such termination shall be calculated
based on:




     (A) DSM’s Mark Up in effect at the time of
termination of this Agreement for DSM’s lost sales
prior to August 31, 2014; and



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




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ARA Alliance, Purchase and Production Agreement





     (B) fifty percent (50%) of Martek’s Gross Profit
on its sales of ARA Products in the Martek ARA Fields
of Use, as determined pursuant to Section 6.13, for
DSM’s lost sales on and
after August 31, 2014 through the fifteenth (15th)
anniversary of the Effective Date; or




     (ii) If the date of termination is on or after August 31,
2014, then DSM’s lost profits on sales of ARA Products to Martek
and its Affiliates as a result of such termination shall be
calculated based on the DSM Mark Up or other pricing arrangement in
effect on the date of termination for DSM’s lost sales from and
after the date of termination through the fifteenth (15th)
anniversary of the Effective Date.



          It is understood and agreed that the amount of damages DSM is entitled to
claim hereunder shall be increased by the balance, if any, as of the date of
termination of the Equalization Reserve. It is also understood and agreed that
the amount of damages that DSM shall be entitled to claim hereunder shall be
reduced (i) by the Gross Profits that DSM derives from sales of ARA Products
into Martek ARA Fields of Use but not including Gross Profits that DSM derives
from sales of ARA Products into any Martek ARA Fields of Use where such sales
are permitted by an arbitration decision pursuant to Section 5.5 and (ii) by
the DSM Gross Profits that DSM derives from alternative utilization of its ARA
production facilities, to the extent DSM could not have derived such had there
not been such a termination of this Agreement. In the event of termination of
the Agreement by DSM pursuant to Section 9.2, DSM agrees to take all
commercially reasonable steps to mitigate the damages it incurs and Martek
shall reimburse DSM for all costs and expenses associated therewith. For the
purposes of this Section 9.4(c), “DSM Gross Profits” shall mean gross monies
including royalties received from the sales of products or services minus costs
of goods/services sold, including but not limited to depreciation, commissions,
delivery costs, sales tax and credits for refunds and returns directly related
to such sales or services.



          Martek shall pay DSM any damages determined pursuant to this Section
9.4(c) quarterly, based on (i) the actual quantities of ARA Products Martek and
its Affiliates purchase from third parties during such quarter plus (ii) the
amount of ARA Products that Martek and its Affiliates produce and sell
themselves during such calendar quarter in excess of the Martek Allocation.
Martek shall provide DSM with a written statement of such amounts within thirty
(30) days following the end of such quarter, which statement shall include
payment to DSM of the amount to which DSM is entitled with respect to lost
sales during such quarter, include a detailed calculation of such amount and
shall be certified as to its accuracy by the chief financial officer of Martek.
DSM shall be entitled to have an independent accounting firm audit from time
to time the relevant books and records of Martek and its Affiliates to confirm
Martek’s and Martek’s Affiliates’ compliance with the terms hereof. Such audit
shall be at the cost of DSM unless it shall reveal a not immaterial
underpayment by Martek, in which event Martek shall bear the costs of the audit
in addition to owing such underpayment to DSM.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




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ARA Alliance, Purchase and Production Agreement




          (d) It is understood and agreed by the parties that, in the event DSM
fails to perform any obligation or covenant or otherwise breaches any term of
this Agreement, Martek shall be entitled to (i) damages sufficient to place
Martek in as good a position as it would have
been in if there had been no breach and the Agreement had been fully
performed, taking into consideration the net amount of losses caused and gains
prevented, in excess of the savings made possible, by the breach, (ii) in the
event that DSM or any of its Affiliates shall sell ARA Products into any Martek
ARA Fields of Use in violation of the provisions of this Agreement, Martek’s
lost profits on such sales and (iii) in the event Martek exercises any right it
may have to terminate this Agreement pursuant to Section 9.2(a) or Section
9.2(b), the DSM ARA Field of Use Royalty on DSM’s sales of ARA Products from
and after the date of termination through the fifteenth (15th) anniversary of
the Effective Date, calculated and payable as set forth in Section 6.9.



          DSM shall pay Martek any damages determined pursuant to this Section
9.4(d) quarterly. DSM shall provide Martek with a written statement of such
amounts within thirty (30) days following the end of such quarter, which
statement shall include payment to Martek of the royalties to which Martek is
entitled with respect to sales of ARA Products by DSM and its Affiliates during
such quarter, include a detailed calculation of such amount and shall be
certified as to its accuracy by the chief financial officer of DSM. Martek
shall be entitled to have an independent accounting firm audit from time to
time the relevant books and records of DSM and its Affiliates to confirm DSM’s
and DSM’s Affiliates’ compliance with the terms hereof. Such audit shall be at
the cost of Martek unless it shall reveal a not immaterial underpayment by DSM,
in which event DSM shall bear the costs of the audit in addition to owing such
underpayment to Martek.



          (e) Notwithstanding anything to the contrary set forth in this Agreement,
the total aggregate amount that a party (a “Liable Party”) shall be liable for
and required to pay to the other party in respect of losses, damages, claims,
costs or expenses (“Losses”) that are asserted against or suffered by such
other party arising out of, in connection with or based upon the breach or
failure to perform by the Liable Party of the provisions of this Agreement
shall not exceed, and the Liable Party shall have no liability under this
Agreement for any Losses that exceed in the aggregate, the greater of (i) one
hundred million US Dollars ($100,000,000) and (ii) the aggregate amount paid by
Martek to DSM pursuant to this Agreement during the twelve (12) month period
immediately preceding the date on which such breach or failure to perform by
the Liable Party shall have first occurred (the “Cap”);
provided, however, that
the Cap shall not apply to:




	 	•	 	Claims under this Agreement arising out of, in connection
with or based upon (A) a breach or failure to perform by Martek of
its obligations set forth in Section 3.1, 3.6(d), 5.2, 5.5(a),
7.2(c)(iii), 9.4(b), or 10.2 of this Agreement; (B) Martek’s
liability under Section 10.17 for any failure of an Affiliate to
comply with any of the obligations set forth in the immediately
preceding (A); or (C) Martek’s liability under Section 9.4(c) in the
event DSM exercises its right to terminate the Agreement pursuant to
Section 9.2(a) or Section 9.2(b); or





*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




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ARA Alliance, Purchase and Production Agreement





	 	•	 	Claims under this Agreement arising out of, in connection
with or based upon (X) a breach or failure to perform by DSM of its
obligations set forth in the first sentence of Section 3.5(d) or in
Sections 5.2, 5.5(a), 7.2(c)(iii), 9.4(a), or 10.2 of this
Agreement;
or (Y) DSM’s liability under Section 10.17 for any failure of an
Affiliate to comply with any of the obligations set forth in the
immediately preceding (X); or
	 
	 	•	 	Martek’s obligation to indemnify, defend and hold harmless
DSM, its Affiliates and their respective directors, officers,
employees and agents from and against all Claims pursuant to Section
4.2(c) of this Agreement or DSM’s obligation to indemnify, defend
and hold harmless Martek, its Affiliates and their respective
directors, officers, employees and agents from and against all
Claims pursuant to Section 4.2(d) of this Agreement.





     Subject to the foregoing proviso, in the event of multiple determinations
of Losses against a Liable Party under this Agreement (whether by arbitration
or admission of fault), the Cap on the liability of the Liable Party for each
subsequent determination of a Loss shall be equal to:




	 	(i)	 	The greater of (a) one hundred million dollars ($100,000,000)
and (b) the aggregate amount paid by Martek to DSM pursuant to this
Agreement during the twelve (12) month period immediately preceding
the date on which the breach or failure to perform by the Liable
Party shall have first occurred;






	 	 	Minus






	 	(ii)	 	The total aggregate amount of Losses that have been
theretofore awarded against the Liable Party pursuant to an
arbitration procedure conducted in accordance with Section 10.5 of
this Agreement plus the amount of Losses that have been theretofore
actually paid by the Liable Party to the other party in respect of
claims of breach or failure to perform by the Liable Party that are
settled between the parties without the issuance of an arbitration
award.





Nothing contained in this Section 9.4(e) shall be deemed to limit in any way
either party’s right to seek provisional injunctive relief or other forms of
provisional remedies pursuant to Section 10.5(e) of this Agreement.



     9.5 Limitation of Liability. EXCEPT FOR THE LOST PROFITS PAYABLE BY
MARTEK PURSUANT TO SECTION 9.4(c), LOST PROFITS PAYABLE BY DSM PURSUANT TO
SECTION 9.4(d)(ii) AND ROYALTIES PAYABLE BY DSM PURSUANT TO SECTION
9.4(d)(iii), IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR
LOSS OF PROFITS OR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES
INCURRED BY THE OTHER PARTY AND ARISING OUT



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




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OF OR IN CONNECTION WITH THIS
AGREEMENT FOR ANY CAUSE OF ACTION OF ANY KIND EVEN IF THE OTHER PARTY HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




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ARA Alliance, Purchase and Production Agreement




10. GENERAL




     10.1 [Reserved]



     10.2 Confidential Information. The parties acknowledge and agree that
each party will be disclosing confidential information to the other party and
that the parties will be developing confidential information jointly during the
term of this Agreement, including but not limited to, the Specifications,
know-how (including, without limitation, all Know-how), Know-how Records,
financial, marketing and business data (if any), and cost information, business
strategies, ideas, concepts, ARA Field of Use and marketing information,
financial information and Joint Proprietary Technology (the “Confidential
Information”). Each party agrees that it shall hold the Confidential
Information in strict confidence, shall not disclose it to others or use it in
any way, commercially or otherwise, except for purposes of performing its
obligations or exploiting its rights under this Agreement. Each party further
agrees to take all action necessary to protect the confidentiality of the
Confidential Information including, without limitation, (a) implementing and
enforcing operating procedures to minimize the possibility of unauthorized use
or copying of the Confidential Information, and (b) obligating each of its
subcontractors, by written agreement, to protect the Confidential Information.
Notwithstanding this Section 10.2, the term “Confidential Information” shall
not include any information which (x) is or becomes part of the public domain
through no fault of the receiving party, (y) is obtained by the receiving party
from any third party which is under no obligation to the disclosing party to
protect the confidentiality thereof, or (z) can be established by the receiving
party with reasonable documentary evidence to have been independently developed
by the receiving party without reliance on the Confidential Information.
Notwithstanding the foregoing, if a party or any of its employees or other
representatives becomes legally compelled (whether by subpoena, court order or
other legal process, by any governmental authority or by applicable law) to
disclose any of the Confidential Information or the fact that the Confidential
Information has been made available to the receiving party or such employees or
representatives, the receiving party shall, to the fullest extent permitted by
applicable law, give the disclosing party an adequate opportunity, at the
disclosing party’s expense, to interpose an objection and/or to seek a
protective order or such other remedy as the disclosing party may consider
appropriate in the circumstances. The receiving party shall, and shall assure
that each such employee or representative shall, disclose only that portion of
the Confidential Information that it is legally required to disclose.



     10.3 Survival. The following provisions shall survive termination or
expiration of this Agreement: Section 4.9 (Disclaimers); Section 6.9 (Martek
Proprietary Technology Royalty), but only in the event Martek shall be entitled
to receive the DSM ARA Field of Use Royalty pursuant to Section 9.4(d)(ii)
following the termination of this Agreement; Section 6.11(f) (Invoices and
Payments); Section 6.1(i) (Profit Sharing Fee), but only in the event DSM
terminates this Agreement pursuant to Section 9.2; Section 6.18(c) (Break-Up
Fee), but only upon expiration of this Agreement or in the event DSM terminates
this Agreement pursuant to Section 9.2 or Section 5.5 when Martek is the
Notifying Party; Section 7.2(a), but only through the fifteenth (15th)
anniversary of the Effective Date; Section 7.3, but only to the extent of any
pending matters at the time of termination or expiration; Section 9.3 (Effect
of Expiration or



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




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Termination on Intellectual Property Rights); Section 9.4
(Other Effects of Termination;
Damages; Cap); Section 9.5 (Limitation of Liability); Section 10.2
(Confidential Information); Section 10.5 (Disputes; Arbitration); Section 10.6
(Regulatory Matters); Section 10.9 (Severability); Section 10.10 (Relationship
of the Parties); Section 10.11 (Notices); Section 10.12 (Governing Law); and
Section 10.15 (Entire Agreement).



     10.4 Trademarks.



          (a) Use of Martek Trademarks. During the term of this Agreement, DSM
shall use Martek’s brand names and the Martek trade name, solely on Martek’s
behalf and for Martek’s benefit, on all shipments of ARA Products by DSM to
Martek or any Martek customer, pursuant to delivery or order instructions by
Martek to DSM, and DSM shall not attach any additional brand names, trademarks,
trade names, logos or designations to any such shipment. DSM’s use of Martek’s
brand names and the Martek trade name shall be in accordance with Martek’s
policies in effect from time to time, as communicated by Martek to DSM. DSM
shall not be authorized to use, and is expressly prohibited from using, any
Martek brand name or the Martek trade name on any shipment of ARA Products
other than a shipment subject to an order and delivery instructions submitted
to DSM by Martek.



          (b) Ownership of Martek Trademarks. DSM has paid no consideration for the
use of any Martek brand name or the Martek trade name, and nothing contained in
this Agreement will give DSM any right, title or interest in any of them. DSM
acknowledges that Martek owns and retains all rights in the Martek brand names
and the Martek trade name. DSM will not at any time during or after this
Agreement assert or claim any interest in any Martek brand name or the Martek
trade name. Upon expiration or termination of this Agreement, DSM will
immediately cease all use of the Martek brand names and the Martek trade name.



          (c) DSM Trademarks. In the event that Martek supplies any Crude Oil or
Finished Oil to DSM in accordance with Article 3 hereto, Sections 10.4(a) and
10.4(b) shall apply in all respects mutatis mutandis with respect to use and
ownership of DSM’s trademarks in the event that Martek uses DSM’s brand names
or trade names on shipments pursuant to delivery or order instructions from
DSM.



     10.5 Disputes; Arbitration.



          (a) Disputes Generally. The parties hereby undertake to use good faith
efforts to settle any dispute arising under this Agreement. Failing
settlement, all disputes, including without limitation all unresolved Disputed
Issues, claims of breach of contract, fraud in the inducement, negligence, and
any other claim of dispute related to this contract shall be finally settled in
accordance with the Rules of Conciliation and Arbitration of the International
Chamber of Commerce (the “ICC Rules”). In addition, the parties agree that the
arbitration shall be conducted according to the International Bar Association’s
Rules of Evidence (the “IBA Rules”). Where the ICC Rules and the IBA Rules are
inconsistent, the IBA Rules shall prevail, but solely with respect to the
presentation and receipt of evidence. The arbitration shall take place in and



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




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ARA Alliance, Purchase and Production Agreement




the seat of the arbitration shall be New York, New York, USA. There shall be a
panel of three (3) arbitrators for all disputes. The claimant party shall
appoint an arbitrator in the arbitration
petition and the respondent party shall appoint an arbitrator in response.
If within thirty (30) days after the arbitration petition, the respondent has
not appointed an arbitrator, such arbitrator shall be appointed by the ICC.
Within thirty (30) days of their confirmation, the two arbitrators shall
appoint a third arbitrator who shall preside over the arbitration panel. If
the two arbitrators cannot agree on a third arbitrator within such thirty (30)
day period, the third arbitrator shall be appointed by the ICC. The
arbitrators shall, before accepting such appointment, agree to render their
decision to the parties in writing together with the underlying reasoning,
including separate statements of findings of facts and conclusions of law, no
later than sixty (60) days after completion of hearings, but in no event later
than one hundred eighty (180) days from the date of appointment of the last of
the arbitrators to be appointed. Any final arbitration award shall be final and
not subject to appeal.



