Document:

EXCLUSIVE LICENSE AGREEMENT AS AMENDED

 Exhibit 10.17 
  
 Confidential Materials omitted and filed separately with the 
 Securities and Exchange Commission. Asterisks denote omissions. 
  
 EXCLUSIVE LICENSE AGREEMENT 
  
 BETWEEN 
  
 CHILDREN’S MEDICAL CENTER CORPORATION 
  
 AND 
  
 ICAGEN, INC. 
  
 This Agreement is made and entered into as of the date last written below
(the Effective Date), by and between Children’s Medical Center Corporation, a charitable corporation duly organized and existing under the laws of the Commonwealth of Massachusetts and having its principal office at 300 Longwood Avenue, Boston,
Massachusetts, 02115, U.S.A. (hereinafter referred to as “CMCC”), and ICAgen, Inc., a business corporation organized and existing under the laws of the State of Delaware and having its principal place of business located at 4222 Emperor
Boulevard, Suite 460, Durham, NC 27703 (hereinafter referred to as “Licensee”). 
  
 WHEREAS, CMCC is the owner of the CMCC Patent Rights which are identified in Appendix A and/or has the right to grant exclusive licenses under said CMCC Patent Rights for the Field of Use, subject only to a
royalty-free, nonexclusive license heretofore granted to the United States Government for those patents developed with U.S. Government funding; 
  
 WHEREAS, CMCC has the right to license its interest in the Sheffield Patent Rights which are identified in Appendix B for the Field of Use, subject only
to a royalty-free, nonexclusive license heretofore granted to the United States Government for those patents developed with U.S. Government funding; 
  
 WHEREAS, CMCC desires to have the Licensed Patent Rights utilized in the public interest and is willing to grant a license thereunder on the terms and
conditions described herein; 
  
 WHEREAS, Licensee has represented
to CMCC that Licensee is ready, willing and able, subject to obtaining necessary regulatory approvals and on the terms and conditions set forth herein, to engage in the commercial development, production, manufacture, marketing and sale of Licensed
Products and/or the use of Licensed Processes and that it shall commit itself (either directly or through Affiliates, Sublicensees or contractees) to a thorough, vigorous and diligent program of exploiting the Licensed Patent Rights in accordance
with the terms and conditions described herein so that public utilization shall result therefrom; and 
  
 WHEREAS, Licensee desires to obtain an exclusive license under the Licensed Patent Rights for the Field of Use on the terms and conditions of this
Agreement. 
  

 NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein, the parties
hereto agree as follows: 
  
 ARTICLE I. DEFINITIONS 
  
 For the purpose of this Agreement, the following words and phrases shall have
the meanings set forth below: 
  
 1.1 “Affiliate” shall
mean any company or other legal entity controlling, controlled by or under common control with Licensee. For purposes of the definition of “Affiliate” the term “control” shall mean: (i) in the case of a corporate entity, the
direct or indirect ownership of at least a majority of the stock or participating shares entitled to vote for the election of directors of that entity; (ii) in the case of a partnership, the power customarily held by a general partner to direct the
management and policies of such partnership; or (iii) in the case of a joint venture, whether in corporate, partnership or other legal form, a more than nominal economic interest and managerial role. 
  
 1.2 “Combination Product(s) or Process(es)” shall mean a product or
process that includes a Licensed Product or Licensed Process sold in combination with another component(s) whose manufacture, use or sale by an unlicensed party would not constitute an infringement of the Licensed Patent Rights. 
  
 1.3 “Field of Use” shall mean human and veterinary therapeutics and
diagnostics, [**]. 
  
 1.4 “First Commercial Sale” shall
mean with respect to each country: (i) the first sale of any Licensed Product or Licensed Process by Licensee, following approval of such Licensed Product’s or Licensed Process’s marketing by the appropriate governmental agency, if any
such approval is necessary, for the country in which the sale is to be made; or (ii) when governmental approval is not required, the first sale in that country of the Licensed Product or Licensed Process. 
  
 1.5 “Gross Compensation” shall mean all consideration received by
Licensee and Affiliates from third parties for the manufacture, sale, commercialization, and/or sublicensing of the Licensed Patent Rights, the Technology and the Sublicensed Technology. Gross Compensation shall include: 
  
 (a) all payments received by Licensee and/or Affiliates as
upfront payments, license fees, milestone payments, royalties, rentals, user fees or other sums received for the manufacturing, sales, commercialization and/or sublicensing of the Technology, and/or the Sublicensed Technology; for further
clarification, Gross Compensation does not include other sums received for solely sponsoring research or development, or as a bona fide equity or debt investment in Licensee or any of its Affiliates; and 
  
 (b) all non-cash compensation received by Licensee and/or
Affiliates such as stock, partnership interests, or other equity interests in a business entity when such equity interest is received by Licensee or Affiliates in return for the manufacturing, sales, 

  

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commercialization and/or sublicensing of the Technology and/or the Sublicensed Technology. 
  
 1.6 “Licensed Patent Rights” shall mean all of the following intellectual property which CMCC owns or has rights
to during the term of this Agreement: 
  
 (a) The
United States and foreign patents and/or patent applications listed in Appendix A and Appendix B attached hereto and incorporated herein by reference and divisionals and continuations thereof. 
  
 (b) The United States and foreign patents issued from the
applications listed in Appendix A and Appendix B and from divisionals and continuations of those applications. 
  
 (c) Claims of United States and foreign continuation-in-part applications, and of the resulting patents, which claim subject matter
specifically described and enabled in the United States and foreign patent applications described in Appendix A and Appendix B. 
  
 (d) Claims of all later filed foreign patent applications, and of the resulting patents, which claim subject matter specifically described
and enabled in the United States patent and/or patent applications described in subparagraphs (a), (b) or (c) of this Article I, Paragraph 1.6. 
  
 (e) Any reissues, divisions, amendments or extensions of the United States or foreign patents described in subparagraphs (a), (b), (c) or
(d) of this Article I, Paragraph 1.6. 
  
 1.7 “Licensed
Product” shall mean any product or part thereof: 
  

	 	1.	The manufacture, use of, importation of, sale of or offer for sale of which would infringe any Valid Claim contained in the Licensed Patent Rights in any country; or

  

	 	2.	The manufacture of which uses a “Licensed Process” 

  
 1.8 “Licensed Process” shall mean any process that would infringe any Valid Claim contained in the Licensed Patent Rights in any country.

  
 1.9 “NCEs” shall mean the compounds covered in whole
or in part by Sheffield Patent Rights. 
  
 1.10 “Net
Sales” shall mean gross receipts received by Licensee or Licensee’s Affiliates for sales of Licensed Products and/or Licensed Processes produced hereunder, less the sum of the following: 
  

	 	1.	Discounts, rebates allowances and adjustments actually allowed in amounts customary in the trade. 

  

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	 	2.	Sales taxes, tariff duties and/or use, excise, value-added, and similar government taxes directly imposed and with reference to particular sales. 

  

	 	3.	Outbound transportation, shipping, importation, and delivery charges (including insurance premiums related to transportation and delivery) prepaid or actually allowed.

  

	 	4.	Amounts allowed or credited on actual returns. 

  

	 	5.	Price reductions or rebates imposed by government authorities. 

  
 No deductions shall be made for commissions paid to individuals whether they are with independent sales agencies or regularly employed by Licensee and on
its payroll or for the cost of collections. Licensed Products and Licensed Processes shall be considered “sold” and “received” when actually collected. Notwithstanding anything herein to the contrary, the following shall not be
considered a sale of a Licensed Product or Licensed Process under this Agreement: (i) the transfer of a Licensed Product or Licensed Process to an Affiliate for sale by the Affiliate in a transaction that will be royalty bearing; (ii) the transfer
of a Licensed Product or Licensed Process to a third party without consideration to Licensee in connection with the development or testing of a Licensed Product or Licensed Process; or (iii) the transfer of a Licensed Product or Licensed Process to
a third party without consideration in connection with the marketing or promotion of the Licensed Product or Licensed Process. 
  
 1.11 “NEWCO’s Field of Use” shall mean the use of the NCE’s in the field of [**]. 
  
 1.12 “Sheffield Patent Rights” shall mean the patents and patent
applications set forth in Appendix B hereto. 
  
 1.13
“Sublicensee” shall mean a person or entity unaffiliated with Licensee to whom Licensee has granted an arm’s length sublicense under this Agreement. 
  
 1.14 “Sublicensed Technology” shall mean any and all patentable and unpatentable technology, Licensed Products,
Licensed Processes, compounds, devices, models, things, know-how, methods, documents, materials, copyrightable works, and all other information in CMCC’s custody and under CMCC’s control relating to the Licensed Patent Rights supplied by
ION to CMCC. 
  
 1.15 “Technology” shall mean
CMCC’s rights, as of the Effective Date hereof, to any and all patentable and unpatentable technology, Licensed Products, Licensed Processes, compounds, devices, models, things, know-how, methods, documents, materials, copyrightable works, and
all other information in CMCC’s custody and under CMCC’s control relating to the Licensed Patent Rights, but excluding Sublicensed Technology. 
  
 1.16 “Valid Claim” shall mean any claim of an issued patent which has not been held invalid or unenforceable in an unappealed or unappealable by
right decision by a court of competent jurisdiction, or a claim of a pending foreign patent application which has been pending not more than five years from its filing date in the country in which it is pending. 
  

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 ARTICLE II. GRANT 
  

2.1 CMCC hereby grants to Licensee and its Affiliates the worldwide right and exclusive license, including the right to grant sublicenses, under the
Licensed Patent Rights to make, have made, use, market, lease, import, offer for sale, sell and otherwise commercialize the Licensed Products and to practice the Licensed Processes in the Field of Use to the end of the term for which the Patent
Rights are granted, unless sooner terminated as provided in this Agreement. 
  
 2.2 CMCC hereby grants to Licensee and its Affiliates the worldwide right and license, with the right to grant sublicenses exclusively under the Sublicensed Technology in the Field of Use and hereby further grants to
Licensee and its Affiliates the worldwide right and license, with the right to grant sublicenses nonexclusively under the Technology (except for the Patent Rights, for which the license is exclusive), to make, have made, use, market, offer to sell,
sell, import or otherwise commercialize Licensed Products and to practice the Licensed Processes. Nothing in this grant, however, shall prevent CMCC from disseminating information included within the Sublicensed Technology or the Technology solely
for non-commercial research purposes with Licensee’s prior written consent, which shall not be unreasonably withheld or delayed, so long as Licensee’s commercial interests are not prejudiced by such dissemination. 
  
 2.3 The licenses granted hereunder shall not be construed to confer rights
upon Licensee by implication, estoppel, or otherwise as to any technology not specifically encompassed by the terms Technology and Sublicensed Technology. It is agreed and understood that the licenses granted hereunder do not confer any right upon
Licensee to any technology owned or controlled by Pharm-Eco Laboratories, Inc., including but not limited to any technology relating to [**] the NCE’s, and that may be known to CMCC. 
  
 2.4 Notwithstanding anything above to the contrary, CMCC shall retain a royalty free, nonexclusive, irrevocable license to
practice (including the right to have made solely for its own non-commercial research purposes) the Sublicensed Technology and the Technology for non-commercial research purposes only, and to provide materials under the Sublicensed Technology and
the Technology to other non-profit research organizations under material transfer agreements which provide that such materials shall be used solely for non-commercial research purposes only; provided however, that if Licensee has notified
CMCC in writing that a particular compound or compounds are being considered as potential clinical compound candidates, CMCC shall not distribute such clinical candidate compounds to any third party without Licensee’s written consent.

  
 2.5 Notwithstanding anything above to the contrary, the
license granted hereunder shall be subject to the rights of the United States government, if any, under Public Laws 96-517, 97-226, and 98-620, codified at 35 U.S.C. sec. 200-212 and any regulations promulgated thereunder. 
  
 2.6 The granting and acceptance of this Agreement is subject to
“Harvard’s Statement of Policy in Regard to Inventions, Patents and Copyrights” dated March 17, 1986; and (ii) Public Law 96-517 and Public Law 98-620. Nothing in this Agreement shall prevent HARVARD, 

  

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CMCC or their employees from seeking additional funding; however, in no event shall any rights under an agreement with non-profit or non-commercial sponsors
of research conflict with or affect in any way the right and license granted hereunder to Licensee by CMCC. Any rights granted in this Agreement greater than permitted under Public Law 96-517, 97-226 or 98-620 shall be subject to modifications as
may be required to conform to provisions of those statutes. 
  
 2.7 Licensee agrees that HARVARD retains the right to make and to use the information and technology relating to the Sheffield Patent Rights set forth in Appendix B for research purposes only and not for any commercial purpose. In the event
that, pursuant to Section 3.5 of the license agreement between Ion Pharmaceuticals, Inc., and CMCC dated July 1999, ION notifies CMCC of the name and address of the scientist and the not-for-profit institution to which HARVARD has transferred any
materials comprising the Sublicensed Technology, then CMCC shall promptly notify Licensee of such name and address. 
  
 2.8 Licensee understands and agrees that the licenses granted hereunder will be revoked if the activities of Licensee, its Sublicensees, Affiliates or
agents under the licenses granted in this Section II infringe upon NEWCO’s Field of Use. By “infringe,” it is meant that Licensee, its Sublicensees, Affiliates or agents conduct a clinical trial, advertise or sell a product for use in
NEWCO’s Field of Use or engage in activities which are determined, by a competent court or administrative body from which no further appeal can be or has been taken, to infringe, directly, contributorily or as inducement, the Sheffield Patent
Rights in NEWCO’s Field of Use. 
  
 2.9 Licensee agrees that
Licensed Products leased or sold in the United States shall be manufactured substantially in the United States. 
  
 2.10 In order to establish exclusivity for Licensee, CMCC hereby agrees that it shall not, without Licensee’s prior written consent, grant to any
other party a license to make, have made, use, lease, import, offer for sale and/or sell Licensed Products or to use the Licensed Processes in the Field of Use during the period of time in which this Agreement is in effect, except as otherwise
specified in this Agreement or as required by law to grant rights to the United States Government. 
  
 ARTICLE III. SUBLICENSING 
  
 3.1 Licensee shall have the right to enter into sublicensing agreements with respect to any of the rights, privileges, and licenses granted hereunder, subject to the terms and conditions hereof. Such sublicenses will
terminate upon the termination of Licensee’s rights granted herein unless events of default are cured by Licensee or Sublicensee within [**] days of notification by CMCC of default and/or as provided by the terms of this Agreement. Any
sublicensing agreement shall include an audit right by HARVARD of the same scope as provided by Article VI hereof. No such sublicensing agreement shall contain any provision which would cause it to extend beyond the term of this Agreement.

