Document:

Exhibit 10.3

 

PROMISSORY
NOTE

(Long Term Reducing Revolver)

 

Note Date: May 13, 2010

 

$5,000,000.00

Maturity Date: May I,
2013

 

FOR
VALUE RECEIVED, DAKOTA ETHANOL, L.L.C., a South
Dakota limited liability company (“BORROWER”) promises to pay to the order of First National Bank of Omaha (“BANK”), at
its principal office or such other address as BANK or holder may designate from
time to time, the principal sum of Five Million and no hundredths Dollars
($5,000,000.00), or the amount shown on the BANK’s records to be outstanding,
plus interest (calculated on the basis of 360-day year) accruing each day on
the unpaid principal balance at the annual interest rates defined below. Absent
manifest error, the BANK’ s records shall be conclusive evidence of the principal
and accrued interest owing hereunder.

 

This
promissory note is executed pursuant to a First Amended and Restated
Construction Loan Agreement (“AGREEMENT”) between BORROWER and BANK dated as of
June 18, 2009, as it may have been amended, from time to time. This
promissory note evidences the LONG TERM REDUCING REVOLVING LOAN, which is also
sometimes referred to as TERM NOTE 5 described in the AGREEMENT, is a
modification or substitution for the TERM NOTE described in the earlier
Construction Loan Agreement between the parties dated September 25, 2000,
as well as a modification or substitution of a previously executed TERM NOTE 5.
All capitalized terms not otherwise defined in this note shall have the
meanings provided in the AGREEMENT.

 

INTEREST ACCRUAL. The interest rate on this loan is subject
to change from time to time based on changes in an independent index which is
the London Interbank offered rate for U.S. Dollar deposits published in the
Wall Street Journal as the One (1) Month LIBOR Rate (“LIBOR RATE”). The
LIBOR RATE will be adjusted and determined without notice to BORROWER as set
forth herein, as of the date of this Note and on the first (1st) day of each
calendar month hereafter (“INTEREST RATE CHANGE DATE”) to the One (1) Month
LIBOR RATE which is published in the Wall Street Journal as the reported rate
for the date that is two London Banking Days prior to each INTEREST RATE CHANGE
DATE. “London Banking Day” means any day other than a Saturday or Sunday, on
which commercial banking institutions in London, England are generally open for
business.  If for any reason the LIBOR
RATE published by the Wall Street Journal is no longer available and/or BANK is
unable to determine the LIBOR RATE for any INTEREST RATE CHANGE DATE, BANK may,
in its sole discretion, select an alternate source to determine the LIBOR RATE
and will provide notice to BORROWER of the source selected. The LIBOR RATE
determined as set forth above shall be referred to herein as (the “INDEX”).  The INDEX is not necessarily the lowest rate
charged by BANK on its loans. If the INDEX becomes unavailable during the term
of this loan, BANK may designate a substitute index after notifying BORROWER.
BANK will tell BORROWER the current INDEX rate upon BORROWER’s request.  The interest rate change will not occur more
often than each month on the first (1st) day of each month.

 

 

BORROWER
understands that BANK may make loans based on other rates as well. The INDEX
currently is .33750 % per annum. The interest rate to be applied to the unpaid
principal balance of this loan will be calculated as described in the “INTEREST
CALCULATION METHOD” paragraph using a rate of 4.0 percentage points over the
INDEX, adjusted if necessary for any minimum and maximum rate limitations
described below, resulting in an initial rate of 4.33750% per annum based on a
year of 360 days. NOTICE: Under no circumstances will the interest rate on this
loan be less than 5% per annum or more than the maximum rate allowed by
applicable law. Whenever increases occur in the interest rate, BANK, at its
option, may do one of the following: (A) increase BORROWER’s payments to
ensure BORROWER’s loan will pay off by its original final maturity date, (B) increase
BORROWER’s payments to cover accruing interest, (C) increase the number of
BORROWER’s payments, and (D) continue BORROWER’s payments at the same
amount and increase BORROWER’s final payment.

 

REDUCING REVOLVING FEATURE, BORROWER  will pay BANK
an unused commitment fee of fifty (50bps) basis points, assessed quarterly in
arrears against the unused portion of the note amount.  Pursuant to this revolving loan feature the
BANK will lend the BORROWER, from time to time until maturity of this note such
sums in integral multiples of $10,000.00 as the BORROWER may request by
reasonable same day notice to the BANK, received by the BANK not later than
11:00 A.M. of such day, but which shall not exceed in the aggregate
principal amount at any one time outstanding, $5,000,000.00. The BORROWER may
borrow, repay and reborrow hereunder, from the date of this AGREEMENT until the
maturity of this note, said amount or any lesser sum which is $10,000.00 or an
integral multiple thereof.

 

Each
year, on the anniversary of the execution of this NOTE, the available principal
amount under this Note shall be reduced by One Million ($1,000,000.00) Dollars,
so that the maximum amount outstanding under this promissory note will decrease
accordingly. If necessary, BORROWER shall immediately pay to BANK any principal
amount outstanding in order to make such reduction in maximum amount
outstanding.

 

Additionally,
the amount available for borrowing hereunder shall also be reduced by the
outstanding balance of principal and accrued interest on TERM NOTE 2.

 

REPAYMENT TERMS. 
Interest accruing hereunder is payable monthly, on the first day of
each month.  Any remaining principal
balance, plus any accrued but unpaid interest, shall be fully due and payable
on the maturity date above stated, if not sooner paid.

 

PREPAYMENT.  The BORROWER
may prepay this promissory note in full or in part at any time.

 

ADDITIONAL TERMS AND CONDITIONS.  The AGREEMENT, and any
amendments or substitutions, contains additional terms and conditions,
including default and acceleration provisions, which are incorporated into this
promissory note by reference.  The
BORROWER 

 

 

agrees
to pay all costs of collection, including reasonable attorneys fees and legal
expenses incurred by the BANK if this promissory note is not paid as provided
above.  This promissory note shall be
governed by the substantive laws of the State of Nebraska.

 

WAIVER OF PRESENTMENT AND NOTICE OF DISHONOR.  BORROWER and any other
person who signs, guarantees or endorses this promissory note, to the extent
allowed by law, hereby waives presentment, demand for payment, notice of
dishonor, protest, and any notice relating to the acceleration of the maturity
of this promissory note.

 

	
   

  	
  Dakota Ethanol, L.L. C.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/  Scott Mundt

  
	
   

  	
   

  	
  Scott Mundt

  
	
   

  	
   

  	
  Chief Executive Officer

  

 

 

	
  STATE OF SOUTH DAKOTA

  	
  )

  	
   

  
	
   

  	
  )ss.

  	
   

  
	
  COUNTY OF LAKE

  	
  )

  	
   

  

 

On this 7 day of June,
2010, before me, the undersigned, a Notary Public, personally appeared Scott
Mundt, Chief Executive Officer of Dakota Ethanol, L.L.C., on behalf of said
entity, who executed the foregoing instrument, and acknowledged that he executed
the same as his voluntary act and deed.

 

	
   

  	
  /s/ Alan E. May

  
	
   

  	
  Notary Public

  
	
   

  	
   

  
	
  Exp. 9/22/2013

  	
   

  
	
   

  	
   

  
	
   

  	
  ALAN E. MAY

  
	
   

  	
  NOTARY PUBLIC

  
	
   

  	
  SOUTH DAKOTA

  
	
   

  	
  My Commission Expires
  9-22-2013Exhibit 10.1

 

***         INDICATES MATERIAL THAT HAS BEEN
OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH
OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO RULE 24b-2 UNDER THE SECURITIES AND EXCHANGE ACT OF 1934, AS
AMENDED.

 

 

LICENSE AND COMMERCIALIZATION AGREEMENT

 

 

BY AND BETWEEN

 

 

REDPOINT BIO CORPORATION

 

 

AND

 

 

INTERNATIONAL FLAVORS & FRAGRANCES INC.

 

 

DATED AS OF JUNE 29, 2010

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE 1

  	
  DEFINITIONS

  	
  1

  
	
   

  	
   

  	
   

  
	
  1.1

  	
  Definitions

  	
  1

  
	
   

  	
   

  	
   

  
	
  1.2

  	
  Interpretation

  	
  5

  
	
   

  	
   

  	
   

  
	
  1.3

  	
  Additional Definitions

  	
  5

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2

  	
  LICENSES

  	
  6

  
	
   

  	
   

  	
   

  
	
  2.1

  	
  License Grants

  	
  6

  
	
   

  	
   

  	
   

  
	
  2.2

  	
  Sublicensing

  	
  7

  
	
   

  	
   

  	
   

  
	
  2.3

  	
  Subcontractors

  	
  7

  
	
   

  	
   

  	
   

  
	
  2.4

  	
  No Implied Licenses

  	
  7

  
	
   

  	
   

  	
   

  
	
  2.5

  	
  Retained Rights

  	
  7

  
	
   

  	
   

  	
   

  
	
  2.6

  	
  Nonassertion

  	
  7

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3

  	
  REGULATORY RESPONSIBILITIES

  	
  8

  
	
   

  	
   

  	
   

  
	
  3.1

  	
  Overview

  	
  8

  
	
   

  	
   

  	
   

  
	
  3.2

  	
  Regulatory Notification

  	
  8

  
	
   

  	
   

  	
   

  
	
  3.3

  	
  Reporting

  	
  8

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4

  	
  DEVELOPMENT AND COMMERCIALIZATION

  	
  8

  
	
   

  	
   

  	
   

  
	
  4.1

  	
  Overview and Diligence

  	
  8

  
	
   

  	
   

  	
   

  
	
  4.2

  	
  Commercialization Plans and Reports

  	
  8

  
	
   

  	
   

  	
   

  
	
  4.3

  	
  Expenses and Responsibilities

  	
  9

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5

  	
  FINANCIAL TERMS

  	
  9

  
	
   

  	
   

  	
   

  
	
  5.1

  	
  Upfront Fee

  	
  9

  
	
   

  	
   

  	
   

  
	
  5.2

  	
  IFF Milestone Payments

  	
  9

  
	
   

  	
   

  	
   

  
	
  5.3

  	
  Royalties on Purchases of Reb C

  	
  9

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6

  	
  PAYMENT TERMS

  	
  10

  
	
   

  	
   

  	
   

  
	
  6.1

  	
  Payment Method

  	
  10

  
	
   

  	
   

  	
   

  
	
  6.2

  	
  Payment Schedules; Reports

  	
  10

  
	
   

  	
   

  	
   

  
	
  6.3

  	
  Taxes

  	
  10

  
	
   

  	
   

  	
   

  
	
  6.4

  	
  Records Retention; Audit

  	
  11

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7

  	
  CONFIDENTIALITY

  	
  11

  
	
   

  	
   

  	
   

  
	
  7.1

  	
  Confidential Information

  	
  11

  

 

i

 

TABLE OF CONTENTS

(continued)

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  7.2

  	
  Publicity; Filing of this Agreement

  	
  13

  
	
   

  	
   

  	
   

  
	
