Exhibit
10.3


 





CONFIDENTIAL


 


EXCLUSIVE
LICENSE AGREEMENT


 


This
Exclusive License Agreement (“Agreement”) is entered into as
of April 21, 2021, between EMulate Therapeutics, Inc., a company incorporated under
the laws of the State of Washington, U.S. (“EMulate”), and having a principal place of business at 425 Pontius Avenue
North, Suite 200, Seattle, WA 98109, U.S., and Hapbee Technologies, Inc., a company
existing under the laws of the province of British Columbia, Canada, and having a principal place of business at 700 West Georgia Street,
25th Floor, Vancouver, BC V7Y 1B3, Canada (“Hapbee”). EMulate and Hapbee are sometimes each referred to
herein as a “Party” and sometimes referred to herein together as the “Parties.”


 


RECITALS


 


Whereas,
EMulate has developed an innovative technology that uses ultra-low radio frequency energy (ulRFE®) to produce some
or all of the biological activity of a broad range of molecules, and owns or controls certain patents, know-how, and other intellectual
property relating to its proprietary ulRFE technology; and


 


Whereas,
Hapbee desires to obtain from EMulate certain exclusive rights and licenses to develop, use, import, and commercialize a product using
the EMulate Technology (as defined herein), which product will be designed to emulate the biological activity associated with one or
more of those molecules identified to the Cognate (as defined herein), and EMulate is willing to grant to Hapbee such rights and licenses,
all on the terms and conditions set forth in this Agreement.


 


Now,
Therefore, in consideration of the mutual covenants
contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, EMulate
and Hapbee hereby agree as follows:


 


Article
1

DEFINITIONS


 


As
used in this Agreement, the following terms have the meanings set out in this Article 1 unless the context clearly and unambiguously
requires otherwise.


 


1.1
“Applicable Laws” means the applicable provisions of any and all national, supranational, regional, state, and
local laws, treaties, statutes, rules, regulations, administrative codes, guidance, ordinances, judgments, decrees, directives, injunctions,
orders, permits of or from any court, arbitrator, or governmental agency or authority having jurisdiction over or related to the subject
item.


 


1.2
 “Auditor” has the meaning set forth in Section 8.5.


 


1.3
“Authorized Product” means any product (a) that is composed of components authorized for use by EMulate, (b) that
transmits the magnetic field encoded by the Cognate in a manner approved by EMulate, and (c) the use, sale, lease, rental, importation
or manufacture of which would, but for the license granted to Hapbee hereunder, either infringe a Valid Claim of the EMulate Patents
or use EMulate Know-How in the Territory.


 






    	 



    	 



    

 


CONFIDENTIAL


 


1.4
“Bankruptcy Laws” has the meaning set forth in Section 13.2(d).


 


1.5
“Business Day” means a day that is not a Saturday, Sunday, or a day on which banking institutions in Vancouver,
Canada, or Seattle, Washington, are required by law to remain closed.


 


1.6
“Calendar Quarter” means a period of three consecutive months during a Calendar Year beginning on and including
January 1st, April 1st, July 1st or October 1st; provided, however that (a) the first Calendar
Quarter of the Term will extend from the Effective Date to the last day of the Calendar Quarter in which the Effective Date falls; and
(b) the last Calendar Quarter of the Term will end upon the expiration or termination of this Agreement.


 


1.7
“Calendar Year” means a period of twelve consecutive months beginning on and including January 1st
and ending on December 31st; provided however, that (a) the first Calendar Year of the Term will extend from the Effective
Date to the last day of the Calendar Year in which the Effective Date falls; and (b) the last Calendar Year of the Term will end upon
the expiration or termination of this Agreement.


 


1.8
“Claim” has the meaning set forth in Section 12.1.


 


1.9
“Cognate” means digitized data that emulates the electromagnetic or magnetic field signal or ultra-low radio frequency
energy (“ulRFE”) of one or more chemicals, biochemical or biological agents or molecules as designated pursuant to
Section 2.8.


 


1.10
“Cognate Inventions” has the meaning set forth in Section 9.1(b).


 


1.11
“Commercial Supply Agreement” has the meaning set forth in Section 6.1.


 


1.12
“Commercialization” means any and all activities undertaken relating specifically to the pre-launch, launch, promotion,
marketing, use, sale, lease, rental, and distribution (including importing, exporting, transporting, customs clearance, warehousing,
invoicing, handling, and delivering the Authorized Product to customers) of the Authorized Product in the Territory, including: (a) strategic
marketing, sale, lease, rentals force detailing, advertising, education and liaison, and market and product support within the Field
and (b) all customer support, invoicing, and sale, lease, rental and subscription activities within the Field. “Commercialize”
means to engage in Commercialization activities.


 






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CONFIDENTIAL


 


1.13
“Confidential Information” means all information of a confidential or proprietary nature disclosed by a Party
to the other Party under this Agreement, including, without limitation, any such information related to any scientific, engineering,
manufacturing, marketing, financial, or personnel matters relating to a Party, or related to a Party’s present or future products,
sale, lease, rentals, suppliers, customers, employees, investors, business plans, Know-How, data, research projects, work in progress,
future developments or business, in all such cases whether disclosed in oral, written, graphic, or electronic form, and whether or not
specifically marked as confidential or proprietary, where under the circumstances in which such disclosure was made or given the nature
of information disclosed, a reasonable person would consider such information confidential; provided, however, that in any event, “Confidential
Information” excludes any information that (a) is known by the recipient at the time of disclosure, and not through a prior disclosure
by or on behalf of the disclosing Party, as documented by written records; (b) is or becomes properly in the public domain through no
fault of the receiving Party; (c) is subsequently rightfully disclosed to the receiving Party by a Third Party who is not directly or
indirectly under an obligation of confidentiality to the disclosing Party, as documented by written records in existence prior to the
disclosure of such information to the receiving Party; or (d) is developed by the receiving Party independently of, and without reference
to or use of, the information received from the disclosing Party. Without limiting the foregoing, Confidential Information will include
the terms and conditions of this Agreement.


 


1.14
“Control” means with respect to any Know-How, Patent, or other intellectual property right, possession of the
right, whether directly or indirectly, and whether by ownership, license, or otherwise, to grant a license, sublicense, or other right
to or under such Know-How, Patent, or other intellectual property right as provided for herein without violating the terms of any agreement
or other arrangements with any Third Party at the time when such license, sublicense, or other right is granted hereunder. “Controlled”
has a correlative meaning.


 


1.15
“Disclosing Party” has the meaning set forth in Section 10.1.


 


1.16
“Distributor” means any Third Party to whom Hapbee or a Sublicensee of Hapbee has granted the right to market,
promote, advertise, retail, sell, lease, rent, and distribute the Authorized Product in the Field in the Territory.


 


1.17
“EMulate Commercial Supply Agreement” has the meaning set forth in Section 2.3.


 


1.18
 “EMulate Indemnitees” has the meaning set forth in Section 12.1.


 


1.19
“EMulate Know-How” means all Know-How that is necessary or reasonably useful for the use or Commercialization
of the Authorized Product in the Field in the Territory, which Know-How is Controlled by EMulate with respect to the Authorized Product
as of the Effective Date or during the Term. For the avoidance of doubt, EMulate Know-How will not include any Joint Know-How.


 


1.20
“EMulate Material Breach” may include, but will not be limited to, one or more of the following events (together
with any breach of this Agreement determined to be material by a judicial tribunal of competent jurisdiction):


 


(a)
Failure by EMulate to perform its obligations under Section 2.8;


 


(b)
Failure by EMulate to supply the Cognate for the Authorized Product exclusively to Hapbee or its Sublicensees and Distributors for
use in the Field in the Territory, as required by Section 6.1; and


 


(c)
Failure by EMulate to perform its indemnification and other obligations pursuant to Article 12.


 






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CONFIDENTIAL


 


1.21
“EMulate Patents” means all Patents that are necessary or reasonably useful for the use or Commercialization of
the Authorized Product in the Field in the Territory, which Patents are Controlled by EMulate as of the Effective Date or during the
Term. For the avoidance of doubt, EMulate Patents will not include any Joint Patents.


 


1.22
“EMulate Technology” means the EMulate Know-How, EMulate Patents and EMulate’s interests in the Joint Patents
and Joint Know-How.


 


1.23
“EMulate Trademarks” means EMulate’s Trademarks related to the Authorized Product, including ulRFE®.


 


1.24
 “Field” means the recreational and/or non-medical use (i.e., use that is not regulated by any governmental body
under Applicable Laws) in humans of the Authorized Product.


 


1.25
“First Commercial Sale” means, with respect to the Territory, the first commercial lease, rental, subscription
or sale, under this Agreement by Hapbee, its Sublicensees or Distributors of any Authorized Product to an end user for use or resale,
lease, rental in the Field in the Territory.


 


1.26
 “Hapbee Housemark” means any trademark or trade name, and registrations and applications therefor, Controlled
by Hapbee in the Territory and covering Hapbee’s corporate name or company logo or product brand name.


 


1.27
“Hapbee Indemnitees” has the meaning set forth in Section 12.2.


 


1.28
“Hapbee Know-How” means all Know-How that is Controlled by Hapbee as of the Effective Date or during the Term,
and that is generated by or on behalf of Hapbee or any of its Sublicensees or Distributors in connection with the use or Commercialization
of the Authorized Product hereunder. For the avoidance of doubt, Hapbee Know-How will not include any Joint Know-How.


 


1.29
“Hapbee Manufacturing Cost” means the fully burdened manufacturing cost of Authorized Product expressed on a per
unit basis, as supported by Hapbee’s reasonably detailed invoices therefor, which will be the sum of: (i) the Direct Manufacturing
Costs and (ii) the Indirect Manufacturing Costs. For the purposes of this definition:


 


(a)
“Direct Manufacturing Costs” means the direct costs incurred in connection with the manufacture of the Authorized
Product, including (i) those material expenses captured in invoices and the like that are specifically attributable to the manufacture
of the Authorized Product, including costs of raw materials, manufacturing supplies, packaging, labels, and other materials used in production,
(ii) labor expenses captured in time sheets and the like, including salaries and fringe benefits (but not overhead) for personnel directly
involved in manufacturing the Authorized Product or any component thereof or purchasing or managing the materials used in the manufacture
thereof or maintaining equipment necessary to support the manufacture thereof, (iii) expenses arising out of quality assurance requirements
(e.g., good manufacturing practices) such as production, quality control, quality assurance, and other similar departments that are reasonably
necessary and participate directly in the production of the Authorized Product or any component thereof, and (iv) equipment and facility
depreciation and other allocations of fixed assets in use to support the manufacture of the Authorized Product or any component thereof,
but in any event excluding any administrative overhead (e.g., costs associated with human resources, business development, and executive
management). Direct expenses also include reasonable out-of-pocket payments to Third Parties (without mark-up) for services related to
the manufacture of the Authorized Product or any component thereof.