  
 3.2 Licensee agrees that any sublicense granted by it shall
provide that the obligations to CMCC of Articles II (Grant), VI (Reports and Records), VIII (Infringement), IX (Insurance and Indemnification), XII (Export Controls), XIII (Non Use of Names), XIV (Assignment), XV (Dispute Resolution), XVI (Term and
Termination) and XVIII (Miscellaneous Provisions) of this 

  

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Agreement shall be binding upon the sublicensee as if it were a party to this Agreement. Licensee further agrees to attach a copy of this Agreement to all
sublicense agreements. 
  
 3.3 Licensee agrees to provide to CMCC
notice of any sublicense granted hereunder and to forward to CMCC promptly upon execution a copy of any and all fully executed sublicense agreements. Licensee further agrees to forward to CMCC annually a copy of such reports received by Licensee
from its sublicensees during the preceding twelve (12) month period as shall be pertinent to a royalty accounting under the applicable sublicense. 
  
 3.4 All sublicenses granted by Licensee hereunder shall include a requirement that the sublicensee use its commercially reasonable efforts to bring the
subject matter of the sublicense into commercial use as promptly as is reasonably possible. 
  
 3.5 Licensee shall advise CMCC in writing of any consideration received from sublicensees under this Agreement. Licensee shall not accept from any sublicensee anything of value in lieu of cash payments to discharge
sublicensee’s payment obligations under any sublicense granted under this Agreement, without the express written permission of CMCC, which permission shall not be unreasonably withheld. 
  
 3.6 CMCC agrees that if Licensee has provided to CMCC notice that Licensee
has granted a sublicense to a sublicensee under this Agreement, then in the event CMCC terminates this Agreement for any reason, CMCC shall provide to such sublicensee no less than thirty (30) days prior to the effective date of said termination,
written notice of said termination at the address specified by Licensee to CMCC in Licensee’s notice to CMCC under Paragraph 3.3 of this Article III. CMCC agrees that upon the sublicensee’s notice as described below and provided the
sublicensee is not in breach of its sublicense, CMCC shall grant to such sublicensee license rights and terms equivalent to the sublicense rights and terms which the Licensee shall have granted to said sublicensee; provided that the sublicensee
shall remain a sublicensee under this Agreement for a period of at least sixty (60) days following receipt of notice from CMCC. Sublicensee shall during said sixty (60) day period provide to CMCC notice wherein the sublicensee: (i) reaffirms the
terms and conditions of this Agreement as it relates to the rights the sublicensee has been granted under the sublicense; (ii) agrees to abide by all of the terms and conditions of this Agreement applicable to sublicensees and to discharge directly
all pertinent obligations of Licensee as it relates to the sublicense which Licensee is obligated hereunder to discharge; and (iii) acknowledges that CMCC shall have no obligations to the sublicensee other than its obligations set forth in this
Agreement with regard to Licensee. 
  
 ARTICLE IV. DUE DILIGENCE

  
 4.1 Licensee (either directly or through Affiliates,
contractees or Sublicensees) shall use its good faith and diligent efforts to bring one or more Licensed Products and/or Licensed Processes to market as soon as reasonably practicable, consistent with sound and reasonable business practices and
judgment. Thereafter, Licensee agrees that until expiration or termination of this Agreement, Licensee shall continue active and diligent efforts to keep Licensed Products and/or Licensed Processes reasonably available to the public. In the event
Licensee decides not to exploit a Licensed Patent Right in a particular country, it shall promptly inform CMCC in writing and shall surrender to CMCC its license to that Licensed Patent Right in that country. 
  

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 4.2 The parties acknowledge that Licensee has provided to CMCC prior to the date of execution of this
Agreement a written commercialization development plan (“Development Plan”) setting forth the initial indications and markets for Licensed Products and Licensed Processes, including to the extent practicable: (i) time-delimited targets for
pre-clinical development, clinical trials, regulatory approval, manufacturing and marketing that represent reasonable efforts, consistent with industry norms for similar technology and applications, to bring Licensed Products and Licensed Processes
to the marketplace; and (ii) actual or projected financial resources and/or strategic alliances that will be required to implement the Development Plan. The Development Plan is attached hereto as Appendix C and is hereby incorporated herein by
reference. 
  
 4.3 Licensee and any Sublicensee or Affiliate shall
use its good faith and diligent efforts to accomplish the milestones set forth in the Development Plan and to manufacture and distribute Licensed Products and Licensed Processes. 
  
 4.4 CMCC shall not unreasonably withhold its assent to any revision of the objective(s) set forth in the Development Plan
when requested in writing by Licensee and supported by reasonable evidence: (i) of technical difficulties or delays in the clinical studies or regulatory process that Licensee could not have reasonably avoided; or (ii) that Licensee, its Affiliates
and/or Sublicensees have expended good faith and diligent efforts and adequate resources to meet said objective. 
  
 4.5 In the event CMCC reasonably believes that Licensee is not reasonably and diligently seeking to achieve the objectives set forth in the Development
Plan in a timely manner, CMCC shall so notify Licensee in writing. Licensee shall have the option, exercisable by written notice to CMCC provided within ten (10) days after receipt of any such notice, to either: (i) receive a [**] grace period to
reasonably establish that Licensee is expending its good faith and diligent efforts and adequate resources to achieve said objectives; or (ii) agree to CMCC’s termination of this Agreement as provided hereafter. In the event Licensee agrees to
termination of this Agreement, CMCC shall immediately terminate the license granted to Licensee under this Agreement. In the event Licensee fails to reasonably establish its diligence as provided above prior to expiration of the [**] grace period,
CMCC shall have the right to terminate the license granted to Licensee under this Agreement or to convert the license granted to Licensee hereunder to a nonexclusive license on financial terms and conditions mutually agreed to by CMCC and Licensee.

  
 4.6 In the event that CMCC believes that Licensee fails to
meet the objective(s) set forth in the Development Plan in a timely manner, CMCC shall notify Licensee thereof in writing, and Licensee shall have [**] days following such notification to establish to that (i) it has met such objective(s); or (ii) a
revision to the Development Plan is necessary and appropriate as contemplated above. In the event that Licensee fails to reasonably establish that it has met such objectives and Licensee has not submitted a revision to the Development Plan, then the
issue of whether the objectives have been met shall be submitted to arbitration in accordance with the provisions of Article XV of this Agreement and this Agreement shall remain in effect until the arbitrator renders a decision and for a period
thereafter sufficient to carry out the decision. In the event Licensee fails to reasonably establish that the objectives have been met and has submitted a revision to the development plan, but Licensor reasonably believes Licensee 

  

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has failed to reasonably establish the need for such revision to the Development Plan and the appropriateness of such revision, the issues of whether the
objectives have been met and the need for and scope of the revision shall be submitted to arbitration in accordance with the provisions of Article XV of this Agreement. In such case, the revision shall be given immediate effect. This Agreement,
including such revision, shall remain in effect until the arbitrator renders a decision and for a period thereafter sufficient to carry out the decision. In considering the issues of need for and scope of the revision, the arbitrator shall be guided
by considerations of the actual cause of the need for revision so that if the need for revision occurs despite the good faith efforts consistent with industry norms of Licensee, then the arbitrator shall find in favor of Licensee, as to the need for
the revision. If the arbitrator does not find in favor of Licensee on whether the objectives have been met or on the need for a revision to the Development Plan, CMCC shall have the right in its discretion to, within [**] days of the
arbitrator’s decision, either terminate the license granted to Licensee under this Agreement or to convert the license granted to Licensee hereunder to a non-exclusive license on financial terms and conditions mutually agreed to by CMCC and
Licensee. 
  
 4.7 Licensee shall fund research at Children’s
Hospital in accordance with the terms of the Sponsored Research Agreement between Licensee and CMCC to be negotiated in good faith by the parties hereto. Such Sponsored Research Agreement shall include the terms set forth in Appendix D hereto. In
the event Licensee terminates the Sponsored Research Agreement within [**] years of its initiation without cause or Hospital terminates said agreement under Paragraphs 8 (b), (c), or (d) of that agreement, this License shall remain in full force
until such time and thereupon shall terminate. In the event Licensee terminates the Sponsored Research Agreement for cause as defined in Article 8 (d), (f), or (j), licenses or options granted pursuant to the Sponsored Research Agreement may not be
terminated by CMCC. 
  
 4.8 Licensee shall provide to CMCC and to
HARVARD written annual reports within sixty (60) days after June 30 of each calendar year which shall include but not be limited to: reports of progress on research and development, regulatory approvals, manufacturing, sublicensing, marketing and
sales during the preceding twelve (12) months as well as plans for the coming year (“Annual Plan”). If progress differs from that anticipated in the Annual Plan, Licensee shall explain the differences and propose a modified plan for
HARVARD’s review. If HARVARD is dissatisfied with the modified plan, then HARVARD and Licensee shall meet to develop a mutually agreed upon plan. HARVARD has agreed to maintain as confidential all information designated as confidential by
Licensee which is provided to HARVARD under this Paragraph. HARVARD has agreed not to use such confidential information for any purpose other than the evaluation of CMCC’s or Licensee’s compliance under this Agreement and agrees not to
disclose such information to anyone who is not a direct employee of HARVARD’s Office of Technology and Licensing or who has not signed a non-disclosure agreement with HARVARD covering the confidential information, which shall be in form and
substance reasonably acceptable to CMCC and Licensee. Copies of such nondisclosure agreements shall be provided to CMCC and Licensee promptly after execution. 
  

4.9 HARVARD shall have the right to terminate or render this Agreement non- exclusive, only as to the Appendix B Licensed Patent Rights, if CMCC or
Licensee, or one of Licensee’s Affiliates or Sublicensees are not engaged in research, development, clinical trials, product approval, manufacturing, or marketing of Licensed Products or Licensed Processes, or 

  

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licensing of the Appendix B Licensed Patent Rights. Prior to invoking the right to terminate or render this Agreement non-exclusive, HARVARD shall give
written notice to CMCC and to Licensee and a [**] opportunity for CMCC or Licensee to demonstrate that it, its affiliate, or sublicensee is using reasonable efforts to comply with its obligations under this Paragraph. If after the [**] period, CMCC
or Licensee fail to demonstrate such compliance, HARVARD may notify CMCC and Licensee of its intent to either terminate or render this Agreement non-exclusive only as to the Appendix B Licensed Patent Rights. 
  
 4.10 Subject to the other provisions of this Article IV, CMCC’s sole
remedy for Licensee’s failure to meet its obligations under this Article IV shall be termination of this Agreement. 
  
 ARTICLE V. ROYALTIES AND OTHER PAYMENTS 
  
 5.1 For the rights, privileges and exclusive licenses granted hereunder, Licensee shall pay to CMCC the following amounts in the manner hereinafter
provided until the end of the term of the last to expire Licensed Patent Right, unless this Agreement shall be sooner terminated as hereinafter provided: 
  
 (a) A license issue fee of [**] Dollars ($[**]), which license issue fee shall be deemed earned on the date of the execution of this
Agreement. 
  
 (b) A License Maintenance Fee of
[**] Dollars ($[**]),[**] Dollars ($[**]) of which shall be payable within [**] days of the first anniversary of the date of execution of this License Agreement and, [**] Dollars ($[**]) of which shall be payable [**] thereafter. 
  
 (c) Licensee shall make the following milestone payments to
CMCC upon the completion of the following events by Licensee (“Licensee Milestones”): 
  
 (i) Payment of [**] Dollars ($[**]) upon [**] by Licensee, but not more than one payment shall be required for each Licensed Product or
Licensed Process in the event that more than one [**] is required for the same Licensed Product or Licensed Process. 
  
 (ii) Payment of Two Hundred Thousand Dollars ($[**]) upon [**] with respect to a Licensed Product or a Licensed Process. 
  
 (iii) The Licensee Milestones will be creditable toward
running royalties due CMCC for Net Sales by Licensee, up to, and no more than, [**]% of the Net Sales due in any given payment period. 
  
 (iv) Notwithstanding anything to the contrary herein, it is understood by the parties that if Licensee ceases to develop a Licensed
Product or Licensed Process prior to the payment of all milestones specified in this paragraph 5.1 (such Licensed Product being referred to as a “Canceled Product”) and Licensee decides to develop a different Licensed Product or Licensed
Process for the same labeled indication as the Canceled Product, then Licensee shall, with respect to 

  

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such other Licensed Product or Licensed Process, be obligated to pay only that/those milestone payment(s) which were not made with respect to the Canceled
Product; provided however, that if Licensee does at some time in the future develop such canceled product, then appropriate and prompt adjustment with respect to milestone payments shall be made hereunder. 
  
 (d) Running royalties on a country-by-country basis in an
amount equal to [**] percent ([**]%) of Net Sales by Licensee or an Affiliate of Licensed Products or Licensed Processes derived from a new chemical entity disclosed by CMCC to Licensee and which, but for this Agreement would infringe a Valid Claim
of the Licensed Patent Rights. Running royalties on a country-by-country basis in an amount equal to [**] percent ([**]%) of Net Sales by Licensee or an Affiliate of Licensed Products or Licensed Processes derived from a new chemical entity
discovered by Licensee or its Affiliate and which, but for this Agreement would infringe a Valid Claim of the Licensed Patent Rights. 
  
 5.2 In the event Licensee or its Affiliate has granted sublicenses under this Agreement, Licensee or its Affiliate will pay CMCC [**] percent ([**]%) of
Gross Compensation received by Licensee or its Affiliate from said Sublicensees on a country-by-country basis for Licensed Products or Licensed Processes derived from a new chemical entity disclosed by CMCC to Licensee or its Affiliate which, but
for this Agreement would infringe a Valid Claim of the Licensed Patent Rights in the country, and [**] percent ([**]%) of Gross Compensation received by Licensee or its Affiliate from said Sublicensees for Licensed Products or Licensed Processes
derived from a new chemical entity discovered by Licensee, its Affiliate or Sublicensee, and which, but for this Agreement would infringe a Valid Claim of the Licensed Patent Rights in the country. 
  
 5.3 No multiple royalties shall be payable because any Licensed Product or
Licensed Process, its manufacture, use, lease or sale which, but for this Agreement would infringe a Valid Claim of more than one patent licensed under this Agreement. 
  