  7.3

  	
  Publication

  	
  14

  
	
   

  	
   

  	
   

  
	
  7.4

  	
  Use of Names

  	
  14

  
	
   

  	
   

  	
   

  
	
  7.5

  	
  Confidentiality of this Agreement

  	
  14

  
	
   

  	
   

  	
   

  
	
  7.6

  	
  Survival

  	
  14

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8

  	
  MANUFACTURING AND SUPPLY

  	
  14

  
	
   

  	
   

  	
   

  
	
  8.1

  	
  Manufacturing and Supply

  	
  14

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9

  	
  OWNERSHIP OF INTELLECTUAL PROPERTY AND PATENT
  RIGHTS

  	
  15

  
	
   

  	
   

  	
   

  
	
  9.1

  	
  Inventorship; Ownership of Inventions

  	
  15

  
	
   

  	
   

  	
   

  
	
  9.2

  	
  Assignment by Employees

  	
  15

  
	
   

  	
   

  	
   

  
	
  9.3

  	
  Filing, Prosecution and Maintenance of Patents

  	
  15

  
	
   

  	
   

  	
   

  
	
  9.4

  	
  Cooperation

  	
  16

  
	
   

  	
   

  	
   

  
	
  9.5

  	
  Infringement by Third Parties

  	
  16

  
	
   

  	
   

  	
   

  
	
  9.6

  	
  Trademarks

  	
  17

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10

  	
  REPRESENTATIONS AND WARRANTIES

  	
  17

  
	
   

  	
   

  	
   

  
	
  10.1

  	
  Representations and Warranties

  	
  17

  
	
   

  	
   

  	
   

  
	
  10.2

  	
  Limitation on Representations or Warranties

  	
  18

  
	
   

  	
   

  	
   

  
	
  10.3

  	
  Disclaimer of Warranty

  	
  18

  
	
   

  	
   

  	
   

  
	
  10.4

  	
  Limitation of Liability

  	
  19

  
	
   

  	
   

  	
   

  
	
  10.5

  	
  Essential Basis

  	
  19

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11

  	
  TERM AND TERMINATION

  	
  19

  
	
   

  	
   

  	
   

  
	
  11.1

  	
  Term

  	
  19

  
	
   

  	
   

  	
   

  
	
  11.2

  	
  Termination

  	
  19

  
	
   

  	
   

  	
   

  
	
  11.3

  	
  Effects of Termination

  	
  20

  
	
   

  	
   

  	
   

  
	
  11.4

  	
  Accrued Rights

  	
  20

  
	
   

  	
   

  	
   

  
	
  11.5

  	
  Survival

  	
  20

  
	
   

  	
   

  	
   

  
	
  ARTICLE 12

  	
  INDEMNIFICATION; INSURANCE

  	
  21

  
	
   

  	
   

  	
   

  
	
  12.1

  	
  Indemnification

  	
  21

  
	
   

  	
   

  	
   

  
	
  12.2

  	
  Notice of Claim

  	
  21

  

 

ii

 

TABLE OF CONTENTS

(continued)

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  12.3

  	
  Control of Defense

  	
  22

  
	
   

  	
   

  	
   

  
	
  12.4

  	
  Right to Participate in Defense

  	
  22

  
	
   

  	
   

  	
   

  
	
  12.5

  	
  Settlement

  	
  22

  
	
   

  	
   

  	
   

  
	
  12.6

  	
  Cooperation

  	
  22

  
	
   

  	
   

  	
   

  
	
  12.7

  	
  Insurance

  	
  23

  
	
   

  	
   

  	
   

  
	
  ARTICLE 13

  	
  DISPUTE RESOLUTION

  	
  23

  
	
   

  	
   

  	
   

  
	
  13.1

  	
  Disputes

  	
  23

  
	
   

  	
   

  	
   

  
	
  13.2

  	
  Arbitration

  	
  23

  
	
   

  	
   

  	
   

  
	
  13.3

  	
  Jurisdiction

  	
  24

  
	
   

  	
   

  	
   

  
	
  13.4

  	
  Injunctive Relief

  	
  24

  
	
   

  	
   

  	
   

  
	
  13.5

  	
  Governing Law

  	
  24

  
	
   

  	
   

  	
   

  
	
  ARTICLE 14

  	
  MISCELLANEOUS

  	
  24

  
	
   

  	
   

  	
   

  
	
  14.1

  	
  Entire Agreement; Amendment

  	
  24

  
	
   

  	
   

  	
   

  
	
  14.2

  	
  Force Majeure

  	
  24

  
	
   

  	
   

  	
   

  
	
  14.3

  	
  Notices

  	
  25

  
	
   

  	
   

  	
   

  
	
  14.4

  	
  Independent Contractors

  	
  25

  
	
   

  	
   

  	
   

  
	
  14.5

  	
  Maintenance of Records

  	
  25

  
	
   

  	
   

  	
   

  
	
  14.6

  	
  No Strict Construction

  	
  26

  
	
   

  	
   

  	
   

  
	
  14.7

  	
  Assignment

  	
  26

  
	
   

  	
   

  	
   

  
	
  14.8

  	
  Counterparts

  	
  26

  
	
   

  	
   

  	
   

  
	
  14.9

  	
  Further Actions

  	
  26

  
	
   

  	
   

  	
   

  
	
  14.10

  	
  Severability

  	
  26

  
	
   

  	
   

  	
   

  
	
  14.11

  	
  Headings

  	
  26

  
	
   

  	
   

  	
   

  
	
  14.12

  	
  No Waiver

  	
  26

  

 

iii

 

LICENSE AND COMMERCIALIZATION AGREEMENT

 

THIS
LICENSE AND COMMERCIALIZATION AGREEMENT (this “Agreement”)
is dated as of June 29, 2010 (the “Effective Date”)
by and between Redpoint Bio Corporation, a Delaware corporation (“Redpoint”) and International Flavors & Fragrances Inc.,
a New York corporation (“IFF”).  Redpoint and IFF are sometimes referred to
herein individually as a “Party” and
collectively as the “Parties”.

 

RECITALS

 

WHEREAS, Redpoint is the owner of the Licensed Technology
and desires to grant IFF the right to use the Licensed Technology to Develop,
Manufacture, use and Commercialize Reb C and Products;

 

WHEREAS, IFF has expertise in Developing, Manufacturing and
Commercializing flavor and fragrance products and desires to obtain from
Redpoint the right to use the Licensed Technology to Develop, Manufacture, use
and Commercialize Reb C and Products; and

 

WHEREAS, IFF intends to enter into supply agreements with
Third Parties for supply of the Reb C for use in Products.

 

NOW, THEREFORE, in consideration of the foregoing premises
and the mutual covenants contained herein, the Parties, intending to be legally
bound, agree as follows:

 

ARTICLE 1

DEFINITIONS

 

1.1           Definitions.  The
following terms shall have the following meanings as used in this Agreement:

 

1.1.1        “Affiliate” means a Person that controls, is controlled by or
is under common control with a Party. 
For the purposes of this definition, the word “control” (including, with
correlative meaning, the terms “controlled by” or “under common control with”)
means the actual power, either directly or indirectly through one or more
intermediaries, to direct the management and policies of such Person, whether
by the ownership of at least fifty percent (50%) of the voting stock of such
Person (it being understood that the direct or indirect ownership of a lesser
percentage of such stock shall not necessarily preclude the existence of
control), or by contract or otherwise.

 

1.1.2        “Bakery Products” means ***.

 

1.1.3        “Beverages” means ***.

 

1.1.4        “Business Day” means any day other than (a) Saturday or
Sunday or (b) any other day on which banks in New York, NY are required to be
closed.

 

1.1.5        “Commercialization” and “Commercialize”
mean any and all activities, excluding Development or Manufacturing, necessary
or desirable to realize commercial sales of 

 

 

Products in accordance with the Law, including distributing, importing,
transporting, customs clearance, exporting, warehousing, packing, handling and
delivering to customers, as well as offering for sale and sales, marketing,
promoting and reimbursement related activities, including booking sales.  When used as a verb “Commercialize” means to
engage in Commercialization.

 

1.1.6        “Confectionary Products” means ***.

 

1.1.7        “Control” means, with respect to any intellectual property
right or other tangible or intangible property, that a Party or one of its
Affiliates owns or has a license or sublicense to such item or right, and has
the ability to grant access, license or sublicense in or to such right without violating
the terms of any agreement or other arrangement with any Third Party.

 

1.1.8        “Dairy Products” means ***.

 

1.1.9        “Develop” and “Development”
means any and all activities necessary or desirable to research, develop and
achieve Regulatory Notification excluding Manufacturing of Reb C in compliance
with the Law, including research and development activities related to the
generation, characterization, optimization, construction, expression, use and
production of Products, test method development and stability testing,
toxicology, quality assurance/quality control, delivery systems, formulation,
statistical analysis, report writing, product approval and registration
activities and all other activities with the intent and for the purpose of
generating data for submission to regulatory authorities.  When used as a verb, “Develop” means to
engage in Development.

 

1.1.10      “Dollars” or “$” shall mean
the legal tender of the United States of America.

 

1.1.11      “Exclusivity Period” means the period commencing on the
Effective Date and ending on the fifth anniversary thereof.

 

1.1.12      “FDA” means the United States Food and Drug Administration or
any successor federal agency thereto.

 

1.1.13      “FEMA” means the Flavor and Extract Manufacturers Association
of the U.S. or any successor organization thereto.

 

1.1.14      “First Purchase of Reb C” means the first commercial purchase
by IFF or any of its Affiliates, agents or sublicensees of Reb C in an
aggregate amount exceeding $*** for use in Products from a Supplier under a Supply
Agreement.

 

1.1.15      “Governmental Authority” means any court, tribunal,
arbitrator, agency, legislative body, commission, official or other
instrumentality of (a) any government of any country, (b) a federal, state,
province, county, city or other political subdivision thereof or (c) any
supranational body, including the FDA.

 

2

 

1.1.16      “GRAS Assessment” means self-assessment or assessment by FEMA
or other organization in the Territory of generally recognized as safe (“GRAS”) of Reb C as a food ingredient, flavoring compound,
flavor enhancer or taste modulator.

 

1.1.17      “IFF Invention” means an Invention that is discovered, made,
reduced to practice or conceived by an employee, agent or consultant of (a) either
Party or a person under an obligation of assignment to either Party solely or
jointly with a Third Party during the Term in the course of performing such
Party’s obligations under this Agreement that relates to flavor or flavor
formulations, or the use of Reb C in flavor formulations, or (b) IFF or a
person under any obligation of assignment to IFF solely or jointly with a Third
Party during the Term in the course of performing IFF’s obligations under this
Agreement, and, in the case of both clauses (a) and (b), all Patents claiming
patentable Inventions therein, other than Redpoint Inventions.

 

1.1.18      “Invention” means, whether patentable or not, any writing,
invention, discovery, improvement or other technology that is discovered, made,
reduced to practice or conceived during the Term.