 






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CONFIDENTIAL


 


(b)
“Indirect Manufacturing Costs” means the reasonable and allocated internal costs and out-of-pocket costs, incurred
or accrued by Hapbee in connection with the manufacture of the Authorized Product or any component thereof, including costs arising from
or associated with (i) freight, carrier insurance, and other transportation charges directly related to the delivery or distribution
of the Authorized Product, (ii) storage and warehousing, (iii) taxes, duties, or other governmental charges (including any tax such as
a value added or similar tax, other than any taxes based on income), but excluding indirect and overhead costs (e.g., costs associated
with human resources, business development, and executive management).


 


1.30
“Hapbee Material Breach” may include, but will not be limited to, one or more of the following events (together
with any breach of this Agreement determined to be material by a judicial tribunal of competent jurisdiction):


 


(a)
Hapbee’s failure to manufacture and supply to EMulate or Third Parties products, other than the Authorized Product, designated
by EMulate for use outside the Field pursuant to Section 2.3;


 


(b)
Hapbee’s sublicensing or attempting to sublicense the rights granted to it under Section 2.1 contrary to the provisions of
Section 2.4(a);


 


(c)
Failure by Hapbee to provide all marketing and promotional literature to EMulate for review and authorization pursuant to Section
5.4;


 


(d)
Failure by Hapbee to timely calculate, report and make royalty payments and late payment interest to EMulate as required by Article
7 and Article 8;


 


(e)
Failure by Hapbee to perform its obligations related to the Commercialization of Authorized Product under Section 11.2; and


 


(f)
Failure by Hapbee to perform its indemnification and other obligations pursuant to Article 12.


 


1.31
“Hapbee Patents” means all Patents that claim Inventions that relate to the Authorized Product and that are conceived,
made, or generated by or on behalf of Hapbee during the Term pursuant to this Agreement. For the avoidance of doubt, Hapbee Patents will
not include any Joint Patents.


 






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CONFIDENTIAL


 


1.32
“Hapbee Technology” means all Hapbee Know-How, Hapbee Patents, and Hapbee’s interests in the Joint Patents
and Joint Know-How. For the avoidance of doubt, (a) all and any of Hapbee’s know-how and Hapbee’s patents which are unrelated
to Authorized Products and (b) all and any know-how or patents of Hapbee that are developed, identified or conceived without the use
of EMulate Confidential Information or outside of the use of the Authorized Product (i.e., independently developed) are excluded from
Hapbee Technology.


 


1.33
“Inventions” means any and all inventions, discoveries, and developments, whether or not patentable, discovered,
made, conceived, or reduced to practice in the course of activities contemplated by this Agreement.


 


1.34
“Joint Inventions” means any and all Inventions discovered, conceived or reduced to practice jointly by or on
behalf Hapbee, on the one hand, and by or on behalf of EMulate, on the other hand.


 


1.35
“Joint Know-How” means all Know-How included in Joint Inventions, other than any Joint Patent.


 


1.36
“Joint Patents” means all Patents claiming any Joint Invention.


 


1.37
“JSC” has the meaning set forth in Section 3.1(a).


 


1.38
“Know-How” means all tangible and intangible scientific, technical, trade, marketing, commercial, financial, or
business knowledge and information, formulations, devices, techniques, processes, methods, trade secrets, formulae, procedures, tests,
data, results, analyses, documentation, reports, know-how, skill, and experience related to the marketing, sale and Commercialization
of the Authorized Product in the Field.


 


1.39
“Knowledge” of a Party means the actual or constructive knowledge of the Senior Executives of such Party, including
the chief executive officer, and any vice president, the general counsel, or the chief medical officer of a Party, or any personnel holding
positions equivalent to such job titles (but only to the extent such positions exist at such Party).


 


1.40
“Losses” has the meaning set forth in Section 12.1.


 


1.41
“Net Income” means the gross amounts invoiced by or on behalf of Hapbee or otherwise chargeable to Hapbee’s
customers, Sublicensees and Distributors for use (e.g., subscriptions for), sales, leases and/or rentals of Authorized Product or the
Cognate to Third Parties, reduced only by, with respect to the relevant Authorized Product, the actual cost of manufacturing, shipping,
handling and merchant credit card processing for such Authorized Product, it being understood that gross amounts invoiced for subscriptions
for the use of the Authorized Product or the Cognate will be net of app store processing fees. For clarity, Net Income will not be reduced
by marketing and promotional expenditures, charges by online platforms or distribution platforms or channels on which the Authorized
Product or the Cognate is sold, or any incentives, rebates, spiffs or commissions provided by Hapbee to online platforms or Distributors
to promote any Authorized Product or the Cognate, or the use, sale, lease, and/or rental thereof. For purposes of calculating Net Income,
any amount originally invoiced for any Authorized Product that is returned during any specific period during the Term may be deducted
by Hapbee from the gross amounts invoiced by Hapbee for Authorized Product during the same period. All charges solely for clothing, jewelry,
necklaces, pillows, hats and other apparel that are not Authorized Products will not be included in “Net Income.”


 






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CONFIDENTIAL


 


By
way of example and for purposes of clarification only, (i) if Hapbee sells an Authorized Product to a Distributor for resale to Third
Parties for $200 and the Distributor resells the Authorized Product to a Customer for $300, Hapbee’s “Net Income” on
such Authorized Product will be $200 minus (if applicable to such resale to the Distributor) costs of manufacturing, shipping, handling
and merchant credit card processing for the Authorized Product; and (ii) if Hapbee itself sells an Authorized Product on an online platform
to a Third Party for $300 and that platform charges Hapbee $60 for the use of its platform, Hapbee’s “Net Income” will
be $300 minus costs of manufacturing, shipping, handling and merchant credit card processing for the Authorized Product.


 


By
way of further example and for purposes of clarification only, if Hapbee decides that its wholesale or retail prices being charged for
any particular Authorized Product are either too high or too low to achieve optimal revenue, Hapbee may elect to adjust the wholesale
or retail price it is charging for an Authorized Product and the Net Income attributable to such Authorized Product will be adjusted
proportionately. Such adjustments may be made in circumstances such as the following: Group sales discounts such as “Buy Four,
Get One 50% Off” offers; special holiday pricing involving reduced prices for a limited time; friends and family discounts; investor
discounts; and offers of free subscriptions for a limited time. Examples of price adjustments that would not affect the Net Income attributable
to an Authorized Product would be rebates offered to customers who, after paying the full advertised purchase price, would receive cash
back following the submission of a rebate card to Hapbee.


 


1.42
“Patent(s)” means (a) all patents, certificates of invention, applications for certificates of invention, priority
patent filings, and patent applications, and (b) any renewal, division, continuation (in whole or in part), or request for continued
examination of any of such patents, certificates of invention and patent applications, and any and all patents or certificates of invention
issuing thereon, and any and all reissues, reexaminations, extensions, divisions, renewals, substitutions, confirmations, registrations,
revalidations, revisions, and additions of or to any of the foregoing.


 


1.43
“Person” means any individual, corporation, partnership, limited liability company, trust, governmental entity,
or other legal entity of any nature whatsoever.


 


1.44
“Receiving Party” has the meaning set forth in Section 10.1.


 


1.45
“Senior Executives” has the meaning set forth in Article 14.


 


1.46
“Sublicensee” means a Third Party , other than a Distributor, to whom Hapbee has granted a sublicense under the
EMulate Technology as permitted under Section 2.4.


 


1.47
“Term” has the meaning set forth in Section 13.1.


 






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1.48
“Territory” means worldwide; provided, that “worldwide” excludes any national/federal, provincial/regional/state,
or local jurisdiction that, with respect to the Cognate in question, does not or ceases to permit the use of such Cognate as contemplated
in this Agreement or otherwise, directly or indirectly, limits the full and free exercise of all of the rights with respect to such Cognate
granted to ETI under this Agreement.


 


1.49
“Third Party” means any Person other than EMulate and Hapbee. “Third-Party” is used in this
Agreement as the adjectival form of Third Party.


 


1.50
“Trademarks” means trademarks, trade names, trade dresses, domain names, logos, and brandings of a Party.


 


1.51
“Transfer Price” means the Hapbee Manufacturing Cost of a unit of Licensed Product plus fifteen percent (15%).


 


1.52
“Upfront Amount” has the meaning set forth in Section 7.1.


 


1.53
“U.S.” means the United States of America, including its territories and possessions and the District of Columbia.


 


1.54
“Valid Claim” means (a) a claim of an issued and unexpired patent that has not been revoked or held unenforceable,
unpatentable, or invalid by a decision of a court or other governmental agency of competent jurisdiction that is not appealable or has
not been appealed within the time allowed for appeal, and that has not been abandoned, disclaimed, denied, or admitted to be invalid
or unenforceable through reissue, re-examination, or disclaimer or otherwise, or (b) a claim of a pending patent application that has
not been cancelled, withdrawn, or abandoned or finally rejected by an administrative agency action from which no appeal can be taken
and that has not been pending for more than ten (10) years.


 


1.55
“Withholding Tax Action” has the meaning set forth in Section 8.3(c).


 


Article
2

GRANT OF LICENSE


 


2.1
License Grants and Hapbee Product Purchases.


 


(a)
Licensed Technology. Subject to the terms and conditions of this Agreement, EMulate hereby grants to Hapbee an exclusive, royalty-bearing
license under the EMulate Technology to use, sell, offer for sale, lease, rent, import, and otherwise Commercialize the Authorized Product
in the Field in the Territory during the Term. In addition, subject to the terms and conditions of this Agreement, EMulate hereby grants
to Hapbee an exclusive, royalty-bearing license under the EMulate Technology to ship, label and package Authorized Product for use in
the Field in the Territory.


 


(b)
Trademarks. Subject to the terms and conditions of this Agreement, EMulate hereby grants to Hapbee a non-exclusive, royalty-free
license under the EMulate Trademarks solely to Commercialize, use, sell, offer for sale, lease, rental, and import Authorized Product
in the Field in the Territory during the Term. For clarity, if a EMulate Trademark is not used exclusively with the Authorized Product
in the Territory at the time of First Commercial Sale of the Authorized Product, then EMulate has the right to use such EMulate Trademark
with any other product in the Territory.


 






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2.2
License Grants to EMulate. Subject to the terms and conditions of this Agreement, Hapbee hereby grants to EMulate a royalty-free,
fully-paid, perpetual, irrevocable, non-exclusive license, with the right to grant sublicenses (in accordance with Section 2.3) through
multiple tiers, in, to and under the Hapbee Technology to research, develop, make, have made, commercialize, use, sell, offer for sale,
lease, rent, and import any product other than Authorized Product.