          (b) Language; Transcript. English shall be the official language of the
arbitration proceedings. The arbitration shall be conducted in the English
language. Relevant documents in other languages shall be translated into
English if the arbitrators so direct. A written transcript in English of the
hearing will be made and furnished to the parties.



          (c) Decision of Arbitrators. The arbitrators will decide in accordance
with the terms of this Agreement and will take into account any appropriate
international trade usages applicable to the transaction. The award of the
arbitrators will be final and binding upon the parties. Judgment upon the
award may be entered in any court having jurisdiction in accordance with the
Convention on the Recognition and Enforcement of Foreign Arbitral Awards of
June 10, 1958. An application may be made to any such court for judicial
acceptance of the award and an order of enforcement.



          (d) Expense of Arbitration. The arbitrators shall determine the allocation
between the parties of expenses incurred in connection with the arbitration,
including, but not limited to, reasonable attorneys’ fees and costs; provided
however in the event of arbitration pursuant to the provisions of Section 5.5
the arbitrators must award the prevailing party its attorneys fees and costs,
arbitration administrative fees, panel member fees and costs, and any other
costs associated with the arbitration.



          (e) Provisional Remedies Not Denied. Each party hereto acknowledges and
agrees that the provisions of this Agreement are of the essence and that any
violation by it of any provision contained in this Agreement shall cause the
other party irreparable injury not fully compensable by monetary damages and
for which the non-breaching party may not have an adequate remedy at law.
Accordingly, if a non-breaching party institutes an arbitration action or
proceeding to enforce this Agreement in accordance with the procedures set
forth above, then such non-breaching party shall be entitled to provisional
injunctive relief or other form of provisional remedy in aid of the arbitration
as may be necessary or appropriate to the fullest extent permissible under
applicable law, to enjoin, prevent or curtail any breach of this Agreement,
threatened or actual, without the posting of any bond or security, whether in



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




80









 








ARA Alliance, Purchase and Production Agreement




summary proceedings or on the merits. It is understood and agreed, however,
that the final determination of any alleged breach giving rise to any
provisional injunctive relief or other form of provisional remedy shall be made
solely by the arbitrators in accordance with the provisions
set forth above. In addition to the authority conferred upon the
arbitration tribunal by the ICC Rules, the tribunal, along with any court of
competent jurisdiction, shall also have the authority to grant provisional
remedies, including injunctive relief. Without limiting the generality of the
foregoing, it is understood and agreed that a party shall be entitled to
injunctive relief in the event the other party breaches any of the provisions
of Section 5.5.



          (f) Federal Arbitration Act. Notwithstanding anything to the contrary
herein, the arbitration provisions set forth herein, and any arbitration
conducted thereunder, shall be governed exclusively by the Federal Arbitration
Act, Title 9, United States Code and the Convention on the Recognition and
Enforcement of Foreign Arbitral Awards of June 10, 1958, to the exclusion of
any state or municipal law.



     10.6 Regulatory Matters. Each party shall provide the other party with all
information the other party may reasonably request in order to obtain or comply
with any necessary regulatory approvals, permits, licenses, clearances and
notifications required by it in connection with its performance under this
Agreement, including but not limited to all information concerning studies
performed by or on behalf of such party in the field of product identification,
characterization and analysis; pathogenicity, toxicity, mutagenicity and
clinical trials. Each party shall promptly notify the other of all
communications with the FDA and other regulatory agencies regarding ARA.



     10.7 Assignment; Delegation. Neither this Agreement nor any rights granted
hereby may be assigned by either party without the prior written consent of the
other party. Any attempt by either party to assign any rights, duties or
obligations without the requisite consent of the other party shall be void and
without force or effect. Notwithstanding the foregoing, either party shall
have the right to assign its rights and delegate its obligations under this
Agreement to an Affiliate, provided that such party shall guarantee the full
and timely performance of such obligations by such Affiliate.



     10.8 Amendments and Waivers. Except as expressly stated herein, neither
this Agreement nor any terms hereof may be amended, waived, discharged or
terminated unless such amendment, waiver, discharge or termination is in
writing signed by all parties or, in the case of a waiver, by the party waiving
compliance.



     10.9 Severability. If any provision of this Agreement shall be held to be
invalid, illegal or unenforceable for any reason, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby. In the case of any such invalidity, illegality or
unenforceability, the parties agree to use their commercially reasonable
efforts to achieve the purpose of such provision by a new legally valid and
enforceable stipulation. In addition, the parties hereby authorize any court
or arbitrator having jurisdiction thereover to modify such provision to the
extent necessary to render such provision enforceable,



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




81









 








ARA Alliance, Purchase and Production Agreement




and the rights and
obligations of the parties shall be construed and enforced accordingly,
preserving to the fullest permissible extent the intent and the agreements of
the parties.



     10.10 Relationship of the Parties. For purposes of this Agreement, DSM and
Martek will be and shall act as independent contractors, and neither party is
authorized to act as an agent or partner of, or joint venturer with, the other
party for any purpose. Neither party by virtue of this Agreement shall have
any right, power, or authority to act or create any obligation, express or
implied, on behalf of the other party.



     10.11 Notices. Except as otherwise expressly provided herein, all notices
required or permitted to be sent hereunder, including any requests and other
communications, to any party hereunder shall be in writing and sufficient if
delivered by recognized international express courier service or by facsimile
with telephone confirmation of receipt by the addressee, in each case addressed
as follows:



	 	 	 
	If to DSM:
	 	 
	

	 	DSM Food Specialties B.V.
	

	 	A. Fleminglaan 1
	

	 	2613 AX Delft
	

	 	The Netherlands
	

	 	Attention: Business Unit Director Nutritional Ingredients
	

	 	Phone: ** 31 15 279 2081
	

	 	Fax: ** 31 15 279 3480
	 
	 	 
	With a copy to:
	 	 
	

	 	DSM Food Specialties B.V.
	

	 	A. Fleminglaan 1
	

	 	2613 AX Delft
	

	 	The Netherlands
	

	 	Attention: Legal Counsel
	

	 	Phone: ** 31 15 279 2557
	

	 	Fax: ** 15 279 4170
	 
	 	 
	If to Martek:
	 	 
	

	 	Martek Biosciences Corporation
	

	 	6480 Dobbin Road
	

	 	Columbia, Maryland 21045
	

	 	Attention: President
	

	 	Phone: 410-740-0081
	

	 	Fax: 410-740-2985
	 
	 	 
	With a copy to:
	 	 
	

	 	Martek Biosciences Corporation
	

	 	6480 Dobbin Road
	

	 	Columbia, Maryland 21045
	

	 	Attention: General Counsel





*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



82









 





ARA Alliance, Purchase and Production Agreement



	 	 	 
	

	 	Phone: 410-740-0081
	

	 	Fax: 410-740-2985
	 
	 	 
	

	 	Hogan & Hartson L.L.P.
	

	 	111 South Calvert Street
	

	 	Baltimore, Maryland 21202
	

	 	Attention: Michael J. Silver, Esq.
	

	 	Phone: 410-659-2741
	

	 	Fax: 410-539-6981










or to such other address as the party to whom notice is to be given may have
furnished to the other party, in writing in accordance herewith. Each such
notice shall be effective on the fifth (5th) business day following the date on
which such communication is sent when delivered by recognized international
express courier service and on the first (1st) business day following the date
on which such communication is sent by facsimile with telephone confirmation of
receipt by the addressee. This provision shall not apply to communications
between the parties in the ordinary course of business.



     10.12 Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York applicable to
contracts to be performed fully within the State of New York. The parties
hereby expressly exclude the applicability of the Convention on Contracts for
the International Sale of Goods and that body of law known as conflicts of
laws. Notwithstanding anything to the contrary herein, issues regarding the
scope or interpretation of any parties’ patents shall be determined in
accordance with the laws of the jurisdiction in which such patent has issued.



     10.13 Force Majeure. Each party shall be excused from the timely
performance, and neither party shall be liable for any damages or penalty for
any delay or failure in performance, of any obligation hereunder or for failure
to give the other party prior notice thereof when such delay or failure is due
to the elements, acts of God, delays in transportation, delays in delivery by
vendors or subcontractors or other causes beyond that party’s reasonable
control (each such event being a “Force Majeure Event”). Such excuse shall
continue for the duration of the Force Majeure Event and for a reasonable
period of time afterwards as then determined by the parties in good faith.



     10.14 No Waivers. No express or implied waiver by either party of any
event of default hereunder shall in any way be, or be construed as, a waiver of
any future or subsequent event of default.



     10.15 Entire Agreement. The parties acknowledge that this Agreement,
together with the Schedules hereto, which are hereby incorporated herein and
made a part hereof, sets forth the complete, exclusive and integrated
understanding of the parties and supersedes all proposals or prior agreements,
oral or written, and all other prior communications between the parties
relating



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




83









 








ARA Alliance, Purchase and Production Agreement




to the subject matter of this Agreement and, except as provided in
Section 10.8, no other documents (including without limitation each party’s
general terms and conditions of purchase or sale) shall act to modify, amend or
add to this Agreement.



     10.16 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 document.



     10.17 Guarantees.



          (a) DSM agrees to arrange for execution by * will be duly executed
immediately following the execution of this Agreement.



          (b) DSM unconditionally and irrevocably guarantees to Martek compliance by
each of its Affiliates with the provisions of this Agreement, including but not
limited to Sections 5.5, 7.2, 7.4, and 9.4, and shall be liable to Martek for
any damages resulting from an Affiliate’s noncompliance with the provisions of
this Agreement. Martek shall, without any further action or formality being
required, have the right to institute arbitration to enforce this provision in
accordance with Section 10.5.



          (c) Martek unconditionally and irrevocably guarantees to DSM compliance by
each of its Affiliates with the provisions of this Agreement, including but not
limited to Sections 5.5, 7.2, 7.4, and 9.4, and shall be liable to DSM for any
damages resulting from an Affiliate’s noncompliance with the provisions of this
Agreement. DSM shall, without any further action or formality being required,
have the right to institute arbitration to enforce this provision in accordance
with Section 10.5.



     10.18 [Reserved]



     10.19 Termination of Prior Alliance Agreement. The parties hereby agree
that the ARA Purchase and Production Agreement, dated as of December 31, 1996,
between Gist-Brocades B.V. and Martek, as amended, shall be terminated in
accordance with the termination agreement attached hereto as Schedule 10.19 and
hereby agree to duly execute such termination agreement immediately following
the execution of this Agreement.



     10.20 Hierarchy of Documents. The body of the Agreement will prevail in
case of discrepancies with the Schedules.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




84









 








ARA Alliance, Purchase and Production Agreement




          IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
duly executed and delivered as of the day and year first above written.



	 	 	 	 	 	 	 
	MARTEK BIOSCIENCES CORPORATION	 	DSM FOOD SPECIALTIES B.V.
	 
	 	 	 	 	 	 
	/s/ Steve Dubin	 	 	/s/ R.W. van Leen
	
	 	

	By:

	 	Steve Dubin
	 	By:
	 	R.W. van Leen
	Title:

	 	President
	 	Title:
	 	Managing Director
	 
	 	 	 	 	 	 
	

	 	 	 	 	/s/ G.F.M. Mooren
	 	 	 	 	

	

	 	 	 	By:
	 	G.F.M. Mooren
	

	 	 	 	Title:
	 	Managing Director







*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




85









 








SCHEDULES




TO




ARA ALLIANCE, PURCHASE AND PRODUCTION AGREEMENT




BY AND BETWEEN




MARTEK BIOSCIENCES CORPORATION




AND




DSM FOOD SPECIALTIES B.V.




Dated as of April 19, 2004





 









 








LIST OF SCHEDULES




	 	 	 
	Schedule 2.12
	 	ARA Assay Procedure
	Schedule 2.17
	 	Biomass Specifications
	Schedule 2.28
	 	Crude Oil Specifications
	Schedule 2.45
	 	DSM Costs
	Schedule 2.50
	 	DSM Patents (pending patents)
	Schedule 2.51
	 	DSM Know-how
	Schedule 2.62
	 	Excluded Subject Matter
	Schedule 2.67
	 	Finished Oil Specifications
	Schedule 2.75
	 	Guaranty Agreement
	Schedule 2.98
	 	Martek Costs
	Schedule 2.101
	 	Martek Patents (pending patents)
	Schedule 2.102
	 	Martek Know-how
	Schedule 2.111
	 	* Customers
	Schedule 4.2(a)
	 	DSM Certificate of Analysis
	Schedule 4.2(b)
	 	Martek Certificate of Analysis
	Schedule 4.6
	 	Manufacturing Changes
	Schedule 6.15
	 	Yield Assumptions
	Schedule 7.2(a)(i)
	 	Martek Non-Challengeable Patents (pending patents)
	Schedule 7.2(b)(i)
	 	DSM Patent Oppositions
	Schedule 7.2(b)(ii)
	 	Martek Patent Oppositions
	Schedule 10.19
	 	Termination Agreement







 










 






Schedules to ARA Alliance, Purchase and Production Agreement




SCHEDULE 2.12

ARA ASSAY PROCEDURE




Determination of units of ARA in biomass:



The content of arachidonic acid in biomass is determined by the content in *.
For the current use only the * is of commercial interest.



The quantification of “units of ARA” in biomass is determined as:




	 	*	 	 





HEL: *




ARA in HEL determination: the method has been subject to a round robin test and
is currently further controlled in an interlaboratory comparison. Data used for
the determination of units of ARA shall only be generated by a laboratory that
has either taken part in these tests or has been validated to comply with the
variability defined in the round robin test as acceptable.



HEL determination: *. The method used at the moment by DSM Food Specialties has
been found to recover *, resulting in an achievable yield of * units an
exhaustive counter-current extraction. The method will be transferred to the
respective DSM production site in the US and the *. Furthermore * throughout
the labs. This method will be verified in comparison with *. If the lab-scale
method will not result in a *.