 

1.1.19      “Know-How” means any non-public information, results and data
of any type whatsoever, in any tangible or intangible form whatsoever,
including databases, ideas, discoveries, inventions, trade secrets, practices,
methods, protocols, tests, assays, techniques, specifications, processes,
formulations, formulae, knowledge, know-how, skill, experience, materials,
including products and compositions, scientific, technical or test data
(including toxicological data), analytical and quality control data, stability
data, studies and procedures, drawings, plans, designs, diagrams, sketches,
technology, documentation, and Patent-related and other legal information or
descriptions.

 

1.1.20      “Law” or “Laws” means all
laws, statutes, rules, codes, regulations, orders, judgments and/or ordinances
of any Governmental Authority having jurisdiction in the Territory.

 

1.1.21      “Licensed Technology” means the technology reflected in the
Redpoint Patents and the Redpoint Know-How and all trade secrets and
proprietary information developed or Controlled by Redpoint or its Affiliates
on the Effective Date or any time during the Term (but excluding any IFF
Inventions) that is reasonably necessary or useful to Develop, Manufacture or
Commercialize Reb C in the Territory.

 

1.1.22      “Losses” means any and all amounts paid or payable to Third
Parties with respect to a Third Party Claim, including damages (including all
incidental and consequential damages), deficiencies, defaults, awards,
settlement amounts, assessments, fines, dues, penalties, costs, liabilities,
obligations, taxes, liens, losses, lost profits, fees and expenses (including,
court costs, interest and reasonable fees of attorneys, accountants and other
experts).

 

1.1.23      “Manufacture” means all activities related to the
manufacturing and production of Reb C and Products, including but not limited
to manufacturing supplies for Development and Commercialization, packaging,
in-process and finished product testing, release of product or any component or
ingredient thereof, quality assurance and quality control 

 

3

 

activities related to manufacturing and release of product, ongoing
stability tests, storage, shipment, and regulatory activities related to any of
the foregoing.

 

1.1.24      “Patent” means (a) valid and enforceable patents,
re-examinations, reissues, renewals, extensions, supplementary protection
certificates and term restorations, any confirmation patent or registration
patent or patent of addition based on any such patent, (b) pending applications
for patents, including continuations, continuations-in-part, re-examinations,
reissues, renewals, extensions, supplementary protection certificates and term
restorations divisional, provisional and substitute applications (c) all
foreign counterparts of any of the foregoing, and (d) all priority applications
of any of the foregoing.

 

1.1.25      “Person” means any natural person, corporation, firm,
business trust, joint venture, association, organization, company, partnership
or other business entity, or any government, or any agency or political
subdivisions thereof.

 

1.1.26      “Products” means any flavor systems used in Beverages, Dairy
Products, Confectionary Products, Snack Products and Bakery Products containing
Reb C.

 

1.1.27      “Reb C” means ***.

 

1.1.28      “Redpoint Invention” means an Invention that is discovered,
made, reduced to practice or conceived by an employee, agent or consultant of
(a) either Party or a person under an obligation of assignment to either Party
solely or jointly with a Third Party during the Term in the course of
performing such Party’s obligations under this Agreement that relates to
manufacture of Reb C or (b) Redpoint or a person under any obligation of
assignment to Redpoint solely or jointly with a Third Party during the Term in
the course of performing Redpoint’s obligations under this Agreement, and, in
the case of both clauses (a) and (b), all Patents claiming patentable
Inventions therein, other than IFF Inventions.

 

1.1.29      “Redpoint Know-How” means any Know-How that is necessary for
the Development, Manufacture, Commercialization and/or use of Reb C in the
Territory that either (a) is Controlled by Redpoint or its Affiliates on the
Effective Date or (b) comes within Redpoint’s or its Affiliates’ Control during
the Term, including Redpoint Inventions.

 

1.1.30      “Redpoint Patents” means any Patent listed on Schedule 1.1.30
that is necessary for the Development, Manufacture, Commercialization and/or
use of Reb C in the Territory that (a) cover Redpoint Know-How and (b) are
Controlled by Redpoint on the Effective Date or come within Redpoint’s Control
during the Term.

 

1.1.31      “Regulatory Notification” means all notifications,
assessments (including GRAS Assessments), approvals, licenses, registrations or
authorizations of any regional, federal, state or local regulatory agency,
department, bureau or other entity (whether governmental or nongovernmental),
necessary or desirable for the Development, Manufacture, use or Commercialization
of Reb C or Products in the Territory.

 

1.1.32      “Regulatory Submission” means a submission (including any
amendments thereto) for Regulatory Notification necessary or desirable before
commercial sale 

 

4

 

or use of Reb C or Products in a regulatory jurisdiction in the
Territory submitted to a regulatory or other authority.

 

1.1.33      “Royalty Term” means the period commencing on First Purchase
of Reb C and ending on the later of (a) the fifth (5th) anniversary thereof
and, (b) if a Redpoint Patent or a Patent Controlled by IFF or any of its
Affiliates covering Reb C or a Product has issued, the date on which Reb C or
such Product is no longer covered by a Valid Claim in any country in the
Territory.

 

1.1.34      “Snack Products” means ***.

 

1.1.35      “Supplier” means any producer(s) manufacturing Reb C in
accordance with suitable specifications allowing for a GRAS Assessment in the
U.S.

 

1.1.36      “Territory” means all countries of the world.

 

1.1.37      “Third Party” means any entity other than Redpoint or IFF or
their respective Affiliates.

 

1.1.38      “U.S.” means the United States of America and its
territories, possessions and commonwealths.

 

1.1.39      “Valid Claim” means any claim of an issued and unexpired
Patent that has not been rejected, revoked or held unenforceable or invalid by
a final, nonappealable decision of a court or other Governmental Authority of
competent jurisdiction or unappealed within the time allowable for appeal, and
that has not been explicitly disclaimed, or admitted to be invalid of
unenforceable through reissue, disclaimer or otherwise.

 

1.2           Interpretation. 
Unless the context of this Agreement otherwise requires, (a) words of
one gender include the other gender; (b) the terms “hereof,” “herein,” “hereby,”
and other similar words refer to this entire Agreement; (c) the words “include”,
“includes”, and “including” when used in this Agreement shall be deemed to be
followed by the words “without limitation”, unless otherwise specified; (d) the
terms “Article”, “Section” and “Schedule” refer to the specified Article,
Section and Schedule of this Agreement; and (e) the phrase “unreasonably
withheld”, when used in connection with the right of a Party to consent or
approve an action, shall mean that such consent or approval shall not be
unreasonably withheld, conditioned or delayed. 
Whenever this Agreement refers to a number of days, unless otherwise
specified, such number shall refer to calendar days.

 

1.3           Additional Definitions. 
Each of the following definitions is set forth in the Section of this
Agreement indicated below:

 

	
  Definition

  	
   

  	
  Section

  
	
  Agreement

  	
   

  	
  Preamble

  
	
  Confidential
  Information

  	
   

  	
  7.1.1

  
	
  Disclosing
  Party

  	
   

  	
  7.1.1

  
	
  Effective
  Date

  	
   

  	
  Preamble

  
	
  Force
  Majeure Event

  	
   

  	
  14.2

  

 

5

 

	
  Definition

  	
   

  	
  Section

  
	
  GRAS

  	
   

  	
  1.1.16

  
	
  IFF

  	
   

  	
  Preamble

  
	
  IFF
  Indemnitees

  	
   

  	
  12.1.2

  
	
  IFF
  Marks

  	
   

  	
  9.5.5

  
	
  Indemnitee

  	
   

  	
  12.2

  
	
  Indemnitees

  	
   

  	
  12.2

  
	
  Infringement
  Claim

  	
   

  	
  9.5.5

  
	
  Milestone

  	
   

  	
  5.2

  
	
  Parties

  	
   

  	
  Preamble

  
	
  Party

  	
   

  	
  Preamble

  
	
  Redpoint

  	
   

  	
  Preamble

  
	
  Redpoint
  Indemnitees

  	
   

  	
  12.1.1

  
	
  Supply
  Agreements 

  	
   

  	
  8.1

  
	
  Term

  	
   

  	
  11.1

  
	
  Third
  Party Claim

  	
   

  	
  12.1.1

  

 

ARTICLE 2

LICENSES

 

2.1           License Grants.

 

2.1.1        Subject
to Section 2.1.2 and the other terms and conditions of this Agreement, Redpoint
hereby grants to IFF an exclusive (even as to Redpoint) royalty-bearing license
(with the right to grant sublicenses in accordance with Section 2.2) under and
to the Licensed Technology to Develop, Manufacture, use and Commercialize Reb C
and Products in the Territory during the Term subject to the following:

 

(a)           the
First Purchase of Reb C occurs prior to the *** anniversary of the Effective
Date; and

 

(b)           royalties
calculated pursuant to Section 5.3.1 for any calendar quarter on a rolling
twelve-month basis are greater than or equal to the minimum royalties due and
payable pursuant to Section 5.3.2 for such calendar quarter;

 

provided that in the case of clauses (a) and (b)
above, the Milestones shall have been achieved; provided, further, that, to the
extent that either of the conditions above are not met, the exclusive license
granted hereunder shall become a non-exclusive license at such time.

 

2.1.2        No
later than ninety (90) days prior to the expiration of the Exclusivity Period,
the Parties will meet to negotiate in good faith an extension of the exclusive
license granted in Section 2.1.1 and the amount of royalties that shall be
payable connection therewith.  If at such
time, the Parties are unable to agree in good faith on the terms of such an extension,
the exclusive license granted in Section 2.1.1 above shall become non-exclusive
upon the expiration of the Exclusivity Period.

 

6

 

2.2           Sublicensing.

 

2.2.1        Generally.  IFF shall
have the right to sublicense the license grants under Section 2.1 to its
Affiliates and, with the prior consent of Redpoint, to Third Parties; provided
that such a sublicense by IFF to an Affiliate shall, unless otherwise agreed by
Redpoint, automatically terminate upon a change of control of such Affiliate in
connection with which such Affiliate ceases to be an Affiliate of IFF or upon
termination of the license grants hereunder. 
IFF shall ensure that each sublicense granted in accordance with this
Section 2.2 requires its Affiliate or permitted sublicensee to comply with all
of the applicable terms and conditions of this Agreement as if such Affiliate
or permitted sublicensee were a party to this Agreement and provides that such
Affiliate or sublicensee shall not further sublicense its rights.  IFF shall be responsible for its Affiliates’
and permitted sublicensees’ performance of and compliance with the applicable
terms and conditions of this Agreement.

 

2.2.2        Sublicensing Payments; Royalties.  In the event that IFF or any of its
Affiliates receives any upfront, milestone or other similar payments in
connection with its sublicense of the license grants as permitted hereunder,
IFF will pay to Redpoint, within thirty (30) days of receipt of such payment by
IFF or such Affiliate, an amount equal to *** of such payment.  In the event that IFF or any of its
Affiliates is entitled to receive a royalty or other similar payment in
connection with its sublicense of the license grants as permitted hereunder,
IFF will pay to Redpoint a percentage of such royalty at a rate equal to *** of
the royalty payable to IFF or such Affiliate, payable within thirty (30) days
of receipt of each such payment by IFF or such Affiliate, in accordance with
the terms of the applicable sublicense.