 5.4 To the extent that Licensee or its Affiliates obtains subsequent to the date of this Agreement licenses to third party
patents or other intellectual property that it or they reasonably believes are necessary to produce or sell Licensed Products or Licensed Processes, Licensee may deduct from the running royalty on Net Sales due to CMCC [**] percent [**]%) of the Net
Sales as appropriate on a country by country basis due in respect of such third party patents or intellectual property, but only up to an amount equal to [**] percent ([**]%) of the Net Sales or share of Gross Compensation due hereunder for the same
payment period. 
  
 5.5 For purposes of calculating royalties, in
the event that a Licensed Product or Licensed Process includes both component(s) which, but for this Agreement would infringe a Valid Claim of the Licensed Patent Rights (“Patented Component”) and a component which is diagnostically
useable or therapeutically active alone or in a combination which does not require the Patented Component, and such component is not covered by a Valid Claim of a Licensed Patent Right (“Unpatented Component”), then Net Sales of the
Combination Product or Combination Process shall be calculated using one of the following methods; provided that in no 

  

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event shall royalties payable to CMCC hereunder be reduced to less than fifty percent (50%) of those otherwise due hereunder: 
  
 (a) By multiplying the Net Sales of the Combination Product
or Combination Process during the applicable royalty accounting period (“accounting period”) by a fraction, the numerator of which is the aggregate gross selling price of the Patented Component(s) contained in the Combination Product or
Combination Process if sold separately, and the denominator of which is the sum of the gross selling price of both the Patented Component(s) and the Unpatented Component(s) contained in the Combination Product or Combination Process if sold
separately; or 
  
 (b) In the event that no such
separate sales are made of the Patented Component(s) or the Unpatented Components during the applicable accounting period, Net Sales for purposes of determining royalties payable hereunder shall be calculated by multiplying the Net Sales of the
Combination Product or Combination Process by a fraction, the numerator of which is the fully allocated production cost of the Patented Component(s) and the denominator of which is the sum of the fully allocated production costs of the Patented
Component(s) and the Unpatented Component(s) contained in the Combination Product or Combination Process. Such fully allocated costs shall be determined by using Licensee’s standard accounting procedures, which procedures must conform to
standard cost accounting procedures. 
  
 5.6 Royalty payments
shall be paid in United States dollars in Boston, Massachusetts, or at such other place as CMCC may reasonably designate consistent with the laws and regulations controlling in any foreign country. If the currency conversion shall be required in
connection with the payments of royalties or other amounts hereunder, the conversion shall be made by using the exchange rate prevailing at the Bank of Boston on the last business day of the calendar quarterly reporting period to which such royalty
payments relate. 
  
 5.7 The royalty payments set forth in this
Agreement shall, if overdue, bear interest until payment at a per annum rate of four percent (4%) above the prime rate in effect at the Bank of Boston on the due date. The payment of such interest shall not foreclose CMCC from exercising any other
rights it may have as a consequence of the lateness of any payment. 
  
 ARTICLE VI. REPORTS AND RECORDS 
  
 6.1 Licensee shall
keep, and shall require its Affiliates and Sublicensees to keep, full, true and accurate books of account in accordance with generally accepted accounting principles and containing sufficient detail to enable CMCC to determine the royalty and other
amounts payable to CMCC under this Agreement. Said books of account shall be kept at Licensee’s principal place of business or the principal place of business of the appropriate division of Licensee to which this Agreement relates. Said books
and the supporting data shall be retained for at least three (3) years following the end of the calendar year to which they pertain. 
  
 6.2 Licensee agrees to permit an auditor selected by CMCC or HARVARD and reasonably acceptable to Licensee to have access, during the term of this
Agreement and for a period of three (3) years thereafter, and during ordinary business hours after reasonable advance 

  

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written notice to Licensee, to such records as may be necessary, in the opinion of such auditor, to determine the correctness of any report and/or payment
made under this Agreement. Such an auditor shall be at CMCC’s or HARVARD’s, as appropriate, expense and shall occur not more than once per year. The auditor shall treat all information to which it has access under this paragraph as
confidential and shall not disclose such information to any third party. 
  
 6.3 Licensee shall deliver to CMCC true and accurate reports by February 15th, for the period July 1 through December 31 of the previous year, and on August 15th, for the period January 1st through June 30th of the
current year, giving such particulars of the business conducted by Licensee, its Affiliates and its Sublicensees under this Agreement as shall be pertinent to a royalty accounting hereunder and to verify Licensee’s activities with respect to
achieving the objectives of the Development Plan described in Article IV above. These reports shall include at least the following: 
  

	 	1.	Gross Compensation received by Licensee by country. 

  

	 	2.	Noncash, nonliquid compensation portions of Gross Compensation. 

  

	 	3.	Amount calculated due to CMCC. 

  

	 	4.	Number of Licensed Products and Licensed Processes manufactured and sold. 

  

	 	5.	Aggregate billings for Licensed Products and Licensed Processes sold. 

  

	 	6.	Applicable deductions. 

  

	 	7.	Total royalties due. 

  

	 	8.	Names and addresses of all sublicensees of Licensee. 

  

	 	9.	Licensed Products manufactured and sold to the U.S. Government. No royalty obligations shall arise from sales or use by, for or on behalf of the U.S. Government in view of a
royalty-free, nonexclusive license that may heretofore have been granted to the U.S. Government. 

  
 6.4 With each such report submitted under subparagraph 6.3, Licensee shall pay to CMCC the compensation due and payable under this Agreement. If no
payments shall be due, Licensee shall so report. 
  
 ARTICLE VII.
PATENT PROSECUTION 
  
 7.1 CMCC shall apply for, seek prompt
issuance of, and maintain during the term of this Agreement the Licensed Patent Rights set forth in Appendix A. CMCC shall be diligent in its participation in applying for, seeking prompt issuance of, and maintaining during the term of this
Agreement the Licensed Patent Rights set forth in Appendix B, as permitted under CMCC’s Agreement with HARVARD and HARVARD’s Agreement with ION. (HARVARD and ION make decisions jointly respecting the Licensed Patent Rights set forth in
Appendix B, and 

  

 -13- 

 
HARVARD has assigned its rights to make such joint decisions to CMCC.) The prosecution, filing and maintenance of all applications and patents on the
Licensed Patent Rights shall be the primary responsibility of CMCC. CMCC shall promptly provide Licensee with copies of all substantive correspondence received by CMCC or CMCC’s attorneys or agents from the U.S. Patent and Trademark Office or
any foreign patent office. Licensee shall have reasonable opportunities to advise CMCC and shall cooperate with CMCC in the prosecution, filing and maintenance of the Licensed Patent Rights. 
  
 7.2 Licensee shall reimburse to CMCC for Licensee’s proportional share
of fees and costs relating to the filing, prosecution and maintenance of the Licensed Patent Rights shown in Appendix A and Appendix B incurred after the date of this Agreement, which proportional share shall be the portion of the fees and costs
payable by CMCC, including any amounts payable by CMCC under the Assignment and Sublicense Agreement between CMCC and Ion Pharmaceuticals, Inc., dated September 14, 1999. CMCC shall provide to Licensee an itemized invoice of all such fees and
Licensee shall pay to CMCC all amounts due under said invoice within thirty (30) days of the date of said invoice. Licensee shall also reimburse CMCC for Licensee’s proportional share, as defined above, of fees and costs relating to the filing,
prosecution and maintenance of the Licensed Patent Rights shown in Appendix A and Appendix B incurred after July 21, 1998 and before the Effective Date of this Agreement, up to a maximum of $15,000. Licensee shall have the right to request,
on a case-by-case and country-by-country basis that a particular action due in such case in such country not be carried out. Such request shall be made no later than the later to occur of thirty (30) days before the due date of such action or thirty
(30) days after Licensee receives notice of such due date. Such timely request shall relieve Licensee of its obligation of payment for such action. In the event that Licensee makes such a request concerning a particular case in a particular country,
Licensee’s license hereunder solely as to that particular case in that particular country shall terminate. 
  
 7.3 In the event CMCC elects not to pursue, maintain or retain a particular Licensed Patent Right licensed to Licensee hereunder, CMCC shall so notify
Licensee in sufficient time for Licensee to assume the filing, prosecution and/or maintenance of such application or patent at Licensee’s expense. In such event, CMCC shall provide to Licensee any authorization necessary to permit Licensee to
pursue and/or maintain such Licensed Patent Right. Licensee shall have no further royalty obligations under this Agreement with respect to any such Licensed Patent Right. 
  
 ARTICLE VIII. INFRINGEMENT 
  
 8.1 Licensee and CMCC shall each inform the other promptly in writing of any alleged infringement known to it by a third party of the Licensed Patent
Rights in the Field of Use and of any available evidence thereof. 
  
 8.2 Subject to the ION/NEWCO Sublicense Agreement dated December 3, 1997, Licensee or its Affiliate or Sublicensee shall have the first right, but not the obligation, to institute and prosecute at its own expense any infringement of the
Licensed Patent Rights which falls, within the Field of Use. If Licensee, its Sublicensee or its Affiliate fails to bring such action or proceedings within a period of two (2) months after receiving written notice of the infringement or if within
such time Licensee notifies CMCC that it intends not to bring such action, then CMCC shall have the right, but not the obligation, to prosecute at its own expense 

  

 -14- 

 
any such infringement of the Licensed Patent Rights. If Licensee, its Affiliate or Sublicensee brings such action then Licensee may reduce, by up to
fifty percent (50%), the royalty due to CMCC which is earned under the Licensed Patent Rights by fifty percent (50%) of the amount of the expenses and costs of such action, including attorney fees. In the event that such
fifty percent (50%) of such expenses and costs exceeds the amount of royalties withheld by Licensee for any calendar year, Licensee may to that extent reduce the royalties due to CMCC from Licensee in succeeding calendar years, but
never by more than fifty percent (50%) of the royalty due in any one year. Recoveries or reimbursements from such action shall first be applied to reimburse CMCC, Licensee, its Affiliate, or its Sublicensee, ION and HARVARD, as
applicable, for litigation costs, and then to reimburse CMCC for royalties withheld. If CMCC brings such action, then any remaining recoveries or reimbursements shall be retained by CMCC, after payment of any amounts due to HARVARD pursuant to the
HARVARD/ION License Agreement. If Licensee, its Affiliate or its Sublicensee brings such action, then any remaining recoveries or reimbursements to CMCC by Licensee due shall be treated as Gross Compensation, after payment of any amounts due to
HARVARD pursuant to the HARVARD/ION License Agreement. Notwithstanding anything to the contrary in the foregoing, Licensee shall reimburse CMCC, ION or HARVARD, as appropriate, for any costs incurred by CMCC, ION or HARVARD as part of an action
brought by Licensee, its Affiliates or Sublicensees, irrespective of whether CMCC, ION or HARVARD become co-plaintiffs. CMCC shall reimburse Licensee for any costs Licensee incurs as part of an action brought by CMCC or its affiliates, irrespective
of whether Licensee becomes a co-plaintiff. 
  
 8.3 Licensee shall
have no right to institute or prosecute any infringement of the Sheffield Patent Rights which falls within NEWCO’s Field of Use. 
  
 8.4 Subject to the ION/NEWCO Sublicense Agreement dated December 3, 1997, in the event that NEWCO or its successors institutes an action for infringement
of the Licensed Patent Rights in Licensee’s Field of Use, CMCC hereby assigns to Licensee any recoveries due to CMCC resulting from such action. 
  
 8.5 If CMCC is deemed to be an indispensable party in a suit brought by Licensee, pursuant to this paragraph, CMCC agrees to be named as a co-plaintiff.
If HARVARD or ION is deemed to be an indispensable party in a suit brought by Licensee pursuant to this paragraph, then CMCC will endeavor to secure ION’s and HARVARD’s agreement to be named as a co-plaintiff. 
  
 8.6 In the event that a declaratory judgment action alleging invalidity,
unenforceability or noninfringement of any of the Licensed Patent Rights shall be brought against Licensee, CMCC, at its option, shall have the right, within thirty (30) days after commencement of such action, to intervene and participate in the
defense of the action at its own expense. 
  
 8.7 In any
infringement suit which either party may institute to enforce the Licensed Patent Rights pursuant to this Agreement, the other party hereto shall, at the request and the expense of the party initiating such suit, cooperate in all reasonable respects
and, to the extent reasonably possible, have its employees testify when requested and make available relevant records, papers, information, samples, specimens, and the like. 
  

 -15- 

 8.8 Licensee shall during the exclusive period of this Agreement have the sole right subject to the terms
and conditions hereof to sublicense any alleged infringer for future use of the Licensed Patent Rights. Any up-front fees paid to Licensee as part of such a sublicense shall be treated as Gross Compensation as set forth in Article V. 
  
 8.9 If a third party obtains a judgment (consent or otherwise) against
Licensee or its Affiliate, as applicable, or obtains a settlement agreement from Licensee or its Affiliate, as applicable, for infringement of a patent based on the manufacture, use, offer to sell, sale, lease or importation of Licensed Products or
Licensed Processes, the costs of Licensee’s or its Affiliate’s, as applicable, defense of the third party’s claims will be offset against fifty percent (50%) of the future royalties each year until Licensee or its
Affiliate, as applicable, is completely reimbursed for all attorneys fees, court costs, legal fees, damages and/or settlement amounts paid. In addition, in such event and upon payment by Licensee of all amounts due CMCC through the effective date of
termination, the Licensee or its Affiliate, against which the judgment is obtained or which enters into the settlement agreement shall have the right to immediately terminate this agreement as to itself. Upon such termination, CMCC shall have no
recourse against that Licensee or Affiliate, as applicable, for exercising its right to terminate. CMCC shall, at the request and expense of Licensee, its Affiliate or Sublicensee, as applicable cooperate with Licensee, its Affiliate or Sublicensee,
as applicable in any such third party action by making its employees available to testify and by producing relevant, non-privileged records, papers, information, samples, specimens and the like. CMCC shall endeavor to secure Harvard’s and
Ion’s consent to, at Licensee’s, its Affiliate’s or Sublicensee’s, as applicable, request and expense, cooperate with Licensee, its Affiliate or Sublicensee, as applicable in any such third party action by making its employees
available to testify and by producing relevant, non-privileged records, papers, information, samples, specimens and the like. 
  
 8.10 In the event that a governmental agency in any country or territory compels CMCC to grant a license, or Licensee, its Affiliate or Sublicensee, as
applicable, to grant a sublicense to any non-governmental third party under the Licensed Patent Rights, then Licensee, its Affiliate or Sublicensee, as applicable, shall have the benefit during the term of such license, in such territory or country
only, of any of the terms granted to such third party which are more favorable than the terms set forth in this Agreement, only if the third party is actually and substantially commercializing Licensed Products or Licensed Processes. This provision
shall apply to a license granted to a governmental agency only if that governmental agency grants a sublicense to a non-governmental third party. 
  