Determination of units of ARA in crude and refined oil:



For the determination of units of ARA in crude and refined oil the following
formula will be used:




	 	*	 	 





The ARA determination has been described above. Also for crude and refined oil
only data generated by a validated lab shall be used.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



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SCHEDULE 2.17

BIOMASS SPECIFICATIONS




	 	 	 	 	 
	

	 	PRODUCT SPECIFICATION FORM

ARA Biomass

= Martek =
	 	ARA-PSF-004M

Revision 3

Dated: 26-11-03

Page 1 of 1







Product no: 2984




	 	 	 	 	 	 	 
	 	 	Approval	 	Discussion	 	 
	Parameters
	 	Limit (*)
	 	Range (**)
	 	Methods

	Release specifications:
	 	 	 	 	 	 
	Description

	 	Granulate (NOTE 1)
	 	 	 	Visual
	Smell

	 	Characteristic
	 	 	 	olfactory
	Colour

	 	Brown
	 	 	 	Visual
	*

	 	*
	 	*
	 	*
	*

	 	*
	 	*
	 	*
	*

	 	*
	 	*
	 	*
	*

	 	*
	 	 	 	*
	*

	 	*
	 	 	 	*
	*

	 	*
	 	 	 	*
	 
	*

	 	Approval limit
	 	 	 	 
	*

	 	*	 	 	 	*
	 
	 
	*

	 	*	 	 	 	 
	*

	 	*
	 	 	 	 
	 
	*

	 	*	 	 	 	*
	

	 	*	 	 	 	 
	

	 	*	 	 	 	 
	

	 	*	 	 	 	 
	

	 	*	 	 	 	 
	

	 	*	 	 	 	 
	 
	*

	 	 
	 	 	 	 
	*
	 	*	 	 	 	*
	*
	 	*	 	 	 	*
	 
	*

	 	 
	 	 	 	 
	*

	 	*
	 	 	 	*
	 
	*

	 	 
	 	 	 	 
	 
	*

	 	*
	 	*	 	 
	*

	 	*
	 	*	 	 
	*

	 	*
	 	*	 	 
	*

	 	*
	 	*	 	 







*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the Securities and Exchange Commission




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Schedules to ARA Alliance, Purchase and Production Agreement




*

*

*

*

*

*



	 	 	 
	Storage:

	 	Packaging:
	   • Below -2° C, preferably lower temperatures

	 	- BigBags (polypropylene with polyethylene liner), anti static
	   • Protected from light

	 	-
Labeled with product number, batch number, production number
production date and storage conditions on both inner and outer
bag

	   • Dry conditions
	 	 







*


*



*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the Securities and Exchange Commission




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Schedules to ARA Alliance, Purchase and Production Agreement




SCHEDULE 2.28

CRUDE OIL SPECIFICATIONS




	 	 	 	 	 
	

	 	PRODUCT SPECIFICATION FORM

ARACHIDONIC ACID CRUDE OIL

= Martek =
	 	ARA-PSF-001M

Revision 4

01/12/2003

Page 1 of 1







Product no: 2983




	 	 	 	 	 	 	 
	 	 	Approval	 	 	 	 
	Parameters
	 	limit (*)
	 	Discussion Range (**)
	 	Methods

	Release specifications:
	 	 	 	 	 	 
	Appearance	 	Typical at 25°C	 	Visual
	Colour	 	Light-medium yellow	 	Visual
	Smell	 	Typical – free of any rancid odor	 	olfactory
	*

	 	*
	 	*
	 	*
	*

	 	*
	 	 	 	*
	*

	 	*
	 	 	 	*
	*

	 	*
	 	*
	 	*
	*

	 	*
	 	*
	 	*
	 
	Control specifications
	 	 	 	 	 	 
	*

	 	*
	 	 	 	*
	*

	 	*
	 	 	 	*
	*

	 	*
	 	 	 	*
	*

	 	*
	 	 	 	*
	 
	Control specifications*:
	 	 	 	 	 	 
	*

	 	*
	 	 	 	*
	*

	 	*
	 	 	 	*
	*

	 	*
	 	 	 	*
	*

	 	*
	 	 	 	*
	*

	 	*
	 	 	 	*
	*

	 	*
	 	 	 	*
	*

	 	*
	 	 	 	*
	 
	Scope

	 	*	 	 	 	 
	*

	 	*	 	 	 	 
	*

	 	*	 	 	 	 
	*

	 	*	 	 	 	 
	 
	*
	 	 	 	 	 	 
	*
	 	 	 	 	 	 
	*
	 	 	 	 	 	 







	 	 	 
	Storage conditions:
   •
below –18°C
   •
Protected from light
   •
Dry conditions

	 	Packaging:

• Under Nitrogen

• 200 kg food grade phenolic coated lined drums (tight head) with

   DSM label
	 
	 	 
	*
	 	 







*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the Securities and Exchange Commission




 1 of 2









 








Schedules to ARA Alliance, Purchase and Production Agreement




*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the Securities and Exchange Commission




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Schedules to ARA Alliance, Purchase and Production Agreement




SCHEDULE 2.45

DSM COSTS




Included Costs:




DSM Costs per Unit of ARA shall equal Variable Costs per Unit of ARA plus Fixed
Costs per Unit of ARA, as described below and adjusted as necessary in
accordance with Article 6 of the attached Agreement. Fixed Costs and Variable
Costs shall be based on Generally Accepted Accounting Principles and shall be
based on actual or budgeted costs as applicable.




Fixed costs other than depreciation shall be based on Practical Capacity.




The depreciation portion of Fixed Costs shall be based on Technical Capacity
and be calculated as follows:




DSM’s capital costs for Approved Expansion Plans shall be depreciated on a
straight-line basis over * period starting at the time such expansion is
placed into production. Notwithstanding the above, (i) the *, shall be
depreciated on a straight-line basis over the time between *; (ii)




Belvidere Phase I Build-out capital costs are agreed to be no greater than *
and shall be depreciated on a straight-line basis over * period starting from
January 1st 2004; and (iii) The basis for depreciating the Belvidere plant
assets in existence prior to the Belvidere Phase I Build-out and dedicated to
use in such Belvidere Phase I Build-out shall be no greater *and will be
depreciated on a straight-line basis over a * period starting January 1st 2004.
The final amount is subject to verification by Martek including, at Martek’s
option, an independent audit of such amount. The basis for depreciating the
Belvidere plant assets in existence prior to the Belvidere Phase I Build-out,
not dedicated to use in such Belvidere Phase I Build-out, and dedicated to
subsequent Belvidere expansions shall be determined by a methodology similar to
that used for the Belvidere Phase I Build-out. and will be depreciated on a
straight-line basis over a * period starting at the time such expansion is
placed into production. The final amount is subject to verification by Martek
including, at Martek’s option, an independent audit of such amount.




The ARA portion of assets not totally dedicated to ARA, other than production
assets (such as ERP systems), shall be depreciated by using the DSM internal
accounting standards applicable to DSM operations in general, but still
consistent with Generally Accepted Accounting Principles.




Excluded Costs:




The following costs shall not to be included in the DSM Costs per Unit of ARA
and Fixed Budget Price per Unit of ARA (the “Excluded Costs”):





	 	•	 	The costs of not meeting the following Performance Standards for
2004:






Capua:




A. Maximum rate of lost batches *




B. Minimum level of fermentation productivity *




Belvidere (represents assumptions for budget 2004 after start-up)




A. rate of lost batches *




B. Minimum level of fermentation productivity: *




The level of fermentation productivity as referred to under B is
defined *(taking into account the cycle time) and taking into account
DSP yields up to crude oil.




	 	•	 	All costs related to the importing and re-exporting of ARA products
sent to Martek that do not meet Martek Specifications, including but not
limited to related freight, tariffs and warehousing costs.






	 	•	 	Costs related to reworking material that originally did not meet
Martek Specifications pursuant to Section 4.7 of the Agreement.





*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the Securities and Exchange Commission




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Schedules to ARA Alliance, Purchase and Production Agreement





	 	•	 	Allocations of corporate overhead that exceed the budget agreed to by
the Committee by more than 10% without Martek’s prior written approval.






	 	•	 	Legal costs associated with negotiating and drafting this Agreement.






	 	•	 	Production Startup Costs






	 	•	 	R&D Contribution pursuant to Section 7.1(f).





*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the Securities and Exchange Commission




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Schedules to ARA Alliance, Purchase and Production Agreement




SCHEDULE 2.50

DSM PATENTS




	 	 	 	 	 
	Patent #
	 	Title
	 	Summary

	WO 97/36996

	 	Process for the
preparation of a
granular microbial
biomass and isolation
of valuable compounds
therefrom
	 	A process for the
isolation of desired
compound(s) from a
microbial biomass is
disclosed, wherein
the microbial biomass
(which, if necessary,
is pre-treated to
give a dry matter
content of from 25 to
80% is granulated
(e.g. by extrusion)
and then dried to a
dry matter content of
at least 80%. The
granulation of the
biomass to granules
significantly eases
subsequent drying of
the biomass (which
can be stored as
dried granules) and
gives higher yields
on extraction of the
compound(s).
	 
	 	 	 	 
	WO97/37032

	 	Fatty acid containing

Oil from pasteurized

biomass
	 	In one aspect the
present invention
provides a process
for the isolation of
one or more
compound(s) from a
microbial biomass,
the process
comprising:
	 
	 

	 	 
	 	a) culturing
microorganisms in a
fermentation broth
under conditions
whereby the
microorganisms
produce the compound

	 
	 

	 	 
	 	b) pasteurizing
either the
fermentation broth or
a microbial biomass
derived therefrom;
and

	 
	 

	 	 
	 	c) extracting,
isolating or
recovering the
compound from the
microbial biomass

	 
	 	 	 	 
	WO9735487

	 	Solid water soluble

PUFA-carrying

particles
	 	The present invention
relates to a process
for the preparation
of a polyunsaturated
fatty acid
(PUFA)-containing
composition where a
PUFA-containing lipid
is adsorbed onto a
solid carrier such as
a powder. This can be
used in a process for
preparing an infant
formula, such as
where the powdered
PUFA-containing lipid
is added after an
emulsion of oil and
water phases has been
formed
	 
	 	 	 	 
	WO97/35488

	 	Late addition of PUFAs
in production of
infant formula
	 	The present invention
relates to a process
for the preparation
of a polyunsaturated
fatty acid
(PUFA)-containing
food, such as an
infant formula, where
a composition
comprising a PUFA is
added at a late stage
of the infant formula
preparation process
in this way, the
PUFAs is minimally
exposed to conditions
during the process
that induce
degradation of the
PUFAs.
	 
	 	 	 	 
	WO9743362

	 	Sterol extraction with

polar solvent
	 	The present invention
relates to a process
of treating an oil,
the process
comprising contacting
the oil with a polar
solvent, and then
separating the
solvent containing
the compound from the
so treated oil. The
oil is microbially
derived, and
extracted either form
a fermentation broth
or a filtrate thereof
using hexane. The
compound to be
extracted is usually
a sterol or a
diglyceride. The
solvent is ethanol
having up to 5% of
water. The oil an
contain a
plyunsaturated fatty
acid such as C28, C20
or C22 w-e, or w-6
fatty acid, such as
arachidonic acid.
	 
	 	 	 	 
	WO9965327

	 	Microbial ARA for use

in maine feed
	 	A marine feed
composition is
described comprising
microbially derived
arachidonic acid
(ARA) or ARA in the
form of a
triglyceride. The ARA
is suitably produced
by a fungus, such as
of the genus
Mortierella, although
the feed composition
itself is free of
microbial cells.
These forms of ARA
have been found to
give better growth
and pigmentation
promotion in marine
organisms (shrimps
and fish) than
corresponding
phospholipid forms of
ARA from fish oil.
The ARA can be in the
form of an oil, e.g.
an oil-in-water
emulsion or may first
be fed to larvae,
rotifers or nauplii
which are themselves
included in a
composition as “live”
feed for larger
organisms.







*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the Securities and Exchange Commission




 1 of 2









 








Schedules to ARA Alliance, Purchase and Production Agreement




	 	 	 	 	 
	Patent #
	 	Title
	 	Summary

	WO 00/21524

	 	PUFA supplement /ARA

for pregnant women
	 	Edible formulations,
such as
polyunsaturated fatty
acids (PUFAs) such as
pharmaceutical
compositions or
nutritional
supplements, are
disclosed comprising
arachidonic acid
(ARA). They are
adapted to deliver
from 150 mg to 1 g
per day of ARA and
may contain other
PUFAs, for example
docosahexaenoic acid
(DHA) at a ration of
ARA: DHA of 1:1 to
1:2 are also
disclosed, as are
foodstuffs comprising
of 0.1 to 5% of ARA.
Such formulations can
be used to increase
ARA levels in vivo,
for example in
pregnant women or for
people who have
diseases or
conditions associated
with low ARA levels.
	 
	 	 	 	 
	WO 02/10423

	 	Isolation of microbial
oils
	 	The extraction of a
microbial or single
cell oil, for example
comprising one or
more polyunsaturated
fatty acids (PUFA’s),
directly form
microbial cells is
disclosed which
avoids the need for
solvents.
	 
	 	 	 	 
	WO02/10322

	 	Purifying crude PUFA

oils
	 	A process for
preparing an oil
mixture of an w-6
PUFA (such as ARA)
with w-3 PUFA (such
as DHA and/or EPA is
described which can
be included into
edible formulations
such as foodstuffs,
and in particular
infant formulas.
	 
	 	 	 	 
	Premier depot

To be published in

2004

	 	*
	 	*
	 
	 	 	 	 
	Premier depot

To be published in

2004

	 	*
	 	*







*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the Securities and Exchange Commission




 2 of 2









 








Schedules to ARA Alliance, Purchase and Production Agreement




SCHEDULE 2.51

DSM KNOW-HOW




Status: Technology in place for large scale ARA production

Main process characteristics: process scale: *,




	 	 	 	*

productivity: *

high quality oil:

*





Main fields of
expertise:




Strains:





	 	•	 	A number of ARA producing strains of different organisms






	 	•	 	Main line of producers: *





Fermentation technology:





	 	•	 	*






	 	•	 	*






	 	•	 	*






	 	•	 	*






	 	•	 	*






	 	•	 	*






	 	•	 	*






	 	•	 	*






	 	•	 	*





Pasteurization technology:





	 	•	 	*






	 	•	 	*






	 	•	 	*





Down stream processing:





	 	•	 	*






	 	•	 	*






	 	•	 	*





Extraction of biomass:





	 	•	 	*






	 	•	 	*





Process developments developed, not implemented:





	 	•	 	*






	 	•	 	*





Toxicology, safety studies:





	 	•	 	*






	 	•	 	*






	 	•	 	*





*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the Securities and Exchange Commission




 1 of 2









 








Schedules to ARA Alliance, Purchase and Production Agreement




Nutrition:





	 	•	 	*






	 	•	 	*





Application areas:





	 	•	 	*





New fields of
investigation:




Increase fermentation efficiency:





	 	•	 	*






	 	•	 	*






	 	•	 	*






	 	•	 	*





Down stream processing:





	 	•	 	*






	 	•	 	*






	 	•	 	*





Extraction:





	 	•	 	*





www.infantvision.com / www.infantvision.nl




This website has been build to inform both consumers (parents) and health care
professionals on the importance of AA and DHA in infant and maternal nutrition.
This site has been updated with the latest literature since Q1 of 2002. The
site is very informative and educational. Furthermore the site has quite some
exposure so far, which makes it a good platform for further educational
activities and marketing pull campaigns for both Infant Formula as well as
supplements/foods for pregnant/lactating women.