 

2.3           Subcontractors.  IFF
shall remain responsible for complying with all terms and conditions of this
Agreement regardless of whether a subcontractor performs any part of this
Agreement.  Any Third Party
subcontractors performing any of IFF’s obligations hereunder shall be subject
to confidentiality and non-use obligations at least as stringent as those set
forth in Article 8 and IFF shall ensure that the agreement with such Third
Party enables Redpoint to exercise the same rights with respect to Inventions
under this Agreement as if IFF had done the work itself.

 

2.4           No Implied Licenses. 
No implied licenses are granted under this Agreement.  IFF hereby covenants and agrees not to use
any of its rights under the licenses set forth in this Article 2 except as expressly
permitted in this Agreement.

 

2.5           Retained Rights. 
Except for the express rights granted to IFF in this Agreement, IFF
shall not enjoy or exercise any proprietary or property right or otherwise have
any other right, title or interest in, to or under the Redpoint Patents,
Redpoint Know-How, Redpoint Inventions, and IFF shall not represent to any
Third Party that it has any such proprietary or property right, or any other
right, title or interest.  Furthermore,
any rights of Redpoint not expressly granted to IFF under the provisions of
this Agreement shall be retained by Redpoint.

 

2.6           Nonassertion.  Subject
to the terms and conditions of this Agreement, including the rights granted to
IFF pursuant to the exclusive license provided herein, IFF and its Affiliates
hereby covenant and agree not to, alone or in cooperation with any Third Party,
assert that the exercise by Redpoint, its Affiliates, or their respective
sublicensees of their rights to Develop, Manufacture, use or otherwise
Commercialize Reb C or any product containing Reb C covered by the Licensed
Technology infringes any intellectual property rights of IFF or its Affiliates
or

 

7

 

their respective sublicensees. 
This covenant will run with and attach to any and all intellectual
property owned or controlled, in whole or in part, by Redpoint and shall be
binding upon any assignee of any intellectual property from Redpoint.   This provision shall survive the termination
or expiration of this Agreement.

 

ARTICLE 3

REGULATORY RESPONSIBILITIES

 

3.1           Overview.  IFF shall
be responsible for seeking and achieving Regulatory Notification for Reb C and
Products in the Territory, and all costs and expenses in connection
therewith.  IFF shall use its
commercially reasonable efforts to seek and achieve Regulatory Notification for
Reb C in the Territory, including GRAS Assessment with FEMA in the U.S.

 

3.2           Regulatory Notification. 
IFF shall be responsible, at its own expense, for preparing and filing
Regulatory Submissions and seeking and achieving Regulatory Notifications for
Reb C in the Territory, including generating any data and other information,
preparing all reports, and assembling panels of qualified scientific experts
necessary or desirable as part of a Regulatory Submission.  All such Regulatory Submissions shall be
filed in the name of IFF or its designees. 
IFF shall permit Redpoint access to and grant Redpoint the right to
reference and use all data, regulatory filings and regulatory communications
associated with Reb C.

 

3.3           Reporting.  On a quarterly
basis, due on each April 1, July 1, October 1 and January 2 after the Effective
Date and ending on achievement of Milestone 2, IFF shall provide Redpoint with
a detailed summary of all material meetings, conference calls, documents and
correspondence IFF has had with or receives from FEMA or other similar
organization or any Governmental Authority in each case relating to any
Regulatory Submission or Regulatory Notification for Reb C and Products during
the immediately preceding two months.

 

ARTICLE 4

DEVELOPMENT AND COMMERCIALIZATION

 

4.1           Overview and Diligence. 
IFF shall be solely responsible for Developing and Commercializing Reb C
and the Products in the Territory.  IFF
shall use commercially reasonable efforts to Commercialize Reb C and the Products
in the Territory.

 

4.2           Commercialization Plans and Reports.

 

4.2.1        Commercialization Plans.  IFF
shall prepare a written commercialization plan that describes the significant
Commercialization activities to be undertaken by IFF with respect to Reb C and
the Products in the Territory in the next calendar year (each, a “Commercialization Plan”). 
The initial Commercialization Plan for the Products shall be prepared
and delivered to Redpoint no later than twelve (12) months prior to the
anticipated First Purchase of Reb C.  By
no later than November 1st of each calendar year after the calendar year in
which the initial Commercialization Plan for the Products was delivered, IFF
shall prepare and deliver to Redpoint an updated Commercialization Plan for the
following calendar year.  The
Commercialization Plan shall also include a good faith forecast of quantities
in kilograms of Reb C to be used in Products in the Territory for such calendar
year.

 

8

 

4.2.2        Reports. On a quarterly basis, due on each April 1, July 1,
October 1 and January 2 after the Effective Date, IFF shall
prepare and deliver to Redpoint a written report summarizing IFF’s Development
and Commercialization activities with respect to Reb C and the Products in the
Territory performed by IFF during the prior two month period.

 

4.3           Expenses and Responsibilities.  IFF shall bear all of its costs and expenses
associated with the Development and Commercialization of Reb C and the Products
for sale or distribution in the Territory. 
IFF shall have the responsibility to distribute, sell, record sales and
collect payments for Reb C and the Products in the Territory.  IFF shall have responsibility for
establishing and modifying the terms and conditions with respect to the sale of
Reb C and the Products in the Territory, including the price or prices at which
Reb C or the Products will be sold, any discount applicable to payments or
receivables and similar matters.

 

ARTICLE 5

FINANCIAL TERMS

 

5.1           Upfront Fee.  As
partial payment for the rights and licenses granted by Redpoint pursuant to
this Agreement, IFF shall pay to Redpoint an aggregate upfront payment of
Five Hundred Thousand Dollars ($500,000) on the Effective Date, which payment
shall be non-creditable and non-refundable.

 

5.2           IFF Milestone Payments. 
In further consideration for the rights and licenses granted by Redpoint
hereunder, IFF shall also pay to Redpoint the payments set forth below for
the achievement by IFF of each such milestone referred to therein (each, a “Milestone”):

 

	
   

  	
   

  	
  Milestone Event

  	
   

  	
  Amount

  	
   

  
	
  Milestone 1

  	
   

  	
  Upon
  identification and validation of the first Supplier for commercial quantities
  of Reb C and agreement on cost, volume specifications and stability terms
  with such Supplier as set forth in an executed Supply Agreement

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  Milestone 2

  	
   

  	
  Upon
  receipt of GRAS Assessment for Reb C

  	
   

  	
  $

  	
  500,000

  	
   

  

 

In the event a Milestone is achieved, the Party
achieving such Milestone shall promptly, but in no event more than five (5) Business
Days after the achievement of such Milestone, notify the other Party in writing
of the achievement of the same.  For all
Milestones achieved, IFF shall promptly, but in no event more than thirty
(30) days after the achievement of each such Milestone, remit payment to
Redpoint for such Milestone.

 

5.3           Royalties on Purchases of Reb C.

 

5.3.1        Royalties Payable on Purchases of Reb C.  Subject to Section 2.1.2, during the
Royalty Term, as further consideration for Redpoint’s grant of the rights and
licenses to IFF hereunder, IFF will pay to Redpoint a royalty equal to ***
per *** of Reb C purchased by IFF or any of its Affiliates, agents or
sublicensees from a Supplier for use in Products; provided that such royalty
shall be increased to *** per *** of Reb C purchased by IFF or any its
Affiliates, agent or sublicensees from a Supplier for use in Products upon the
issuance of a Patent

 

9

 

Controlled by Redpoint or IFF or their respective Affiliates covering
Reb C as a sweetness enhancer or compositions of Reb C.

 

5.3.2        Minimum Royalties. 
Notwithstanding the foregoing, IFF will pay minimum royalties of no
less than (i) *** during the first (1st) twelve month period commencing
upon First Purchase of Reb C, (ii) *** during the second (2nd) twelve
month period commencing upon First Purchase of Reb C, (iii) *** during the
third (3rd) twelve month period commencing upon First Purchase of Reb C, and (iv) ***
during each successive twelve month period thereafter during the Royalty Term.

 

ARTICLE 6

PAYMENT TERMS

 

6.1           Payment Method.  All
amounts due to Redpoint hereunder will be paid in Dollars by wire transfer in
immediately available funds to an account designated by Redpoint.  Any undisputed payments or portions thereof
due hereunder that are not paid by the date such payments are due under this
Agreement will bear simple interest at the lower of a rate per annum equal to (a) one
percent (1%) per month, or (b) the maximum rate permitted by applicable
Law, calculated on the number of days such payment is delinquent.

 

6.2           Payment Schedules; Reports. 
The payments due pursuant to Sections 5.1 and 5.2 are due and payable on
the dates described therein.  Royalty
payments due pursuant to Section 5.3 are due and payable within thirty
(30) days of the end of each calendar quarter. 
IFF will accompany each payment of royalties under this Agreement with a
report setting forth the amount of Reb C purchased from Suppliers for use in
Products, and a calculation of the amount of royalty payment due on such
purchases.

 

6.3           Taxes.  The Parties
shall use reasonable efforts to reduce tax withholding on payments made to
Redpoint hereunder.  Notwithstanding such
efforts, if IFF concludes, after consultation with Redpoint, that tax withholdings
under the laws of any country are required, IFF may deduct from any
royalty payment that IFF is required to pay hereunder for such tax withholding
obligations.  IFF will provide Redpoint
with reasonable advance notice of tax withholding obligations to which it
reasonably believes that it is subject. 
Redpoint will provide IFF any information available to Redpoint that is
necessary to determine such withholding taxes. 
Such withholding taxes will be paid to the proper taxing authority for
Redpoint’s account and evidence of such payment will be secured and sent to
Redpoint within a reasonable period of time. 
The Parties will do all such lawful acts and things and sign all such
lawful deeds and documents as either Party may reasonably request from the other
Party to enable Redpoint and IFF to take advantage of any applicable legal
provision or any treaty provisions with the object of paying the sums due to
Redpoint hereunder with the lowest legal amount of withholding taxes.

 

6.3.1        Additional Withholding Taxes.  If, as a result of any change in the
corporate status or location of IFF, or the permitted assignment of this
Agreement by IFF, additional withholding taxes become due on payments from IFF
or its permitted assignee to Redpoint that would not have been due absent such
change in corporate status or location or permitted assignment, then IFF will
deduct withholding taxes in accordance with this Section 6.3, but will, in
addition to the sums otherwise payable under this Agreement, pay to Redpoint

 

10

 

such further sum as will ensure that, after deduction of withholding
taxes on all such sums, the net amount received by Redpoint equals the amount
that Redpoint would have received had such additional withholding taxes not
been deducted.

 

6.4           Records  Retention; Audit.

 

6.4.1        Record Retention.  IFF
will maintain complete and accurate books, records and accounts relevant for
the calculation of royalties on purchases of Reb C hereunder, in sufficient
detail to confirm the accuracy of any payments required under this Agreement,
which books, records and accounts will be retained by IFF for three (3) years
after the end of the period to which such books, records and accounts pertain,
or longer as is required by applicable Law.