 ARTICLE IX. UNIFORM INDEMNIFICATION 
 AND
INSURANCE PROVISIONS 
  
 9.1 Each party shall promptly notify the
other of any claim, lawsuit, or other proceeding related to the Licensed Patent Rights. Licensee shall indemnify, defend and hold harmless CMCC, its corporate affiliates, current or future directors, trustees, officers, faculty, medical and
professional staff, employees, students and agents and their respective successors, heirs and assigns (the “Indemnitees”), against any liability, damage, loss or expense (including reasonable attorney’s fees and expenses of
litigation) incurred by or imposed upon the Indemnitees or any one of them in connection with any claims, suits, actions, demands or judgments arising out of any theory of product liability (including, but not limited to, actions in 

  

 -16- 

 
the form of tort, warranty, or strict liability) concerning any product, process or service made, used or sold pursuant to any right or license granted under
this Agreement. Any Indemnitee shall promptly notify Licensee of any suit, claim or action for which indemnification may be sought. Licensee shall have the right, but not the obligation, at its own expense, to control the defense of any such suit,
claim or action. Indemnitees shall not settle any such suit, claim or action without Licensee’s consent. Licensee’s indemnification hereunder shall not apply to any liability, damage, loss or expense to the extent that it is directly
attributable to the negligent activities, deliberate misrepresentations or willful misconduct of the Indemnitees or Additional Indemnities. 
  
 9.2 Licensee or Licensee’s Sublicensees and Affiliates shall indemnify, defend and hold harmless ION and its officers, employees, directors,
affiliates and agents and HARVARD and its trustees, officers, medical and professional staff, employees, students and agents and ION’s and HARVARD’s respective successors, heirs and assigns (the “Additional Indemnitees”) from and
against any liability, damage, loss or expense (including reasonable attorneys’ fees and expenses of litigation) incurred by or imposed upon any of the Additional Indemnitees in connection with any claims, actions, suits, demands, judgments or
other proceeding relating to this Agreement and arising out of the design, manufacture, sale, use in commerce, lease or promotion by Licensee, its Affiliates, Sublicensees or agents, of any product, process or service relating to, or developed
pursuant to, this Agreement. Any Additional Indemnitee seeking indemnification hereunder shall promptly notify Licensee of any suit, claim or action for which indemnification may be sought. Licensee shall have the right, but not the obligation, at
its own expense, to control the defense of any such suit, claim or action, using attorneys reasonably acceptable to Harvard. Additional Indemnitees shall not settle any such suit, claim or action without Licensees consent, which consent shall not be
unreasonably withheld or delayed. Licensee’s indemnification hereunder shall not apply to any liability, damage, loss or expense to the extent that it is directly attributable to the negligent activities, deliberate misrepresentations or
willful misconduct of the Indemnitees or Additional Indemnities. 
  
 9.3 Licensee agrees, at its own expense, to provide attorneys reasonably acceptable to CMCC to defend against any actions brought or filed against any party indemnified hereunder with respect to the subject of indemnity contained herein,
whether or not such actions are rightfully brought. 
  
 9.4 (a)
During the period of time in which research or development for any Licensed Products or Licensed Process is conducted on the premises of Licensee, its Affiliates or Sublicensees, and during the period of time in which any clinical trials are being
conducted for any Licensed Products or Licensed Processes, Licensee, its Affiliates or Sublicensees shall at its sole cost and expense, shall have procured and maintained policies of comprehensive general liability insurance with a nationally
recognized carrier in amounts not less than $2,000,000 per incident and $2,000,000 annual aggregate. Such insurance policies shall name each of CMCC, ION and HARVARD as additional insured parties with the same scope of coverage for each coverage
required for Licensee. 
  
 9.4(b) Beginning at the time as any
such product, process or service is being commercially distributed or sold (other than for the purpose of obtaining regulatory approvals) by Licensee or by a Sublicensee, Affiliate or agent of Licensee, Licensee shall, at its sole cost 

  

 -17- 

 
and expense, procure and maintain commercial general liability insurance in amounts not less than $2,000,000 per incident and $2,000,000 annual aggregate and
naming the Indemnitees, ION and HARVARD as additional insureds. Such commercial general liability insurance shall provide (i) product liability coverage and (ii) contractual liability coverage for Licensee’s indemnification under Article IX,
Paragraphs 9.1 through 9.3 of this Agreement. 
  
 9.4(c) If
Licensee elects to self-insure all or part of the limits described above in 9.4(a) and 9.4(b) (including deductibles or retentions which are in excess of $250,000 annual aggregate), such self-insurance program must be acceptable to CMCC and the Risk
Management Foundation of the Harvard Medical Institutions, Inc. The minimum amount of insurance coverage required under this Article IX, Paragraph 9.4 shall not be construed to create a limit of Licensee’s liability with respect to its
indemnification under Article IX, Paragraphs 9.1 through 9.3 of this Agreement. 
  
 9.5 Licensee shall provide CMCC with written evidence of such insurance upon request of CMCC. Licensee shall provide CMCC with written notice at least thirty (30) days prior to the cancellation, non-renewal or
material change in such insurance. If Licensee does not obtain replacement insurance providing comparable coverage within such thirty (30) day period, CMCC shall have the right to terminate this Agreement effective at the end of such thirty (30) day
period without notice of any additional waiting periods. 
  
 9.6
Licensee shall maintain such commercial general liability insurance during (i) the period that any such product, process or service is being commercially distributed or sold (other than for the purpose of obtaining regulatory approvals) by Licensee
or by a Sublicensee, Affiliate or agent of Licensee and (ii) a reasonable period after the period referred to above, which in no event shall be less than fifteen (15) years. 
  
 9.7 Article IX, Paragraphs 9.1 through 9.6 shall survive expiration or termination of this Agreement. 
  
 9.8 OTHER THAN WARRANTIES SET FORTH HEREIN, CMCC MAKES NO WARRANTY, EXPRESS
OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTY OF MERCHANTABILITY OR ANY IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO ANY PATENT, TRADEMARK, SOFTWARE, TRADE SECRET, TANGIBLE RESEARCH PROPERTY, INFORMATION OR
DATA LICENSED OR OTHERWISE PROVIDED TO LICENSEE HEREUNDER AND HEREBY DISCLAIMS THE SAME. 
  
 ARTICLE X. CMCC REPRESENTATIONS WARRANTIES AND COVENANTS 
  
 10.1 CMCC warrants that it has the lawful right and authority to enter into this Agreement without the consent or authority of another person or entity. 
  
 10.2 CMCC warrants that it owns or has rights in the Licensed Patent Rights sufficient to allow it to grant the licenses
granted hereunder without conflict with or violation of any agreement between CMCC and any third party. 
  

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 10.3 CMCC warrants that to the best of the knowledge of CMCC’s Intellectual Property Office, the
Licensed Patent Rights are in good standing, i.e., that all proper assignments have been made transferring to CMCC its proper interest right, title and interest in the Licensed Patent Rights, that all annuities have been paid in respect of
the Licensed Patent Rights, and that none of the Licensed Patent Rights is the subject of any protest, opposition, interference, re-examination, reissue, litigation, or any other inter parties proceeding. 
  
 10.4 CMCC warrants that to the best of the knowledge of CMCC’s
Intellectual Property Office, as of the Effective Date of this Agreement the Licensed Patent Rights constitute all the patents and patent applications with a CMCC inventor common to the Licensed Patent Rights owned by it that, but for this agreement
would be infringed by the manufacture, offer to sell, sale, use, lease or importation of Licensed Products. 
  
 10.5 CMCC warrants that it has provided to Licensee true and correct copies of all agreements (“the Relevant Agreements”) in its possession,
including any amendments or modifications thereto, that actually or potentially affect any right, title or interest in the Licensed Patent Rights. Appendix E is a list of all such Relevant Agreements. 
  
 10.6 CMCC covenants that it will not, without Licensee’s consent, modify
any of the Relevant Agreements or take any action thereunder in a manner which would affect Licensee’s rights under the Licensed Patent Rights. 
  
 ARTICLE XI. CONFIDENTIALITY 
  
 11.1 Each Party shall keep confidential all confidential information of the other Party, or as applicable its Affiliates or Sublicensees communicated to
such Party, or as applicable its Affiliates or Sublicensees pursuant to this Agreement. For purposes of this Section, information shall be deemed to be communicated to CMCC only if such information is communicated to CMCC’s Office of
Technology. CMCC shall not undertake obligations of confidentiality for information communicated by Licensee to CMCC employees other than Office of Technology staff. The confidentiality obligations of either party shall not apply, however, to:

  
 (a) information which is generally available
to the public or which becomes available to the public through no fault of the receiving party, or as applicable its Affiliates or Sublicensees; 
  
 (b) information that is required by law to be disclosed by the receiving Party, or as applicable its Affiliates or Sublicensees, provided
that such Party has advised the other Party, or as applicable its Affiliates or Sublicensees, of the demand, subpoena, interrogatory or other legal process sufficiently in advance of such disclosure as to allow the other Party, or as applicable its
Affiliates or Sublicensees to attempt to obtain a protective order or other remedy, if available, and if such Party, or as applicable its Affiliates or Sublicensees does obtain such a remedy, the information shall continue to be treated as
confidential information; 
  
 (c) information
that was known or used by the receiving Party, or as applicable its Affiliates or Sublicensees prior to its disclosure to the receiving Party, or as 

  

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applicable its Affiliates or Sublicensees by the other Party, or as applicable its Affiliates or Sublicensees; 
  
 (d) information which is otherwise lawfully disclosed to the
receiving Party, or as applicable its Affiliates or Sublicensees by sources other than the other Party, or as applicable its Affiliates or Sublicensees who are rightfully in possession of such information and have no duty to keep such information
confidential; or 
  
 (e) information which is
independently developed, as evidenced by written documents, by or for the receiving party, or as applicable its Affiliates or Sublicensees, without reference to or reliance upon information communicated to such Party, or as applicable its Affiliates
or Sublicensees by the other Party. 
  
 11.2 Nothing in this
Section shall be construed as prohibiting Licensee from disclosing Confidential Information which Licensee, in its sound business judgment is reasonably necessary for the purpose of commercializing Licensed Products or Licensed Processes, including
without limitation, disclosure to business partners, potential business partners, government agencies, investors and potential investors. 
  
 ARTICLE XII. EXPORT CONTROLS 
  
 It is understood that CMCC is subject to United States laws and regulations controlling the export of technical data, computer software, laboratory
prototypes and other commodities (including the Arms Export Control Act, as amended and the Export Administration Act of 1979), and that its obligations hereunder are contingent on compliance with applicable United States export laws and
regulations. The transfer of certain technical data and commodities may require a license from the cognizant agency of the United States Government and/or written assurances by Licensee that Licensee shall not export data or commodities to certain
foreign countries without prior approval of such agency. CMCC neither represents that a license shall not be required, nor that if required, it shall be issued Licensee is responsible for taking any steps necessary to comply with such regulations.

  
 ARTICLE XIII. NON-USE OF NAMES 
  
 13.1 Use of Names. Licensee agrees that it and its sublicensees may
not use in any way, nor permit any other party to use in any way, the names “Children’s Medical Center Corporation”, “CMCC”, “ION,” “SHEFFIELD,” “HARVARD COLLEGE,” “HARVARD” or any
logotypes or symbols associated with CMCC, HARVARD, ION, or SHEFFIELD or the names of any of their corporate affiliates, nor any adaptation thereof, nor the name of any employee at CMCC or HARVARD, without the prior written consent of ION,
SHEFFIELD, HARVARD or CMCC (in the case of ION, SHEFFIELD, HARVARD, CMCC, as appropriate; except that such obligation of Licensee under this Paragraph 11.1, shall not apply to information (i) that Licensee or its sublicensees determines in its sole
discretion to be necessary and appropriate to satisfy its disclosure and other obligations under federal or state law, or (ii) any and all data or research work product derived or resulting from the Technology or Sublicensed Technology for the sole
purpose of complying with federal and state laws and regulatory 

  

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requirements. Licensee may state that it is licensed by CMCC under one or more patents or patent applications of the Licensed Patent Rights. 
  
 ARTICLE XIV. ASSIGNMENT 
  
 14.1 Except as otherwise provided herein, this Agreement is not assignable in
whole or in part, and any attempt to do so shall be void and of no effect. 
  
 14.2 CMCC may assign this Agreement at any time to any corporate affiliate of CMCC without the prior consent of Licensee. 
  
 14.3 Except as provided in Article XIV, Paragraph 14.4 below, Licensee may assign this Agreement to another entity only with the prior written consent of
CMCC, which consent shall not be unreasonably withheld or delayed. 
  
 14.4 Notwithstanding anything herein to the contrary, in the event Licensee merges with another entity, is acquired by another entity, or sells all or substantially all of its assets related to Licensed Products and Licensed Processes to
another entity, Licensee may assign its rights and obligations hereunder to, in the event of a merger or acquisition, the surviving entity, and in the event of a sale, the acquiring entity, without CMCC’s consent so long as: (i) Licensee is not
then in breach of this Agreement; (ii) the proposed assignee has a net worth at least equivalent to the net worth Licensee had as of the date of this Agreement; (iii) the proposed assignee has available resources and sufficient scientific, business
and other expertise comparable to Licensee in order to satisfy its obligations hereunder; (iv) Licensee provides written notice of the assignment to CMCC, together with documentation sufficient to demonstrate the requirements set forth in
subparagraphs (i) through (iii) above, at least twenty (20) days prior to the effective date of the assignment; and (v) CMCC receives from the assignee, in writing, at least ten (10) days prior to the effective date of the assignment: (a)
reaffirmation of the terms of this Agreement; (b) an agreement to be bound by the terms of this Agreement; and (c) an agreement to perform the obligations of Licensee under this Agreement. Any such notices or documentation received by CMCC hereunder
shall be held in confidence by CMCC and shall not be disclosed by CMCC to any third party. 
  