*The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The confidential portions have been submitted separately to the Securities and Exchange Commission




 2 of 2









 








Schedules to ARA Alliance, Purchase and Production Agreement




SCHEDULE 2.62

EXCLUDED SUBJECT MATTER




	 	 	 	 	 	 	 	 	 	 	 	 	 
	SR No./Hunton	 	 	 	 	 	 	 	 	 	 
	No./Rothwell	 	 	 	Application or	 	Appl. Date or	 	 	 	 
	No.
	 	Country
	 	Patent Number
	 	Date Issued
	 	Title of Patent
	 	Status

	0103 / 000106

	 	Australia
	 	12392/92

661297
	 	1/22/92

11/7/1995
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0290 / 000107

	 	Austria
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0291/000108

	 	Belgium
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	077 / 000109

	 	Brazil
	 	PI 9205526.5
	 	1/22/1992
	 	Microbial Oil Mixtures and Uses Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0104 / 000110

	 	Canada
	 	2,101,274

2,101,274
	 	1/22/1992

12/15/1998
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0294 / 000111

	 	Denmark
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0285 / 000112

	 	Europe
	 	1200067.5	 	1/22/1992
	 	Microbial Oil Mixtures and Uses Thereof
(Martek Reference: Blends/EP-DIV)
	 	Pending

Published
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0029 / 000113

	 	Europe
	 	EP 92904388.3

EP 568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0305 / 000114

	 	France
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0107 / 000115

	 	French Africa (OPAI)
	 	PV 60396

10348
	 	1/22/92

12/29/1997
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0293 / 000116

	 	Germany
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0296 / 000117

	 	Greece
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0105 / 000118

	 	Indonesia
	 	P001678

ID 0000174
	 	1/24/1992

6/20/1995
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0026 / 000119

	 	Israel
	 	100733

100733
	 	1/22/1992

4/1/1996
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0083 / 000120

	 	Israel
	 	114253

114253
	 	1/22/1992

10/14/1997
	 	Composition Including Blends of
Microbial Oils and Their Preparation
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0297 / 000121

	 	Italy
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0032 / 000122

	 	Japan
	 	504606/92

2731035
	 	1/22/1992

12/19/1997
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0300 / 000123

	 	Luxembourg
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0090 / 000124

	 	Mexico
	 	9200320

183638
	 	1/24/1992

1/6/1997
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0301 / 000125

	 	Monaco
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0303 / 000126

	 	Netherlands
	 	EP 92904388.3
EP
0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0106 / 000127

	 	New Zealand
	 	241359

241359
	 	1/22/1992

2/16/1996
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 








1 of 4









 








Schedules to ARA Alliance, Purchase and Production Agreement




	 	 	 	 	 	 	 	 	 	 	 	 	 
	SR No./Hunton	 	 	 	 	 	 	 	 	 	 
	No./Rothwell	 	 	 	Application or	 	Appl. Date or	 	 	 	 
	No.
	 	Country
	 	Patent Number
	 	Date Issued
	 	Title of Patent
	 	Status

	0108 / 000128

	 	PCT
	 	PCT/US92/00522

WO 92/ 12711
	 	1/22/1992

8/6/1992
	 	Microbial Oil Mixtures and Uses Thereof
	 	Entered Nat’l Phase
Published
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0109 / 000129

	 	Philippines
	 	1992-43812

43812
	 	1/22/1992

11/23/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0066 / 000130

	 	Russia
	 	930524210.13

2093996
	 	1/22/1992

10/27/1997
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0065 / 000131

	 	Singapore
	 	9608986.7

49307
	 	4/13/1996

1/10/2002
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0110 / 000132

	 	South Africa
	 	92/0452

92/0452
	 	1/22/1992

10/28/1992
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0034 / 000133

	 	South Korea
	 	1993-0702205

321543
	 	1/22/1992

1/9/2002
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0245 / 000134

	 	South Korea
	 	2001-7003480

292103
	 	3/30/2000

3/20/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0278 / 000135

	 	South Korea
	 	2001-7002283

313987
	 	2/22/2001

10/25/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0302 / 000136

	 	Spain
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0111 / 000137

	 	Sri Lanka
	 	10526

10526
	 	1/22/1992

6/17/1994
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0304 / 000138

	 	Sweden
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0292 / 000139

	 	Switzer

land
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0295 / 000140

	 	United Kingdom
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0102 / 000141

	 	USA
	 	07/944,739

US 5,374,657
	 	9/14/1992

12/20/1994
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0059 / 000142

	 	USA
	 	(07/944,739)

08/358,474

US 5,550,156
	 	(9/14/1992)

12/19/1994

8/27/1996
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-20-PCN

	 	China
	 	1816395.5	 	1/19/2001
	 	Methods for Raising Rabbits
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-20-PCZ

	 	Czech Republic
	 	2002- 2507	 	1/19/2001
	 	Methods for Raising Rabbits
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-20-PEP

	 	Europe
	 	1902119.5	 	1/19/2001
	 	Methods for Raising Rabbits
	 	Pending; Renewal
1/19/2004
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-20-PHU

	 	Hungary
	 	P0301967	 	1/19/2001
	 	Methods for Raising Rabbits
	 	PendingAnnuity Date

1-19-2004
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-20-PPL

	 	Poland
	 	 	 	 	 	1/19/2001
	 	Methods for Raising Rabbits
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-20-TH

	 	Thailand
	 	63197.0	 	1/22/2001
	 	Methods for Raising Rabbits
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-20-TW

	 	Taiwan
	 	90101741

(90115400)
	 	6/26/01

(SR has 4/25/2001)
	 	Methods for Raising Rabbits
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 








2 of 4









 








Schedules to ARA Alliance, Purchase and Production Agreement




	 	 	 	 	 	 	 	 	 	 	 	 	 
	SR No./Hunton	 	 	 	 	 	 	 	 	 	 
	No./Rothwell	 	 	 	Application or	 	Appl. Date or	 	 	 	 
	No.
	 	Country
	 	Patent Number
	 	Date Issued
	 	Title of Patent
	 	Status

	2997-20-PUS

	 	US
	 	10/181756

6,568,351
	 	7/19/2002

5/27/2003
	 	Methods for Raising Rabbits
	 	Issued; Annuity
fees due
11/27/2006; 2010;
and 2014
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-21-PAU

	 	Australia
	 	2001273028	 	6/26/2001
	 	Improved Methods of Incorporating
Polyunsaturated Fatty Acids in Milk
	 	Pending; Annuity
fee due 6/26/2006
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-21-PCA

	 	Canada
	 	2413109.0	 	6/26/2001
	 	Improved Methods of Incorporating
Polyunsaturated Fatty Acids in Milk
	 	Pending; Renewal
fees due 6/26/2004
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-21-PEP

	 	Europe
	 	1952255.6	 	6/26/2000
	 	Improved Methods of Incorporating
Polyunsaturated Fatty Acids in Milk
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-21-EPHK

	 	Hong Kong
	 	 	 	 	 	 	 	Improved Methods of Incorporating
Polyunsaturated Fatty Acids in Milk
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-21-PCT

	 	PCT
	 	US 01/20471

WO02/00028
	 	6/26/2001
	 	Improved Methods of Incorporating
Polyunsaturated Fatty Acids in Milk
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-21-PNZ

	 	New Zealand
	 	523741.0	 	6/26/2001
	 	Improved Methods of Incorporating
Polyunsaturated Fatty Acids in Milk
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-21-PUS

	 	US
	 	10/312106	 	12/20/2002
	 	Improved Methods of Incorporating
Polyunsaturated Fatty Acids in Milk
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-21-TW

	 	Taiwan
	 	90115400.0	 	6/26/2001
	 	Improved Methods of Incorporating
Polyunsaturated Fatty Acids in Milk
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-21-TH

	 	Thailand
	 	66509.0	 	6/25/2001
	 	Improved Methods of Incorporating
Polyunsaturated Fatty Acids in Milk
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-31

	 	US
	 	10/146,660	 	5/14/2002
	 	A Method of Improving the Flavor,
Tenderness and Overall Consumer
Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-31-PCT

	 	PCT
	 	US02/15353

02731799.9
	 	5/14/2002
	 	A Method of Improving the Flavor,
Tenderness and Overall Consumer
Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-31-PAU

	 	Australia
	 	2002303744.0	 	5/14/2002
	 	A Method of Improving the Flavor,
Tenderness and Overall Consumer
Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-31-PCA

	 	Canada
	 	Forthcoming
	 	5/14/2002
	 	A Method of Improving the Flavor,
Tenderness and Overall Consumer
Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-31-PEP

	 	Europe
	 	2731799.9	 	5/14/2002
	 	A Method of Improving the Flavor,
Tenderness and Overall Consumer
Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-31-PJP

	 	Japan
	 	2002-588780	 	5/14/2002
	 	A Method of Improving the Flavor,
Tenderness and Overall Consumer
Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-31-PMX

	 	Mexico
	 	PA/a/2003/010400
	 	5/14/2002
	 	A Method of Improving the Flavor,
Tenderness and Overall Consumer
Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-31-PUAE

	 	United Arab Emerites
	 	PCT/AE
376/2003
	 	5/14/2002
	 	A Method of Improving the Flavor,
Tenderness and Overall Consumer
Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-38

	 	US
	 	10/228843	 	8/26/2002
	 	Products Containing Highly Unsaturated
Fatty Acids for Use by Women During
Stages of Preconception, Pregnancy and
Lactation
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-38-PCT

	 	PCT
	 	US02/27134

WO03/ 17945 A2
	 	8/26/2002

3/6/2003
	 	Products Containing Highly Unsaturated
Fatty Acids for Use by Women During
Stages of Preconception, Pregnancy and
Lactation
	 	Published
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	2997-46-PCT

	 	PCT
	 	US03/19108

PCT/US03/19108
	 	6/18/2003
	 	Stable Emulsions of PUFA Oils in
Aqueous Solutions and Methods for
Producing Same
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0127 / 000176

	 	Australia
	 	69635/94

693450
	 	6/2/1994

11/5/1998
	 	Methods and Pharmaceutical
Compositions Useful for Treating
Neurological Disorders
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 








3 of 4









 








Schedules to ARA Alliance, Purchase and Production Agreement




	 	 	 	 	 	 	 	 	 	 	 	 	 
	SR No./Hunton	 	 	 	 	 	 	 	 	 	 
	No./Rothwell	 	 	 	Application or	 	Appl. Date or	 	 	 	 
	No.
	 	Country
	 	Patent Number
	 	Date Issued
	 	Title of Patent
	 	Status

	0128 / 000177

	 	Canada
	 	2164291.0	 	6/2/1994
	 	Methods and Pharmaceutical
Compositions Useful for Treating
Neurological Disorders
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0031 / 000178

	 	Europe
	 	94918217.4

WO94/28913
	 	6/2/1994
	 	Methods and Pharmaceutical
Compositions Useful for Treating
Neurological Disorders
	 	Allowed
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0129 / 000179

	 	Japan
	 	501997.0	 	6/2/1994
	 	Methods and Pharmaceutical
Compositions Useful for Treating
Neurological Disorders
	 	Pending

Published
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0035 / 000180

	 	Mexico
	 	944334.0	 	6/8/1994
	 	Methods and Pharmaceutical
Compositions Useful for Treating
Neurological Disorders
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0118 / 000181

	 	PCT
	 	PCT/US94/
06317

W094/ 28913

EP 0707487
	 	6/2/1994

12/22/1994
	 	Methods and Pharmaceutical
Compositions Useful for Treating
Neurological Disorders
	 	Entered Nat’l Phase
Published
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0254 / 000183

	 	Australia
	 	51828/00	 	6/3/1996
	 	Methods for Controlling Highly

Unsaturated Fatty Acid Content in

Various Tissues
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0167 / 000184

	 	Europe
	 	96921263.8	 	6/3/1996
	 	Methods for Controlling Highly

Unsaturated Fatty Acid Content in

Various Tissues
	 	Pending(Published)
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0168 / 000185

	 	Israel
	 	122405

122405
	 	6/3/1996

4/10/2003

Hunton has 7/11/2003
	 	Methods for Controlling Highly

Unsaturated Fatty Acid Content in

Various Tissues
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0033 / 000186

	 	USA
	 	08/479,809	 	6/7/1995
	 	Methods for Controlling Highly

Unsaturated Fatty Acid Content in

Various Tissues
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	0067 / 000187

	 	PCT
	 	WO 96/ 40106

PCT/US96/0
8649
	 	6/3/1996

12/19/1996
	 	Methods for Controlling Highly

Unsaturated Fatty Acid Content in

Various Tissues
	 	Entered Nat’l Phase
Published







4 of 4









 





Schedule to ARA Alliance, Purchase and Production Agreement




SCHEDULE 2.67

FINISHED OIL SPECIFICATIONS




Product Specifications

ARASCO®




	 	 	 	 	 	 	 	 	 
	Fatty Acid Composition
	 	Area %

	*
	 	 	*	 	 	 	*	 
	*
	 	 	*	 	 	 	*	 
	*
	 	 	*	 	 	 	*	 
	*
	 	 	*	 	 	 	*	 
	*
	 	 	*	 	 	 	*	 
	*
	 	 	*	 	 	 	*	 
	*
	 	 	*	 	 	 	*	 
	*
	 	 	*	 	 	 	*	 
	*
	 	 	*	 	 	 	*	 
	*
	 	 	*	 	 	 	*	 
	*
	 	 	*	 	 	 	*	 
	*
	 	 	*	 	 	 	*	 
	*
	 	 	 	 	 	 	*	 







	 	 	 	 	 
	Physical Description
	 	 	 	Method

	Description
	 	Vegetable oil from fungi	 	 
	Appearance:
	 	Clear, free flowing liquid at 40 C	 	visual
	Color:
	 	Light-medium yellow	 	visual
	Antioxidants:
	 	*	 	by addition
	Odor:
	 	Characteristic	 	sensory







	 	 	 	 	 	 	 	 	 
	Chemical Analyses
	 	Units
	 	Minimum
	 	Maximum
	 	 
	 
	 	 	 	 	 	 	 	AOCS#:
	*
	 	%	 	*	 	*	 	*
	*
	 	mg/g	 	*	 	*	 	*
	*
	 	%	 	 	 	*	 	*
	*
	 	%	 	 	 	*	 	*
	*
	 	meq/kg	 	 	 	*	 	*
	*
	 	%	 	 	 	*	 	*
	*
	 	%	 	 	 	*	 	*
	*
	 	%	 	 	 	*	 	*
	*
	 	%	 	 	 	*	 	*
	Elemental Analyses
	 	 	 	 	 	 	 	 
	*
	 	ppm	 	 	 	*	 	*
	*
	 	ppm	 	 	 	*	 	*
	*
	 	ppm	 	 	 	*	 	*
	*
	 	ppm	 	 	 	*	 	*
	*
	 	ppm	 	 	 	*	 	*
	*
	 	ppm	 	 	 	*	 	*
	*
	 	ppm	 	 	 	*	 	*
	*
	 	ppm	 	 	 	*	 	*
	*
	 	ppm	 	 	 	*	 	*
	*
	 	ppm	 	 	 	*	 	*





*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



1 of 1









 





Schedule to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 
	Elemental Analyses
	 	Units
	 	Minimum
	 	Maximum
	 	 
	*
	 	ppm	 	 	 	*	 	*
	*
	 	ppm	 	 	 	*	 	*
	*
	 	ppm	 	 	 	*	 	*







*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



2 of 1









 








Schedule to ARA Alliance, Purchase and Production Agreement




SCHEDULE 2.75

GUARANTY AGREEMENT




[Please see attached.]




*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



 









 








CORPORATE GUARANTY




     THIS CORPORATE GUARANTY is made as of this 19 day of April, 2004, by the
parties set forth below.



     WHEREAS, *, a * company (“*”) incorporated under the laws of *, having its
registered office at * hereinafter to be referred to as: the “Guarantor”;



     WHEREAS, DSM Food Specialties B.V., a private limited liability company
(“besloten vennootschap met beperkte aansprakelijkheid”) incorporated under the
laws of the Netherlands, having its registered office at A. Fleminglaan 1 in
Delft, the Netherlands (hereinafter to be referred to as: “DFS”), is a *;



     WHEREAS, DFS and Martek Biosciences Corporation, a corporation
incorporated under the laws of the State of Delaware, United States of America,
having its principal place of business at 6480 Dobbin Road, Columbia, Maryland
21045, United States of America (hereinafter to be referred to as: “Martek”),
have entered into that certain ARA Alliance, Purchase and Production Agreement
dated as of the date hereof, as may be amended (the “ARA Agreement”);



     WHEREAS, the Guarantor and Martek have agreed that the Guarantor shall
guarantee the correct and timely fulfillment by DFS of any and all of DFS’
obligations, undertakings, representations, warranties and covenants to Martek
under or arising out of the ARA Agreement as set forth herein;



     NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:



1. Arbitral Award Guaranty.




(a) Subject to the other terms and conditions of this Corporate Guaranty, the
Guarantor hereby unconditionally and irrevocably guarantees payment to Martek
of any amount for which DFS may be found to be indebted to Martek by virtue of
a valid arbitral award established in accordance with the provisions set forth
in Section 10.5 of the ARA Agreement including but not limited to liability for
attorneys fees and costs (“Arbitral Award”).



(b) In the event full payment of any Arbitral Award is not received by Martek
from DFS within thirty (30) days of such award being issued, Guarantor shall
immediately pay Martek the full amount of such award without any further action
on Martek’s part.



(c) Upon DFS’ failure to pay to Martek the amount of any Arbitral Award within
thirty (30) days as provided above, Guarantor agrees that Martek at its
election may proceed directly and at once, without notice, against Guarantor to
collect the amount of the Arbitral Award without first proceeding against DFS,
any other person, or any assets of DFS or of any other person.