 

6.4.2        Audit.  Redpoint will
have the right to have PricewaterhouseCoopers LLP (provided that at the time of
such audit there exists no conflict with such firm due to other services
provided to IFF), or such other independent certified public accounting firm of
internationally recognized standing mutually acceptable to the Parties, to have
access during normal business hours, upon reasonable prior written notice and
not more than once in each calendar year during the Term and for three (3) years
thereafter, or longer as is required by applicable Law, to such of the records
of IFF, its Affiliates, sublicensees and Suppliers as may be reasonably
necessary to verify the accuracy of the calculation of purchases of Reb C from
Suppliers and any payments under sublicensing arrangements, if applicable, for
any calendar year ending not more than three (3) years, or longer as is
required by applicable Law, prior to the date of such request.  Results of such inspections shall be made
available to both Redpoint and IFF; provided that  the accounting firm shall report to the Parties only the
final audited royalty payment amounts to be paid by IFF.  Redpoint will bear all costs of such audit,
unless the audit reveals a discrepancy in Redpoint’s favor of more than five
percent (5%), in which case IFF will bear the cost of the audit.

 

6.4.3        Payment of Additional Amounts.  If, based on the results of any audit,
additional payments are owed to Redpoint under this Agreement, IFF will
make such additional payments within thirty (30) days after the accounting firm’s
written report is delivered to the Parties. 
The provisions of Section 6.1 shall apply to such payment as of the
date such additional payments were originally due.

 

6.4.4        Confidentiality. 
Redpoint will treat all information that is shared with it in connection
with Redpoint’s audit rights under this Section 6.4 in accordance with the
provisions of Article 7.

 

ARTICLE 7

CONFIDENTIALITY

 

7.1           Confidential  Information.

 

7.1.1        Confidential Information. 
As used in this Agreement, the term “Confidential
Information” means all secret, confidential or proprietary
information or data, whether provided in written, oral, graphic, video,
computer, electronic or other form, generated pursuant to this Agreement or
provided pursuant to this Agreement by one Party (the “Disclosing 

 

11

 

Party”) to the other Party (the “Receiving
Party”), including but not limited to, information relating to the
Disclosing Party’s existing or proposed research, development efforts, patent
applications, business or products, and any other materials that have not been
made available by the Disclosing Party to the general public.  Notwithstanding the foregoing sentence,
Confidential Information shall not include any information or materials that:

 

(a)           were
already known to the Receiving Party (other than under an obligation of
confidentiality), at the time of disclosure by the Disclosing Party, to the
extent such Receiving Party has documentary evidence to that effect;

 

(b)           were
generally available to the public or otherwise part of the public domain at the
time of disclosure thereof to the Receiving Party;

 

(c)           became
generally available to the public or otherwise part of the public domain after
disclosure or development thereof, as the case may be, and other than through
any act or omission of a Party in breach of such Party’s confidentiality
obligations under this Agreement;

 

(d)           were
disclosed to a Party, other than under an obligation of confidentiality, by a
Third Party who had no obligation to the Disclosing Party not to disclose such
information to others; or

 

(e)           were
independently discovered or developed by or on behalf of the Receiving Party
without the use of the Confidential Information belonging to the other Party,
to the extent such Receiving Party has documentary evidence to that effect.

 

(f)            For
clarity, Redpoint Inventions shall be Confidential Information of Redpoint and
IFF Inventions shall be Confidential Information of IFF.

 

7.1.2        Confidentiality Obligations. 
Each of Redpoint and IFF shall not disclose, and shall keep all
Confidential Information of the other Party confidential with the same degree
of care it employs to maintain the confidentiality of its own Confidential
Information, but in no event less than a reasonable degree of care.  Neither Party shall use such Confidential
Information for any purpose other than in performance of, or in exercise of its
rights under, this Agreement or disclose the same to any other Person other
than to such of its and its Affiliates’ directors, managers, employees,
independent contractors, agents or consultants who have a need to know such
Confidential Information to implement the terms of this Agreement or enforce
its rights under this Agreement; provided, however, that a Receiving Party
shall advise any of its and its Affiliates’ directors, managers, employees,
independent contractors, agents or consultants who receives such Confidential
Information of the confidential nature thereof and of the obligations contained
in this Agreement relating thereto, and the Receiving Party shall ensure
(including, in the case of a Third Party, by means of a written agreement with
such Third Party having terms at least as protective as those contained in this
Article 7) that all such directors, managers, employees, independent
contractors, agents or consultants comply with such obligations as if they had
been a Party hereto.  For clarity,
nothing contained herein shall restrict Redpoint from disclosing its Confidential
Information to its and its Affiliates’ directors, managers, employees,
independent contractors, agents or consultants who are under similar

 

12

 

confidentiality obligations as set forth herein in connection with any
licensing, commercialization, financing, acquisition or other transaction.  Upon termination of this Agreement, the
Receiving Party shall return or destroy all documents, tapes or other media
containing Confidential Information of the Disclosing Party that remain in the
possession of the Receiving Party or its directors, managers, employees,
independent contractors, agents or consultants, except that the Receiving Party
may keep one copy of the Confidential Information in the legal department files
of the Receiving Party, solely for archival purposes.  Such archival copy shall be deemed to be the
property of the Disclosing Party, and shall continue to be subject to the
provisions of this Article 8.  It is
understood that receipt of Confidential Information under this Agreement will
not limit the Receiving Party from assigning its employees to any particular
job or task in any way it may choose, subject to the terms and conditions of
this Agreement.

 

7.1.3        Permitted Disclosure and Use.  Notwithstanding Section 7.1.2, a Party
may disclose Confidential Information of the other Party to the extent such
disclosure is reasonably necessary to: (a) achieve Regulatory Notification
of Reb C to the extent such disclosure is made to FEMA or a similar organization
or a Governmental Authority; (b) comply with or enforce any of the
provisions of this Agreement, including to prosecute and maintain Patents; (c) comply
with Laws; or (d) comply with an applicable securities laws and
regulations, stock exchange or Nasdaq rules. 
If a Party deems it necessary to disclose Confidential Information of
the other Party pursuant to this Section 7.1.3, such Party shall give
reasonable advance notice of such disclosure to the other Party to permit such
other Party sufficient opportunity to challenge or limit such disclosure or to
take measures to ensure confidential treatment of such information.

 

7.1.4        Governmental Requirements. 
Confidential Information that is disclosed by judicial or administrative
process shall remain otherwise subject to the confidentiality and non-use
provisions of this Section 7.1, and the Party disclosing Confidential
Information pursuant to law or court order shall take all steps reasonably
practical, including seeking an order of confidentiality, to ensure the
continued confidential treatment of such Confidential Information.

 

7.1.5        Notification.  The
Receiving Party shall notify the Disclosing Party promptly upon discovery of
any unauthorized use or disclosure of the Disclosing Party’s Confidential Information,
and will cooperate with the Disclosing Party in any reasonably requested
fashion to assist the Disclosing Party to regain possession of such
Confidential Information and to prevent its further unauthorized use or
disclosure.

 

7.2           Publicity; Filing of this Agreement.  Any publication, news release or other public
announcement relating to this Agreement or to the performance hereunder, shall
first be reviewed and approved by both Parties; provided,
however, that (a) once a press
release or other public announcement is approved in writing by both Parties, a
Party may make subsequent public disclosure of the information contained in
such press release or other public announcement without the further approval of
the other Party, and (b) any disclosure which is required by applicable
Law as advised by the disclosing Party’s counsel may be made by such Party
without the prior consent of the other Party. 
To the extent practicable, the non-disclosing Party shall be given at
least seven (7) Business Days advance notice of any such legally required
disclosure, and shall provide any comments on the proposed disclosure during
such period.  To 

 

13

 

the extent that either Party determines that it or the other Party is
required to file or register this Agreement or a notification thereof to comply
with the requirements of an applicable stock exchange or Nasdaq regulation or
any Governmental Authority, including the U.S. Securities and Exchange
Commission, the Competition Directorate of the Commission of the European
Communities or the U.S. Federal Trade Commission, such Party shall promptly
inform the other Party thereof.  Prior to
making any such filing, registration or notification, the Parties shall agree
on the provisions of this Agreement for which the Parties shall seek
confidential treatment, it being understood that if one Party determines to
seek confidential treatment for a provision for which the other Party does not,
then the Parties will use reasonable efforts in connection with such filing to
seek the confidential treatment of any such provision.  The Parties shall cooperate, each at its own
expense, in such filing, registration or notification, including such confidential
treatment request, and shall execute all documents reasonably required in
connection therewith.

 

7.3           Publication.  On and after the Effective Date and during the Term, the following
restrictions shall apply with respect to any academic, scientific, medical or
other publication or presentation or other disclosure by IFF that contains or
refers to the Licensed Technology: (a) IFF shall provide Redpoint with an
advance copy of any such proposed publication at least thirty (30) days prior
to the proposed publication date, and Redpoint shall have a reasonable
opportunity to recommend any changes it reasonably believes are necessary to
preserve such Licensed Technology; and (b) if Redpoint informs IFF, within
thirty (30) days of receipt of an advance copy of a proposed publication, that
such publication in its reasonable judgment could be expected to have a
material adverse effect on any Licensed Technology, IFF shall delay or
prevent such publication as proposed. 
IFF may publicly disclose without regard to the preceding requirements
of this Section 7.3 any information that was previously disclosed in a
public disclosure that was in compliance with such requirements.

 

7.4           Use of Names.  Neither
Party shall use the name of the other Party in relation to this transaction in
any public announcement, press release or other public document without the
prior written consent of such other Party, which consent shall not be
unreasonably withheld; provided, however, that either Party may use the name of the other
Party in any document filed with any regulatory agency or authority, including
the FEMA, FDA and the U.S. Securities and Exchange Commission.

 

7.5           Confidentiality of this Agreement.  The terms and existence of this Agreement
shall be Confidential Information of each Party and, as such, shall be subject to
the provisions of this Article 7.

 

7.6           Survival.  The
obligations and prohibitions contained in this Article 7 shall survive the
expiration or termination of this Agreement for a period of ten (10) years.

 

ARTICLE 8

MANUFACTURING AND SUPPLY

 

8.1           Manufacturing and Supply. 
As soon as practicable after satisfaction of Milestone 1, IFF shall
enter into supply agreements, purchase orders or other supply arrangements with
Suppliers for the manufacture and supply of Reb C (the “Supply
Agreements”).  Such Supply
Agreements shall include reasonable and customary provisions

 

14

 

with respect to forecasting and ordering and purchasing quantities of
Reb C on an ongoing basis based on actual demand for Products.  IFF shall promptly provide Redpoint with
copies of such Supply Agreements and any amendments or supplements thereto upon
execution of such agreements, amendments or supplements.