 


2.3
Purchase of Product from Hapbee. During the Term, Hapbee will manufacture and supply EMulate such product, other than the Authorized
Product, to EMulate or Third Parties designated by EMulate for use outside the Field anywhere in the world, in such quantities as EMulate
will order and Hapbee will accept pursuant to and in accordance with a separate commercial supply agreement to be entered into between
Hapbee and EMulate (the “EMulate Commercial Supply Agreement”) at the Transfer Price for such product, which Transfer
Price will be specified in the EMulate Commercial Supply Agreement. The Parties will negotiate in good faith to enter into the EMulate
Commercial Supply Agreement on commercially reasonable terms (other than the Transfer Price).


 


2.4
Sublicensees; Distributors. Subject to the terms and conditions of this Agreement, Hapbee will have the right to sublicense the rights
granted to it under Section 2.1 to:


 


(a)
Third Parties with EMulate’s prior consent, such consent not to be unreasonably withheld, conditioned, or delayed; provided,
that (i) such sublicensee agrees with EMulate in writing to comply with the term and conditions of this Agreement that are applicable
to such Sublicensee’s activities under such sublicense; and (ii) Hapbee remains fully liable for the performance of such sublicensee
in accordance with this Agreement.


 


(b)
Distributors without EMulate’s consent, provided that Hapbee will remain responsible for the performance of its Distributors
hereunder, including without limitation the compliance with Applicable Laws by such Distributors in connection with the distribution
of the Authorized Product hereunder. In the event of termination of this Agreement pursuant to Section 13.2(b) for breach by Hapbee,
EMulate will reasonably consider and discuss with each such Distributor potential continuation of the Distributor agreement directly
with EMulate if such Distributor is not then in breach of its Hapbee Distributor agreement, a complete copy of which Hapbee will provide
to EMulate upon request.


 


2.5
No Implied License. Neither Party grants to the other Party any rights or licenses in or to any intellectual property, whether by
implication, estoppel, or otherwise, other than the licenses and rights that are expressly granted under this Agreement.


 






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2.6
Retained Rights. EMulate hereby expressly retains:


 


(a)
the right under the EMulate Technology to exercise its rights and perform its obligations under this Agreement, whether directly
or through one or more licensees (other than Hapbee) or subcontractors; and


 


(b)
all rights to practice and to grant licenses under the EMulate Technology outside of the scope of the license granted in Section
2.1(a), including without limitation the exclusive right to make and have made cognates other than the Cognate anywhere in the world,
and the exclusive right to practice the EMulate Technology with respect to products other than the Authorized Product.


 


2.7
Exclusivity Obligations. During the Term, unless otherwise agreed in writing by the Parties, Hapbee agrees that it will not acquire,
develop, manufacture, sell, lease, rent, import, distribute, or otherwise Commercialize in the Territory any product for use in the Field
other than the Authorized Product, either by itself or through any Third Party. In furtherance of the license and exclusivity grant to
Hapbee herein, EMulate covenants that during the Term it will not grant rights to any Third Party to use the Cognate in the Field in
the Territory or acquire, develop, manufacture, sell, lease, rent, import, distribute, or otherwise Commercialize the Authorized Product
in the Territory in the Field.


 


2.8
Designation of Cognate. EMulate has, pursuant to one or more agreements between the Parties (each, an “Evaluation Agreement”),
provided Hapbee the opportunity to evaluate (or to have evaluated) for safety one (1) cognate that emulates the electromagnetic or magnetic
field signal or ulRFE of adenosine. Based on the results of the evaluations performed, Hapbee hereby designates to EMulate such
one (1) cognate, which will, subject to the other provisions of this Section 2.8, hereafter be deemed to be the “Cognate”
for purposes of this Agreement.


 


Article
3

GOVERNANCE


 


3.1
Joint Steering Committee.


 


(a)
Establishment. Within thirty (30) days following the Effective Date, EMulate and Hapbee will establish a committee (the “JSC”)
to oversee, review, and coordinate the supply and Commercialization of the Authorized Product in the Field in the Territory.


 


(b)
Duties. The JSC will:


 


(i)
provide a forum for the Parties to discuss material marketing, sales, lease, rental, subscription and manufacturing matters pertaining
to the Authorized Product in the Territory;


 


(ii)
provide a forum for the Parties to exchange information and coordinate their respective activities with respect to marketing, sales,
lease, rental, subscription and manufacturing matters pertaining to the Authorized Product in the Field in the Territory and outside
the Field or Territory;


 






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CONFIDENTIAL


 


(iii)
review Hapbee’s Commercialization plans and discuss Hapbee’s proposed activities with respect to realizing Commercialization
plans for the Authorized Product; and


 


(iv)
perform such other duties as are specifically assigned by the Parties to the JSC pursuant to this Agreement.


 


3.2
Membership. Promptly after the Effective Date, each Party will designate up to three (3) representatives with appropriate expertise
to serve as members of the JSC. The Parties may elect to vary the participating member and number of representatives that serve on the
JSC, provided that in all cases the JSC maintains an equal number of representatives from each Party. Each Party may replace its representatives
on the JSC at any time upon written notice to the other Party.


 


3.3
Chairperson; Minutes. One member of the JSC will serve as the chairperson, who will be responsible for organizing meetings, preparing
and circulating an agenda in advance of each meeting, and preparing minutes of each meeting. Each JSC representative will review and
approve such minutes in writing; provided that if a representative does not object to the accuracy of such minutes within fifteen (15)
days after the circulation of such minutes, such minutes will be deemed approved by such representative. Hapbee will appoint the chairperson
for an initial one (1) year term and thereafter the Parties will alternate in appointing the chairperson for twelve (12) month terms.


 


3.4
Meetings. The JSC will hold meetings on a Calendar Quarter basis or on such other schedule to which the Parties may mutually agree.
Meetings of the JSC will be effective only if at least one (1) representative of each Party is present or participating. The JSC may
meet either (i) in person at either Party’s facilities or at such locations as the Parties may otherwise agree; or (ii) by audio
or video teleconference. With the prior consent of the other Party’s representatives (such consent not to be unreasonably withheld
or delayed), each Party may invite non-members to participate in the discussions and meetings of the JSC, provided that such participants
will have no vote and will be subject to the confidentiality provisions set forth in Article 10. Additional JSC meetings may be held
with each Party’s consent, or as required under this Agreement, and neither Party will unreasonably withhold or delay its consent
to hold such an additional meeting.


 


3.5
Decision-Making.


 


(a)
The JSC will make good faith efforts to make all decisions on matters that are within the scope of its decision-making authority
by consensus. Subject to the terms of this Section 3.5, actions to be taken by the JSC will be taken only following a unanimous vote
with each Party’s representatives collectively having one (1) vote. If the JSC fails to reach unanimous consent on a particular
matter that is within the scope of its decision-making authority within thirty (30) days of a Party having requested a formal vote on
such matter (or, if such matter is urgent, within ten (10) days of such request), then either Party may submit such matter for resolution
to the Senior Executives pursuant to Article 14.


 






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(b)
The scope of the JSC’s decision making authority is limited to coordination of operational and planning matters that relate
to the performance by the Parties of this Agreement. For the avoidance of doubt, any dispute regarding the interpretation of this Agreement,
the performance or alleged nonperformance of a Party’s obligations under this Agreement, or any alleged breach of this Agreement
(including but not limited to the alleged occurrence of a Hapbee Material Breach of an EMulate Material Breach)will be resolved in accordance
with the terms of Article 14 and are outside the scope of the JSC’s decision-making authority.


 


3.6
Expenses. Each Party will be responsible for all of its own travel and other costs and expenses for its respective members, designees,
and non-member invitees to attend meetings of, and otherwise participate on, the JSC and any subcommittees or working groups.


 


3.7
Subcommittees. From time to time, the JSC may establish subcommittees to oversee particular projects or activities within the JSC’s
scope of authority, as it deems necessary or advisable. Each subcommittee will consist of such number of representatives of each Party
as the JSC determines is appropriate from time to time, and will meet with such frequency as the JSC determines.


 


3.8
Discontinuation of Participation. The JSC will continue to exist until the first to occur of: (a) the Parties mutually agreeing to
disband the committee; or (b) EMulate providing to Hapbee written notice of its intention to disband and no longer participate in such
committee. Upon EMulate’s delivery to Hapbee of such written notice, the JSC will have no further obligations under this Agreement
and any matters that would previously have been addressed by the JSC will be handled by the Parties in accordance with the terms of this
Agreement.


 


3.9
Alliance Managers. Promptly after the Effective Date, each Party will appoint an individual who will be an employee of such Party
having appropriate qualification and experience to act as the alliance manager for such Party (the “Alliance Manager”).
Each Alliance Manager will be responsible for coordinating and managing processes and interfacing between the Parties on a day-to-day
basis throughout the Term. The Alliance Manager will ensure communication to the JSC of all relevant matters raised at any joint subcommittees
or working groups. Each Alliance Manager will be permitted to attend meetings of the JSC as non-voting participants. The Alliance Managers
will be the primary contact for the Parties regarding the activities contemplated by this Agreement and will facilitate all such activities
hereunder. Each Party may replace its Alliance Manager with an alternative representative at any time with prior written notice to the
other Party. Any Alliance Manager may designate a substitute to temporarily perform the functions of that Alliance Manager. Each Alliance
Manager will be charged with creating and maintaining a collaborative work environment within the JSC and its subcommittees. Each Party
will be responsible for all of its own costs with respect to its Alliance Manager.


 


Article
4

COMMERCIALIZATION ACTIVITIES


 


4.1
Diligence. Hapbee will be responsible for the conduct and cost of all activities and efforts in the Territory necessary to support
the Commercialization of the Authorized Product in the Field in the Territory. Hapbee will submit to the JSC for review and discussion
a plan setting forth Hapbee’s planned Commercialization activities with respect to the Authorized Product in the Field in the Territory.
Hapbee will consult with and provide regular updates to EMulate through the JSC regarding Hapbee’s Commercialization activities
and efforts.


 






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4.2
Records. Hapbee will maintain detailed and accurate records regarding its Commercialization activities and efforts with respect to
the Authorized Product in the Field pursuant to this Agreement. Upon request by EMulate from time to time, Hapbee will promptly provide
the JSC with summaries of such Commercialization activities and efforts to date. Upon reasonable prior written notice, EMulate will have
the right (subject to Article 10) to inspect the books and records of Hapbee and its Sublicensees and Distributors reflecting the work
done and results achieved by or on behalf of Hapbee or its Sublicensees or Distributors in the performance of its Commercialization activities
and efforts for the sole purpose of determining compliance by Hapbee with this Agreement.