(d) This guaranty is absolute, unconditional, and continuing, and is in no way
conditioned upon any event or contingency, other than the issuance of the
Arbitral Award, or upon any attempt to collect from DFS through the
commencement of legal proceedings or otherwise, and shall be binding upon



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



 









 








and enforceable in full against Guarantor without regard to any circumstance
which might otherwise constitute a defense available to, or a discharge of,
Guarantor in respect of the Arbitral Award, other then payment in full of the
Arbitral Award. Guarantor acknowledges and agrees that the Arbitral Award
shall be binding on Guarantor as if Guarantor were a party to the arbitration
proceeding in which the award was issued.



2. Bankruptcy.



(a) If DFS is declared bankrupt (“faillissement”) or granted suspension of
payments (“surséance van betaling”) and a bankruptcy trustee or a court of
competent jurisdiction fails to respect the arbitration procedures set forth in
Section 10.5 of the ARA Agreement or enjoins, stays or otherwise delays for
more than ninety (90) days an arbitration proceeding instituted thereunder,
Martek and the Guarantor shall resolve any claims under the ARA Agreement by
arbitration conducted in accordance with the procedures set forth in such
Section 10.5 to determine the indebtedness and liability of DFS to Martek.
Guarantor agrees to pay Martek any amount of such liability or indebtedness of
DFS as established by the arbitration proceeding.



(b) In the event that DFS is the subject of a bankruptcy proceeding, Martek
hereby consents to the Guarantor’s assumption of the defence by DFS of any
claim by Martek under the ARA Agreement.



3. Claims.



Any and all claims under Section 1 of this Corporate Guaranty must be made
within * of the date of any Arbitral Award.



4. Term Date.



This Corporate Guaranty shall continue in full force and effect until the
earlier of (i) such date as all of the statutes of limitations applicable to
any cause of action Martek might have against DFS related to the ARA Agreement
have expired or (ii) the date three (3) years after the expiration or the
termination of the ARA Agreement (“Term Date”), provided that this Corporate
Guaranty shall continue in effect even after the Term Date with regard to any
Arbitral Award issued as a result of any arbitration previously commenced by
Martek against DFS before the Term Date and not yet completed as of the Term
Date.



5. Licenses.



In the event the licenses granted to Martek by DFS pursuant to Section 7.4(b)
and (d) of the ARA Agreement (the “Licenses”) are terminated as a result of DFS
filing for or being placed into bankruptcy or granted suspension of payments,
Guarantor shall obtain promptly for Martek at no cost to Martek any licenses as
required for Martek to continue to have the license rights as specified in
Section 7.4(b) and (d) of the ARA Agreement. Martek reserves any and all
statutory, contractual and other legal rights to retain its rights with respect
to the Licenses notwithstanding termination or rejection in any bankruptcy or
insolvency proceeding. It is understood and agreed that if Guarantor obtains
such licenses for Martek, Martek shall not be entitled to claim damages against
DFS, or the Guarantor pursuant to Section 2, for DFS’s failure to itself
provide such Licenses from and after the date(s) on which the Guarantor obtains
such licenses for Martek.



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



 









 








6. Limitations.



The obligations of the Guarantor under this Corporate Guaranty shall never
exceed the aggregate of DFS’ obligations and/or liabilities under the ARA
Agreement. The liability of the Guarantor hereunder shall be without regard to
a bankruptcy or suspension of payments of DFS, and with regard solely to any
action brought by Martek pursuant to Section 2, any and all defenses and
limitations with respect to DFS’ obligations and/or liabilities under the ARA
Agreement, without regard to a bankruptcy or suspension of payments of DFS, may
also be invoked and relied upon by the Guarantor.



7. Article *.



This Corporate Guaranty is in addition to and is not in substitution for or in
derogation of any rights Martek has against the Guarantor pursuant to any
declaration in accordance with Article *, provided, however, that Martek agrees
that it shall not be entitled to a double recovery of its damages, and (i) to
the extent that Martek recovers damages in a * Action, it shall not be entitled
to recover such damages again in an action under this Corporate Guaranty, and
(ii) to the extent Martek recovers damages in an action under this Corporate
Guaranty, it shall not be entitled to recover such damages again in a * Action.



8. Notices.



Any notice to be made to the Guarantor under this Corporate Guaranty must be
made to:




	 	 	*
	 	 	Attn. Chairman of the Managing Board of Directors
	 	 	*
	 	 	*
	 	 	*
	 	 	 
	 	 	with a copy to:
	 	 	 
	 	 	*
	 	 	Attn. Director Corporate Legal Affairs
	 	 	*
	 	 	*
	 	 	*





9. Governing Law.



This Corporate Guaranty shall be governed by and interpreted in accordance with
the internal laws (excluding the conflict of laws rules) of the State of New
York, USA. The Guarantor hereby irrevocably submits to the jurisdiction of any
United States federal court sitting in New York, New York in any action or
proceeding arising out of or relating to this Corporate Guaranty, and
irrevocably agrees that all claims in respect of such action or proceeding may
be heard and determined in any such federal court. The Guarantor further
agrees that service of any process, summons, notice or document by registered
mail to its address set forth in Section 8 above shall be effective service of
process for any action, suit or proceeding brought against the Guarantor in any
such court. The Guarantor



*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



 









 








irrevocably and unconditionally waives any objection to the laying of venue of
any action, suit or proceeding arising out of this Corporate Guaranty in such
courts and further irrevocably and unconditionally waives and agrees not to
plead or claim in any such court that any such action, suit or proceeding
brought in any such court has been brought in an inconvenient forum. Subject
to the provisions of Section 7 hereof, the Guarantor further agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.



10. Assignment.



This Corporate Guaranty shall be binding upon the successors and assigns of
Guarantor; provided, that no transfer, assignment or delegation by Guarantor
without the consent of Martek shall release Guarantor from its liabilities
hereunder.



11. Acknowledgement.



Guarantor acknowledges that this Corporate Guaranty is being furnished to
Martek by it in order to induce Martek to enter into the ARA Agreement with
DFS. Guarantor further acknowledges that duly authorized and competent agents
or representatives of Guarantor have read, and understand, this Corporate
Guaranty and that Guarantor has been advised by competent counsel with regard
to this Corporate Guaranty.



12. No Waiver.



No failure or delay or lack of demand, notice or diligence in exercising any
right under this Corporate Guaranty shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right preclude any other or
further exercise thereof or the exercise of any other right under this
Corporate Guaranty.



13. Confession of Judgment.



Upon the failure or refusal of the Guarantor to pay in full the amount of any
Arbitral Award upon demand therefor, the Guarantor hereby authorizes the Clerk
of Court of record in the federal court sitting in Baltimore, Maryland, upon
application by Martek, to enter judgment in favor of Martek and against the
Guarantor in the full outstanding amount of the Arbitral Award together with
interest accrued on the Arbitral Award at the rate of * per year from the date
of the Arbitral Award until paid, attorneys’ fees of * of the Arbitral Award
and costs. The Guarantor hereby waives presentment, demand, notice and protest
and all other demands and notices in connection with the delivery, acceptance,
performance, default or enforcement hereof.



[The remainder of this page has been intentionally left blank.]




*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



 









 








          IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Corporate Guaranty as of the day and year first above written.



*




	 	 	 	 	 
	By*

	 	

	 	By: *
	Name:

	 	*
	 	Name: *
	Title:

	 	Member of the Managing Board of Directors
	 	Title: Director Corporate Legal Affairs







MARTEK BIOSCIENCES CORPORATION




	 	 	 
	By:

	 	/s/ Steve Dubin
	

	 	

	Name:

	 	Steve Dubin
	Title:

	 	President







*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



 









 








Schedule to ARA Alliance, Purchase and Production Agreement




SCHEDULE 2.98

MARTEK COSTS




Included Costs:



The Martek Costs per Unit of ARA shall equal the Variable Costs for Martek
Services per Unit of ARA plus the Fixed Costs for Martek Services per Unit of
ARA, as described below. Fixed Costs and Variable Costs shall be based on
Generally Accepted Accounting Principles and shall be based on actual or
budgeted costs as applicable.



The depreciation portion of Fixed Costs shall be based on Martek’s internal
depreciation policies which are generally on a straight line basis for twenty
years for the Company’s oil processing plants, ten to fifteen years for oil
processing machinery and equipment and five years for furniture and fixtures.



The ARA portion of assets not totally dedicated to ARA, other than production
assets (such as ERP systems), shall be depreciated by using the Martek’s
internal accounting standards applicable to Martek operations in general, but
still consistent with Generally Accepted Accounting Principles.



Excluded Costs:



The following costs shall not to be included in the Costs for Martek Services
per Unit of ARA (the “Excluded Costs”):




	 	•	 	The costs of not meeting the following Performance Standards for
2004:






	 	A.	 	Maximum level of extraction losses of * based on analytical
techniques as specified in Schedule 2.12.
	 
	 	B.	 	Maximum level of RBD losses of *






	 	•	 	All costs related to the importing and re-exporting of ARA
products sent to DSM that do not meet applicable Specifications,
including but not limited to related freight, tariffs and warehousing
costs.
	 
	 	•	 	Costs related to reworking material that originally did not meet
applicable Specifications pursuant to Section 4.7 of the Agreement.
	 
	 	•	 	Allocations of corporate overhead that exceed the amount agreed
to by the Committee by more than * without DSM’s prior written
approval.
	 
	 	•	 	Legal costs associated with negotiating and drafting this Agreement.
	 
	 	•	 	R&D Contribution pursuant to Section 7.1(f).





*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission



1 of 1





 









 





Schedules to ARA Alliance, Purchase and Production Agreement




SCHEDULE 2.101

MARTEK PATENTS




	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Date Issued
	 	Title of Patent
	 	Status

	2997-4

	 	US
	 	08/377766

5,583,019
	 	1/24/1995

12/10/96
	 	Method for Production of Arachidonic Acid
	 	Issued; Maintenance
Fees Due; 6/10/04;
6/10/08
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-AU

	 	Australia
	 	37991/95

711967
	 	11/20/1995

2/10/00
	 	Method for Production of Arachidonic Acid
	 	Issued; Annuity Due
11/20/03
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-CA

	 	Canada
	 	2163278.0
	 	11/20/1995
	 	Method for Production of Arachidonic Acid
	 	Pending; Annuity
Due 11/20/03
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-EP

	 	Europe
	 	96200072.5

EP0726 321 B1
	 	1/16/96

6/12/2002
	 	Method for Production of Arachidonic Acid
	 	Issued; Annuity Due
1/16/04
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-EP-DIV

	 	Europe
	 	01128282.9
	 	11/28/2001
	 	Method for Production of Arachidonic Acid
	 	Pending. Annuity
due 11/28/2003
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-EP-DIV-HK

	 	Hong Kong
	 	02106865.7

HK1045628
	 	1/16/1996

12/6/2002
	 	Method for Production of Arachidonic Acid
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-EPDE

	 	West Germany
	 	96200072.5
69621663.9-08
	 	1/16/1996

6/12/2002
	 	Method for Production of Arachidonic Acid
	 	Issued; Renewal due
1/16/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-EPFR

	 	France
	 	96200072.5
0726321
	 	1/16/1996

6/12/2002
	 	Method for Production of Arachidonic Acid
	 	Issued; Renewal due
1/16/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-EPGB

	 	United Kingdom
	 	96200072.5
0726321
	 	1/16/1996

6/12/2002
	 	Method for Production of Arachidonic Acid
	 	Issued; Renewal due
1/16/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-EPIT

	 	Italy
	 	96200072.5
0726321
	 	1/16/1996

6/12/2002
	 	Method for Production of Arachidonic Acid
	 	Issued; Renewal due
1/16/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-JP

	 	Japan
	 	7-314330
	 	12/1/1995
	 	Method for Production of Arachidonic Acid
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-1

	 	US
	 	08/763973

5,882,703
	 	12/10/96

3/16/99
	 	Product Containing Mortierella sect. Schmuckeri lipids
	 	Issued; Maintenance
Fees Due 9/16/06;
9/16/10
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-1-1

	 	US
	 	09/270,294

6,245,365
	 	3/15/99

6/12/01
	 	Food Products Containing Mortierella sect. Schmuckeri
	 	Issued; Maintenance
fee due 12/12/2004;
12/12/2008 and
12/12/2012
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-1-1-1

	 	US
	 	09/480,060

6,319,698
	 	1/10/00

11/20/2001
	 	A Method for Producing Arachidonic Acid (As Amended)
	 	Issued 11/20/2001
Maintenance fee due
5/20/2005;
5/20/2009 and
5/20/2013
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-1-1-2

	 	US
	 	09/972,550
	 	10/5/2001
	 	Method for Production of Arachidonic Acid
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-1-2

	 	US
	 	09/7890576,541,049
	 	2/19/014/1/2003
	 	Method for Production of Arachidonic Acid
	 	IssuedMaintenance
Fees due 10/1/2006;
2010 and 2014







1 of 7








 





Schedules to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Date Issued
	 	Title of Patent
	 	Status

	2997-19

	 	US
	 	09/ 766,500
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending;
Must File IDS
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PAU

	 	Australia
	 	29636/01
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending; Renewal
1/19/2006
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PBR

	 	Brazil
	 	P10107699-0
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending; Renewal
1/19/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PCA

	 	Canada
	 	2397655.0
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending; Renewal
1/19/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PCN

	 	China
	 	1806424.8
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PCZ

	 	Czech Republic
	 	PV 2002-2506
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PEP

	 	Europe
	 	1942672.5
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending; Renewal
1/19/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PHK

	 	Hong Kong
	 	03102740.6

Pub. HK1050716
	 	4/15/2003

7/4/2003
	 	Solventless Extraction Process
	 	Pending;
Annuity Fees due
1/19/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PHU

	 	Hungary
	 	Serial No. P0300556
	 	1/19/2001

6/30/2003
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PIN

	 	India
	 	2002/00711/

DEL
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PID

	 	Indonesia
	 	W00200201683
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PIL

	 	Israel
	 	150772.0
	 	7/16/2002
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PJP

	 	Japan
	 	2001-553374
Publication No.
2003-520046
	 	1/19/2001

7/2/2003
	 	Solventless Extraction Process
	 	Pending

Published
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PKR

	 	South Korea
	 	2002-7009287
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PMX

	 	Mexico
	 	2002/007092
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PNZ

	 	New Zealand
	 	520287.0
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PNO

	 	Norway
	 	20023449.0
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending; Annuity
fee due 1/19/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PPL

	 	Poland
	 	P356587
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending







2 of 7









 





Schedules to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Date Issued
	 	Title of Patent
	 	Status

	2997-19-PRU

	 	Russia
	 	2002119551.0
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PSG

	 	Singapore
	 	2002-04383-4
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PZA

	 	South Africa
	 	2002/5790
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending; Renewal
1/19/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-TH

	 	Thailand
	 	63198.0
	 	1/22/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-TW

	 	Taiwan
	 	90105452.0
	 	3/8/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-42

	 	US
	 	Filed
	 	12/12/2002
	 	Extraction and Winterization of Lipids From Oilseed
and Microbial Sources Using Acetone or Analogous
Solvent
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-42-PCT

	 	PCT
	 	US02/39930

WO03/049832
	 	12/12/2002
June 19, 2003
	 	Extraction and Winterization of Lipids From Oilseed
and Microbial Sources Using Acetone or Analogous
Solvent
	 	Published
	 
	 	 	 	 	 	 	 	 	 	 
	2997-45

	 	US
	 	 	 	5/3/2003
	 	High-Quality Lipids and Methods for Producing by
Enzymatic Liberation from Biomass
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-45-PCT

	 	US
	 	US03/14177

WO03/14177
	 	5/5/2002

11/13/2003
	 	High-Quality Lipids and Methods for Producing by Enzymatic Liberation from Biomass
	 	Published
	 