 

ARTICLE 9

OWNERSHIP OF INTELLECTUAL PROPERTY AND PATENT RIGHTS

 

9.1           Inventorship; Ownership of Inventions.

 

9.1.1        Inventorship. 
Inventorship for patentable Inventions conceived or reduced to practice
during the course of the performance of activities pursuant to this Agreement
shall be determined in accordance with United States patent laws.

 

9.1.2        Ownership.  All right,
title and interest in all Redpoint Inventions shall vest in Redpoint.  All right, title and interest in all IFF
Inventions shall vest in IFF.

 

9.2           Assignment by Employees. 
Each Party represents and agrees that its and its Affiliates’ employees
and consultants, shall be obligated under a binding written agreement to assign
to such Party, or as such Party shall direct, all Inventions made or conceived
during and as a result of the research or the development by such employee or
consultant; provided, that to the extent such Invention relates to the
Manufacture of Reb C, such Invention shall be assigned to Redpoint, and, to the
extent such Invention relates to flavor or flavor formulations or the use of
Reb C in flavor formulations, such Invention shall be assigned to IFF.  In the case of non-employees working for
other companies or institutions on behalf of Redpoint or IFF, Redpoint or IFF,
as applicable, shall use commercially reasonable efforts to obtain the right to
license all Inventions made by such non-employees on behalf of Redpoint or IFF,
as applicable, in accordance with the policies of the company or institution
employing such non-employee.  Redpoint
and IFF agree to undertake to enforce such agreements with employees or others
or such rights pertaining to non-employees (including, where appropriate, by
legal action) considering, among other things, the commercial value of such
Inventions.

 

9.3           Filing, Prosecution  and  Maintenance  of  Patents.

 

9.3.1        IFF
shall use commercially reasonable efforts to prosecute and maintain the
Redpoint Patents in Redpoint’s name at IFF’s sole cost and expense in the
United States and in such other jurisdictions as IFF may elect in its
commercially reasonable discretion.  As
soon as practicable after the Effective Date, Redpoint shall provide IFF with
copies of any patent applications included within the Redpoint Patents which
are not publicly available.  IFF shall be
responsible for filing, prosecuting and maintaining the Redpoint Patents,
including converting the provisional Patent applications into non-provisional
Patent applications and prosecuting and maintaining any foreign prosecution of
the Patent applications.  In addition, IFF
may combine one or more provisional applications into a single application if
IFF determines, in its reasonable discretion, that such action will not delay
issuance of a pending Redpoint Patent or decrease the likelihood of issuance of
a pending Redpoint Patent in a timely manner; provided that such action does
not adversely affect or reduce the scope of such pending Redpoint Patent.

 

15

 

9.3.2        IFF
shall provide Redpoint with advance copies (which may be in draft form) of all
material documents and filings as well as material correspondence from the
relevant patent offices, in each case relating to such Redpoint Patents,
including the Patent applications, and shall consider in good faith all
comments from Redpoint relating to such filings and correspondence.

 

9.3.3        If
IFF elects not to undertake (or after commencement of such filing, prosecution
and/or maintenance, desires to cease) the prosecution or the maintenance of any
Redpoint Patents consistent with its obligations set forth herein, then IFF
shall notify Redpoint of such election and Redpoint shall have the right, in
its sole discretion, to file, prosecute and/or maintain such Redpoint Patents
at its sole cost and expense.

 

9.4           Cooperation.  Redpoint
shall make available to IFF (or to IFF’s authorized attorneys, agents or
representatives), its employees, agents, subcontractors or consultants to the
extent reasonably necessary or appropriate to enable IFF to file, prosecute and
maintain Patents as set forth in Section 9.3 and for periods of time
reasonably sufficient for IFF to obtain the assistance it needs from such
personnel.  Where appropriate, Redpoint
shall sign or cause to have signed all documents relating to said Patents at no
charge to IFF.

 

9.5           Infringement  by  Third  Parties.

 

9.5.1        Notice. Each Party shall promptly give the other written
notice if it reasonably believes that any Licensed Technology, Redpoint
Invention or IFF Invention is being infringed or misappropriated by a Third
Party, and shall provide the other Party with all available evidence supporting
such belief.

 

9.5.2        Initial Obligation to Enforce.  For so long as IFF has an exclusive license
under Section 2.1.1, IFF shall use commercially reasonable efforts
and shall have the obligation to initiate a suit or take other appropriate
action that it believes is reasonably required to protect (i.e., prevent or
abate actual or threatened infringement or misappropriation of) or otherwise
enforce the Licensed Technology, Redpoint Inventions or IFF Inventions in the
Territory.   IFF agrees to notify Redpoint
of its intention to bring an action or proceeding and to keep Redpoint informed
of material developments in the prosecution or settlement of such action or
proceeding.  IFF shall be responsible for
all costs and expenses of any action or proceeding that IFF initiates and
maintains.  Redpoint shall cooperate
fully at its expense by joining as a party plaintiff if required to do so by
law to maintain such action or proceeding and by executing and making available
such documents as IFF may reasonably request. 
Redpoint may be represented by counsel of its choice in any such action
or proceeding, at Redpoint’s expense, acting in an advisory but not controlling
capacity.  The prosecution, settlement,
or abandonment of any infringement action or proceeding brought by IFF shall be
at IFF’s sole discretion; provided, that IFF may not enter into any settlement
that adversely affects Redpoint’s rights or interests hereunder in the Licensed
Technology.

 

9.5.3        Step-In Right.  If IFF
fails to elect or elects not to exercise such first right pursuant to Section 9.5.3
within ninety (90) days of evidence of an actual infringement, Redpoint shall
have the right, at its discretion, to institute and prosecute an action or
proceeding to abate such infringement and to resolve such matter by settlement
or otherwise.  Redpoint shall keep

 

16

 

IFF informed of material developments in the prosecution or settlement
of such action or proceeding.  Redpoint
shall be responsible for all costs and expenses of any action or proceeding
that Redpoint initiates.  IFF shall
cooperate fully by joining as a party plaintiff if required to do so by law to
maintain such action and by executing and making available such documents as
Redpoint may reasonably request.  IFF may
be represented by counsel in any such action or proceeding at its own
expense.  The prosecution, settlement, or
abandonment of any infringement action or proceeding brought by Redpoint shall
be at Redpoint’s sole discretion.

 

9.5.4        Recoveries.  If the
Parties obtain any damages, license fees, royalties or other compensation
(including any amount received in settlement of such litigation) from a Third
Party in connection with a suit brought by a Party pursuant to this Section 9.5,
such amounts shall be allocated as follows:

 

(i)            in
all cases to reimburse each Party for all expenses of such litigation,
including reasonable attorneys’ fees and disbursements, court costs and other
litigation expenses; and

 

(ii)           any
of the remaining amount that relates to the Products shall be split fifty-fifty
by the Parties.

 

9.5.5        Infringement Claims. 
If a Third Party at any time asserts a claim that the Licensed
Technology is invalid or unenforceable, or if any Third Party at any time
provides written notice of a claim to, or brings an action, suit or proceeding
against, any Party, or any of their respective Affiliates, claiming
infringement of its patent rights or unauthorized use or misappropriation of
its Know-How, based upon an assertion or claim arising out of the Development,
Manufacture or Commercialization of Reb C or a Product in the Territory (an “Infringement Claim”), control of the response to such claim
in the Territory shall, as between the Parties, be determined in the same
manner as enforcement rights are determined pursuant to Sections 9.5.2 and
9.5.3, with the time periods set forth in 9.5.3 shortened where necessary to
provide Redpoint sufficient time to respond without a loss of rights, and IFF
shall cooperate with Redpoint in the preparation and formulation of such
response, and in taking other steps reasonably necessary to respond, to such
Infringement Claim.  Neither Party shall
settle or compromise any Infringement Claim without the consent of the other
Party, which consent shall not be unreasonably withheld.

 

9.6           Trademarks.  IFF shall
select, register and own the trademarks, trade dress, logos, slogans and
internet domain names including any of the foregoing for the Products for use
in the Territory (the “IFF Marks”).
For purposes of clarity, the term IFF Marks shall not include the corporate
names and logos of Redpoint or its Affiliates.

 

ARTICLE 10

REPRESENTATIONS AND WARRANTIES

 

10.1         Representations
and Warranties.

 

10.1.1      Mutual Representations. 
Each of the Parties hereby represents and warrants to the other Party
that, as of the Effective Date:

 

17

 

(a)           Such
Party has full corporate right, power and authority to enter into this
Agreement and to perform its respective obligations under this Agreement;

 

(b)           This
Agreement is a legal and valid obligation binding upon such Party and
enforceable in accordance with its terms. 
The execution, delivery and performance of the Agreement by such Party
does not conflict with any agreement, instrument or understanding, oral or
written, to which it is a Party or by which it is bound, nor, to its knowledge,
violate any Law of any Governmental Authority having jurisdiction over it;

 

(c)           Such
Party has not granted any right to any Third Party that would conflict with the
rights granted to the other Party hereunder;

 

(d)           Except
for Regulatory Notifications, pricing and/or reimbursement approvals,
manufacturing approvals and/or similar approvals necessary for the Development,
Manufacture or Commercialization of Reb C and the Products, such Party has
obtained all necessary consents, approvals and authorizations of all Government
Authorities and other Persons required to be obtained by it as of the Effective
Date in connection with the execution, delivery and performance of this
Agreement; and

 

(e)           There
is no action or proceeding pending or, to such Party’s knowledge, threatened,
that questions the validity of this Agreement or any action taken by such Party
in connection with the execution of this Agreement.

 

10.1.2      Additional Representations of Redpoint.  Redpoint hereby represents and warrants to
IFF that, as of the Effective Date:

 

(a)           Redpoint
owns all right, title and interest in and to, or has a license, sublicense or
other permission to use and license in the Territory the Licensed Technology;

 

(b)           To
Redpoint’s knowledge, all patent applications within the Redpoint Patents are
still pending;

 

(c)           Redpoint
is not aware of any claim made against it asserting the invalidity or
non-infringement of any of the Redpoint Patents;

 

(d)           Redpoint
does not currently have an agreement with any Third Party granting a license
under or to any of the Licensed Technology to Develop, Manufacture or
Commercialize Reb C in the Territory; and

 

10.2         Limitation on Representations or Warranties.  Notwithstanding anything to the contrary
herein, neither Party will be in breach of any representation or warranty made
pursuant to this Article 10 to the extent that the Party alleged to have so
breached can demonstrate that the Party alleging such breach had, on or prior
to the Effective Date, actual knowledge of such breach of such representation or
warranty.