 ARTICLE XV. DISPUTE RESOLUTION AND ARBITRATION 
  
 15.1 Except for the right of either party to apply to a court of competent jurisdiction for a temporary restraining order, a preliminary injunction, or other equitable relief to preserve the status quo or prevent
irreparable harm, any and all claims, disputes or controversies arising under, out of, or in connection with the Agreement, including any dispute relating to patent validity or infringement, which the parties shall be unable to resolve within sixty
(60) days shall be resolved by final and binding arbitration in Boston, Massachusetts, in accordance with the rules of the American Arbitration Association (“AAA”) then obtaining. The arbitration shall be the exclusive forum for resolving
any such dispute and all expenses, in connection therewith (including without limitation the award of attorneys’ fees to the prevailing party), shall be paid as determined by the arbitrator. A single arbitrator shall be mutually agreed upon and
if the parties are unable to agree on a mutually acceptable arbitrator, an arbitrator shall be chosen in accordance with AAA rules. The decision of the arbitrator shall be final and binding upon the 

  

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parties hereto. Any award rendered in such arbitration shall be final and may be enforced by either party in either the courts of the Commonwealth of
Massachusetts or in the United States District Court for the District of Massachusetts, wherein subject matter jurisdiction properly resides, and each of CMCC and Licensee hereby consents and submits to exclusive personal jurisdiction in such forum.
The arbitrator shall have no power to add to, subtract from or modify any of the terms or conditions of this Agreement, nor to award punitive damages. 
  
 15.2 Notwithstanding the foregoing, nothing in this Article shall be construed to waive any rights or timely performance of any obligations existing under
this Agreement. 
  
 ARTICLE XVI. TERM AND TERMINATION 

 
 16.1 The term of this Agreement shall be (15) years or the life of the
last expiring Licensed Patent Right, whichever period is longer. 
  
 16.2 CMCC may terminate this Agreement immediately upon the bankruptcy, insolvency, liquidation, dissolution or cessation of operations of Licensee; or the filing of any voluntary petition for bankruptcy, dissolution, liquidation or
winding-up of the affairs of Licensee; or any voluntary assignment by Licensee for the benefit of creditors; or the filing of any involuntary petition for bankruptcy, dissolution, liquidation or winding-up of the affairs of Licensee which is not
dismissed within ninety (90) days of the date on which it is filed or commenced. 
  
 16.3 CMCC may terminate this Agreement upon thirty (30) days prior written notice in the event of Licensee’s failure to pay to CMCC royalties due and payable hereunder in a timely manner, unless Licensee shall
make all such payments to CMCC within said thirty (30) day period. Upon the expiration of the thirty (30) day period, if Licensee shall not have made all such payments to CMCC, the rights, privileges and licenses granted hereunder shall terminate.

  
 16.4 Except as otherwise provided in Paragraph 14.3 above,
CMCC may terminate this Agreement upon sixty (60) days prior written notice in the event of Licensee’s breach or default of any material term or condition or warranty contained in this Agreement, unless Licensee shall cure such breach within
said sixty (60) day period. Upon the expiration of the sixty (60) day period, if Licensee shall not have cured said breach, the rights, privileges and license granted hereunder shall terminate. 
  
 16.5 Licensee shall have the right to terminate this Agreement at any time
upon six (6) months’ prior written notice to CMCC, and upon payment by Licensee of all amounts due CMCC through the effective date of termination. 
  
 16.6 Upon termination of this Agreement for any reason, nothing herein shall be construed to release either party from any obligation that matured prior
to the effective date of such termination. Licensee and any sublicensee thereof may, however, after the effective date of such termination, sell all Licensed Products and complete Licensed Products in the process of manufacture at the time of such
termination and sell the same, provided that Licensee shall pay to CMCC the royalties thereon as required under this Agreement and shall submit the reports required under this Agreement on the sales of Licensed Products. 
  

 -22- 

 ARTICLE XVII. PAYMENTS, NOTICES, AND OTHER COMMUNICATIONS 
  
 17.1 All payments, notices, reports and/or other communications made in
accordance with this Agreement, shall be deemed effectively given on the date of delivery if delivered by hand, three (3) days deposit in certified or registered mail, or the next business day if sent by a national overnight business courier service
and addressed as follows: 
  
 In the case of CMCC: 
  
 Director, Technology Transfer 
 Office of Research Administration 
 Children’s Hospital 
 300 Longwood Avenue 
 Boston, MA 02115 
  
 In the case
of Licensee: 
  
 President 
 ICAgen, Inc. 
 P.O. Box 14487 
 Research Triangle Park NC 27709 
  
 or such other address as either party shall notify the other in writing. 
  
 ARTICLE XVIII. GENERAL PROVISIONS 
  
 18.1 All rights and remedies hereunder will be cumulative and not alternative, and this Agreement shall be construed and governed by the laws of the
Commonwealth of Massachusetts. 
  
 18.2 This Agreement may be
amended only by written agreement signed by the parties. 
  
 18.3
It is expressly agreed by the parties hereto that CMCC and Licensee are independent contractors and nothing in this Agreement is intended to create an employer relationship, joint venture, or partnership between the parties. No party has the
authority to bind the other. 
  
 18.4 This Agreement constitutes
the entire agreement between the parties with respect to the subject matter hereof and supersedes all proposals, negotiations and other communications between the parties, whether written or oral, with respect to the subject matter hereof.

  
 18.5 If any provisions of this Agreement shall be held to be
invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions of this Agreement shall not be impaired thereby. 
  
 18.6 This Agreement may be executed in any number of counterparts, each of which shall be deemed an original as against the party whose signature appears
thereon, but all of which taken together shall constitute but one and the same instrument. 
  

 -23- 

 18.7 The failure of either party to assert a right to which it is entitled or to insist upon compliance
with any term or condition of this Agreement shall not constitute a waiver of that right or excuse a similar subsequent failure to perform any such term or condition by the other party. 
  
 18.8 Licensee agrees to mark any Licensed Products sold in the United States with all applicable United States patent
numbers. All Licensed Products shipped to or sold in other countries shall be marked in such a manner as to conform with the patent laws and practices of the country of manufacture or sale. 
  
 18.9 Each party hereto agrees to execute, acknowledge and deliver such
further instruments and do all such further acts as may be necessary or appropriate to carry out the purposes and intent of this Agreement. 
  
 18.10 The paragraph headings contained in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of
this Agreement. 
  
 18.11 Subject to the provisions of Article XII
hereof, this agreement shall be binding upon the parties and their respective successors and assigns. 
  
 18.12 Articles III (Paragraph 3.6), IX (Paragraphs 9.1 through 9.6), X, XI and XIII shall survive the termination of this Agreement. 
  
 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
last written below. 
  

			
	 CHILDREN’S MEDICAL CENTER
 CORPORATION

		
	By:	 	[illegible]
		
	Name:	 	 
		
	Title:	 	 
		
	Date:	 	 

  

			
	 LICENSEE

		
	By:	 	 /S/    P. KAY
WAGONER

		
	Name:	 	 P. Kay Wagoner, Ph. D.

		
	Title:	 	 President & CEO

		
	Date:	 	 2/29/2000

  

 -24- 

 APPENDIX A 
  

US Patent Application Serial No. 09/159,335 
  
 US Patent Application Serial No. 09/159,399 
  
 US Patent Application Serial No. 08/621,169 (US Patent 5,889,083) 
  

International Application No. PCT/US97/04244 
  
 Any Continuation, Continuation-in-Part, or Divisional Application(s) [**]: 
  

	 	1.	US Patent Application Serial No. [**]; 

  

	 	2.	International Patent Application No. [**], 

  
 which contain [**]. 
  

 APPENDIX B 
  

US Patent Application Serial No. [**] 
  
 International Application No. [**] 
  

 APPENDIX C 
  

ICAgen Sickle Cell Disease Development Plan 
  
 Confidential 
  

					
	 Development Milestone

	  	 Target Date

	  	 Cumulative Funding
Commitment (est.)

	 [**]
	  	[**]	  	 
	 [**]
	  	[**]	  	Total $[**]
	 [**]
	  	[**]	  	 
	 [**]
	  	[**]	  	Total $[**]
	 [**]
	  	[**]	  	 
	 [**]
	  	[**]	  	 

  

 APPENDIX D 
  
 TERMS OF SPONSORED RESEARCH AGREEMENT 
  
 Icagen shall provide a total of $[**]in research grants to the Children’s Hospital researchers over a [**] period. Funding will begin
six months after the execution of the License Agreement to which this Appendix pertains and will be paid [**] in $[**] installments. This amount does not include anticipated grants for future [**] conducted with [**]. 
  

 APPENDIX E 
  
 INVENTION ADMINISTRATION AGREEMENT, DATED FEBRUARY 13,1995 BETWEEN THE PRESIDENT AND FELLOWS OF HARVARD COLLEGE AND CHILDREN’S MEDICAL CENTER CORPORATION.

  
 INVENTION ADMINISTRATION AGREEMENT, DATED MAY 24, 1995 BETWEEN THE PRESIDENT
AND FELLOWS OF HARVARD COLLEGE, BRIGHAM AND WOMEN’S HOSPITAL, INC. AND CHILDREN’S MEDICAL CENTER CORPORATION. 
  
 MEMORANDUM, DATED DECEMBER 1, 1997 BETWEEN THE PRESIDENT AND FELLOWS OF HARVARD COLLEGE AND CHILDREN’S MEDICAL CENTER CORPORATION REGARDING INVENTION ADMINISTRATION
AGREEMENT. 
  
 INVENTION ADMINISTRATION AGREEMENT DATED FEBRUARY 3, 1995 BETWEEN
THE PRESIDENT AND FELLOWS OF HARVARD COLLEGE, BETH ISRAEL HOSPITAL AND CHILDREN’S MEDICAL CENTER CORPORATION. 
  
 AMENDMENTS DATED JANUARY 9, 1997, NOVEMBER 13, 1996, NOVEMBER 19, 1996 AND NOVEMBER 20, 1996 TO INVENTION ADMINISTRATION AGREEMENT DATED FEBRUARY 3, 1995 
  
 RESEARCH AGREEMENT BETWEEN CHILDREN’S HOSPITAL AND SHEFFIELD MEDICAL TECHNOLOGIES, INC.,
DATED JUNE 1, 1995 
  
 AMENDMENTS #1-6 TO RESEARCH AGREEMENT BETWEEN
CHILDREN’S HOSPITAL AND ION PHARMACEUTICALS, INC., DATED NOVEMBER 1, 1996 
  
 RESEARCH AND LICENSE OPTION AGREEMENT BETWEEN CHILDREN’S MEDICAL CENTER CORPORATION AND ION PHARMACEUTICALS, INC., DATED JUNE 1, 1996 
  
 LICENSE AGREEMENT BETWEEN CHILDREN’S MEDICAL CENTER CORPORATION AND ION PHARMACEUTICALS, INC., DATED NOVEMBER 1, 1996 
  
 MODIFICATION #1 TO THE LICENSE AGREEMENT BETWEEN CHILDREN’S MEDICAL CENTER CORPORATION
AND ION PHARMACEUTICALS, INC., DATED NOVEMBER 1, 1996 
  
 LICENSE AGREEMENT
BETWEEN THE PRESIDENT AND FELLOWS OF HARVARD COLLEGE AND SHEFFIELD MEDICAL TECHNOLOGIES, INC., DATED AUGUST 22, 1994 
  
 MODIFICATION #1 TO LICENSE AGREEMENT DATED AUGUST 22, 1994 BETWEEN THE PRESIDENT AND FELLOWS OF HARVARD COLLEGE AND SHEFFIELD MEDICAL TECHNOLOGIES, INC. 
  

 MODIFICATION #2 TO LICENSE AGREEMENT DATED AUGUST 22, 1994 BETWEEN THE PRESIDENT AND FELLOWS OF HARVARD COLLEGE AND ION
PHARMACEUTICALS, INC. 
  
 MODIFICATION #3 TO LICENSE AGREEMENT DATED AUGUST 22,
1994 BETWEEN THE PRESIDENT AND FELLOWS OF HARVARD COLLEGE AND ION PHARMACEUTICALS, INC. 
  
 RESEARCH AGREEMENT DATED AUGUST 22, 1994 BETWEEN THE PRESIDENT AND FELLOWS OF HARVARD COLLEGE AND SHEFFIELD MEDICAL TECHNOLOGIES, INC. 
  
 AMENDMENT #1 TO THE RESEARCH AGREEMENT BETWEEN THE PRESIDENT AND FELLOWS OF HARVARD COLLEGE AND SHEFFIELD MEDICAL TECHNOLOGIES, INC., DATED AUGUST 22, 1995 
  
 ASSIGNMENT AND LICENSE AGREEMENT BETWEEN 1266417 ONTARIO LIMITED AND ION PHARMACEUTICALS,
INC., DATED DECEMBER 3, 1997 
  
 SUB-LICENSE AGREEMENT BETWEEN 1266417 ONTARIO
LIMITED AND ION PHARMACEUTICALS, INC., DATED DECEMBER 3, 1997 
  
 ASSIGNMENT AND
SUBLICENSE AGREEMENT DATED SEPTEMBER, 1999 BETWEEN CHILDREN’S MEDICAL CENTER CORPORATION AND ION PHARMACEUTICALS, INC. 
  

 Intellectual Property Office 
 Children’s Hospital Boston 
 300 Longwood Avenue 
 Boston, MA 02115 
 phone 617-355-4050 fax
617-730-0146 
 IPO@childrens.harvard.edu 
 www.childrenshospital.org/ipo 
  
 August 30, 2004 
  
 Ms. Kay Wagoner 
 President & CEO 
 ICAgen, Inc. 
 4222 Emperor Boulevard, Suite 350 
 Durham, NC 27703 
  
 Dear Kay: 
  
 Thank you for providing the update on the Development Plan and Annual Plan for the Sickle Cell Program. We are delighted to learn of Icagen’s progress. 
  
 We acknowledge receipt of the updated milestone timeline and look forward to learning of
Icagen’s progression into Phase III Clinical trials. A signed copy of the amended Development Plan is enclosed as acknowledgement of receipt by our office. 
  

Please continue to keep us apprised of your progress. 
  

	
	 With kind regards,

	
	 /s/ Leslie Grushkin-Lerner, Ph.D.

	 Leslie Grushkin-Lerner, Ph.D.
 Licensing Manager

  

 Appendix C 
  
 Icagen Sickle Cell Disease Development Plan 
 CONFIDENTIAL 
  

					
	 Development Milestone

	  	Target Date

	 	 Cumulative Funding
Commitment (est.)

