OF A THIRD PARTY AT
WHICH PST® TESTING IS CONDUCTED BY OR ON BEHALF OF ORAL DNA, UPON AT LEAST
FIFTEEN (15) DAYS' PRIOR WRITTEN NOTICE, FOR THE PURPOSES OF INSURING THAT
QUALITY STANDARDS ARE BEING ADHERED TO AND MAINTAINED AT SUCH FACILITY TO ILI'S
REASONABLE SATISFACTION AND IN COMPLIANCE WITH THIS AGREEMENT.
(B)
APPROVAL.
NOTWITHSTANDING ANYTHING TO THE
CONTRARY IN THIS AGREEMENT, ORAL DNA WILL NOT BEGIN PROCESSING PST® SAMPLES
UNTIL ALL OF THE TESTING FACILITIES THAT WILL BE USED FOR PROCESSING
PST® SAMPLES HAVE BEEN APPROVED BY ILI (TO INCLUDE INSPECTION, AT ILI'S
DISCRETION), SUCH APPROVAL NOT TO BE UNREASONABLY WITHHELD.
(C)
FREQUENCY.
ILI MAY NOT REQUEST INSPECTION
OF A GIVEN TESTING FACILITY UNDER THIS SECTION 3.1.2 MORE FREQUENTLY THAN TWO
(2) TIMES IN THE FIRST CALENDAR YEAR NOR MORE FREQUENTLY THAN ONE (1) TIME PER
CALENDAR YEAR AFTER THE FIRST CALENDAR YEAR.
3.1.3
DILIGENCE.
(A)
GENERAL DILIGENCE OBLIGATIONS.
ORAL DNA
SHALL USE COMMERCIALLY REASONABLE EFFORTS IN COMMERCIALIZING AND MARKETING
LICENSED PRODUCTS IN THE FIELD AND IN THE TERRITORY.
(B)
SPECIFIC DILIGENCE OBLIGATIONS.
WITHOUT
LIMITING THE GENERALITY OF THE PROVISION OF SECTION 3.1.2 ABOVE, ORAL DNA HEREBY
AGREES THAT IT WILL:
(I) COMPLETE THE INITIAL MARKETING ACTIVITIES ON OR BEFORE
SIX (6) MONTHS FROM THE EFFECTIVE DATE; (II) ACHIEVE A FIRST COMMERCIAL SALE
WITHIN ONE HUNDRED TWENTY (120) DAYS FROM THE EFFECTIVE DATE; (III)
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company's application requesting
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended.
7
COMMENCING ON THE SIXTH CALENDAR MONTH FOLLOWING THE EFFECTIVE DATE AND
CONTINUING THEREAFTER, MAKE SUBSTANTIALLY THE SAME VOLUME OF SALES CALLS AS MADE
FOR ITS PRIMARY TESTING SERVICES; AND (IV) CONDUCT AT LEAST ONE (1) LECTURE PER
CALENDAR QUARTER THROUGH ONE OR MORE MEMBERS OF ITS MANAGEMENT TEAM OR
SCIENTIFIC ADVISORY BOARD (OR SUCH OTHER INDIVIDUAL AS MAY BE REASONABLY
ACCEPTABLE TO ILI) THAT DISCUSSES THE IMPORTANCE OF GENETIC SUSCEPTIBILITY IN
REGARD TO THE PST® GENETIC RISK ASSESSMENT TEST AND PERIODONTAL DISEASE.
IN THE
EVENT THAT ORAL DNA FAILS TO USE COMMERCIALLY REASONABLE EFFORTS IN COMPLYING
WITH ITS DILIGENCE OBLIGATIONS UNDER SECTIONS 3.1.3(A) OR (B), THEN, SUBJECT TO
SECTION 3.1.3(C), ILI MAY TERMINATE THIS AGREEMENT PURSUANT TO SECTION 7.2.2.
(C)
EFFECT OF FAILURE TO MEET OBLIGATIONS.
IF
ORAL DNA FAILS TO MEET ANY OF ITS OBLIGATIONS SET FORTH ABOVE IN
SECTION 3.1.3(B) BY THE APPLICABLE DEADLINE, BUT IS OTHERWISE CONTINUOUSLY IN
COMPLIANCE WITH THE PROVISIONS OF SECTION 3.1.3(A) THROUGHOUT THE ENTIRETY OF
THE DILIGENCE PERIOD SPECIFIED ABOVE, THEN ILI AND ORAL DNA WILL NEGOTIATE IN
GOOD FAITH AN EXTENSION OF THESE DEADLINES.
3.2
MARKETING PLAN AND INFORMATION.
AS SOON AS
PRACTICABLE FOLLOWING THE EFFECTIVE DATE, ORAL DNA SHALL SUBMIT TO ILI FOR ITS
INFORMATION A MARKETING PLAN (THE "MARKETING PLAN") FOR LICENSED PRODUCTS IN THE
FIELD AND IN THE TERRITORY. THEREAFTER, IF REQUESTED BY ILI, THE PARTIES WILL
HAVE QUARTERLY CONFERENCE CALLS IN WHICH (A)