 


Article
5

COMMERCIALIZATION


 


5.1
Overview and Diligence; Failure to Commercialize. Subject to, and in accordance with, the terms and conditions of this Agreement
and all Applicable Laws, Hapbee, at its expense, will be solely responsible for Commercializing the Authorized Product for the Field
in the Territory. Hapbee will use commercially reasonable efforts to achieve the First Commercial Sale in the Territory within six (6)
months after the Effective Date; provided, however, that (a) such 6-month period may be extended by written agreement of the Parties;
(b) such 6-month period will be extended if, in EMulate’s sole reasonable determination, Hapbee is making substantial progress
towards entering into agreements with one or more third parties for the purpose of Commercializing the Authorized Product in the Field
in the Territory, and (c) if Hapbee does not achieve the First Commercial Sale in the Territory within such 6-month period (if such period
has not been extended), then EMulate will have the right to terminate the licenses granted by EMulate pursuant to Section 2.1 and all
rights granted to Hapbee under such licenses and under this Agreement with respect thereto will upon such termination immediately revert
to EMulate. EMulate will exercise such right of termination by providing written notice thereof to Hapbee.


 


5.2
Commercialization Plan. Upon EMulate’s reasonable request, Hapbee will submit to EMulate for review and discussion at the next
scheduled JSC meeting a commercialization plan setting forth the goals, strategies, and plans for Hapbee’s prelaunch activities,
launch, and subsequent Commercialization of the Authorized Product in the Field in the Territory and the level of anticipated sales force
and promotion efforts dedicated to the Authorized Product, together with the budget in connection therewith (the “Commercialization
Plan”). Hapbee will conduct all Commercialization activities in accordance with such Commercialization Plan; provided, that,
Hapbee may, upon providing notice thereof to EMulate, modify the Commercialization Plan from time to time to the extent that such modification
(a) would improve Commercialization of the Authorized Product in the Field in the Territory, (b) would not constitute a breach by Hapbee
of any of its obligations under this Agreement, or (c) would not limit any of the rights of EMulate under this Agreement or any benefits
that EMulate would have otherwise received under this Agreement but for such modification. Hapbee will consult with and provide regular
updates to EMulate regarding its Commercialization strategies.


 






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5.3
Reports. Hapbee will present written reports to the JSC annually summarizing Hapbee’s significant Commercialization activities
with respect to the Authorized Product in the Territory pursuant to this Agreement and including a forecast for the following year’s
sales, leases, rentals and subscriptions of or for the Authorized Product in the Territory. Such reports will cover subject matter at
a level of detail reasonably sufficient to enable EMulate to determine Hapbee’s compliance with its diligence obligations pursuant
to this Article 5.


 


5.4
Marketing and Promotional Literature. Hapbee will prepare all marketing and promotional literature related to Authorized Product
for use in the Territory in accordance with Applicable Laws. All such marketing and promotional literature will be subject to the review
and authorization of EMulate. EMulate will provide feedback regarding such literature within five (5) business days following receipt
thereof, and failure to provide feedback within such period will be deemed to be authorization thereof. At the request of EMulate, EMulate
will be presented and described as the Party who developed and manufactured the Authorized Product in a manner satisfactory to both EMulate
and Hapbee on, by way of example, all labels, packaging, packaging inserts, and promotional literature related to the Authorized Product,
in each case to the extent permitted by Applicable Laws, for example by use of phrases like “powered by EMulate Therapeutics.”
Without limiting any other provision of this Agreement, Hapbee will have the sole right to brand the Authorized Product for Commercialization
in any manner consistent with Applicable Laws that Hapbee deems appropriate, including using Hapbee Housemarks and similar trademarks
or trade names of any Hapbee Sublicensee.


 


5.5
Labeling and Patent Rights Marking. Subject to, and in accordance with, Applicable Laws, Hapbee will identify EMulate as the licensor
or producer of the Cognate used in the Authorized Product using the EMulate Trademarks designated by EMulate for such use in certain
mutually agreed promotional materials for Authorized Product in the Territory where such identification is appropriate, in a manner approved
in advance in writing by both Parties, and in accordance with (and subject to) the Trademark License set forth in Section 2.1(b). To
the extent permitted by Applicable Law and customary in the industry for such products, Hapbee will mark all Authorized Product sold,
leased or rented in the Territory by Hapbee, its Sublicensees or Distributors with appropriate EMulate Trademarks and patent numbers
and the appropriate Hapbee Housemarks and patent numbers. Hapbee may, in its sole discretion, include any Hapbee Housemark on the Authorized
Product, and on the labels, packaging, promotional materials, and other materials therefor, subject to Applicable Law.


 


Article
6


SUPPLY


 


6.1
Supply and Purchase of the Cognate for the Authorized Product. Subject to the terms of this Agreement, during the Term, EMulate will
produce and supply the Cognate for the Authorized Product exclusively to Hapbee or its Sublicensees and Distributors for use in the Field
in the Territory, and Hapbee or its Sublicensees and Distributors will purchase exclusively from EMulate, all of Hapbee’s and its
Sublicensees’ and Distributors’ requirements of the Cognate used in the Authorized Product for Commercialization use in the
Field in the Territory in such quantities as Hapbee will order and EMulate will accept pursuant to and in accordance with a separate
commercial supply agreement to be entered into between Hapbee and EMulate (the “Commercial Supply Agreement”). The
Parties will negotiate in good faith to enter into the Commercial Supply Agreement on commercially reasonable terms.


 






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Article
7

FINANCIAL TERMS


 


7.1
Upfront Payment. In consideration for the licenses and rights granted to Hapbee under this Agreement with respect to the Cognate
designated by and provided to Hapbee pursuant to this Agreement, Hapbee will pay to EMulate, within ten (10) days following the Effective
Date, a non-refundable, non-creditable payment in an amount equal to ten thousand US dollars (US$10,000.00) (the “Upfront Amount”).
Such payment will be made by wire transfer of immediately available funds into an account designated by EMulate.


 


7.2
Royalty Payments.


 


(a)
Royalty Rate. Subject to this Section 7.2 and the other terms and conditions of this Agreement, in further consideration for the
licenses and rights granted to Hapbee under this Agreement, Hapbee will pay to EMulate, on a Calendar Quarter basis, royalties on the
quarterly Net Income from (i) sales, lease or rental of the Authorized Product in the Territory multiplied by a percentage royalty rate
equal to twenty percent (20%), and (ii) use of (e.g., subscriptions for) the Authorized Product in the Territory multiplied by a percentage
royalty rate equal to twenty percent (20%); provided, that the percentage royalty rate on the first ten million US dollars (US$10,000,000.00)
of Net Income from use of (e.g., subscriptions for) Authorized Product will be equal to twenty-five percent (25%).


 


(b)
Royalty Term. Hapbee’s obligation to make royalty payments pursuant to this Section 7.2 will commence upon the Effective Date
and will continue throughout the term of this Agreement.


 


7.3
Taxes. All amounts payable to EMulate will be paid without any reduction or offset for taxes. If any withholding taxes or stamp,
VAT, foreign exchange, or other transfer taxes apply to payments payable to EMulate, then Hapbee will pay such taxes directly and will
increase the amounts payable to EMulate so that EMulate receives the full amount it would have received if no such taxes applied.


 


7.4
Expenses Related to Cognate. The amount of all costs and expenses incurred by EMulate for producing the Cognate (e.g., costs of measuring,
recording and optimizing such Cognate) will be for the account of Hapbee.


 


Article
8

PAYMENTS, BOOKS, AND RECORDS


 


8.1
Payment; Royalty Reports. Royalty payments due by Hapbee to EMulate under Section 7.2 will be calculated and reported for each Calendar
Quarter. All royalty payments due under Section 7.2 will be paid within thirty (30) days after the end of each Calendar Quarter and will
be accompanied by a report setting forth the Net Income from sales, lease, rental or subscription of or for the Authorized Product by
Hapbee and its Sublicensees and Distributors in the Territory in sufficient detail to permit confirmation of the accuracy of the royalty
payment made, including, the number of Authorized Product sold, the Net Income from sales, lease, rental or subscription of or for Authorized
Product, the royalties payable, the method used to calculate the royalties, and the exchange rates used. Prior to commencement of Commercialization
of Authorized Product, the Parties will agree on the form of royalty report. Hapbee will submit a single report for all Net Income from
sales, lease, rental, subscription of or for Authorized Product during a Calendar Quarter, including by Hapbee, its Sublicensees and
Distributors, but will separately identify the Net Income and other information applicable to each entity.


 






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8.2
Payment Currency; Currency Conversion. All references to dollars and “$” herein will refer to U.S. dollars. All payments
hereunder will be payable in U.S. dollars. With respect to conversion of Net Income in any non-U.S. currency to U.S. dollars, such conversion
will be at the exchange rate equal to the U.S. dollar conversion rate for such currency as published by The Wall Street Journal,
Western U.S. Edition, as published on the last business day of the Calendar Quarter in which the applicable Net Income was invoiced.
All payments owed under this Agreement will be made by wire transfer in immediately available funds to a bank and account designated
in writing by EMulate from time to time for such purpose.


 


8.3
Taxes.


 


(a)
Taxes on Income. Except as otherwise provided in this Section 8.3, each Party will be solely responsible for the payment of all taxes
imposed on its share of income arising directly or indirectly from the activities of the Parties under this Agreement.


 


(b)
Tax Cooperation. The Parties agree to cooperate with one another and use reasonable efforts to avoid or reduce tax withholding, transfer
taxes, or similar obligations with respect to milestone payments, royalty payments, and other payments made by Hapbee to EMulate under
this Agreement. To the extent Hapbee is required by Applicable Laws to deduct and withhold taxes on any payment to EMulate, Hapbee will
pay the amounts of such taxes to the proper governmental authority in a timely manner and promptly transmit to EMulate an official tax
certificate or other evidence of such payment sufficient to enable EMulate to claim such payment of taxes. EMulate will provide Hapbee
any tax forms that may be reasonably necessary in order for Hapbee not to withhold tax or to withhold tax at a reduced rate under an
applicable bilateral income tax treaty, to the extent legally able to do so. EMulate will use reasonable efforts to provide any such
tax forms to Hapbee in advance of the due date; provided, that EMulate may direct Hapbee to temporarily hold a payment otherwise payable
in order to avoid withholding taxes if EMulate is waiting for a required tax form to be issued by a governmental authority. Hapbee will
provide EMulate with reasonable assistance to enable the recovery, as permitted by Applicable Laws, of withholding taxes, transfer taxes,
or similar obligations resulting from payments made under this Agreement, such recovery to be for the benefit of EMulate. Each Party
agrees to assist the other Party in claiming exemption from such deductions or withholdings under double taxation or similar agreement
or treaty from time to time in force and in minimizing the amount required to be so withheld or deducted.


 






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(c)
Taxes Resulting From a Party’s Action. If a Party takes any action, including any assignment, sublicense, change of place of
incorporation, or failure to comply with Applicable Laws or filing or record retention requirements, which results in a withholding or
deduction obligation or a transfer tax (“Withholding Tax Action”), then such Party will pay the sum associated with
such Withholding Tax Action. For clarity, if Hapbee undertakes a Withholding Tax Action, then the sum payable by Hapbee (in respect of
which such deduction or withholding is required to be made) will be increased to the extent necessary to ensure that EMulate receives
a sum equal to the sum which it would have received had no such Withholding Tax Action occurred. Otherwise, the sum payable by Hapbee
(in respect of which such deduction or withholding is required to be made) will be made to EMulate after deduction of the amount required
to be so withheld or deducted. If a change in Applicable Laws results in a withholding or deduction obligation absent either Party taking
a Withholding Tax Action, then the amount of such withholding or deduction obligation will be paid by Hapbee to the applicable governmental
authority on behalf of EMulate in accordance with the provisions of Section 8.3(b). The Parties will use commercially reasonable efforts
to invoke the application of any applicable bilateral income tax treaty that would reduce or eliminate otherwise applicable taxes with
respect to payments payable pursuant to this Agreement.