	 IND Filing with US FDA
	  	Filed	 	$[**]
	 Initiate Phase 2 Clinical Trial
	  	Completed	 	$[**]
	 Initiate Phase 3 Clinical Trial
	  	[**]	 	$[**]
	 US NDA Submission
	  	[**]	 	$[**]
	 Initiate Marketing in USA (by Icagen or via Partner)
	  	[**]	 	 
	 Initiate Marketing in First non-USA Country (by Icagen or Partner)
	  	[**]	 	 

  
 Acknowledged and Agreed to by
Children’s Medical Center Corporation: 
  

			
		
	 Name:
	 	 /s/ Donald P. Lombardi

		
	 Title:
	 	 Chief Intellectual Property Officer

		
	 Date:
	 	 August 27, 2004Subscription and Registration Rights Agreement

 Exhibit 10.1 
  
 ATP OIL & GAS CORPORATION 
  

SUBSCRIPTION AND REGISTRATION RIGHTS AGREEMENT 
  
 This Subscription and Registration Rights Agreement (this “Agreement”), made as of the date set forth below by and among ATP Oil &
Gas Corporation (the “Company”), the persons set forth on Schedule I hereto (the “Selling Shareholders”) and the undersigned (“Subscriber”), is intended to set forth certain representations,
covenants and agreements among the Company, the Selling Shareholders and the Subscriber, with respect to the offering (the “Offering”) for sale by the Company of up to 4,000,000 shares (the “Company Shares”) of
common stock, par value $0.001 per share (the “Common Stock”) and by the Selling Shareholder of up to 1,000,000 shares (the “Selling Shareholder Shares”) of Common Stock. 
  
 1. Subscription. Subject to the terms and conditions hereof, the
Subscriber hereby irrevocably subscribes for and agrees to purchase from the Company and the Selling Shareholders the number of shares of Common Stock (the “Shares”) set forth under the Subscriber’s name on the signature page
hereto at a purchase price of $14.00 per share (the “Offering Price”), and the Company and the Selling Shareholders, severally, agree to sell such Shares to the Subscriber at the Offering Price, subject to the Company’s and the
Selling Shareholder’s right to sell to the Subscriber such lesser number of Shares as the Company or the Selling Shareholders may, in their sole discretion, deem necessary or desirable. The Shares purchased by Subscriber will be comprised of a
proportionate number of Company Shares and Selling Shareholder Shares. 
  
 2. Delivery of Subscription Amount; Acceptance of Subscription; Delivery of Shares. Subscriber understands and agrees that this subscription is made subject to the following terms and conditions: 
  
 (a) Subscriber understands that separate subscription agreements will be
executed with other Subscribers for the remainder of the Shares to be sold in the Offering; 
  
 (b) Contemporaneously with the execution and delivery of this Agreement, Subscriber shall execute and deliver the Certificate of Accredited Investor Status attached hereto as Exhibit B. Contemporaneously with
or prior to Closing, Subscriber shall wire to the Company to hold in a separate, non-interest bearing account, immediately available funds in the amount equal to the Offering Price multiplied by the number of Shares for which the Subscriber has
subscribed (the “Subscription Amount”) in accordance with the instructions set forth on Exhibit A hereto; 
  
 (c) The subscription for Shares shall be deemed to be accepted only when this Agreement has been signed by an authorized officer of the Company and by the
Selling Shareholders. The deposit of the Subscription Amount for clearance will not be deemed an acceptance of this Agreement; 
  
 (d) The Company shall have the right to reject this subscription, in whole or in part, and shall have the right to allocate Shares among Subscribers in
any manner it may desire; provided, that no Subscriber shall be obligated to purchase more than the number of shares set forth under its name on the signature page hereto without its prior written consent; 

 (e) The payment of the Subscription Amount (or, in the case of rejection of a portion of the
Subscriber’s subscription, the part of the payment relating to such rejected portion) will be returned promptly, without interest, if Subscriber’s subscription is rejected in whole or in part or if the Offering is withdrawn or canceled;

  
 (f) Certificates representing the Shares purchased will be
issued in the name of each Subscriber at Closing as set forth under Section 3 hereof; and 
  
 (g) The representations and warranties of the Company, the Selling Shareholders and Subscriber set forth herein shall be true and correct as of the date that the Company accepts this subscription. 
  
 (h) The Company is not required to accept any minimum aggregate amount of
subscriptions before conducting a Closing; and 
  
 (i) The
representations and warranties of the Company and the Subscriber set forth herein shall be true and correct as of the date that the Company accepts this subscription. 
  
 3. Terms of Subscription. 
  

(a) The subscription period will begin as of November 24, 2004 and will terminate at 11:59 p.m. Eastern time on November 30, 2004, unless extended by
the Company, on one or more occasions, for up to an additional sixty (60) days (the “Termination Date”). Such extension may be effected without notice to the Subscribers. The purchase and sale of the Shares (the
“Closing”) shall occur as soon as practicable after the execution of this Agreement by the Company, the Selling Shareholders and each of the Subscribers in the Offering at a time and location (the “Closing Date”)
agreed upon by the Company and the Subscribers. On the Closing Date, the Company will deliver or cause to be delivered, one or more physical certificates representing the Shares purchased by each Subscriber. 
  
 (b) As compensation for advisory services, the Company and the Selling
Shareholders will pay to the Company’s advisor Sterne, Agee & Leach, Inc. an aggregate fee equal to five (5%) percent of the aggregate purchase price of the Shares sold. The Company will also pay all expenses in connection with the
Offering. 
  
 (c) If the Subscriber is not a United States person,
the Subscriber hereby represents that it has satisfied itself as to the full observance of the laws of its jurisdiction in connection with any invitation to subscribe for the Shares or any use of this Agreement, including (i) the legal requirements
within its jurisdiction for the purchase of the Shares, (ii) any foreign exchange restrictions applicable to such purchase, (iii) any governmental or other consents that may need to be obtained, and (iv) the income tax and other tax consequences, if
any, that may be relevant to the purchase, holding, redemption, sale or transfer of the Shares. The Subscriber’s subscription and payment for, and his or her continued beneficial ownership of the Shares, will not violate any applicable
securities or other laws of the Subscriber’s jurisdiction. 
  

 2 

 4. Registration Rights. 
  
 (a) Subscriber acknowledges that it is acquiring the Shares for its own account and for the purpose of investment and not
with a view to any distribution or resale thereof within the meaning of the Securities Act of 1933, as amended, (the “Securities Act”). The Subscriber further agrees that it will not sell, assign or transfer the Shares at any time
in violation of the Securities Act and acknowledges that, in taking unregistered securities, it must continue to bear the economic risk of its investment for an indefinite period of time because of the fact that the Shares have not been registered
under the Securities Act, and further realizes that the Shares can not be sold unless subsequently registered under the Securities Act or an exemption from such registration is available. The Subscriber further recognizes that neither the Company
nor the Selling Shareholders are assuming any obligation to register the Shares except as expressly set forth herein. The Subscriber also acknowledges that appropriate legends reflecting the status of the Shares under the Securities Act may be
placed on the face of the certificates for such shares at the time of their transfer and delivery to the holder thereof. 
  
 (b) The Shares may not be transferred except in a transaction which is in compliance with the Securities Act. Except as provided hereafter with respect to
registration of the Shares, it shall be a condition to any such transfer that the Company shall be furnished with an opinion of counsel to the holder of such shares, reasonably satisfactory to the Company, to the effect that the proposed transfer
would be in compliance with the Securities Act. 
  
 (c) Within 30
days after the Closing Date (the “Filing Date”), the Company shall use its commercially reasonable efforts to prepare and file with the Securities and Exchange Commission (the “SEC”), a registration statement and
such other documents as may be necessary in the opinion of counsel for the Company, and use its commercially reasonable efforts to have such registration statement declared effective as soon as practicable after the Filing Date in order to comply
with the provisions of the Securities Act so as to permit the registered resale of the Shares for a period of two (2) years following the Closing Date by each and every holder of Shares sold in the Offering, except for those holders who designate on
the signature page hereto that they do not wish to have their Shares included in the registration statement. The Shares that are registered for resale under such registration statement are referred to herein as the “Offering
Shares,” and the Subscribers who are eligible to sell their Shares under such registration statement, together with their affiliates, are hereafter referred to as “Offering Holders.” The Company will include in such
registration statement (i) the information required under the Securities Act to be so included concerning the Offering Holders, as provided by the Offering Holders on the signature page hereto, including any changes in such information that may be
provided by the Offering Holders in writing to the Company from time to time, and (ii) a section entitled “Plan of Distribution,” substantially in the form of Exhibit C hereto (with such changes thereto as may be required by the
SEC), that describes the various procedures that may be used by the Offering Holders in the sale of Offering Shares. 
  
 (d) In the event that the Company does not file a registration statement to register the Offering Shares with the SEC within the time period specified in
Section 4(c), the Company will be required to pay as liquidated damage to each Offering Holder equal to one percent (1%) of such Offering Holder’s purchase price for the Offering Shares, and an additional one percent (1%) for each additional
30-day period during which such registration statement is not filed. 
  

 3 

 (e) Notwithstanding the foregoing provisions of this Section 4, the Company may voluntarily suspend the
effectiveness of any such registration statement for a limited time, which in no event shall be longer than 30 days in any three-month period and no longer than 90 days in any twelve month period, if the Company has been advised by counsel or
underwriters to the Company that the offering of any Offering Shares pursuant to the registration statement would materially adversely affect, or would be improper in view of (or improper without disclosure in a prospectus), a proposed financing, a
reorganization, recapitalization, merger, consolidation, or other transaction involving the Company. Subject to the foregoing right of the Company to suspend registration, if any event occurs that would cause any such registration statement to
contain a material misstatement or omission or not to be effective and usable during the period that such registration statement is required to be effective and usable, the Company shall promptly file an amendment to the registration statement and
use its commercially reasonable efforts to cause such amendment to be declared effective as soon as practicable thereafter. Notwithstanding any provision contained herein to the contrary, the Company’s obligation to include, or continue to
include, Offering Shares in any such registration statement under this Section 4 shall terminate to the extent such shares are eligible for resale under Rule 144(k) promulgated under the Securities Act. 
  
 (f) If and whenever the Company is required by the provisions of this
Agreement to use its commercially reasonable efforts to effect the registration of the Offering Shares under the Securities Act for the account of an Offering Holder, the Company will, as promptly as practicable: 
  
 (i) prepare and file with the SEC a registration statement
with respect to such securities and use its commercially reasonable efforts to cause such registration statement to become and remain effective; 
  
 (ii) prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective and to comply with the requirements of the Securities Act and the rules and regulations promulgated by the SEC thereunder relating to the sale or other disposition of the
securities covered by such registration statement; 
  
 (iii) furnish to each Offering Holder such numbers of copies of a prospectus, including a preliminary prospectus, complying with the requirements of the Securities Act, and such other documents as such Offering Holder may reasonably request
in order to facilitate the public sale or other disposition of the Offering Shares owned by such Offering Holder, but such Offering Holder shall not be entitled to use any selling materials other than a prospectus and such other materials as may be
approved by the Company, which approval will not be unreasonably withheld; and 
  
 (g) Except as provided below in this Section 4, the expenses incurred by the Company in connection with action taken by the Company to comply with this Section 4, including, without limitation, all registration and
filing fees, printing and delivery expenses, accounting fees, fees and disbursements of counsel to the Company, consultant and expert fees, premiums for liability insurance, if the Company chooses to obtain such insurance, obtained in connection
with a 
  

 4 

 registration statement filed to effect such compliance and all expenses, including counsel fees, of complying with any
state securities laws, shall be paid by the Company. All fees and disbursements of any counsel, experts, or consultants employed by any Offering Holder shall be borne by such Offering Holder. The Company shall not be obligated in any way in
connection with any registration pursuant to this Section 4 for any selling commissions or discounts payable by any Offering Holder to any underwriter or broker of securities to be sold by such Offering Holder. Subscriber agrees to pay all expenses
required to be borne by such Offering Holder. 
  
 (h) In the event
of any registration of Shares pursuant to this Section 4, the Company will indemnify and hold harmless each Offering Holder, its officers, directors, investment advisors and each underwriter of such securities, and any person who controls such
Offering Holder or underwriter within the meaning of Section 15 of the Securities Act, against all claims, actions, losses, damages, liabilities and expenses (“Losses”), joint or several, to which any of such persons may become subject
under the Securities Act or otherwise, insofar as such Losses arise out of or are based upon any untrue statement of any material fact contained in any registration statement under which such securities were registered under the Securities Act, any
preliminary prospectus or final prospectus contained therein, or any amendment or supplement thereof, or arise out of or are based upon the omission to state therein a material fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse such Offering Holder, its officers, directors and each underwriter of such securities, and each such controlling person or entity for any legal and any other expenses reasonably incurred by such Offering
Holder, such underwriter, or such controlling person or entity in connection with investigating or defending any such Losses; provided, however, that the Company will not be liable in any such case to the extent that any such Losses
arise directly out of or are based primarily upon an untrue statement or omission made in said registration statement, said preliminary prospectus or said prospectus, or said amendment of supplement in reliance upon and in conformity with written
information furnished to the Company by such Offering Holder or such underwriter specifically for use in the preparation thereof, and provided further, however, that the Company will not be liable in any such case to the extent
that any such Losses arise directly out of or are based primarily upon an untrue statement or omission made in any preliminary prospectus or final prospectus if (i) such Offering Holder failed to send or deliver a copy of the final prospectus or
prospectus supplement with or prior to the delivery of written confirmation of the sale of the Offering Shares, and (ii) the final prospectus or prospectus supplement would have corrected such untrue statement or omission. 
  
 (i) At any time when a prospectus relating to the Offering is required to be
delivered under the Securities Act, the Company will notify the Offering Holder of the happening of any event, upon the notification or awareness of such event by an executive officer of the Company, as a result of which the prospectus included in
such registration statement, as then in effect, includes an untrue statement of material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances
then existing. 
  
 (j) In the event of any registration of any
Shares under the Securities Act pursuant to this Section 4, Subscriber agrees to indemnify and hold harmless the Company, its officers, directors and any person who controls the Company within the meaning of Section 15 of the Securities Act, against
any Losses, joint or several, to which the Company, its officers, directors, or such 
  

 5 

 controlling person or entity may become subject under the Securities Act or otherwise, insofar as such Losses arise out
of or are based upon any untrue statement of any material fact contained in any registration statement under which such Shares were registered under the Securities Act, any preliminary prospectus or final prospectus contained therein, or any
amendment or supplement thereto, or arise out of or are based upon the omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent and only to the
extent that any such Losses, arise out of or are based upon an untrue statement or omission made in said registration statement, said preliminary prospectus or said prospectus or said amendment or supplement in reliance upon and in conformity with
written information furnished to the Company by Subscriber or any affiliate (as defined in the Securities Act) of Subscriber specifically for use in the preparation thereof. 
  