 

10.3         Disclaimer of Warranty. 
EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH IN SECTION 10.1, NEITHER
PARTY MAKES ANY REPRESENTATIONS NOR GRANTS ANY WARRANTIES, EXPRESS OR IMPLIED,
EITHER IN FACT OR BY

 

18

 

OPERATION OF LAW, BY STATUTE OR OTHERWISE, AND REDPOINT AND IFF EACH
SPECIFICALLY DISCLAIMS ANY OTHER REPRESENTATIONS AND WARRANTIES, WHETHER
WRITTEN OR ORAL, EXPRESS, STATUTORY OR IMPLIED, INCLUDING ANY WARRANTY OF
QUALITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE OR ANY
WARRANTY AS TO THE VALIDITY OF ANY PATENTS OR THE NON-INFRINGEMENT OF ANY
INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES. 
EACH PARTY HEREBY DISCLAIMS ANY REPRESENTATION OR WARRANTY THAT THE
DEVELOPMENT, MANUFACTURE AND COMMERCIALIZATION OF REB C OR PRODUCTS PURSUANT TO
THIS AGREEMENT WILL BE SUCCESSFUL.

 

10.4         Limitation of Liability. 
IN NO EVENT WILL EITHER PARTY BE LIABLE FOR LOST PROFITS OR FOR ANY
SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, HOWEVER
CAUSED, ON ANY THEORY OF LIABILITY AND WHETHER OR NOT SUCH PARTY HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, ARISING UNDER ANY CAUSE OF ACTION
AND ARISING IN ANY WAY OUT OF THIS AGREEMENT, EXCEPT AS A RESULT OF A PARTY’S
WILLFUL MISCONDUCT, GROSS NEGLIGENCE, RECKLESS CONDUCT OR A BREACH OF THE
CONFIDENTIALITY AND NON-USE OBLIGATIONS IN ARTICLE 7.  MOREOVER, THE FOREGOING LIMITATIONS WILL NOT
LIMIT EITHER PARTY’S OBLIGATIONS TO THE OTHER PARTY UNDER ARTICLE 12.

 

10.5         Essential Basis.  The
Parties acknowledge and agree that the disclaimers, exclusions and limitations
of liability set forth in this Article 10 form an essential basis of this
Agreement, and that, absent any of such disclaimers, exclusions or limitations
of liability, the terms of this Agreement, including the economic terms, would
be substantially different.

 

ARTICLE 11

TERM AND TERMINATION

 

11.1         Term.  This Agreement
shall commence as of the Effective Date and shall continue in effect until the
earlier of (a) the end of the Royalty Term or (b) the effective date of any
termination of this Agreement pursuant to Section 11.2 below (the “Term”).

 

11.2         Termination.

 

11.2.1      Breach.  Either Party
may, without prejudice to any other remedies available to it at Law or in
equity, terminate this Agreement in the event that the other Party shall have
materially breached or defaulted in the performance of any of its obligations
hereunder, including, in the case of IFF, IFF’s failure to use commercially
reasonable efforts to Commercialize Reb C and the Products.  The defaulting Party shall have thirty (30)
days (five (5) days in the event of non-payment) after receiving written notice
thereof to remedy such default.  Any such
termination shall become effective at the end of such thirty (30)-day period
(five (5)-day period for non-payment) unless the defaulting Party has cured any
such breach or default prior to the expiration of such thirty (30)-day period
(five (5)-day period for non-payment).

 

19

 

11.2.2      Bankruptcy.  Redpoint
may terminate this Agreement upon written notice to IFF at any time, to the
extent permitted by Law, if IFF shall make or seek to make or arrange an
assignment for the benefit of creditors, or if proceedings in voluntary or
involuntary bankruptcy shall be initiated by, on behalf of or against IFF (and,
in the case of any such involuntary proceeding, not dismissed within ninety
(90) days), or if a receiver or trustee of IFF’s property shall be appointed
and not discharged within ninety (90) days.

 

11.2.3      IFF Termination Right. 
After the *** anniversary of the Effective Date, IFF may terminate this
Agreement at any time upon ninety (90) days prior written notice to Redpoint.

 

11.3         Effects of Termination.

 

11.3.1      Without
limiting any other legal or equitable remedies that Redpoint may have, if this
Agreement is terminated pursuant to Sections 11.2.1 or 11.2.2 at any time or
pursuant to Section 11.2.3 prior to the expiration of the Royalty Term, all
licenses granted by Redpoint to IFF under this Agreement shall terminate in
their entirety on the effective date of the termination of this Agreement and
IFF shall as promptly as commercially practicable (a) transfer to Redpoint or
Redpoint’s designee (i) possession and ownership of all governmental or
regulatory correspondence, filings and approvals (including all Regulatory
Submissions) relating to the Licensed Technology, (ii) copies of all data,
reports, records and materials in IFF’s possession or control relating to the
Licensed Technology to the extent not publicly available, and (iii) all records
and materials in IFF’s possession or control containing Confidential
Information of Redpoint, and (b) if Redpoint so requests, transfer any Third
Party agreements, including the Supply Agreements relating to Reb C.  IFF shall execute all documents and take all
such further actions as may be reasonably requested by IFF in order to give
effect to the foregoing clauses (a) and (b).

 

11.3.2      Upon
the expiration of the Royalty Term, solely to the extent not earlier terminated
pursuant to Section 11.3.1, IFF shall have a fully paid, royalty-free,
irrevocable, non-exclusive license in the Licensed Technology to Develop,
Manufacture, use and Commercialize Reb C and Products in the Territory.

 

11.4         Accrued Rights. 
Termination of this Agreement for any reason will be without prejudice
to any rights that will have accrued to the benefit of a Party prior to the
effective date of such termination.  Such
termination will not relieve a Party from obligations that are expressly
indicated to survive the termination of this Agreement.

 

11.5         Survival.  The
following Articles and Sections, together with any definitions used or exhibits
referenced therein, will survive any termination or expiration of this Agreement:  Sections 6.3, 6.4.1, 6.4.4, 10.2, 10.3, 10.4,
11.3, 11.4, 11.5, 14.1, 14.3 and Articles 12 and 13.  Furthermore, Article 7 shall survive any
termination or expiration of this Agreement for a period of ten (10) years.

 

20

 

ARTICLE 12

INDEMNIFICATION; INSURANCE

 

12.1         Indemnification.

 

12.1.1      Indemnification by IFF. 
Except as it relates to claims brought under Article 9, IFF hereby
agrees to save, defend and hold Redpoint, its Affiliates, and their respective
directors, officers, agents, consultants and employees (collectively, “Redpoint Indemnitees”) harmless from and against any and all
Losses arising in connection with any and all charges, complaints, actions,
suits, proceedings, hearings, investigations, claims, demands, judgments,
orders, decrees, stipulations or injunctions by a Third Party (each a “Third Party Claim”) resulting from (a) any breach by IFF of
any of its representations, warranties, covenants or obligations pursuant to
this Agreement, (b) any alleged violation of any Laws by an IFF Indemnitee
relating to the Development, Manufacture, use or Commercialization of Reb C or
the Products, (c) the death of or any injury to any person or any damage to or
loss of property as a result of Products Developed, Manufactured, used,
Commercialized or otherwise distributed by IFF or its Affiliates or
sublicensees, (d) any negligent act, omission or misconduct of IFF, or its
Affiliates, sublicensees, distributors, wholesalers or agents in the Development,
Manufacture, use or Commercialization of the Products, or any other improper
activity conducted by IFF, or its Affiliates, sublicensees, distributors,
wholesalers or agents under this Agreement which is the proximate cause of
injury, death or property damage to a Third Party, or (e) any negligent act or
omission of IFF or its Affiliates or sublicensees in connection with
interactions and communications with Governmental Authorities, FEMA or other
similar organizations; in each case except to the extent that such Losses are
subject to indemnification by Redpoint pursuant to Section 12.1.2.

 

12.1.2      Indemnification by Redpoint. 
Redpoint hereby agrees to save, defend and hold IFF, its Affiliates, and
their respective directors, officers, agents, consultants and employees
(collectively, “IFF Indemnitees”) harmless from
and against any and all Losses arising in connection with any and all Third
Party Claims resulting from (a) any breach by Redpoint of any of its
representations, warranties, covenants or obligations pursuant to this
Agreement or (b) any negligent act, omission or willful misconduct by Redpoint
or its Affiliates or their respective officers, directors, employees, agents or
consultants in performing any obligations under this Agreement; in each case
except to the extent that such Losses are subject to indemnification by IFF
pursuant to Section 12.1.1.

 

12.2         Notice of Claim.  All
indemnification claims in respect of any indemnitee seeking indemnity under
Section 12.1 (collectively, the “Indemnitees”
and each an “Indemnitee”) will be made solely
by the corresponding Party (the “Indemnified Party”).  The Indemnified Party will give the
indemnifying Party (the “Indemnifying Party”)
prompt written notice (an “Indemnification Claim
Notice”) of any Losses or the discovery of any fact upon which such
Indemnified Party intends to base a request for indemnification under Section
12.1, but in no event will the Indemnifying Party be liable for any Losses that
result from any delay in providing such notice which materially prejudices the
defense of such Third Party Claim.  Each
Indemnification Claim Notice must contain a description of the claim and the
nature and amount of such Loss (to the extent that the nature and amount of
such Loss are known at such time).  Together
with the Indemnification Claim Notice, the Indemnified Party will furnish
promptly to the Indemnifying Party copies of all notices and documents
(including court papers) received by any Indemnitee in connection with the
Third Party Claim.  The Indemnifying
Party shall not be obligated to indemnify the Indemnified Party to the extent
any admission or statement made by the Indemnified Party materially prejudices
the defense of such Third Party Claim.

 

21

 

12.3         Control of Defense. 
At its option (and except for any claims, proceedings, or other actions
under Article 9), the Indemnifying Party may assume the defense of any Third
Party Claim subject to indemnification as provided for in Sections 12.1.1 and 12.1.2
by giving written notice to the Indemnified Party within thirty (30) days after
the Indemnifying Party’s receipt of an Indemnification Claim Notice.  Upon assuming the defense of a Third Party
Claim, the Indemnifying Party may appoint as lead counsel in the defense of the
Third Party Claim any legal counsel it selects. 
Should the Indemnifying Party assume the defense of a Third Party Claim,
the Indemnifying Party will not be liable to the Indemnified Party or any other
Indemnitee for any legal expenses subsequently incurred by such Indemnified
Party or other Indemnitee in connection with the analysis, defense or
settlement of the Third Party Claim.

 

12.4         Right to Participate in Defense.  Without limiting Section 12.3, any Indemnitee
will be entitled to participate in, but not control, the defense of a Third
Party Claim for which it has sought indemnification hereunder and to employ
counsel of its choice for such purpose; provided, however, that such employment will be at the Indemnitee’s
own expense unless (a) the employment thereof has been specifically authorized
by the Indemnifying Party in writing, or (b) the Indemnifying Party has failed
to assume the defense and employ counsel in accordance with Section 12.3 (in
which case the Indemnified Party will control the defense).