 


8.4
Records. Hapbee will keep, and require its Sublicensees and Distributors to keep, complete, true, and accurate books of accounts
and records for the purpose of determining the amounts payable to EMulate pursuant to this Agreement. Such books and records will be
kept for such period of time required by law, but no less than at least five (5) years following the end of the Calendar Quarter to which
they pertain. Such records will be subject to inspection in accordance with Section 8.5.


 


8.5
Audits. Upon not less than ten (10) days’ prior written notice, Hapbee will permit an independent, certified public accountant
selected by EMulate and reasonably acceptable to Hapbee, which acceptance will not be unreasonably withheld or delayed (for the purposes
of this Section 8.5, the “Auditor”), to audit or inspect those books or records of Hapbee, its Sublicensees and Distributors
that relate to Net Income, or Royalty Reports for the sole purpose of verifying (a) the royalties payable hereunder in respect of Net
Income, (b) the withholding taxes, if any, required by Applicable Law to be deducted as a payment by Hapbee in respect of such Net Income,
and (c) the exchange rates used in determining the amount of U.S. dollars. The Auditor will disclose to EMulate only the amount and accuracy
of payments reported and actually paid or otherwise payable under this Agreement. The Auditor will send a copy of the report to Hapbee
at the same time it is sent to EMulate. EMulate will bear the full cost of such audit unless such audit discloses an underpayment of
the amount actually owed of more than five percent (5%), in which case Hapbee will bear the full out-of-pocket, external cost of such
audit. Within thirty (30) days from the auditor’s report, Hapbee will submit to EMulate any underpayment discovered in such audit,
or EMulate will refund any amounts shown to have been overpaid, in each case as applicable.


 


8.6
Late Payment. Any amounts not paid when due under this Agreement will be subject to interest from and after the date payment is due
through and including the date upon which such Party makes such payment at the annual interest rate of one and a half (1.5) percent (1.5%)
compounded monthly; provided, however, that in no event will such rate exceed the maximum legal annual interest rate. The payment of
such interest will not limit the Party entitled to receive payment from exercising any other rights it may have as a consequence of the
lateness of any payment.


 






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Article
9

INTELLECTUAL PROPERTY


 


9.1
Ownership of Intellectual Property.


 


(a)
EMulate Technology and Hapbee Technology. EMulate owns and will retain all rights, title, and interests in and to the EMulate Technology.
Hapbee will own and retain all rights, title and interests in and to the Hapbee Technology.


 


(b)
Ownership of Inventions. Ownership of all Inventions will be based on inventorship, as determined in accordance with the rules of
inventorship under U.S. patent laws. Each Party will solely own any Inventions made solely by its or its employees, agents, or independent
contractors (“Sole Inventions”). The Parties will jointly own any Inventions that are made jointly by employees, agents,
or independent contractors of one Party together with employees, agents, or independent contractors of the other Party (“Joint
Inventions”). If an Hapbee Sole Invention or a Joint Invention covers or is related to the Cognate (collectively, the “Cognate
Inventions”), such Cognate Inventions will be owned solely by EMulate, and Hapbee will and hereby does assign to EMulate its
right and interest in such Cognate Inventions and such assigned Cognate Inventions will be included in the EMulate Technology licensed
to Hapbee pursuant to Section 2.1(a).


 


9.2
Patent Prosecution and Maintenance.


 


(a)
EMulate Patents. Except as otherwise provided in this Section 9.2, EMulate will have the sole right and authority to prepare, file,
prosecute, and maintain the EMulate Patents on a worldwide basis. EMulate will bear all costs of preparation, filing, prosecution, and
maintenance of the EMulate Patents in the Territory.


 


(b)
EMulate Abandonment. If EMulate determines in its sole discretion to abandon or not maintain any such EMulate Patent(s) in the Territory,
then EMulate will provide Hapbee with written notice of such determination within a period of time reasonably necessary to allow Hapbee
to determine its interest in such EMulate Patent(s). In the event Hapbee provides written notice expressing its interest in obtaining
such EMulate Patent(s), EMulate will assign and transfer, without any compensation, to Hapbee the ownership of, and interest in, such
EMulate Patent(s) in the Territory, at Hapbee’s sole expense. Hapbee will thereafter bear all costs of preparation, filing, prosecution,
and maintenance of such assigned and transferred Patents in the Territory. In the event that Hapbee decides to abandon or not maintain
any such Patent(s), Hapbee will promptly provide EMulate with written notice of such decision.


 


(c)
Hapbee Patents. Except as otherwise provided in this Section 9.2, Hapbee will have the sole right and authority, in its sole discretion,
to prepare, file, prosecute, and maintain the Hapbee Patents within the Territory at its own expense.


 






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(d)
Hapbee Abandonment. If Hapbee determines in its sole discretion to abandon or not maintain any such Patent within the Hapbee Patents
anywhere in the world, then Hapbee will provide EMulate with written notice of such determination within a period of time reasonably
necessary to allow EMulate to determine its interest in such Hapbee Patent(s). In the event EMulate provides written notice expressing
its interest in obtaining such Hapbee Patent(s), Hapbee will assign and transfer, without any compensation, to EMulate the ownership
of, and interest in, such Hapbee Patent(s) in the applicable jurisdiction at EMulate’s sole expense. EMulate will thereafter bear
all costs of preparation, filing, prosecution, and maintenance of such assigned and transferred Patent(s). For the avoidance of doubt,
such transferred Patent(s) will be a part of the EMulate Patents licensed hereunder to Hapbee upon Hapbee’s payment to EMulate
of the patent expenses incurred by EMulate in the Territory related thereto. In the event that EMulate decides to abandon or not maintain
any such transferred Patent(s), EMulate will promptly provide Hapbee with written notice of such decision.


 


(e)
Joint Patents.


 


(i)
Initial Responsibility. EMulate will be responsible for the preparation, filing, prosecution, and maintenance of Joint Patents worldwide,
subject to the rest of this Section 9.2(e). EMulate will be responsible for preparing, filing, prosecuting, and maintaining all Joint
Patents, using a patent counsel selected by EMulate and reasonably acceptable to Hapbee; provided, that Hapbee and EMulate will share
equally the cost and expenses of the preparation, filing, prosecution, and maintenance of Joint Patents, and Hapbee will reimburse EMulate
for Hapbee’s portion of such costs and expenses incurred by EMulate within thirty (30) days from the date of invoice for such costs
and expenses by EMulate.


 


(ii)
Cooperation. EMulate will consult with Hapbee in preparing Joint Patent applications and will consider and adopt in good faith Hapbee’s
comments and suggestions prior to the filing of any Joint Patent application. EMulate will keep Hapbee fully informed of progress with
regard to the preparation, filing, prosecution, and maintenance of the Joint Patents in and outside the Territory. EMulate will:


 


(1)
provide Hapbee with a copy of the final draft of any proposed application at least thirty (30) days prior to filing the same in any
patent office worldwide, unless otherwise agreed by patent counsel for both parties, and EMulate will consider in good faith any comments
or revisions suggested by Hapbee or its counsel;


 


(2)
promptly provide Hapbee with a copy of each patent application as filed, together with a notice of its filing date and serial number;


 


(3)
provide Hapbee with a copy of any action, communication, letter, or other correspondence issued by the relevant patent office within
at least ten (10) days of receipt thereof, and EMulate will consult with Hapbee regarding responding to the same and will consider in
good faith any comments, strategies, and the like proposed by Hapbee;


 


(4)
provide Hapbee with a copy of any response, amendment, paper, or other correspondence filed with the relevant patent office within
ten (10) days of EMulate’s receipt of the as-filed document;


 






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(5)
promptly notify Hapbee of the allowance, grant, or issuance of such Joint Patents; and


 


(6)
consult with Hapbee regarding the countries to be filed and maintained, the payment of annuities, taxes and maintenance fees for
any such Joint Patents.


 


(iii)
Joint Patent Abandonment. In the event that EMulate desires to abandon or cease prosecution and/or maintenance of any Joint Patent,
EMulate will provide reasonable prior written notice to Hapbee of such intention to abandon (which notice will, to the extent possible,
be given no later than ninety (90) calendar days prior to the next deadline for any action that must be taken with respect to such Joint
Patent in the relevant patent office). In such case or if EMulate refuses to pay its share of costs related to any such Joint Patent,
at Hapbee’s sole discretion, upon written notice from Hapbee, Hapbee may elect to continue prosecution and/or maintenance of any
such Joint Patent at its own expense, and EMulate will execute such documents and perform such acts, at EMulate’s expense, as may
be reasonably necessary to effect an assignment of EMulate’s entire right, title, and interest in and to such Joint Patent to Hapbee.
Any such assignment will be completed in a timely manner to allow Hapbee to continue prosecution and/or maintenance of any such Joint
Patent. Any Patents so assigned will no longer be considered Joint Patents and will become Hapbee Patents.


 


(iv)
Hapbee Declines Responsibility. If Hapbee refuses to pay its share of costs related to any Joint Patent, upon written notice from
EMulate, Hapbee will assign its entire right, title, and interest in and to any such Joint Patent to EMulate. Any Patents so assigned
will no longer be considered Joint Patents and will become EMulate Patents.


 


9.3
Infringement by Third Parties.


 


(a)
Notice. In the event that either EMulate or Hapbee becomes aware of any infringement or threatened infringement by a Third Party
of any Patents that are subject to the prosecution, maintenance, or enforcement by a Party under this Agreement, it will notify the other
Party in writing to that effect. Any such notice will include evidence to support an allegation of infringement or threatened infringement
by such Third Party.


 


(b)
EMulate Patents. Subject to this Section 9.3(b), EMulate has the first right, as between EMulate and Hapbee, to bring and control
any action or proceeding with respect to infringement of any EMulate Patent worldwide, at its own expense and by counsel of its own choice.
Hapbee has the right, at its own expense, to be represented in any such action by counsel of its own choice, and EMulate and its counsel
will reasonably cooperate with Hapbee and its counsel in strategizing, preparing, and presenting any such action or proceeding. If EMulate
fails to bring an action or proceeding with respect to infringement of any EMulate Patent described in the preceding sentence within
(i) one hundred twenty (120) days following the notice of alleged infringement or (ii) ten (10) days before the time limit, if any, set
forth in the appropriate laws and regulations for the filing of such actions, whichever comes first, Hapbee has the right, but not the
obligation, to bring and control any such action at its own expense and by counsel of its own choice. Upon Hapbee’s request, EMulate
will timely join any such litigation and cooperate with Hapbee in connection with such infringement action. Except as otherwise agreed
to by the Parties as part of a cost-sharing arrangement, any recovery or damages realized as a result of such action or proceeding will
be used first to reimburse the Parties’ documented out-of-pocket legal expenses relating to the action or proceeding, and any remaining
damages relating to the Authorized Product (including without limitation, lost sales, leases, rentals or lost profits with respect to
the Authorized Product) will be retained by the Party bringing suit, and if such Party is Hapbee, such remaining damages will be deemed
Net Income subject to the royalty provisions of Section 7.3.