	 	 	 	 	 	 	 	 	 	 
	2997-46

	 	US
	 	 	 	6/18/2003
	 	Highly Stable Emulsions of PUFA Oils in Aqueous
Solutions and Methods for Producing Same
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0114/ 0009

	 	Australia
	 	AU92/12355

AU 661674

WO92/13086
	 	1/22/1992

11/21/1995
	 	Arachidonic Acid and Methods for the Production and Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	264/00010

	 	Austria
	 	EP 92904428.7

EP 0568608
	 	1/22/19929/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	265/ 00011

	 	Belgium
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	076 / 00012

	 	Brazil
	 	PI9205519.2
	 	1/22/1992
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	115 / 00013

	 	Canada
	 	2101273

2101273
	 	1/22/1992

4/2/2002
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	268/ 000014

	 	Denmark
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	056 / 00015

	 	Europe
	 	EP92904438.7

EP 0568608 B1
	 	1/22/92

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0227 / 000016

	 	Europe
	 	99204324

EP 1001034 A1
	 	1/22/1992

5/17/2000
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending







3 of 7









 





Schedules to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Date Issued
	 	Title of Patent
	 	Status

	0270/ 000017

	 	France
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	120 / 000018

	 	French Africa (OAPI)
	 	PV 60397

09909
	 	1/22/1992

9/15/1994
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0267 / 000019

	 	Germany
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0272 / 000020

	 	Greece
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0117 / 000021

	 	Indonesia
	 	P-001679

ID 0000393
	 	1/24/1992

12/22/1995
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0116 / 000022

	 	Israel
	 	100732.0
	 	10/1/1995
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0273 / 000023

	 	Italy
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0203 / 000024

	 	Japan
	 	240168/98

3229268
	 	1/22/1992

9/7/2001
	 	Arachidonic Acid Containing Fungal Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	274 / 000026

	 	Luxembourg
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0119 / 000027

	 	Mexico
	 	9200301

202940
	 	1/24/1992

7/6/2001
	 	Arachidonic Acid and Methods for the Production and Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	275 / 000028

	 	Monaco
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0276 / 000029

	 	Netherlands
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0113 / 000030

	 	New Zealand
	 	241358

NZ 241358
	 	1/22/1992

2/8/1995
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0122 / 000031

	 	PCT
	 	WO 92/ 13086

PCT/US92/00517
	 	1/22/1992

8/6/1992
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Entered Nat’l Phase
Published
	 
	 	 	 	 	 	 	 	 	 	 
	0121 / 000032

	 	Philippines
	 	43811

1992-43811
	 	1/22/1992

8/22/2002
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	087/ 000033

	 	Russia
	 	93-054772

2120998
	 	1/22/1992

1/29/1998
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0037 / 000034

	 	South Africa
	 	92/0454

92/0454
	 	1/22/1992

10/28/1992
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0085 / 000035

	 	South Korea
	 	1993-702193

254300
	 	1/22/1992

2/1/2000
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted







4 of 7









 





Schedules to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Date Issued
	 	Title of Patent
	 	Status

	0226 / 000036

	 	South Korea
	 	10-1999-7008800


302036
	 	9/27/1999

6/29/2001
	 	An Oil Composition Containing ARA
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0269 / 000037

	 	Spain (ES)
	 	EP 92904428.7  

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0027 / 000038

	 	Sri Lanka
	 	10527

10527
	 	1/22/1992

10/27/1993
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0277 / 000039

	 	Sweden
	 	EP 92904428.7


EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0266 / 000040

	 	Switzer

land
	 	EP 92904428.7


EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0271 / 000041

	 	United Kingdom
	 	EP 92904428.7

EP 0568608
	 	1/22/19929/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	003 / 000043

	 	Australia
	 	AU 96/48542

713567
	 	1/3/1996

12/2/1999
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	004 / 000044

	 	Brazil
	 	PI 9607179.6
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	005 / 000045

	 	Canada
	 	
_______

2,209,513
	 	1/3/1996

5/28/2002
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Issued
	 
	 	 	 	 	 	 	 	 	 	 
	006 /000046

	 	China
	 	96192002.5
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0287 / 000047

	 	Eurasia
	 	1036.0
	 	8/28/2000
	 	Unmodified Fungal Oil Mortierella Sp., Method for
Production Thereof, Method of Providing Arachidonic
Acid to Infant Formula, Infant Formula Containing
Arachidonic Acid, Method of Providing a Human with
Supplemental Amount of Arachidonic Acid and Cosmetic
Composition
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	007 / 000048

	 	Europe
	 	96904435.3


0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Issued
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000260

	 	Europe
	 	EP 3076254.6

Pub. No. EP1342787
	 	1/3/1996

9/10/2003
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending

Published
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000261

	 	Portugal
	 	EP 96904435.3


EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000262

	 	Sweden
	 	EP 96904435.3


EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000263

	 	Monaco
	 	EP 96904435.3


EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000264

	 	Nether

lands
	 	EP 96904435.3


EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000265

	 	Luxembourg
	 	EP 96904435.3


EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted







5 of 7









 






Schedules to ARA Alliance, Purchase and Production Agreement


	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Date Issued
	 	Title of Patent
	 	Status

	/ 000266

	 	Italy
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000267

	 	Ireland
	 	EP 96904435.3

EP 0800584
	 	1/3/19965/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000268

	 	Greece
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000269

	 	United Kingdom
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000270

	 	France
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000271

	 	Germany
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000272

	 	Switzer

land
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000273

	 	Austria
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000274

	 	Belgium
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000275

	 	Denmark
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000276

	 	Spain
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	008 / 000049

	 	Finland
	 	972829.0
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	002 / 000050

	 	Japan
	 	521231/ 96
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0011/ 000051

	 	Mexico
	 	975078.0
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	264

	 	NL
	 	?
	 	?
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0012 / 000052

	 	Norway
	 	973085.0
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0062 / 000053

	 	PCT
	 	US96/00182WO

96/21037
	 	1/3/967/11/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Entered Nat’l Phase
Published
	 
	 	 	 	 	 	 	 	 	 	 
	0013 / 000054

	 	Poland
	 	P321208
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending







6 of 7









 





Schedules to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Date Issued
	 	Title of Patent
	 	Status

	0173/ 000055

	 	Singapore
	 	9703038.1

42669
	 	1/3/1996

3/30/1999
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	009 / 000056

	 	South Korea
	 	1997-0704585
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0025 / 000057

	 	USA
	 	Appl. 08/367881

US 5,658,767
	 	1/3/1995

8/19/1997
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0014 / 000058

	 	Russia
	 	EA-97/0090-US


1036
	 	1/3/1996

8/28/2000
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0186 / 000105

	 	USA
	 	 09/210,598

US 6,166,231
	 	12/15/1998

12/26/2000
	 	Two Phase Extraction of Oil from Biomass
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	–*

	 	*
	 	*
	 	5/14/2002
	 	*
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	*

	 	*
	 	Forthcoming
	 	5/14/2002
	 	*
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	*

	 	*
	 	*
	 	5/14/2002
	 	*
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	*

	 	*
	 	*
	 	5/14/2002
	 	*
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	*

	 	*
	 	*
	 	5/14/2002
	 	*
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	*

	 	*
	 	*
	 	5/14/2002
	 	*
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	*

	 	*
	 	*
	 	5/14/2002
	 	*
	 	Pending







7 of 7









 






Schedules to ARA Alliance, Purchase and Production Agreement




SCHEDULE 2.102

MARTEK KNOW-HOW




Main fields of expertise:




Strains and strain improvement methodologies:





	•	 	Strains identified with significantly higher productivity and ARA potency than the *
	 
	•	 	*
	 
	•	 	*





Fermentation:





	•	 	*
	 
	•	 	*





Downstream Processing:





	•	 	*
	 
	•	 	*
	 
	•	 	*
	 
	•	 	*
	 
	•	 	*
	 
	•	 	*





Product Formulation:





	•	 	*
	 
	•	 	*





Product Characterization:





	•	 	*





Transgenic Oilseeds:





	•	 	*





Feed Applications:





	•	 	*
	 
	•	 	*
	 
	•	 	*
	 
	•	 	*





Ingredient Forms:





	•	 	*
	 
	•	 	*





Product Safety and Toxicology:





	•	 	*
	 
	•	 	*





Product Efficacy & Health Benefits:





	•	 	*




*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




1 of 2




 









 








Schedules to ARA Alliance, Purchase and Production Agreement




SCHEDULE 2.111

*



*
*
*
*
*


*The asterisk denotes that confidential portions of this exhibit have been
omitted in reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The
confidential portions have been submitted separately to the Securities and
Exchange Commission




1 of 1





 










 





Schedule to ARA Alliance, Purchase and Production Agreement




SCHEDULE 4.2(a)

DSM CERTIFICATE OF ANALYSIS




	 	 	 	 	 
	

	 	Certificate of Analysis
	 	ARA-CoA-004M
	 	ARA Biomass
	 	Revision
	 	 	 	Dated: 26-11-03
	 	 	 	Page 1 of 1







Product no: 2984




	 	 	 	 	 	 	 
	 	 	 	 	Discussion	 	 
	Parameters
	 	Requirement
	 	Range (**)
	 	Result

	Release specifications:
	 	 	 	 	 	 
	Description

	 	Granulate	 	 	 	 
	Smell

	 	Characteristic	 	 	 	 
	Colour

	 	Brown	 	 	 	 
	*

	 	*
	 	*	 	 
	*

	 	*	 	 	 	 
	*

	 	*
	 	*	 	 
	*

	 	*
	 	*	 	 
	*

	 	*	 	 	 	 
	*

	 	*	 	 	 	 
	*

	 	*	 	 	 	 
	 
	 	 	 	 	 	 
	*

	 	Approval
limit
	 	 	 	 
	*

	 	*	 	 	 	 
	 
	 	 	 	 	 	 
	*

	 	*	 	 	 	 
	*

	 	*	 	 	 	 
	*

	 	*	 	 	 	 
	*

	 	*	 	 	 	 
	 
	 	 	 	 	 	 
	Controlled in batch records:
	 	 	 	 	 	 
	*

	 	*	 	 	 	 
	*

	 	*	 	 	 	 
	 
	 	 	 	 	 	 
	*
	 	 	 	 	 	 
	*
	 	 	 	 	 	 
	*
	 	 	 	 	 	 
	*
	 	 	 	 	 	 
	*
	 	 	 	 	 	 







	 	 	 	 	 	 	 	 	 
	Storage:	 	 	 	Packaging:
	 	 	•

	 	Below -2° C, preferably
	 	-
	 	 BigBags (polypropylene with polyethylene liner), anti static
	 	 	

	 	lower temperatures
	 	-
	 	 Labeled with product number, batch number, production number
	 	 	•

	 	Protected from light
	 	 
	 	production date and storage conditions on both inner and outer bag
	 	 	•

	 	Dry conditions
	 	 	 	 
	*
	 	 
	 	 	 	 	 	 







* The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule
24b-2 of the Securities Exchange Act of 1934.
The confidential portions have been submitted separately to the Securities and Exchange Commission




 1 of 2









 








Schedule to ARA Alliance, Purchase and Production Agreement




	 	 	 	 	 
	

	 	CERTIFICATE OF ANALYSIS AND
	 	ARA-CoA-Crude-001
	 	BATCH RELEASE FORM
	 	Revision 6
	 	ARACHIDONIC ACID CRUDE OIL
	 	Page 1 of 1







Product no::2983




	 	 	 	 	 
	Parameters
	 	Requirements
	 	Results

	Release specifications:
	 	 	 	 
	Appearance

	 	Typical at 25°C	 	 
	Colour

	 	Light-medium yellow	 	 
	Smell

	 	Typical – free of any
rancid odor	 	 
	ARA content

	 	*	 	 
	*

	 	*	 	 
	*

	 	*	 	 
	*

	 	*	 	 
	 
	Control specifications:
	 	 	 	 
	*

	 	*	 	 
	*

	 	*	 	 
	*

	 	*	 	 
	*

	 	*	 	 
	*

	 	*	 	 
	 
	Control specifications: *:
	 	 	 	 
	*

	 	*	 	 
	*

	 	*	 	 
	*

	 	*	 	 
	*

	 	*	 	 
	*

	 	*	 	 
	*

	 	*	 	 
	*

	 	*	 	 
	 
	Batch records: Manufacturer

	 	Approved: Manufacturer







	 	 	 
	Storage conditions:

	 	Packaging:
	•  Below
–18°C

	 	•  Under nitrogen
	•  Protected from light

	 	•  200 kg food grade phenolic coated (tight head) drums with DSM label
	•  Dry conditions
	 	 







*




Remarks




	 	 	 	 	 
	


	 	

	 	 
	Date:

	 	W.A. van Wing	 	 
	

	 	QA-Manager	 	 







* The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule
24b-2 of the Securities Exchange Act of 1934.
The confidential portions have been submitted separately to the Securities and Exchange Commission




 2 of 2









 








Schedule to ARA Alliance, Purchase and Production Agreement




* The asterisk denotes that confidential portions of this exhibit have been omitted in reliance on Rule
24b-2 of the Securities Exchange Act of 1934.
The confidential portions have been submitted separately to the Securities and Exchange Commission




 3 of 2









 








Schedule to ARA Alliance, Purchase and Production Agreement




SCHEDULE 4.2(b)

MARTEK CERTIFICATE OF ANALYSIS




CERTIFICATE OF ANALYSIS

ARASCO®

Lot Number




Description: *




	 	 	 
	Fatty Acid Profile
	 	 
	

	*

	 	*







	 	 	 	 	 
	Physical Description
	 	 	 	Conforms

	Appearance:

	 	Clear, free flowing liquid at 40 C
	 	yes
	Color:

	 	Light-medium yellow
	 	yes
	Antioxidants:

	 	*
	 	by addition
	Odor:

	 	Characteristic
	 	yes







	 	 	 	 	 	 	 	 	 	 	 
	Chemical Analyses
	 	Units
	 	Minimum
	 	Maximum
	 	Results

	*

	 	 	%	 	 	*
	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	mg/g
	 	*
	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	 	%	 	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	 	%	 	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	meq/kg
	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	 	%	 	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	 	%	 	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	 	%	 	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	 	%	 	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	 
	 	 	 	 	 	 	 	 	 	 
	Elemental Analyses
	 	 	 	 	 	 	 	 	 	 
	*

	 	ppm
	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	ppm
	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	ppm
	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	ppm
	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	ppm
	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	ppm
	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	ppm
	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	ppm
	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	ppm
	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	ppm
	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	ppm
	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	ppm
	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	

	*

	 	ppm
	 	 	 	*	 	 
	

	 	 	 	 	 	 	 	 	 	








	 	 	 	 	 
	Analysis Completed By:

	 	 	 	 
	

	 	
	 	 
	Analytical Review By:
	 	 	 	 
	

	 	
	 	 
	Product Release By:
	 	 	 	 
	

	 	
	 	 
	Date:
	 	 	 	 
	

	 	
	 	 







* The asterisk denotes that confidential portions of this exhibit have been omitted in
reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The confidential
portions have been submitted separately to the Securities and Exchange Commission






 1 of 1









 








Schedule to ARA Alliance, Purchase and Production Agreement




SCHEDULE 4.6

MANUFACTURING CHANGES




I. Standard Operating Procedure: Martek/DSM Procedure “Process Change Control
Procedure”



A. Documentation: All process changes must be documented and approved by
representatives from management level in several departments, ie R&D,
manufacturing, and QA/QC; a log of changes will be maintained.