 (k) If a claim for indemnification under Section 4 is unavailable to an indemnified party because of a failure or refusal of
a governmental authority to enforce such indemnification in accordance with its terms (by reason of public policy or otherwise), then each indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such Losses, in such proportion as is appropriate to reflect the relative fault of the indemnifying party and indemnified party in connection with the actions, statements or omissions that resulted in
such Losses as well as any other relevant equitable considerations. The relative fault of such indemnifying party and indemnified party shall be determined by reference to, among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission of a material fact, has been taken or made by, or relates to information supplied by, such indemnifying party or indemnified party, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such action, statement or omission. The amount paid or payable by a party as a result of any shall be deemed to include any reasonable attorneys’ or other reasonable fees or
expenses incurred by such party in connection with the defense of any Losses to the extent such party would have been indemnified for such fees or expenses if the indemnification provided for under Section 4(h) or 4(j) was available to such party in
accordance with its terms. Notwithstanding anything to the contrary contained herein, no Offering Holder shall be liable or required to contribute under this Section 4(k) for any amount that exceeds the net proceeds to such Offering Holder as a
result of the sale of Shares pursuant to the registration statement provided by this Section 4. The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 4(k) were determined by pro rata allocation or
by any other method of allocation that does not take into account the equitable considerations referred to in this paragraph. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The indemnity and contribution agreements contained in this Section 4 are in addition to any liability that the indemnifying parties may have to the
indemnified parties. 
  
 (l) Any party entitled to indemnification
hereunder will (i) give prompt written notice to the indemnifying party of any claim with respect to which it seeks indemnification and (ii) unless in such indemnified party’s reasonable judgment a conflict of interest between such indemnified
and indemnifying parties may exist with respect to such claim, permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party. If such defense is assumed, the indemnifying party will
not be subject to any liability for any 
  

 6 

 settlement made by the indemnified party without its consent (which consent may not be unreasonably withheld). An
indemnifying party who is not entitled to, or elects not to, assume the defense of a claim will not be obligated to pay the fees and expenses of more than one counsel for all parties indemnified by such indemnifying party with respect to such claim,
unless in the reasonable judgment of any indemnified party a conflict of interest may exist between such indemnified party and any other of such indemnified parties with respect to such claim. 
  
 (m) With a view to making available to the Offering Holder the benefits of
Rule 144 promulgated under the Securities Act, the Company agrees that it will use its commercially reasonable efforts to maintain registration of its Common Stock under Section 12 or 15 of the Securities and Exchange Act of 1934, as amended (the
“Exchange Act”) and to file with the SEC in a timely manner all reports and other documents required to be filed by an issuer of securities registered under the Exchange Act so as to maintain the availability of Rule 144. Upon the
request of any record owner, the Company will deliver to such owner a written statement as to whether it has complied with the reporting requirements of Rule 144. 
  
 (n) The Company agrees to promptly file a supplemental listing application for the purpose of listing the Shares on the
Nasdaq National Stock Market. 
  
 5. Representations and
Warranties of the Subscriber. Subscriber hereby represents and warrants to the Company as follows: 
  
 (a) Subscriber is acquiring the Shares for its own account, for investment and not with a view to, or for resale in connection with, any distribution or
public offering thereof within the meaning of the Securities Act, and applicable state securities laws. 
  
 (b) The Subscriber understands that (A) the Shares (1) have not been registered under the Securities Act or any state securities laws, (2) will be issued
in reliance upon an exemption from the registration and prospectus delivery requirements of the Securities Act pursuant to Section 4(2) and/or Regulation D thereof and (3) will be issued in reliance upon exemptions from the registration and
prospectus delivery requirements of state securities laws which relate to private offerings, and (B) the Subscriber must therefore bear the economic risk of such investment indefinitely unless a subsequent disposition thereof is registered under the
Securities Act and applicable state securities laws or is exempt therefrom. Subscriber further understands that such exemptions depend upon, among other things, the bona fide nature of the investment intent of the Subscriber expressed herein.
Pursuant to the foregoing, the Subscriber acknowledges that the certificates representing the Shares acquired by the Subscriber shall bear a restrictive legend substantially as follows: 
  

	
	“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFER UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND STATE SECURITIES LAWS, AND MAY NOT BE OFFERED FOR SALE,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF UNLESS (I) REGISTERED UNDER THE APPLICABLE SECURITIES LAWS OR (II) AN OPINION OF COUNSEL, WHICH OPINION AND COUNSEL ARE BOTH

  

 7 

	
	REASONABLY SATISFACTORY TO THE COMPANY, HAS BEEN DELIVERED TO THE COMPANY AND SUCH OPINION STATES THAT THE SHARES MAY BE TRANSFERRED WITHOUT SUCH REGISTRATION.”

  
 (c) The Subscriber has
knowledge, skill and experience in financial, business and investment matters relating to an investment of this type and is capable of evaluating the merits and risks of such investment and protecting the Subscriber’s interest in connection
with the acquisition of the Shares. The Subscriber understands that the acquisition of the Shares is a speculative investment and involves substantial risks and that the Subscriber could lose the Subscriber’s entire investment in the Shares. To
the extent deemed necessary by the Subscriber, the Subscriber has retained, at its own expense, and relied upon, appropriate professional advice regarding the investment, tax and legal merits and consequences of purchasing and owning the Shares. The
Subscriber has the ability to bear the economic risks of the Subscriber’s investment in the Company, including a complete loss of the investment, and the Subscriber has no need for liquidity in such investment. 
  
 (d) The Subscriber has been furnished by the Company all information (or
provided access to all information) regarding the business and financial condition of the Company, its expected plans for future business activities, the attributes of the Shares and the merits and risks of an investment in the Shares which the
Subscriber has requested or otherwise needs to evaluate the investment in the Company. 
  
 (e) Subscriber is in receipt of and has carefully read and understands the following items: 
  
 (i) Annual Report on Form 10-K for the period ending December 31, 2003, filed by the Company with the Securities and Exchange Commission;

  
 (ii) Quarterly Reports on Form 10-Q for each
of the periods ending March 31, 2004, June 30, 2004 and September 30, 2004 filed by the Company with the Securities and Exchange Commission; 
  
 (iii) Definitive Proxy Statement on Form 14A, filed by the Company with the Securities and Exchange Commission on April 29, 2004;

  
 (iv) Current Reports on Form 8-K filed by the
Company with the Securities and Exchange Commission on February 27, 2004, April 1, 2004, April 23, 2004, May 17, 2004, August 4, 2004, September 30, 2004 and November 5, 2004; and 
  
 (v) Confidential Private Placement Memorandum, dated November 24, 2004, and exhibits attached thereto
(collectively, items (i) through (v), and together with all exhibits filed therewith and incorporated by reference therein, the “Disclosure Documents”). 
  
 (f) In making the proposed investment decision, the Subscriber is relying solely on investigations made by the Subscriber
and the Subscriber’s representatives. The Subscriber acknowledges that the documents and other information listed in Section 5(e) are the only information provided to the Subscriber by the Company and that the Subscriber is not relying on

  

 8 

 any other information in making the proposed investment decision. The offer to sell the Shares was communicated to the
Subscriber in such a manner that the Subscriber was able to ask questions of and receive answers from the management of the Company concerning the terms and conditions of the proposed transaction and that at no time was the Subscriber presented with
or solicited by or through any leaflet, public promotional meeting, television advertisement or any other form of general or public advertising or solicitation. 
  

(g) The Subscriber acknowledges that the Subscriber has been advised that: 
  
 (i) The Shares offered hereby have not been approved or disapproved by the SEC or any state securities
commission nor has the SEC or any state securities commission passed upon the accuracy or adequacy of any representations by the Company. Any representation to the contrary is a criminal offense. 
  
 (ii) In making an investment decision, the Subscriber must
rely on its own examination of the Company and the terms of the Offering, including the merits and risks involved. The Shares have not been recommended by any federal or state securities commission or regulatory authority. Furthermore, the foregoing
authorities have not confirmed the accuracy or determined the adequacy of any representation. Any representation to the contrary is a criminal offense. 
  
 (iii) The Shares are “Restricted Securities” within the meaning of Rule 144 under the Securities Act, are subject to
restrictions on transferability and resale and may not be transferred or resold except as permitted under the Securities Act and applicable state securities laws, pursuant to registration or exemption therefrom. The Subscriber is aware that the
Subscriber may be required to bear the financial risks of this investment for an indefinite period of time. 
  
 (h) The Subscriber acknowledges and is aware that there has never been any representation, guarantee or warranty made by the Company or any officer,
director, employee or agent or representative of the Company or any Selling Shareholder, expressly or by implication, as to (i) the approximate or exact length of time that the Subscriber will be required to remain an owner of the Shares; (ii) the
percentage of profit and/or amount of or type of consideration, profit or loss to be realized, if any, as a result of this investment; or (iii) that the limited past performance (if any) or experience on the part of the Company, or any future
expectations will in any way indicate the predictable results of the ownership of the Shares or of the overall financial performance of the Company. 
  
 (i) The Subscriber agrees to furnish the Company such other information as the Company may reasonably request in order to verify the accuracy of the
information contained herein and agrees to notify the Company immediately of any material change in the information provided herein that occurs prior to the Company’s acceptance of this Agreement. 
  
 (j) The Subscriber further represents and warrants that the Subscriber is an
“accredited investor” within the meaning of Rule 501 of Regulation D under the Securities Act, and Subscriber has executed the Certificate of Accredited Investor Status, attached hereto as Exhibit B. 
  

 9 

 (k) As of the date of this Agreement the Subscriber and its affiliates do not have, and during the 30 day
period prior to the date of this Agreement the Subscriber and its affiliates have not entered into, any “put equivalent position” as such term is defined in Rule 16a-1 under the Exchange Act or short sale positions with respect to the
Common Stock of the Company. Until the registration statement referred to in Section 4(c) is declared effective, the Subscriber hereby agrees not to, and will cause its affiliates not to, enter into any such “put equivalent position” or
short sale position. 
  
 (l) If the Subscriber is a natural
person, the Subscriber has reached the age of majority in the state in which the Subscriber resides, has adequate means of providing for the Subscriber’s current financial needs and contingencies, is able to bear the substantial economic risks
of an investment in the Securities for an indefinite period of time, has no need for liquidity in such investment and, at the present time, could afford a complete loss of such investment. 
  
 (m) If this Agreement is executed and delivered on behalf of a partnership,
corporation, trust, estate or other entity (an “Entity”): (i) such Entity has the full legal right and power and all authority and approval required (a) to execute and deliver, or authorize execution and delivery of, this Agreement
and all other instruments executed and delivered by or on behalf of such Entity in connection with the purchase of the Securities, (b) to delegate authority pursuant to power of attorney and (c) to purchase and hold such Securities, (ii) the
signature of the party signing on behalf of such Entity is binding upon such Entity; and (iii) such Entity has not been formed for the specific purpose of acquiring such Securities, unless each beneficial owner of such Entity is qualified as an
accredited investor within the meaning of Rule 501(a) of Regulation D promulgated under the Securities Act and has submitted information substantiating such individual qualification. 
  
 (n) If the Subscriber is a retirement plan or is investing on behalf of a retirement plan, the Subscriber acknowledges that
investment in the Securities poses additional risks, including, without limitation, the inability to use losses generated by an investment in the Securities to offset taxable income. 
  
 (o) The Subscriber represents and warrants that it is not a broker-dealer or an affiliate of a broker-dealer, except as set
forth on the signature page hereto. If the Subscriber is a broker-dealer, the Subscriber acknowledges that the Subscriber will be deemed to be an underwriter with respect to the re-sale of its Securities. If the Subscriber is an affiliate of a
broker-dealer, the Subscriber acknowledges that the Subscriber will be deemed to be an underwriter with respect to the re-sale of its Securities to the extent that such Shares are sold through its affiliated broker-dealer. To the extent that the
Subscriber is affiliated in any manner with a broker-dealer, the Subscriber further represents and warrants that it is purchasing the Shares in the ordinary course of its business and that as of the date hereof it has no agreements or
understandings, directly or indirectly, with any person to distribute the Securities. 
  
 The foregoing representations and warranties and undertakings are made by the Subscriber with the intent that they be relied upon in determining its suitability as an investor and the Subscriber hereby agrees that
such representations and warranties shall survive its purchase of the Shares. 
  

 10 

 6. Representations and Warranties of the Company and the Selling Shareholders. 
  
 A. The Company hereby represents and warrants to the Subscriber as follows:

  
 (a) Each of the Company and its subsidiaries is duly
incorporated, validly existing and in good standing under the laws of its state of incorporation, and is duly qualified to do business as a foreign corporation in all jurisdictions in which the failure to be so qualified would materially and
adversely affect the business or financial condition, properties or operations of the Company. Each of the Company and its subsidiaries has all requisite corporate power and authority (i) to own and lease the properties and assets it currently owns
and leases (if any) and it contemplates owning and leasing and (ii) to conduct its activities as such activities (if any) are currently conducted and as currently contemplated to be conducted. 
  
 (b) The authorized capital of the Company immediately prior to the Closing
will consist of: (i) 10,000,000 shares of Preferred Stock, none of which are issued and outstanding, and (ii) 100,000,000 shares of Common Stock, 24,801,627 of which were issued and outstanding as of November 23, 2004. 
  
 (c) The Company has duly authorized the issuance and sale of the Shares in
accordance with the terms of this Agreement (as described herein) by all requisite corporate action, including the authorization of the Company’s Board of Directors of the issuance and sale of the Shares in accordance herewith and the
execution, delivery and performance of any other agreements and instruments executed in connection herewith. This Agreement constitutes a valid and legally binding obligation of the Company, enforceable in accordance with its terms, except (i) as
limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance,
injunctive relief, or other equitable remedies, and (iii) to the extent the indemnification provisions contained herein may be limited by applicable federal or state securities laws. 
  
 (d) The Shares, when issued and paid for in accordance with this Agreement when issued upon conversion of the Shares, will
represent validly authorized, duly issued and fully paid and nonassessable shares of Common Stock of the Company, and the issuance thereof will not conflict with the Articles of Incorporation or Bylaws of the Company and will be in full compliance
with all federal and state securities laws applicable to such issuance and sale. 
  
 (e) The execution and delivery of this Agreement, the fulfillment of the terms set forth herein and the consummation of the transactions contemplated hereby will not conflict with, or constitute a breach of or default
under, any agreement, indenture or instrument by which the Company is bound or any law, administrative rule, regulation or decree of any court or any governmental body or administrative agency applicable to the Company. 
  
 (f) As of the date of this Agreement, the Disclosure Documents do not contain
any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. 

 

 11 

 (g) The Disclosure Documents that have been filed with the SEC, at the time they were filed with the SEC,
complied in all material respects with the requirements of the Exchange Act, and, when read together and with the other information in the Disclosure Documents, do not contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. 
  