 






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(c)
Hapbee Patents. Hapbee has the first right (but not the obligation), as between EMulate and Hapbee, to bring and control any action
or proceeding with respect to infringement of any Hapbee Patent worldwide, at its own expense and by counsel of its own choice and the
right to retain all damages resulting from its enforcement action.


 


(d)
Joint Patents. Any action or proceeding with respect to infringement of any Joint Patent worldwide may only be brought by both Parties,
with the costs to be shared equally between the Parties. Except as otherwise agreed to by the Parties as part of a cost-sharing arrangement,
any recovery or damages from an action or proceeding relating to Joint Patents will be used first to reimburse the Parties’ documented
out-of-pocket legal expenses relating to the action or proceeding, and any remaining damages will be shared equally between the Parties.


 


(e)
Cooperation. In the event either Party brings an infringement action in accordance with this Section 9.3, the other Party will cooperate
fully, including, if required to bring such action, the furnishing of a power of attorney or being named as a party to such action.


 


9.4
Infringement of Third-Party Rights. Each Party will promptly notify the other in writing of any allegation by a Third Party that
the activity of either of the Parties pursuant to this Agreement infringes or may infringe the intellectual property rights of such Third
Party. EMulate has the sole right to control any defense of any such claim involving alleged infringement of Third-Party rights by EMulate’s
activities at its own expense and by counsel of its own choice, and Hapbee has the right, at its own expense, to be represented in any
such action by counsel of its own choice. Hapbee has the sole right to control any defense of any such claim involving alleged infringement
of Third-Party rights by Hapbee’s activities at its own expense and by counsel of its own choice, and EMulate has the right, at
its own expense, to be represented in any such action by counsel of its own choice.


 


9.5
Consent for Settlement. Neither Party will enter into any settlement or compromise of any action or proceeding under this Article
9 which would materially alter, diminish, or be in derogation of the other Party’s rights under this Agreement without the prior
written consent of such other Party, which consent will not be unreasonably withheld.


 


9.6
Patent Marking. Hapbee (or its Sublicensees, or Distributors) will mark Authorized Product marketed and sold by Hapbee (or its Sublicensees,
or Distributors) hereunder with appropriate patent numbers or indicia designed by EMulate to the extent such markings or such notices
would impact recoveries of damages or equitable remedies available under Applicable Law with respect to infringements of patents in the
Territory.


 






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9.7
Trademarks. Without limiting any of Hapbee’s rights to brand the Authorized Product as provided for in Section 5.4, Hapbee
will use the EMulate Trademarks selected by EMulate to Commercialize the Authorized Product in the Territory. Where Hapbee reasonably
believes the EMulate Trademark is not appropriate for commercial use, or if such EMulate Trademark is not approved for use in the Territory
by the applicable Regulatory Authority, the Parties will agree on an alternative product trademark for such country and such alternative
product trademark will be deemed a EMulate Trademark. In addition, unless prohibited by Applicable Laws, Hapbee will include EMulate’s
corporate trademark on the packaging and product information of the Authorized Product sold in the Territory to indicate that the Authorized
Product is licensed from EMulate. All use of the EMulate Trademarks and EMulate corporate trademark will comply with Applicable Laws
and regulations and will be subject to EMulate’s review and approval. For clarity, Hapbee may also include its (or its Sublicensee’s)
corporate logo Hapbee Housemarks and similar trademarks or trade names of any Hapbee Sublicensee in the Authorized Product sold in the
Territory.


 


Article
10

CONFIDENTIALITY


 


10.1
Nondisclosure. Except to the extent expressly authorized by this Agreement or otherwise agreed in writing by the Parties, during
the Term and for seven (7) years thereafter, the receiving Party (the “Receiving Party”) will keep confidential and
will not publish or otherwise disclose and will not use for any purpose other than as expressly provided for in this Agreement any Confidential
Information of the other Party (the “Disclosing Party”), and both Parties will keep confidential and, subject to Sections
10.2, 10.3, and 10.4, will not publish or otherwise disclose the terms of this Agreement. Notwithstanding the foregoing, the Receiving
Party’s obligation of confidentiality and restriction on use with respect to the Disclosing Party’s Confidential Information
which derives economic value from not being generally known to public and is identified in writing by the Disclosing Party as trade secrets
will continue perpetually for so long as such Confidential Information is unpublished by the Disclosing Party and no provision of Section
10.2(b), (c), or (d) applies to such Confidential Information. Each Party may use the other Party’s Confidential Information solely
to the extent required to accomplish the purposes of this Agreement, including exercising such Party’s rights or performing its
obligations under this Agreement. Each Party will use at least the same standard of care as it uses to protect proprietary or confidential
information of its own (but no less than reasonable care) to ensure that its employees, agents, consultants, contractors, other representatives
and, in the case of Hapbee, Sublicensees and Distributors do not disclose or make any unauthorized use of the Confidential Information
of the other Party. Each Party will promptly notify the other Party upon discovery of any unauthorized use or disclosure of the Confidential
Information of the other Party.


 


10.2
Authorized Disclosure. The Receiving Party may disclose Confidential Information belonging to the Disclosing Party only to the extent
such disclosure is reasonably necessary in the following instances:


 


(a)
filing or prosecuting Patents as permitted by this Agreement;


 






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CONFIDENTIAL


 


(b)
prosecuting or defending litigation, including responding to a subpoena in a Third-Party litigation;


 


(c)
complying with Applicable Laws or regulations (including regulations promulgated by securities exchanges) or court or administrative
orders;


 


(d)
to its Sublicensees or prospective Sublicensees, Distributors, Third-Party Partners, subcontractors or prospective subcontractors,
payors, consultants, agents, and advisors on a “need-to-know” basis in order for the Receiving Party to exercise its rights
or fulfill its obligations under this Agreement, each of whom prior to disclosure must be bound by obligations of confidentiality and
restrictions on use of such Confidential Information that are no less restrictive than those set forth in this Article 10; provided,
however, that, in each of the above situations, the Receiving Party will remain responsible for any failure by any Third Party who receives
Confidential Information pursuant to this Section 10.2 to treat such Confidential Information as required under this Article 10; or


 


(e)
to bona fide potential and actual investors, acquirors, merger partners, licensees, and other financial or commercial partners solely
for the purpose of evaluating or carrying out an actual or potential investment, acquisition, or collaboration, in each case under written
obligations of confidentiality and non-use at least as stringent as those herein.


 


(f)
Notwithstanding the foregoing, in the event a Party is required to make a disclosure of the other Party’s Confidential Information
pursuant to Sections 10.2(b), (c), or (d), it will, except where impracticable, give at least thirty (30) days’ advance notice
to the other Party of such disclosure, reasonably consider the comments of the other Party with respect to limiting such disclosure,
and use efforts to secure confidential treatment of such Confidential Information at least as diligent as such Party would use to protect
its own confidential information, but in no event less than reasonable efforts. In any event, the Parties agree to take all reasonable
action to avoid disclosure of Confidential Information hereunder. Any information disclosed pursuant to Sections 10.2(b), (c), or (d)
will remain the Confidential Information of the Disclosing Party and subject to the restrictions set forth in this Agreement, including
the foregoing provisions of this Article 10.


 


10.3
Public Announcements. At the election of EMulate with respect to any or all of the Authorized Product, the Parties agree to issue
a joint press release in form and substance reasonably satisfactory to both Parties announcing the signature of this Agreement at or
shortly after the Effective Date, but in any event within the time-period as required by Applicable Laws. It is understood that either
Party may make such disclosures as it determines, based on advice of counsel, is reasonably necessary to comply with Applicable Laws
or for appropriate market disclosure. Each Party will provide the other Party with advance notice of legally required disclosures to
the extent practicable. The Parties will consult with each other on the provisions of this Agreement to be redacted in any filings made
by a Party as required by Applicable Laws; provided, that each Party will have the right to make any such filing as it reasonably determines
necessary under Applicable Laws. In addition, following any initial joint press release announcing this Agreement, either Party will
be free to disclose, without the other Party’s prior written consent, the existence of this Agreement, the identity of the other
Party, and those terms of the Agreement which have already been publicly disclosed in accordance herewith.


 






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Article
11

REPRESENTATIONS, WARRANTIES AND COVENANTS


 


11.1
Mutual Representations and Warranties. Each Party represents and warrants to the other that, as of the Effective Date: (a) it is
duly incorporated and validly existing under the laws of its jurisdiction of incorporation or formation, and has full corporate or other
power and authority to enter into this Agreement and to carry out the provisions hereof, (b) it is duly authorized to execute and deliver
this Agreement and to perform its obligations hereunder, and the person or persons executing this Agreement on its behalf has been duly
authorized to do so by all requisite corporate or partnership action, (c) this Agreement is legally binding upon it, enforceable in accordance
with its terms, and does not conflict with any agreement, instrument, or understanding, oral or written, to which it is a Party or by
which it may be bound, nor, to the knowledge of the indemnifying Party, violate any material law or regulation of any court, governmental
body, or administrative or other agency having jurisdiction over it, and (d) it has the right to grant the licenses granted by it under
this Agreement.


 


11.2
Additional Hapbee Covenants. Hapbee covenants as follows:


 


(a)
Hapbee will comply in all material respects with all Applicable Laws related to its Commercialization of Authorized Product.


 


(b)
Hapbee will Commercialize all Authorized Product solely within the Territory for use in the Field pursuant to the authority, rights,
and licenses granted to Hapbee under this Agreement. During the Term Hapbee will not (i) Commercialize any Authorized Product outside
of the Field or of the Territory, (ii) provide any Authorized Product to any Third Party if Hapbee has actual knowledge or reasonably
believes that such Third Party, either directly or indirectly, is selling, renting, leasing, or intends to sell, rent or lease such Authorized
Product outside the Field or the Territory and (iii) expressly provide in each agreement with its Distributor that such Distributor will
be subject to immediate termination in the event of a breach of the covenants in this Section 11.2(b) and (iv) immediately terminate
any Distributor for a breach of the requirements of Section 11.2(b)(iii).