B. Major vs. minor changes: Changes are categorized as “minor” or “major”
process changes, as summarized in the examples below:



Minor changes: Impact to yield or process efficiency



	 	 	 	 	 
	Fermentation
	 	Drying
	 	Extraction/RBD

	*

	 	*
	 	*
	*

	 	 	 	*
	*

	 	 	 	*
	*

	 	 	 	*
	*

	 	 	 	*







Major changes: May impact the quality of the product




	 	 	 	 	 
	Fermentation
	 	Drying
	 	Extraction/RBD

	*

	 	*
	 	*
	*

	 	*
	 	*
	*

	 	*
	 	*
	*

	 	 	 	*
	

	 	 	 	*
	

	 	 	 	*
	

	 	 	 	*







Both parties will inform each other on major changes prior to implementation
and agree on a validation schedule. Any changes not included in the above
examples will be discussed in the Committee to determine if they are “major” or
“minor” changes.



C. Customer notification requirements: In the case of major process changes,
prior notification of end users (customers), or regulatory review, may be
required.



* The asterisk denotes that confidential portions of this exhibit have been omitted in
reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The confidential
portions have been submitted separately to the Securities and Exchange Commission





 1 of 1









 








Schedule to ARA Alliance, Purchase and Production Agreement




SCHEDULE 6.15

YIELD ASSUMPTIONS





	(a)	 	Biomass Conversion to Crude Oil






	 	1.	 	*
	 
	 	2.	 	*
	 
	 	3.	 	*






	(b)	 	Crude Oil Conversion to Finished Oil






	 	1.	 	*





* The asterisk denotes that confidential portions of this exhibit have been omitted in
reliance on Rule 24b-2 of the Securities Exchange Act of 1934. The confidential
portions have been submitted separately to the Securities and Exchange Commission



 1 of 1









 





Schedules to ARA Alliance, Purchase and Production Agreement




SCHEDULE 7.2(a)(i)

MARTEK NON-CHALLENGEABLE PATENTS




	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or Date	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Issued
	 	Title of Patent
	 	Status

	2997-4

	 	US
	 	08/377766

5,583,019
	 	1/24/1995

12/10/96
	 	Method for Production of Arachidonic Acid
	 	Issued; Maintenance
Fees Due; 6/10/04;
6/10/08
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-AU

	 	Australia
	 	37991/95

711967
	 	11/20/1995

2/10/00
	 	Method for Production of Arachidonic Acid
	 	Issued; Annuity Due
11/20/03
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-CA

	 	Canada
	 	2163278.0
	 	11/20/1995
	 	Method for Production of Arachidonic Acid
	 	Pending; Annuity
Due 11/20/03
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-EP

	 	Europe
	 	96200072.5

EP0726 321 B1
	 	1/16/96

6/12/2002
	 	Method for Production of Arachidonic Acid
	 	Issued; Annuity Due
1/16/04
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-EP-DIV

	 	Europe
	 	01128282.9
	 	11/28/2001
	 	Method for Production of Arachidonic Acid
	 	Pending. Annuity
due 11/28/2003
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-EP-DIV-HK

	 	Hong Kong
	 	02106865.7
HK1045628
	 	1/16/1996

12/6/2002
	 	Method for Production of Arachidonic Acid
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-EPDE

	 	West Germany
	 	96200072.5
69621663.9-08
	 	1/16/1996

6/12/2002
	 	Method for Production of Arachidonic Acid
	 	Issued; Renewal due
1/16/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-EPFR

	 	France
	 	96200072.5
0726321
	 	1/16/1996

6/12/2002
	 	Method for Production of Arachidonic Acid
	 	Issued; Renewal due
1/16/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-EPGB

	 	United Kingdom
	 	96200072.5
0726321
	 	1/16/1996

6/12/2002
	 	Method for Production of Arachidonic Acid
	 	Issued; Renewal due
1/16/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-EPIT

	 	Italy
	 	96200072.5
0726321
	 	1/16/1996

6/12/2002
	 	Method for Production of Arachidonic Acid
	 	Issued; Renewal due
1/16/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-JP

	 	Japan
	 	7-314330
	 	12/1/1995
	 	Method for Production of Arachidonic Acid
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-1

	 	US
	 	08/763973

5,882,703
	 	12/10/96

3/16/99
	 	Product Containing Mortierella sect.
Schmuckeri lipids
	 	Issued; Maintenance
Fees Due 9/16/06;
9/16/10
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-1-1

	 	US
	 	09/270,294

6,245,365
	 	3/15/99

6/12/01
	 	Food Products Containing Mortierella
sect. Schmuckeri
	 	Issued; Maintenance
fee due 12/12/2004;
12/12/2008 and
12/12/2012
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-1-1-1

	 	US
	 	09/480,060

6,319,698
	 	1/10/00

11/20/2001
	 	A Method for Producing Arachidonic Acid
(As Amended)
	 	Issued 11/20/2001
Maintenance fee due
5/20/2005;
5/20/2009 and
5/20/2013
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-1-1-2

	 	US
	 	09/972,550
	 	10/5/2001
	 	Method for Production of Arachidonic Acid
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-4-1-2

	 	US
	 	09/7890576,541,049
	 	2/19/014/1/2003
	 	Method for Production of Arachidonic Acid
	 	IssuedMaintenance
Fees due 10/1/2006;

2010 and 2014






1 of 11









 




Schedules to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or Date	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Issued
	 	Title of Patent
	 	Status

	2997-19

	 	US
	 	09/ 766,500
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending;
Must File IDS
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PAU

	 	Australia
	 	29636/01
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending; Renewal
1/19/2006
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PBR

	 	Brazil
	 	P10107699-0
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending; Renewal
1/19/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PCA

	 	Canada
	 	2397655.0
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending; Renewal
1/19/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PCN

	 	China
	 	1806424.8
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PCZ

	 	Czech Republic
	 	PV 2002-2506
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PEP

	 	Europe
	 	1942672.5
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending; Renewal
1/19/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PHK

	 	Hong Kong
	 	03102740.6
Pub. HK1050716
	 	4/15/2003

7/4/2003
	 	Solventless Extraction Process
	 	Pending;
Annuity Fees due
1/19/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PHU

	 	Hungary
	 	Serial No. P0300556
	 	1/19/2001

6/30/2003
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PIN

	 	India
	 	2002/00711/

DEL
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PID

	 	Indonesia
	 	W00200201683
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PIL

	 	Israel
	 	150772.0
	 	7/16/2002
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PJP

	 	Japan
	 	2001-553374
Publication No.
2003-520046
	 	1/19/2001

7/2/2003
	 	Solventless Extraction Process
	 	Pending

Published
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PKR

	 	South Korea
	 	2002-7009287
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PMX

	 	Mexico
	 	2002/007092
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PNZ

	 	New Zealand
	 	520287.0
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PNO

	 	Norway
	 	20023449.0
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending; Annuity
fee due 1/19/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PPL

	 	Poland
	 	P356587
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PRU

	 	Russia
	 	2002119551.0
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending







2 of 11









 




Schedule to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or Date	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Issued
	 	Title of Patent
	 	Status

	2997-19-PSG

	 	Singapore
	 	2002-04383-4
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-PZA

	 	South Africa
	 	2002/5790
	 	1/19/2001
	 	Solventless Extraction Process
	 	Pending; Renewal
1/19/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-TH

	 	Thailand
	 	63198.0
	 	1/22/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-19-TW

	 	Taiwan
	 	90105452.0
	 	3/8/2001
	 	Solventless Extraction Process
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-42

	 	US
	 	Filed
	 	12/12/2002
	 	Extraction and Winterization of Lipids
From Oilseed and Microbial Sources Using
Acetone or Analogous Solvent
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-42-PCT

	 	PCT
	 	US02/39930

WO03/049832
	 	12/12/2002
June 19, 2003
	 	Extraction and Winterization of Lipids
From Oilseed and Microbial Sources Using
Acetone or Analogous Solvent
	 	Published
	 
	 	 	 	 	 	 	 	 	 	 
	2997-45

	 	US
	 	 	 	5/3/2003
	 	High-Quality Lipids and Methods for
Producing by Enzymatic Liberation from
Biomass
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-45-PCT

	 	US
	 	US03/14177

WO03/14177
	 	5/5/2002

11/13/2003
	 	High-Quality Lipids and Methods for
Producing by Enzymatic Liberation from
Biomass
	 	Published
	 
	 	 	 	 	 	 	 	 	 	 
	2997-46

	 	US
	 	 	 	6/18/2003
	 	Highly Stable Emulsions of PUFA Oils in
Aqueous Solutions and Methods for
Producing Same
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0114/ 0009

	 	Australia
	 	AU92/12355

AU 661674

WO92/13086
	 	1/22/1992 11/21/1995
	 	Arachidonic Acid and Methods for the
Production and Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	264/00010

	 	Austria
	 	EP 92904428.7
EP
0568608
	 	1/22/19929/6/2000
	 	Fungal Oil Containing ARA, Method for
its Preparation and Composition
Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	265/ 00011

	 	Belgium
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for
its Preparation and Composition
Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	076 / 00012

	 	Brazil
	 	PI9205519.2
	 	1/22/1992
	 	Arachidonic Acid and Methods for the
Production and Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	115 / 00013

	 	Canada
	 	2101273

2101273
	 	1/22/1992

4/2/2002
	 	Arachidonic Acid and Methods for the
Production and Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	268/ 000014

	 	Denmark
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for
its Preparation and Composition
Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	056 / 00015

	 	Europe
	 	EP92904438.7

EP 0568608 B1
	 	1/22/92

9/6/2000
	 	Fungal Oil Containing ARA, Method for
its Preparation and Composition
Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0227 / 000016

	 	Europe
	 	99204324

EP 1001034 A1
	 	1/22/1992

5/17/2000
	 	Arachidonic Acid and Methods for the
Production and Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0270/ 000017

	 	France
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for
its Preparation and Composition
Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	120 / 000018

	 	French Africa (OAPI)
	 	PV 60397

09909
	 	1/22/1992

9/15/1994
	 	Arachidonic Acid and Methods for the
Production and Use Thereof
	 	Granted








3 of 11









 





Schedules to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or Date	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Issued
	 	Title of Patent
	 	Status

	0267 / 000019

	 	Germany
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0272 / 000020

	 	Greece
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0117 / 000021

	 	Indonesia
	 	P-001679

ID 0000393
	 	1/24/1992

12/22/1995
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0116 / 000022

	 	Israel
	 	100732.0
	 	10/1/1995
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0273 / 000023

	 	Italy
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0203 / 000024

	 	Japan
	 	240168/98

3229268
	 	1/22/1992

9/7/2001
	 	Arachidonic Acid Containing Fungal Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	274 / 000026

	 	Luxembourg
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0119 / 000027

	 	Mexico
	 	9200301

202940
	 	1/24/1992

7/6/2001
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	275 / 000028

	 	Monaco
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0276 / 000029

	 	Netherlands
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0113 / 000030

	 	New Zealand
	 	241358

NZ 241358
	 	1/22/1992

2/8/1995
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0122 / 000031

	 	PCT
	 	WO 92/ 13086

PCT/US92/00517
	 	1/22/1992

8/6/1992
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Entered Nat’l Phase
Published
	 
	 	 	 	 	 	 	 	 	 	 
	0121 / 000032

	 	Philippines
	 	43811

1992-43811
	 	1/22/1992

8/22/2002
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	087/ 000033

	 	Russia
	 	93-054772

2120998
	 	1/22/1992

1/29/1998
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0037 / 000034

	 	South Africa
	 	92/0454

92/0454
	 	1/22/1992

10/28/1992
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0085 / 000035

	 	South Korea
	 	1993-702193

254300
	 	1/22/1992

2/1/2000
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0226 / 000036

	 	South Korea
	 	10-1999-7008800

302036
	 	9/27/1999

6/29/2001
	 	An Oil Composition Containing ARA
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0269 / 000037

	 	Spain (ES)
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0027 / 000038

	 	Sri Lanka
	 	10527

10527
	 	1/22/1992

10/27/1993
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted







 4 of 11









 





Schedules to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or Date	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Issued
	 	Title of Patent
	 	Status

	0277 / 000039

	 	Sweden
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0266 / 000040

	 	Switzerland
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0271 / 000041

	 	United Kingdom
	 	EP 92904428.7

EP 0568608
	 	1/22/1992

9/6/2000
	 	Fungal Oil Containing ARA, Method for its Preparation
and Composition Containing Said Oil
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	003 / 000043

	 	Australia
	 	AU 96/48542

713567
	 	1/3/1996

12/2/1999
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	004 / 000044

	 	Brazil
	 	PI 9607179.6
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	005 / 000045

	 	Canada
	 	_________

2,209,513
	 	1/3/1996

5/28/2002
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Issued
	 
	 	 	 	 	 	 	 	 	 	 
	006 /000046

	 	China
	 	96192002.5
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0287 / 000047

	 	Eurasia
	 	1036.0
	 	8/28/2000
	 	Unmodified Fungal Oil Mortierella Sp., Method for
Production Thereof, Method of Providing Arachidonic
Acid to Infant Formula, Infant Formula Containing
Arachidonic Acid, Method of Providing a Human with
Supplemental Amount of Arachidonic Acid and Cosmetic
Composition
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	007 / 000048

	 	Europe
	 	96904435.3

0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Issued
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000260

	 	Europe
	 	EP 3076254.6

Pub. No.

EP 1342787
	 	1/3/1996

9/10/2003
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending


Published
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000261

	 	Portugal
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000262

	 	Sweden
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000263

	 	Monaco
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000264

	 	Netherlands
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000265

	 	Luxembourg
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000266

	 	Italy
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000267

	 	Ireland
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000268

	 	Greece
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted









 5 of 11









 





Schedules to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or Date	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Issued
	 	Title of Patent
	 	Status

	/ 000269

	 	United

Kingdom
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000270

	 	France
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000271

	 	Germany
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000272

	 	Switzer

land
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000273

	 	Austria
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000274

	 	Belgium
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000275

	 	Denmark
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	/ 000276

	 	Spain
	 	EP 96904435.3

EP 0800584
	 	1/3/1996

5/2/03
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	008 / 000049

	 	Finland
	 	972829.0
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	002 / 000050

	 	Japan
	 	521231/ 96
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0011/ 000051

	 	Mexico
	 	975078.0
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	264

	 	NL
	 	?
	 	?
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0012 / 000052

	 	Norway
	 	973085.0
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0062 / 000053

	 	PCT
	 	US96/00182WO96/

21037
	 	1/3/96
7/11/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Entered Nat’l Phase
Published
	 
	 	 	 	 	 	 	 	 	 	 
	0013 / 000054

	 	Poland
	 	P321208
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0173/ 000055

	 	Singapore
	 	9703038.1

42669
	 	1/3/1996

3/30/1999
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	009 / 000056

	 	South Korea
	 	1997-0704585
	 	1/3/1996
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0025 / 000057

	 	USA
	 	Appl. 08/367881

US 5,658,767
	 	1/3/1995

8/19/1997
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0014 / 000058

	 	Russia
	 	EA-97/0090-US
1036
	 	1/3/1996

8/28/2000
	 	Arachidonic Acid and Methods for the Production and
Use Thereof
	 	Granted







 6 of 11









 





Schedules to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or Date	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Issued
	 	Title of Patent
	 	Status

	0186 / 000105

	 	USA
	 	09/210,598

US 6,166,231
	 	12/15/1998

12/26/2000
	 	Two Phase Extraction of Oil from Biomass
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0103 / 000106

	 	Australia
	 	
12392/92

661297
	 	
1/22/92

11/7/1995
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	–*

	 	*
	 	*
	 	*
	 	*
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	*

	 	*
	 	Forthcoming*
	 	5/14/2002
	 	*
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	*

	 	*
	 	*
	 	5/14/2002
	 	*
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	*

	 	*
	 	*
	 	5/14/2002
	 	*
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	*

	 	*
	 	*
	 	5/14/2002
	 	*
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	*

	 	*
	 	*
	 	5/14/2002
	 	*
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	*

	 	*
	 	*
	 	5/14/2002
	 	*
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0290 / 000107