 (h) Subsequent to the dates as of which information is given in the Disclosure Documents, except as described therein or SEC
filing made after the date thereof, there has not been any material adverse change with regard to the assets or properties, results of operations or financial condition of the Company. 
  
 B. Each Selling Shareholder, as to itself and the Shares being sold by such Selling Shareholder only, severally, and not
jointly, hereby represents and warrants to the Subscriber as follows: 
  
 (a) This Agreement and the transactions contemplated herein have been duly authorized by the Selling Shareholder, and upon execution and delivery of this Agreement by such Selling Shareholder, this Agreement will constitute a valid and
legally binding obligation of such Selling Shareholder, enforceable in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of
creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies, and (iii) to the extent the indemnification provisions contained herein may be limited by
applicable federal or state securities laws. 
  
 (b) The Selling
Shareholder is, and on the Closing Date will be, the lawful record owner of the Shares to be sold by such Selling Stockholder at the Closing, free and clear of any lien, claim, security interest or other encumbrance, including, without limitation,
any restriction on transfer. 
  
 (c) If the certificates for the
Shares to be sold by the Selling Shareholder were delivered to the Subscriber in the State of New York and assuming the Subscriber purchases the Shares to be sold by such Selling Shareholder in good faith and without “notice of adverse
claim” (as such phrase is used in Section 8-105 of the New York Uniform Commercial Code as currently in effect in the State of New York (the “NY UCC”), upon (i) delivery (as defined in Section 8-301(a) of the NY UCC) to the Subscriber
of the certificates representing such Shares endorsed in blank by an effective endorsement (within the meaning of Section 8-107 of the NY UCC), and (ii) payment therefore in accordance with the terms of this Agreement, the Subscriber would become a
“protected purchaser” (as defined in Section 8-303(a) of the NY UCC) of such Shares, and will acquire such Shares free and clear of “adverse claims” (as defined in Section 8-102 of the NY UCC) except for any such adverse claims
created by or at the request of the Subscriber. 
  
 (d) All
information relating to the Selling Shareholder furnished in writing by the Selling Shareholder to the Company expressly for use in the Disclosure Documents is true, correct, and complete in all material respects, and does not contain any untrue
statement of a material fact or omit to state any material fact required to be stated therein or necessary to make such information not misleading. 
  

 12 

 7. Survival; Indemnification. All representations, warranties and covenants contained in this
Agreement and the indemnification contained in this Section 7 shall survive (i) the acceptance of this Agreement by the Company and the Selling Shareholders, (ii) changes in the transactions, documents and instruments described herein which are not
material or which are to the benefit of Subscriber, and (iii) the death or disability of Subscriber. Subscriber acknowledges the meaning and legal consequences of the representations, warranties and covenants in Section 5 hereof and that the Company
and the Selling Shareholders have relied upon such representations, warranties and covenants in determining Subscriber’s qualification and suitability to purchase the Shares. Subscriber hereby agrees to indemnify, defend and hold harmless the
Company, its officers, directors, employees, agents and controlling persons, and the Selling Shareholders from and against any and all losses, claims, damages, liabilities, expenses (including attorneys’ fees and disbursements), judgments or
amounts paid in settlement of actions arising out of or resulting from the untruth of any representation of Subscriber herein or the breach of any warranty or covenant herein by Subscriber. Notwithstanding the foregoing, however, no representation,
warranty, covenant or acknowledgment made herein by Subscriber shall in any manner be deemed to constitute a waiver of any rights granted to it under the Securities Act or state securities laws. 
  
 8. Notices. All notices and other communications provided for herein
shall be in writing and shall be deemed to have been duly given if delivered personally or sent by registered or certified mail, return receipt requested, postage prepaid: 
  
 (a) if to the Company or to a Selling Shareholder, to the following address: 
  

			
	 ATP Oil & Gas Corporation

	 4600 Post Oak Place

	 Suite 200

	 Houston, Texas 77027

	 Attn:
	 	 Albert L. Reese Jr.

	 	 	 Chief Financial Officer

	 Fax:
	 	 (713) 622-5101

  
 (b) if to Subscriber,
to the address set forth on the signature page hereto. 
  
 (c) or
at such other address as any party shall have specified by notice in writing to the others. 
  
 9. Notification of Changes. Subscriber agrees and covenants to notify the Company immediately upon the occurrence of any event prior to the consummation of this Offering that would cause any representation,
warranty, covenant or other statement contained in this Agreement to be false or incorrect or of any change in any statement made herein occurring prior to the consummation of this Offering. 
  

 13 

 10. Assignability. This Agreement is not assignable by the Subscriber, and may not be modified,
waived or terminated except by an instrument in writing signed by the party against whom enforcement of such modification, waiver or termination is sought. 
  
 11. Binding Effect. Except as otherwise provided herein, this Agreement shall be binding upon and inure to the benefit of the parties and their
heirs, executors, administrators, successors, legal representatives and assigns, and the agreements, representations, warranties and acknowledgments contained herein shall be deemed to be made by and be binding upon such heirs, executors,
administrators, successors, legal representatives and assigns. 
  
 12. Obligations Irrevocable. The obligations of the Subscriber shall be irrevocable, except with the consent of the Company, until the consummation or termination of the Offering or the rejection of Subscriber’s subscription in
whole by the Company. 
  
 13. Entire Agreement. This
Agreement constitutes the entire agreement of the Subscriber, the Selling Shareholders and the Company relating to the matters contained herein, superseding all prior contracts or agreements, whether oral or written. 
  
 14. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Texas, without regard to the principles of conflicts of law thereof that would require the application of the laws of any jurisdiction other than the State of Texas. 
  
 15. Severability. If any provision of this Agreement or the
application thereof to Subscriber or any circumstance shall be held invalid or unenforceable to any extent, the remainder of this Agreement and the application of such provision to other subscriptions or circumstances shall not be affected thereby
and shall be enforced to the greatest extent permitted by law. 
  
 16. Headings. The headings in this Agreement are inserted for convenience and identification only and are not intended to describe, interpret, define, or limit the scope, extent or intent of this Agreement or any provision hereof.

  
 17. Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which together shall be deemed to be one and the same agreement. 
  
 18. Counsel. Subscriber hereby acknowledges that the Company and its counsel, Vinson & Elkins L.L.P., represent
the interests of the Company and not those of the Subscriber in any agreement (including this Agreement) to which the Company is a party. 
  
 [Signature Page to follow] 
  

 14 

 IN WITNESS WHEREOF, Subscriber has executed this Subscription and Registration Rights Agreement as of
                    , 2004. 
  

			
	 SUBSCRIBER

	
	

		
	 Number o f Shares:
	 	  

	 Offering Price per Share: $
	 	  

	 Subscription Amount: $
	 	  

  

			
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

	 Address:
	 	  

	  

	  

  
 The Company
hereby accepts the foregoing subscription subject to the terms and conditions hereof as of November 29, 2004. 
  

			
	 ATP Oil & Gas Corporation

	 a Texas corporation

		
	 By:
	 	 /s/ Albert L. Reese, Jr.

	 	 	 Albert L. Reese, Jr.

	 	 	 Chief Financial Officer

  

 15 

 Each Selling Shareholder hereby accepts, severally and not jointly, the foregoing subscription subject to
the terms and conditions hereof as of November 29, 2004. 
  

			
	 	 	 /s/ T. Paul Bulmahn

	 Name:
	 	 T. Paul Bulmahn

		
	 	 	 /s/ Gerald W. Schlief

	 Name:
	 	 Gerald W. Schlief

		
	 	 	 /s/ Albert L. Reese, Jr.

	 Name:
	 	 Albert L. Reese, Jr.

  

 16 

 SCHEDULE I 
  

			
	 Name of Selling Stockholder

	  	Number of Shares
to be Sold

	 T. Paul Bulmahn
	  	650,000
	 Gerald W. Schlief
	  	200,000
	 Albert L. Reese, Jr.
	  	150,000
	 	  	

	 Total
	  	1,000,000

  

 17 

 Exhibit A 
  
 HOW TO SUBSCRIBE 
  
 (1) If you are subscribing for the purchase of Shares, please date and sign the signature page to this Subscription and Registration Rights Agreement in
the applicable spaces. Please signify the amount of Shares you are purchasing by inserting such amount in the space provided for on the signature page to the Agreement. 
  
 (2) Complete and sign the accompanying Accredited Investor Certificate. 
  
 (3) Send all completed documents to: 
  
 ATP Oil & Gas Corporation 
 4600 Post Oak Place 
 Suite 200 
 Houston, Texas 77027 
 Attn: Albert L. Reese
Jr. 
 Chief Financial Officer 
 Fax: (713) 622-5101 
  

	 	(4)	Fax signature pages for all completed documents together with the fed reference number for the wire transfer of funds to: 

  
 Sterne, Agee & Leach, Inc. 
 Attn.: W. Barry McRae 
 Facsimile: (205) 949-3626 
 Telephone: (205) 949-3555 
  

	 	(5)	Transmit funds in an amount equal to the number of shares you are purchasing multiplied by the Offering Price via wire to the following account: 

  
 Domestic 
  

	
	 _____________________

	 _____________________

	 _____________________

	 

  

			
	 For Further Credit To:
	  	_________________________
	 	  	_________________________

  
 Foreign 

	
	 ____________________

	 ____________________

	 ____________________

	 

			
	 For Further Credit To:
	 	_________________________
	 	 	 _________________________

  
 ATTENTION SUBSCRIBERS: NO
SUBSCRIPTION WILL BE ACCEPTED UNLESS ALL DOCUMENTATION PRESCRIBED HEREIN IS FULLY COMPLETED AND EXECUTED. ANY MATERIALS RECEIVED THAT ARE INCOMPLETE IN ANY RESPECT WILL BE RETURNED BY THE COMPANY. 
  

 2 

 Exhibit B 
  
 CERTIFICATE OF ACCREDITED INVESTOR STATUS 
  
 Except as may be indicated by the undersigned below, the undersigned is an individual “accredited investor,” as
that term is defined in Regulation D under the Securities Act of 1933, as amended (the “Securities Act”). The undersigned has checked the box below indicating the basis on which he is representing his status as an “accredited
investor”: 
  

	•	a bank as defined in Section 3(a)(2) of the Securities Act, or any savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Securities Act whether
acting in its individual or fiduciary capacity; a broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934, as amended (the “Securities Exchange Act”); an insurance company as defined in Section
2(13) of the Securities Act; an investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that Act; a small business investment company licensed by the U.S. Small
Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958; a plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions,
for the benefit of its employees, and such plan has total assets in excess of $5,000,000; an employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974, if the investment decision is made by a plan fiduciary, as
defined in Section 3(21) of such Act, which is either a bank, savings and loan association, insurance company, or registered investment adviser, or if the employee benefit plan has total assets in excess of $5,000,000 or, if a self-directed plan,
with investment decisions made solely by persons that are “accredited investors”; 

  

	•	a private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940; 

  

	•	an organization described in Section 501(c)(3) of the Internal Revenue Code, corporation, Massachusetts or similar business trust, or partnership, not formed for the specific
purpose of acquiring the securities offered, with total assets in excess of $5,000,000; 

  

	•	a natural person whose individual net worth, or joint net worth with the undersigned’s spouse, at the time of this purchase exceeds $1,000,000; 

  

	•	a natural person who had an individual income in excess of $200,000 in each of the two most recent years or joint income with the undersigned’s spouse in excess of $300,000 in
each of those years and has a reasonable expectation of reaching the same income level in the current year; 

  

	•	a trust with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the securities offered, whose purchase is directed by a person who has such
knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of the prospective investment; or 

	•	an entity in which all of the equity holders are “accredited investors” by virtue of their meeting one or more of the above standards. 

  

	•	an individual who is a director or executive officer of ATP Oil & Gas Corporation. 

  
 IN WITNESS WHEREOF, the undersigned has executed this Certificate of Accredited Investor Status effective as of
                    , 2004. 
  

			
	  

	 Name of Subscriber

		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

  

 2 

 Exhibit C 
  
 PLAN OF DISTRIBUTION 
  
 As of the date of this prospectus, we have not been advised by the selling shareholders as to any plan of distribution. Distributions of the shares by the
selling shareholders, or by their partners, pledgees, donees (including charitable organizations), transferees or other successors in interest, may from time to time be offered for sale either directly by such individual, or through underwriters,
dealers or agents or on any exchange on which the shares may from time to time be traded, in the over-the-counter market, or in independently negotiated transactions or otherwise. The methods by which the shares may be sold include: 
  

	 	•	a block trade (which may involve crosses) in which the broker or dealer so engaged will attempt to sell the securities as agent but may position and resell a portion of the block as
principal to facilitate the transaction; 

  

	 	•	purchases by a broker or dealer as principal and resale by such broker or dealer for its own account pursuant to this prospectus; 

  

	 	•	exchange distributions and/or secondary distributions; 

  

	 	•	sales in the over-the-counter market; 

  

	 	•	underwritten transactions; 

  

	 	•	ordinary brokerage transactions and transactions in which the broker solicits purchasers; and 

  

	 	•	privately negotiated transactions. 

  
 Such transactions may be effected by the selling shareholders at market prices prevailing at the time of sale or at negotiated prices. The selling
shareholders may effect such transactions by selling the securities to underwriters or to or through broker-dealers, and such underwriters or broker-dealers may receive compensations in the form of discounts or commissions from the selling
shareholders and may receive commissions from the purchasers of the securities for whom they may act as agent. The selling shareholders may agree to indemnify any underwriter, broker-dealer or agent that participates in transactions involving sales
of the shares against certain liabilities, including liabilities arising under the Securities Act. We have agreed to register the shares for sale under the Securities Act and to indemnify the selling shareholders and each person who participates as
an underwriter in the offering of the shares against certain civil liabilities, including certain liabilities under the Securities Act. 
  
 In connection with sales of the securities under this prospectus, the selling shareholders may enter into hedging transactions with broker-dealers, who
may in turn engage in short sales of the securities in the course of hedging the positions they assume. The selling shareholders also may sell securities short and deliver them to close our the short positions, or loan or pledge the securities to
broker-dealers that in turn may sell them. 
  
 The selling
shareholders and any underwriters, dealers or agents that participate in distribution of the securities may be deemed to be underwriters, and any profit on sale of the securities by them and any discounts, commissions or concessions received by any
underwriter, dealer or agent may be deemed to be underwriting discounts and commissions under the Securities Act. 
  
 There can be no assurances that the selling shareholders will sell any or all of the securities offered under this prospectus.

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