 


(c)
At EMulate’s request with respect to any jurisdiction in the Territory, Hapbee will cause its special counsel, reasonably acceptable
to EMulate, to deliver to EMulate a legal opinion, in form and substance satisfactory to EMulate, stating (among other things) that the
transactions contemplated by the Exclusive License Agreement are the legal, valid and binding obligations of Hapbee enforceable against
Hapbee in accordance with the terms of such agreement and that the commercial transactions by Hapbee as contemplated in such jurisdiction
in the Exclusive License Agreement will not violate any Applicable Laws in the Territory.


 






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CONFIDENTIAL


 


11.3
Additional EMulate Representations, Warranties, and Covenants. EMulate represents and warrants to Hapbee that as of the Effective
Date:


 


(a)
EMulate Patents. EMulate owns, or has an exclusive license to, the EMulate Patents.


 


(b)
Title; Encumbrances. EMulate has sufficient legal and/or beneficial title, ownership, or license, free and clear from any mortgages,
pledges, liens, security interests, conditional and installment sale, lease, rental agreements, encumbrances, charges or claims of any
kind, of the EMulate Technology to grant the licenses to Hapbee as purported to be granted pursuant to this Agreement.


 


(c)
No Conflict. EMulate has not granted any assignment, license, covenant not to sue, or other similar interest or benefit, exclusive
or otherwise, to any Third Party relating to any patent, know-how, or other proprietary right that conflicts with or limits the rights
granted to Hapbee hereunder or which falls within the scope of the licenses granted in Section 2.1.


 


(d)
Non-Infringement of Third Party’s IP Rights. The EMulate Technology and the import, sale, lease, rental, or use of the Authorized
Product in the Territory does not and will not infringe any intellectual property rights of any Third Party existing as of the Effective
Date.


 


(e)
Non-Infringement of EMulate Technology by Third Parties. EMulate is not aware of any activities by Third Parties that constitute
infringement or misappropriation of the EMulate Technology within the Territory.


 


(f)
No Claims of Third-Party Rights. EMulate has not received any written notice, claim, or demand from any person or entity asserting
that the research, development, use, or sale, lease, rental of the Authorized Product infringes a patent of a Third Party in the Territory,
nor is EMulate aware of the threat of such claim.


 


(g)
No Action or Claim. To EMulate’s Knowledge as of the Effective Date, there are no actual, pending, alleged, or threatened adverse
actions, suits, claims, interferences, or formal governmental investigations involving the Authorized Product by or against EMulate or
distributors in or before any court or governmental entity.


 


(h)
Disclaimer. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, OR ANY OTHER AGREEMENT CONTEMPLATED HEREUNDER, NEITHER PARTY MAKES ANY
REPRESENTATIONS OR EXTENDS ANY WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, AND EACH PARTY EXPRESSLY DISCLAIMS ALL IMPLIED WARRANTIES
OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE OR USE, NON-INFRINGEMENT, VALIDITY AND ENFORCEABILITY OF PATENTS, OR THE PROSPECTS
OR LIKELIHOOD OF COMMERCIAL SUCCESS OF THE AUTHORIZED PRODUCT.


 


11.4
No Representation Regarding Cognate. The Parties agree that (without limiting any provision in Section 11.3(h)) EMULATE MAKES NO
REPRESENTATIONS, WARRANTIES OR GUARANTEES WITH RESPECT TO (A) THE SAFETY OR EFFECTIVENESS OF THE COGNATE, (B) THE CAPABILITY OR SUITABILITY
OF THE COGNATE FOR COMMERCIALIZATION, OR (C) FROM AND AFTER THE EFFECTIVE DATE, THAT THE USE OF THE COGNATE AS CONTEMPLATED IN THIS AGREEMENT
OR OTHERWISE, OR THE EXERCISE OF ANY OF ETI’S RIGHTS WITH RESPECT TO SUCH COGNATE UNDER THIS AGREEMENT WILL NOT VIOLATE ANY MATERIAL
LAW OR REGULATION OF ANY COURT, GOVERNMENTAL BODY, OR ADMINISTRATIVE OR OTHER AGENCY HAVING JURISDICTION OVER IT OR WILL NOT BE SUBJECT
TO THE JURISDICTION OF ANY GOVERNMENTAL AUTHORITY.


 






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Article
12

INDEMNIFICATION


 


12.1
Indemnification of EMulate. Hapbee will indemnify, defend and hold harmless each of EMulate and its directors, shareholders, officers,
and employees (collectively, the “EMulate Indemnitees”) from and against any and all losses, liabilities, damages,
penalties, fines, costs, and expenses (including reasonable attorneys’ fees and other expenses of litigation) (“Losses”)
from any Third-Party claims, actions, suits, or proceedings (each, a “Claim”) incurred by any EMulate Indemnitee,
arising from, or occurring as a result of (a) the negligence or willful misconduct of Hapbee, its Sublicensees, Distributors or other
subcontractors, and (b) any breach of any representations, warranties, or covenants by Hapbee under this Agreement; except in each case
to the extent such Claim falls within the scope of EMulate’s indemnification obligations set forth in Section 12.2.


 


12.2
Indemnification of Hapbee. EMulate will indemnify, defend and hold harmless each of Hapbee and its Sublicensees and Distributors
and their respective directors, officers, employees, and agents (collectively, the “Hapbee Indemnitees”), from and
against any and all Losses from any Third-Party Claims incurred by any Hapbee Indemnitee, arising from, or occurring as a result of (a)
the negligence or willful misconduct of EMulate; and (b) any breach of any representations, warranties, or covenants by EMulate under
this Agreement; except in each case to the extent such Claim falls within the scope of the indemnification obligations of Hapbee set
forth in Section 12.1.


 


12.3
Procedure. Each Party’s agreement to indemnify, defend, and hold harmless the other Party is conditioned on the indemnified
Party: (a) providing written notice to the indemnifying Party of any Claim for which it is seeking indemnification hereunder promptly
after the indemnified Party has knowledge of such Claim; (b) permitting the indemnifying Party to assume full responsibility to investigate,
prepare for, and defend against any such Claim, except that the indemnified Party may cooperate in the defense at its own expense using
its own counsel; (c) assisting the indemnifying Party, at the indemnifying Party’s reasonable expense, in the investigation of,
preparation for, and defense of any such Claim; and (d) not compromising or settling such Claim without the indemnifying Party’s
written consent. The indemnifying Party will not settle any Claim without the prior written consent of the indemnified Party, not to
be unreasonably withheld, unless the settlement involves only the payment of money. If the indemnifying Party does not assume and conduct
the defense of the Claim as provided above, (y) the indemnified Party may defend against and consent to the entry of any judgment or
enter into any settlement with respect to the Claim in any manner the indemnified Party may deem reasonably appropriate (and the indemnified
Party need not consult with, or obtain any consent from, the indemnifying Party in connection therewith), and (z) the indemnifying Party
will remain responsible to indemnify the indemnified Party as provided in this Article 12. The failure to promptly notify the indemnifying
Party after the commencement of any action with respect to a Claim will only relieve the indemnifying Party of its obligations under
this Article 12 if and to the extent the indemnifying Party is actually prejudiced thereby.


 






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12.4
Insurance. Each Party will procure and maintain insurance, including product liability insurance, adequate to cover its obligations
hereunder and which are consistent with normal business practices of prudent companies similarly situated at all times during the Term.
It is understood that such insurance will not be construed to create a limit of either Party’s liability with respect to its indemnification
obligations under this Article 12. Each Party will provide the other Party with written evidence of such insurance upon request. Each
Party will provide the other Party with written notice at least thirty (30) days prior to the cancellation, non-renewal, or material
change in such insurance or self-insurance which materially adversely affects the rights of the other Party hereunder.


 


12.5
Limitation of Liability. NEITHER PARTY WILL BE LIABLE TO THE OTHER FOR ANY SPECIAL, CONSEQUENTIAL, INCIDENTAL, EXEMPLARY, PUNITIVE,
OR INDIRECT DAMAGES ARISING FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF ANY NOTICE OF THE POSSIBILITY OF SUCH DAMAGES.
NOTWITHSTANDING THE FOREGOING, NOTHING IN THIS SECTION 12.5 IS INTENDED TO OR WILL LIMIT OR RESTRICT THE INDEMNIFICATION RIGHTS OR OBLIGATIONS
OF ANY PARTY UNDER SECTION 12.1 OR SECTION 12.2, OR DAMAGES AVAILABLE FOR A PARTY’S BREACH OF CONFIDENTIALITY OBLIGATIONS IN ARTICLE
10.


 


Article
13

Term and Termination


 


13.1
Term. This Agreement will commence on the Effective Date, and unless terminated earlier as provided in this Article 13, will continue
in full force and effect until the twentieth (20th) anniversary of the Effective Date (the “Term”); provided,
that if the Cognate has been determined pursuant to Section 2.8 not to be safe for its intended Commercial use, the Term of this Agreement
with respect to such Cognate will terminate as of the date of such determination. The Commercial Supply Agreement, as applicable, will
terminate upon any termination or expiration of this Agreement.


 


13.2
Early Termination.


 


(a)
Mutual Agreement. The Parties may terminate this Agreement at any time by mutual written agreement of the Parties.


 


(b)
Material Breach. EMulate will have the right to terminate this Agreement upon written notice to Hapbee if Hapbee, after receiving
written notice from EMulate identifying a Hapbee Material Breach, fails to cure such Hapbee Material Breach within sixty (60) days from
the date of such notice (or within thirty (30) days’ notice for any payment breach). Hapbee will have the right to terminate this
Agreement upon written notice to EMulate if EMulate, after receiving written notice identifying an EMulate Material Breach, fails to
cure such EMulate Material Breach within sixty (60) days from the date of such notice.


 






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CONFIDENTIAL


 


(c)
Bankruptcy. Each Party will have the right to terminate this Agreement immediately in its entirety upon written notice to the other
Party if such other Party makes a general assignment for the benefit of creditors, files an insolvency petition in bankruptcy, petitions
for or acquiesces in the appointment of any receiver, trustee, or similar officer to liquidate or conserve its business or any substantial
part of its assets, commences under the laws of any jurisdiction (the “Bankruptcy Laws”) any proceeding involving
its insolvency, bankruptcy, reorganization, adjustment of debt, dissolution, liquidation or any other similar proceeding for the release
of financially distressed debtors or becomes a party to any proceeding or action under the Bankruptcy Laws and such proceeding is not
dismissed within sixty (60) days after the commencement thereof.


 


(d)
License Grant by Hapbee to EMulate. Hapbee hereby grants EMulate, effective upon the effective date of an early termination pursuant
to this Section 13.2, a fully paid, royalty free, perpetual, irrevocable, exclusive license, with the right to grant sublicenses (through
multiple tiers), under any and all Patents and Know-How Controlled by Hapbee at the time of such termination for EMulate to develop,
make, have made, use, sell, offer for sale, lease, rental, and import Authorized Product in the Territory.