	 	Austria
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0291/000108

	 	Belgium
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	077 / 000109

	 	Brazil
	 	PI 9205526.5

	 	1/22/1992
	 	Microbial Oil Mixtures and Uses Thereof
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0104 / 000110

	 	Canada
	 	2,101,274

2,101,274
	 	1/22/1992

12/15/1998
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0294 / 000111

	 	Denmark
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0285 / 000112

	 	Europe
	 	1200067.5
	 	1/22/1992
	 	Microbial Oil Mixtures and Uses Thereof
(Martek Reference: Blends/EP-DIV)
	 	Pending

Published
	 
	 	 	 	 	 	 	 	 	 	 
	0029 / 000113

	 	Europe
	 	EP 92904388.3

EP 568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0305 / 000114

	 	France
	 	EP 92904388.3
EP
0568606
	 	1/22/1992
4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0107 / 000115

	 	French Africa (OPAI)
	 	PV 60396

10348
	 	1/22/92

12/29/1997
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0293 / 000116

	 	Germany
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted







 7 of 11









 





Schedules to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or Date	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Issued
	 	Title of Patent
	 	Status

	0296 / 000117

	 	Greece
	 	EP 92904388.3

EP 0568606`
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0105 / 000118

	 	Indonesia
	 	P 001678

ID 0000174
	 	1/24/1992

6/20/1995
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0026 / 000119

	 	Israel
	 	100733

100733
	 	1/22/1992

4/1/1996
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0083 / 000120

	 	Israel

	 	114253

114253
	 	1/22/1992

10/14/1997
	 	Composition Including Blends of Microbial Oils and
Their Preparation
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0297 / 000121

	 	Italy
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0032 / 000122

	 	Japan
	 	504606/92

2731035
	 	1/22/1992

12/19/1997
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0300 / 000123

	 	Luxembourg
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0090 / 000124

	 	Mexico
	 	9200320

183638
	 	1/24/1992

1/6/1997
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0301 / 000125

	 	Monaco
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0303 / 000126

	 	Netherlands
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0106 / 000127

	 	New Zealand
	 	241359

241359
	 	1/22/1992

2/16/1996
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0108 / 000128

	 	PCT
	 	PCT/US92/00522

WO 92/ 12711
	 	1/22/1992

8/6/1992
	 	Microbial Oil Mixtures and Uses Thereof
	 	Entered Nat’l Phase
Published
	 
	 	 	 	 	 	 	 	 	 	 
	0109 / 000129

	 	Philippines
	 	1992-4381243812
	 	1/22/1992

11/23/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0066 / 000130

	 	Russia
	 	930524210.13

2093996
	 	1/22/1992

10/27/1997
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0065 / 000131

	 	Singapore
	 	9608986.7

49307
	 	4/13/1996

1/10/2002
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0110 / 000132

	 	South Africa
	 	92/0452

92/0452
	 	1/22/1992

10/28/1992
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0034 / 000133

	 	South Korea
	 	1993-0702205

321543
	 	1/22/1992

1/9/2002
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0245 / 000134

	 	South Korea
	 	2001-7003480

292103
	 	3/30/2000

3/20/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0278 / 000135

	 	South Korea
	 	2001-7002283

313987
	 	2/22/2001

10/25/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted







 8 of 11









 





Schedules to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or Date	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Issued
	 	Title of Patent
	 	Status

	0302 / 000136

	 	Spain
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0111 / 000137

	 	Sri Lanka
	 	10526

10526
	 	1/22/1992

6/17/1994
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0304 / 000138

	 	Sweden
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0292 / 000139

	 	Switzerland
	 	EP 92904388.3
EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0295 / 000140

	 	United Kingdom
	 	EP 92904388.3

EP 0568606
	 	1/22/1992

4/18/2001
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0102 / 000141

	 	USA
	 	07/944,739

US 5,374,657
	 	9/14/1992

12/20/1994
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0059 / 000142

	 	USA
	 	(07/944,739)

08/358,474

US 5,550,156

	 	(9/14/1992)

12/19/1994

8/27/1996
	 	Microbial Oil Mixtures and Uses Thereof
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	2997-20-PCN

	 	China
	 	1816395.5
	 	1/19/2001
	 	Methods for Raising Rabbits
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-20-PCZ

	 	Czech Republic
	 	2002-2507
	 	1/19/2001
	 	Methods for Raising Rabbits
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-20-PEP

	 	Europe
	 	1902119.5
	 	1/19/2001
	 	Methods for Raising Rabbits
	 	Pending; Renewal

1/19/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-20-PHU

	 	Hungary
	 	P0301967
	 	1/19/2001
	 	Methods for Raising Rabbits
	 	Pending

Annuity Date

1-19-2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-20-PPL

	 	Poland
	 	 	 	1/19/2001
	 	Methods for Raising Rabbits
	 	
Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-20-TH

	 	Thailand
	 	63197.0
	 	1/22/2001
	 	Methods for Raising Rabbits
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-20-TW

	 	Taiwan
	 	90101741

(90115400)
	 	6/26/01

(SR has 4/25/2001)
	 	Methods for Raising Rabbits
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-20-PUS

	 	US
	 	10/181756

6,568,351
	 	7/19/2002

5/27/2003
	 	Methods for Raising Rabbits
	 	Issued; Annuity
fees due 11/27/2006; 2010; and 2014
	 
	 	 	 	 	 	 	 	 	 	 
	2997-21-PAU

	 	Australia
	 	2001273028
	 	6/26/2001
	 	Improved Methods of Incorporating Polyunsaturated
Fatty Acids in Milk
	 	Pending; Annuity
fee due 6/26/2006
	 
	 	 	 	 	 	 	 	 	 	 
	2997-21-PCA

	 	Canada
	 	2413109.0
	 	6/26/2001
	 	Improved Methods of Incorporating Polyunsaturated
Fatty Acids in Milk
	 	Pending; Renewal
fees due 6/26/2004
	 
	 	 	 	 	 	 	 	 	 	 
	2997-21-PEP

	 	Europe
	 	1952255.6
	 	6/26/2000
	 	Improved Methods of Incorporating Polyunsaturated
Fatty Acids in Milk
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-21-EPHK

	 	Hong Kong
	 	 	 	 	 	Improved Methods of Incorporating Polyunsaturated
Fatty Acids in Milk
	 	Pending







 9 of 11









 





Schedules to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or Date	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Issued
	 	Title of Patent
	 	Status

	2997-21-PCT

	 	PCT
	 	US 01/20471

WO 02/00028
	 	6/26/2001
	 	Improved Methods of Incorporating Polyunsaturated
Fatty Acids in Milk
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-21-PNZ

	 	New Zealand
	 	523741.0
	 	6/26/2001
	 	Improved Methods of Incorporating Polyunsaturated
Fatty Acids in Milk
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-21-PUS

	 	US
	 	10/312106
	 	12/20/2002
	 	Improved Methods of Incorporating Polyunsaturated
Fatty Acids in Milk
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-21-TW

	 	Taiwan
	 	90115400.0
	 	6/26/2001
	 	Improved Methods of Incorporating Polyunsaturated
Fatty Acids in Milk
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-21-TH

	 	Thailand
	 	66509.0
	 	6/25/2001
	 	Improved Methods of Incorporating Polyunsaturated
Fatty Acids in Milk
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-31

	 	US
	 	10/146,660
	 	5/14/2002
	 	A Method of Improving the Flavor, Tenderness and
Overall Consumer Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-31-PCT

	 	PCT
	 	US 02/15353

02731799.9
	 	5/14/2002
	 	A Method of Improving the Flavor, Tenderness and
Overall Consumer Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-31-PAU

	 	Australia
	 	2002303744.0
	 	5/14/2002
	 	A Method of Improving the Flavor, Tenderness and
Overall Consumer Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-31-PCA

	 	Canada
	 	Forthcoming
	 	5/14/2002
	 	A Method of Improving the Flavor, Tenderness and
Overall Consumer Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-31-PEP

	 	Europe
	 	2731799.9
	 	5/14/2002

	 	A Method of Improving the Flavor, Tenderness and
Overall Consumer Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-31-PJP

	 	Japan
	 	2002-588780
	 	5/14/2002
	 	A Method of Improving the Flavor, Tenderness and
Overall Consumer Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-31-PMX

	 	Mexico
	 	PA/a/2003/010400
	 	5/14/2002
	 	A Method of Improving the Flavor, Tenderness and
Overall Consumer Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-31-PUAE

	 	United Arab Emerites
	 	PCT/AE

376/2003
	 	5/14/2002
	 	A Method of Improving the Flavor, Tenderness and
Overall Consumer Acceptability of Poultry Meat
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997 – 38

	 	US
	 	10/228843
	 	8/26/2002
	 	Products Containing Highly Unsaturated Fatty Acids
for Use by Women During Stages of Preconception,
Pregnancy and Lactation
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	2997-38-PCT

	 	PCT
	 	US 02/27134

WO 03/ 17945 A2
	 	8/26/2002

3/6/2003
	 	Products Containing Highly Unsaturated Fatty Acids
for Use by Women During Stages of Preconception,
Pregnancy and Lactation
	 	Published
	 
	 	 	 	 	 	 	 	 	 	 
	2997-46-PCT

	 	PCT
	 	US 03/19108

PCT/US03/19108
	 	6/18/2003
	 	Stable Emulsions of PUFA Oils in Aqueous Solutions
and Methods for Producing Same
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0127 / 000176

	 	Australia
	 	69635/94

693450
	 	6/2/1994

11/5/1998
	 	Methods and Pharmaceutical Compositions Useful for
Treating Neurological Disorders
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0128 / 000177

	 	Canada
	 	2164291.0
	 	6/2/1994
	 	Methods and Pharmaceutical Compositions Useful for
Treating Neurological Disorders
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0031 / 000178

	 	Europe
	 	94918217.4

WO 94/28913
	 	6/2/1994
	 	Methods and Pharmaceutical Compositions Useful for
Treating Neurological Disorders
	 	Allowed







 10 of 11









 





Schedules to ARA Alliance, Purchase and Production Agreement



	 	 	 	 	 	 	 	 	 	 	 
	SR No. /	 	 	 	Application or	 	Appl. Date or Date	 	 	 	 
	Hunton No.
	 	Country
	 	Patent Number
	 	Issued
	 	Title of Patent
	 	Status

	0129 / 000179

	 	Japan
	 	501997.0
	 	6/2/1994
	 	Methods and Pharmaceutical Compositions Useful for
Treating Neurological Disorders
	 	Pending

Published
	 
	 	 	 	 	 	 	 	 	 	 
	0035 / 000180

	 	Mexico
	 	944334.0
	 	6/8/1994
	 	Methods and Pharmaceutical Compositions Useful for
Treating Neurological Disorders
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0118 / 000181

	 	PCT
	 	PCT/US94/

06317


W094/ 28913

EP 0707487
	 	6/2/1994




12/22/1994
	 	Methods and Pharmaceutical Compositions Useful for
Treating Neurological Disorders
	 	Entered Nat’l Phase
Published
	 
	 	 	 	 	 	 	 	 	 	 
	0254 / 000183

	 	Australia
	 	51828/00
	 	6/3/1996
	 	Methods for Controlling Highly Unsaturated Fatty Acid
Content in Various Tissues
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0167 / 000184

	 	Europe
	 	96921263.8
	 	6/3/1996
	 	Methods for Controlling Highly Unsaturated Fatty Acid
Content in Various Tissues
	 	Pending

(Published)
	 
	 	 	 	 	 	 	 	 	 	 
	0168 / 000185

	 	Israel
	 	122405

122405
	 	6/3/1996

4/10/2003

Hunton has 7/11/2003
	 	Methods for Controlling Highly Unsaturated Fatty Acid
Content in Various Tissues
	 	Granted
	 
	 	 	 	 	 	 	 	 	 	 
	0033 / 000186

	 	USA
	 	08/479,809
	 	6/7/1995
	 	Methods for Controlling Highly Unsaturated Fatty Acid
Content in Various Tissues
	 	Pending
	 
	 	 	 	 	 	 	 	 	 	 
	0067 / 000187

	 	PCT
	 	WO 96/ 40106

PCT/US96/0

8649
	 	6/3/1996

12/19/1996
	 	Methods for Controlling Highly Unsaturated Fatty Acid
Content in Various Tissues
	 	Entered Nat’l Phase
Published








 11 of 11









 





Schedules to ARA Alliance, Purchase and Production Agreement




SCHEDULE 7.2(b)(i)

DSM PATENT OPPOSITIONS




DSM Oppositions:





	•	 	EP0568608 (via their Hoffman La-Roche AG Subsidiary)
	 
	•	 	EP0568606 (via their Hoffman La-Roche AG Subsidiary)







1 of 1




 









 








Schedules to ARA Alliance, Purchase and Production Agreement




SCHEDULE 7.2(b)(ii)

MARTEK PATENT OPPOSITIONS




Martek Oppositions:





	•	 	WO97/43362; EP0904339 B1





1 of 1




 









 








Schedules to ARA Alliance, Purchase and Production Agreement




SCHEDULE 10.19

TERMINATION AGREEMENT




[Please see attached.]




1 of 1




 









 








TERMINATION AGREEMENT




     THIS TERMINATION AGREEMENT (this “Agreement”) is made as of this 19th day
of April, 2004, by and between DSM CAPUA S.P.A., an Italian corporation (“DSM”)
and MARTEK BIOSCIENCE CORPORATION, a corporation organized under the laws of
the State of Delaware (“MARTEK” and, together with DSM, the “Parties”)



WITNESSETH




     WHEREAS, Gist-Brocades B.V. and MARTEK entered into that certain ARA
PURCHASE AND PRODUCTION AGREEMENT dated as of December 31, 1996, as amended
(the “ARA Agreement”);



     WHEREAS, Gist-Brocades B.V. assigned the ARA Agreement to Gist-Brocades
S.p.A. effective January 10, 1997;



     WHEREAS, Gist-Brocades S.p.A. changed its name into DSM Capua S.p.A.;



     WHEREAS, MARTEK and DSM FOOD SPECIALTIES B.V. have entered into that
certain ARA ALLIANCE, PURCHASE AND PRODUCTION AGREEMENT dated April 19, 2004
(the “Alliance Agreement”);



     WHEREAS, DSM and MARTEK desire to terminate the ARA Agreement effective
immediately as of the Effective Date (as defined in the Alliance Agreement);



     NOW THEREFORE, in consideration of the premises and the mutual covenants
contained herein, receipt of which is acknowledged, the parties hereto agree as
follows:



1.    Notwithstanding anything to the contrary in the ARA Agreement, the ARA
Agreement is hereby terminated effective immediately as of, but not prior to,
the Effective Date.



2.    Survival of Obligations. Notwithstanding section 1 of this Agreement, each
Party shall remain responsible for, and shall not be released from, its
respective liabilities and obligations under sections 6, 9, 10, 11, 12, 13.5,
14, 15, and 17 of the ARA Agreement, as provided for in Section 17.9 of the ARA
Agreement.



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



4.    This Agreement shall be governed by and construed in accordance with the
laws of the State of Maryland.



[The remainder of this page has been intentionally left blank.]





 









 








     IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Termination Agreement as of the day and year first above written.



DSM CAPUA S.P.A.




	 	 	 	 	 	 	 
	By:

	 	 	 	By:	 	 
	

	 	

	 	 	 	

	Name:

	 	 	 	Name:	 	 
	Title:

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	MARTEK BIOSCIENCES CORPORATION	 	 	 	 
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	

	 	
	 	 	 	 
	Name:

	 	Steve Dubin	 	 	 	 
	Title:

	 	President