 


13.3
Effects of Termination. Upon the early termination of this Agreement by EMulate under Section 13.2(b) or 13.2(c), the following will
apply:


 


(a)
Inventory. Hapbee, its Distributors, and Sublicensees will continue, to the extent that Hapbee, its Distributors, and Sublicensees
continue to have stocks of usable Authorized Product, to fulfill orders received from customers for the Authorized Product in the Field
in the Territory for up to six (6) months after the effective date of termination. Hapbee will pay royalties to EMulate in accordance
with Section 7.2 on the amount of Net Income from the use, sale, lease and rental of Authorized Product sold by Hapbee after notice of
termination and after the effective date of termination.


 


(b)
License Grant by Hapbee to EMulate. Hapbee hereby grants EMulate, effective upon the effective date of such termination, a fully
paid, royalty free, perpetual, irrevocable, exclusive license, with the right to grant sublicenses (through multiple tiers), under any
and all Patents and Know-How Controlled by Hapbee and incorporated into the Authorized Product at the time of such termination for EMulate
to make, have made, use, sell, offer for sale, lease, rental and import Authorized Product in the Territory.


 


(c)
Supply. The Commercial Supply Agreement, if applicable, will terminate upon the effective date of the termination of this Agreement.


 


(d)
Transition. Hapbee will cooperate with EMulate and/or its designee to effect a smooth and orderly transition in the use, sale, lease,
rental and marketing, promotion, and Commercialization of the Authorized Product in the Territory.


 






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13.4
Effects of Termination for Cause by Hapbee. Upon termination of this Agreement by Hapbee under Section 13.2(b) or 13.2(c), (in addition
to any other rights and obligations under this Agreement with respect to such termination) all licenses granted by EMulate to Hapbee
pursuant to Section 2.1 will terminate; provided, however, that Hapbee may elect to have all or any portion of the licenses granted to
Hapbee pursuant to Section 2.1 (and pursuant to the Commercial Supply Agreement, if applicable) continue, in which case Hapbee’s
obligations to EMulate under Article 7 and EMulate’s rights under Article 7 will continue.


 


13.5
Rights Upon Bankruptcy. All rights and licenses granted under or pursuant to this Agreement by EMulate (and pursuant to the Commercial
Supply Agreement, if applicable) are, and will otherwise be deemed to be, for purposes of Section 365(n) of the U.S. Bankruptcy Code,
licenses of right to “intellectual property” as defined under Section 101 of the Bankruptcy Laws. The Parties agree that
Hapbee, as licensee of such rights under this Agreement, will retain and may fully exercise all of its rights and elections under the
Bankruptcy Laws.


 


13.6
Return of Confidential Information. Upon termination or expiration of this Agreement, except to the extent necessary or reasonably
useful for a Party to exercise its rights under any license surviving such termination or expiration, each Party will promptly return
to the other Party, or delete or destroy, all relevant records and materials in such Party’s possession or control containing Confidential
Information of the other Party; provided, that such Party may keep one copy of such materials for archival purposes only.


 


13.7
Survival. The following provisions will survive any expiration or termination of this Agreement: Articles 1 (Definitions), 10 (Confidentiality),
12 (Indemnification), 14 (Dispute Resolution), and 15 (General Provisions), and Sections 2.3 (License Grant to EMulate), 2.4 (No Implied
License), 4.2 (Records), 8.4 (Records), 8.5 (Audits), 9.1 (Ownership of Intellectual Property), 13.3-13.4 (Effects of Termination; in
each case to the extent applicable), and 13.7 (Survival).


 


Article
14

DISPUTE RESOLUTION


 


The
Parties recognize that disputes as to certain matters may from time to time arise during the Term that relate to interpretation of a
Party’s rights and/or obligations hereunder or any alleged breach of this Agreement. If the Parties cannot resolve any such dispute
within thirty (30) days after written notice of a dispute from one Party to another, either Party may, by written notice to the other
Party, have such dispute referred to the Chief Executive Officer of EMulate and the Chief Executive Officer of Hapbee (collectively,
the “Senior Executives”). The Senior Executives will negotiate in good faith to resolve the dispute within thirty
(30) days. If the Senior Executives are not able to resolve such dispute referred to them under this Article 14 within such thirty (30)-day
period, each of the Parties will be free to pursue its legal rights and remedies before a judicial tribunal of competent jurisdiction.


 






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Article
15

GENERAL PROVISIONS


 


15.1
Governing Law; Venue. This Agreement and all questions regarding the existence, validity, interpretation, breach, or performance
of this Agreement, will be governed by, and construed and enforced in accordance with, the laws of the State of Washington, United States,
without reference to its conflicts of law principles. Any dispute arising under this Agreement will be pursued in a court of competent
jurisdiction located in Seattle, Washington, and each of the Parties waives any objection it may have to the laying of venue brought
in any such court, waives any claim that any proceedings with respect to a dispute have been brought in an inconvenient forum, and further
waives any right to object that such court does not have any jurisdiction over such Party.


 


15.2
Waiver of Breach. No delay or waiver by either Party of any condition or term hereunder in any one or more instances will be construed
as a further or continuing waiver of such condition or term or of any other condition or term in this Agreement. Any waiver by a Party
of a particular term or condition will be effective only if set forth in a written instrument duly executed by or on behalf of the Party
waiving such term or condition.


 


15.3
Further Actions. Each Party agrees to execute, acknowledge, and deliver such further instruments, and to perform all such other acts,
as may be necessary or appropriate in order to carry out the purposes and intent of this Agreement.


 


15.4
Severability. In the event any provision of this Agreement is adjudicated to be invalid, illegal, or unenforceable by a court of
competent jurisdiction, the Parties will use their best efforts to replace the invalid, illegal, or unenforceable provision with a valid,
legal, and enforceable provision that most closely reflects the original intent of the Parties. All other provisions of this Agreement
will not in any way be affected or impaired by such adjudication and will remain in full force and effect.


 


15.5
Entire Agreement; Amendment. This Agreement, together with the exhibits hereto (which exhibits are by this reference incorporated
into this Agreement), contains the entire understanding of the Parties with respect to the subject matter hereof. This Agreement supersedes
all prior and contemporaneous agreements and communications of the Parties, whether oral, written, or otherwise, concerning any and all
matters that are the subject of this Agreement. Except as expressly set forth herein, this Agreement may be amended or modified only
by a written instrument executed by authorized representatives of each Party.


 


15.6
Notices. Any notice or communication required or permitted under this Agreement will be in writing in the English language, delivered
personally, sent by facsimile (and promptly confirmed by personal delivery, registered or certified mail or overnight courier), sent
by internationally-recognized courier or sent by registered or certified mail, postage prepaid to the following addresses of the Parties
(or at any address such Party may designate by prior written notice to the other Party in accordance with this Section 15.6):


 






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If
to EMulate, notices must be addressed to:


 


EMulate
Therapeutics, Inc.


425
Pontius Avenue North, Suite 200


Seattle,
WA 98109


U.S.A


Attention:
President and CEO


Tel:
+1 206-708-2288, ext. 122


Fax:
+1 206-260-7201


 


With
a copy to (which will not constitute notice):


 


EMulate
Therapeutics, Inc.


425
Pontius Avenue North, Suite 200


Seattle,
WA 98109


U.S.A


Attention:
General Counsel


Tel:
+1 206-708-2288, ext. 105


Fax:
+1 206-260-7201


 


If
to Hapbee, notices must be addressed to:


 


Hapbee
Technologies, Inc.


700
West Georgia Street

25th Floor

Vancouver, BC V7Y 1B3

Canada

Attention: CEO


Tel:
+1 360-929-1520


 


Any
such notice will be deemed to have been given (a) when delivered if personally delivered; (b) on the next Business Day after dispatch
if sent by confirmed facsimile or by internationally-recognized overnight courier; and/or (c) on the fifth (5th) Business
Day following the date of mailing if sent by mail or other internationally-recognized courier. Notices hereunder will not be deemed sufficient
if provided only between or among each Party’s representatives on the JSC.


 


15.7
Assignment. Neither this Agreement nor any obligation of a Party hereunder may be assigned by either Party without the prior written
consent of the other Party; provided, however, that either Party may assign this Agreement in its entirety without such consent to (i)
any purchaser of all, or substantially all, of its assets to which this Agreement relates, or (ii) any successor corporation resulting
from any merger, consolidation, share exchange, or other similar transaction, provided that any such successor corporation will assume
all obligations of its assignor under this Agreement. This Agreement will inure to the benefit of EMulate and Hapbee and their respective
successors and permitted assigns. Any assignment of this Agreement that is not made in accordance with this Section 15.7 will be null
and void and of no legal force or effect.


 






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15.8
Relationship of the Parties. Nothing in this Agreement or any action which may be taken pursuant to its terms is intended, or will
be deemed, to establish a joint venture, agency, or partnership between Hapbee and EMulate. Neither Party to this Agreement has any express
or implied right or authority to assume or create any obligations on behalf of, or in the name of, the other Party, or to bind the other
Party to any contract, agreement or undertaking with any Third Party, without the prior written consent of the other Party.


 


15.9
Interpretation. The headings of clauses contained in this Agreement preceding the text of the sections, subsections, and paragraphs
hereof are inserted solely for convenience and ease of reference only and will not constitute any part of this Agreement, or have any
effect on its interpretation or construction. All references in this Agreement to the singular will include the plural where applicable.
Unless otherwise specified, references in this Agreement to any Article will include all sections, subsections, and paragraphs in such
Article, references to any section will include all subsections and paragraphs in such section, and references in this Agreement to any
subsection will include all paragraphs in such subsection. The word “including” and similar words means including without
limitation. The word “or” means “and/or” unless the context dictates otherwise because the subjects of the conjunction
are mutually exclusive. The words “herein,” “hereof,” and “hereunder” and other words of similar
import refer to this Agreement as a whole and not to any particular section or other subdivision. All references to days in this Agreement
mean calendar days, unless otherwise specified. Ambiguities and uncertainties in this Agreement, if any, will not be interpreted against
either Party, irrespective of which Party may be deemed to have caused the ambiguity or uncertainty to exist. This Agreement has been
prepared in the English language and the English language will control its interpretation. In addition, all notices required or permitted
to be given hereunder, and all written, electronic, oral, or other communications between the Parties regarding this Agreement will be
in the English language. Les parties reconnaissent avoir exigé que la présente et tous les documents connexes soient rédigés
en anglais.


 


15.10
Counterparts. This Agreement may be executed in any number of counterparts each of which will be deemed an original, and all of which
together will constitute one and the same instrument.


 


[Signature
page follows]


 




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IN
WITNESS WHEREOF, the Parties have caused this Exclusive License Agreement to be executed by their duly authorized representatives
as of the date first written above.


 






	EMulate
    Therapeutics, Inc.	 	Hapbee
                                            Technologies, Inc.

    

		 	
	By:	                                                                              	 	By:	                                             
	Name:	Steven
    E. Pope	 	Name:	Chris
    E. Rivera
	Title:	SVP
    and Secretary	 	Title:	President