 

12.5         Settlement.  Except as
it relates to claims brought under Article 9 hereof, with respect to any Losses
relating solely to the payment of money damages in connection with a Third
Party Claim and that will not result in the Indemnitee becoming subject to
injunctive or other relief or otherwise adversely affect the business of the
Indemnitee in any manner, and as to which the Indemnifying Party will have
acknowledged in writing the obligation to indemnify the Indemnitee hereunder,
the Indemnifying Party will have the sole right to consent to the entry of any
judgment, enter into any settlement or otherwise dispose of such Loss, on such
terms as the Indemnifying Party, in its reasonable discretion, will deem
appropriate (provided, however
that such terms shall include a complete and unconditional release of the
Indemnified Party from all liability with respect thereto), and will transfer
to the Indemnified Party all amounts which said Indemnified Party will be
liable to pay prior to the time of the entry of judgment.  With respect to all other Losses in
connection with Third Party Claims, where the Indemnifying Party has assumed
the defense of the Third Party Claim in accordance with Section 12.3, the
Indemnifying Party will have authority to consent to the entry of any judgment,
enter into any settlement or otherwise dispose of such Loss provided it obtains
the prior written consent of the Indemnified Party (which consent will be at
the Indemnified Party’s reasonable discretion). 
The Indemnifying Party that has assumed the defense of the Third Party
Claim in accordance with Section 12.3 will not be liable for any settlement or
other disposition of a Loss by an Indemnitee that is reached without the
written consent of such Indemnifying Party. 
Regardless of whether the Indemnifying Party chooses to defend or
prosecute any Third Party Claim, no Indemnitee will admit any liability with
respect to, or settle, compromise or discharge, any Third Party Claim without
first offering to the Indemnifying Party the opportunity to assume the defense
of the Third Party Claim in accordance with Section 12.3.

 

12.6         Cooperation.  Except
as it relates to claims brought under Article 9 hereof, if the Indemnifying
Party chooses to defend or prosecute any Third Party Claim, the Indemnified
Party will, and will cause each other Indemnitee to, cooperate in the defense
or prosecution thereof and will furnish such records, information and
testimony, provide such witnesses and attend such

 

22

 

conferences, discovery proceedings, hearings, trials and appeals as may
be reasonably requested in connection with such Third Party Claim.  Such cooperation will include access during
normal business hours afforded to the Indemnifying Party to, and reasonable
retention by the Indemnified Party of, records and information that are
reasonably relevant to such Third Party Claim, and making Indemnitees and other
employees and agents available on a mutually convenient basis to provide
additional information and explanation of any material provided hereunder, and
the Indemnifying Party will reimburse the Indemnified Party for all its
reasonable out-of-pocket expenses incurred in connection with such cooperation.

 

12.7         Insurance.  IFF shall
obtain and maintain in force General Liability and Products Liability with
limits at a minimum of $***.  Such
insurance shall name Redpoint as an additional insured.  It is understood that such insurance will not
be construed to limit IFF’s liability with respect to its indemnification
obligations under this Article 12.  IFF
will provide to Redpoint upon request a certificate evidencing the insurance
IFF is required to obtain and keep in force under this Article 12.  Such certificate will provide that such
insurance will not expire or be cancelled or modified without at least thirty
(30) days’ prior notice to Redpoint.

 

ARTICLE 13

DISPUTE RESOLUTION

 

13.1         Disputes.  For all
matters under this Agreement, the Parties hereby agree that disputes shall be referred
to the designated senior executives of Redpoint and IFF (the “Representatives”).  If
any such matter has not been resolved within fifteen (15) Business Days of such
referral to the Representatives, then the Parties may mutually agree whether
such dispute should be determined through binding arbitration pursuant to the
provisions of Section 13.2 or through litigation pursuant to the provisions of
Section 13.3 and, if the Parties cannot so agree, then such dispute shall be
finally determined according to the provisions of Section 13.3.  In the event of any dispute between the
Parties arising in connection with Article 9 of this Agreement, the Parties
agree that the dispute resolution described under this Article 13 will be
conducted with sufficient dispatch to prevent loss of patent rights in the
disputed subject matter.

 

13.2         Arbitration.  In the
event that any dispute is referred to arbitration pursuant to Section 13.1,
then such arbitration shall be conducted in accordance with the commercial
rules of the American Arbitration Association in force on the date of
commencement of the arbitration.  The
arbitration will be final and binding, and judgment upon the award rendered by
the arbitrators may be entered in any court having jurisdiction thereof.  There will be three (3) arbitrators, with one
arbitrator selected by Redpoint and one arbitrator selected by IFF, which
arbitrators shall jointly select the third arbitrator.  The place of arbitration shall be New York,
New York or such other location mutually acceptable to the Parties and the laws
of the State of New Jersey shall apply to any such arbitration.  Each of the arbitrators must have at least
ten (10) years experience in commercial transactions.  The arbitration will commence within thirty
(30) days after appointment of the arbitrators and will continue uninterrupted,
unless otherwise suspended by the arbitrators for good cause, for not longer
than one hundred (120) days (including any discovery permitted by the
arbitrators).  The arbitrators will,
within such one hundred and twenty (120) day period, render a written decision
with findings of fact and conclusions of law and deliver such decision to the
Parties.  No arbitrator (nor the panel of
arbitrators) shall have the power to award punitive damages under this
Agreement and such

 

23

 

award is expressly prohibited. 
The decision of the arbitrators will be final and non-appealable and
binding upon the Parties, and may be entered and enforced in any court having
jurisdiction.  The Parties shall share
the costs of the arbitration equally.

 

13.3         Jurisdiction.  In the
event that any dispute is not referred to binding arbitration pursuant to
Section 13.1, then the Parties unconditionally and irrevocably agree and
consent to the exclusive jurisdiction of, and service of process and venue in,
the state and federal courts of New Jersey and waive any objection with respect
thereto, for the purpose of any action, suit or proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby and further
agree not to commence any such action, suit or proceeding except in any such
courts.

 

13.4         Injunctive Relief. 
Notwithstanding anything to the contrary in this Agreement, either Party
will have the right to seek temporary injunctive relief in any court of
competent jurisdiction as may be available to such Party under the laws and
rules applicable in such jurisdiction with respect to any matters arising out
of the other Party’s performance of its obligations under this Agreement.

 

13.5         Governing Law.  This
Agreement shall be governed by and construed under the substantive laws of the
State of New Jersey, without regard to conflicts of law rules that would
provide for application of the law of a jurisdiction outside the State of New
Jersey.

 

ARTICLE 14

MISCELLANEOUS

 

14.1         Entire Agreement; Amendment. 
This Agreement, including the Schedules attached hereto (each of which
is hereby incorporated herein by reference), sets forth the complete, final and
exclusive agreement and all the covenants, promises, agreements, warranties,
representations, conditions and understandings between the Parties hereto and
supersedes and terminates all prior agreements and understandings between the
Parties which will continue to govern the obligations of the Parties with
respect to information disclosed thereunder with respect to periods prior to
the Effective Date.  There are no
covenants, promises, agreements, warranties, representations, conditions or
understandings, either oral or written, between the Parties other than as are
set forth herein.  No subsequent
alteration, amendment, change or addition to this Agreement shall be binding
upon the Parties unless reduced to writing and signed by an authorized officer
of each Party.

 

14.2         Force Majeure. 
Neither Party shall be liable to the other for any failure or delay in
the fulfillment of its obligations under this Agreement (other than the payment
of monies due and owing to a Party under this Agreement), when any such failure
or delay is caused by fire, flood, earthquakes, explosions, sabotage, strikes,
lockouts, insurrections, civil commotions, riots, invasions, wars, acts of war
(whether war be declared or not), peril of the sea, acts, restraints,
requisitions, regulations or directions of, or omissions or delays in acting
by, Governmental Authorities, acts of God, or any similar cause beyond the
reasonable control of the performing Party (each, a “Force
Majeure Event”).  In the event
that either Party is prevented from discharging its obligations under this
Agreement on account of a Force Majeure Event, the performing Party will notify
the other Party forthwith, and will nevertheless make every

 

24

 

endeavor, in the utmost good faith, to discharge its obligations, even
if in a partial or compromised manner.

 

14.3         Notices.  All notices
or other communications that are required or permitted under this Agreement
will be in writing and delivered personally, sent by facsimile (and promptly
confirmed by personal delivery or overnight courier as provided in this
Agreement), or sent by internationally-recognized overnight courier to the
addresses below.  Any such communication
will be deemed to have been given (a) when delivered, if personally delivered
or sent by facsimile on a Business Day (so long as promptly confirmed by
personal delivery or overnight courier as provided in this Agreement), and (b)
on the second Business Day after dispatch, if sent by internationally-recognized
overnight courier.  Unless otherwise
specified in writing, the mailing addresses of the Parties shall be as
described below.

 

For IFF:                                                     International
Flavors & Fragrances Inc.

521 West 57th Street

New York, New York 10019

Phone: (212) 765-5500

Fax: (212) 708-7132

Attention: 
General Counsel

 

with a copy to:

 

For Redpoint:                      Redpoint Bio
Corporation

7 Graphics Drive

Ewing, New Jersey 08628

Phone: (609) 637-9700

Fax: 609.637.0126

Attention: Scott Horvitz, CFO

 

with a copy to:                Morgan, Lewis
& Bockius LLP

502 Carnegie Center

Princeton, New Jersey 08540

Fax: 609.919.6701

Attention:  Andrew P. Gilbert, Esq.

 

14.4         Independent Contractors. 
In making and performing this Agreement, IFF and Redpoint shall act at
all times as independent contractors and nothing contained in this Agreement
shall be construed or implied for any purpose to create an agency, partnership,
limited partnership, joint venture or employer and employee relationship
between IFF and Redpoint and this Agreement shall not be construed to suggest
otherwise.  At no time shall one Party
make commitments or incur any charges or expenses for or in the name of the
other Party.  Except as otherwise
provided in this Agreement, each Party shall be solely responsible for its own
costs and expenses associated with this Agreement.

 

14.5         Maintenance of Records. 
Each Party shall keep and maintain all records required by Law with
respect to Reb C and the Products and shall make copies of such records
available to the other Party during normal business hours, upon reasonable
prior written notice

 

25

 

and solely to the extent access to such records is necessary for a
Party to exercise its rights under this Agreement.

 

14.6         No Strict Construction. 
This Agreement has been prepared jointly and shall not be strictly
construed against either Party. 
Ambiguities, if any, in this Agreement shall not be construed against
any Party, irrespective of which Party may be deemed to have authored the
ambiguous provision.

 

14.7         Assignment.  Neither
Party will sell, transfer, assign, delegate, pledge or otherwise dispose of,
whether voluntarily, involuntarily, by operation of Law or otherwise, this
Agreement or any of its rights or obligations under this Agreement without the
prior written consent of the other Party (which consent may be granted,
withheld or conditioned at such other Party’s sole and absolute discretion); provided, however, that
either Party may assign or transfer this Agreement or any of its rights or
obligations under this Agreement without the consent of the other Party (a) to
any Affiliate of such Party, or (b) to any Third Party with which it merges or
consolidates, or to which it transfers all or substantially all of its assets
related to this Agreement.  The assigning
Party (unless it is not the surviving entity) will remain jointly and severally
liable with, and will guarantee the performance of, the relevant Affiliate or
Third Party assignee under this Agreement, and the relevant Affiliate assignee,
Third Party assignee or surviving entity will assume in writing all of the
assigning Party’s obligations under this Agreement.  Any purported assignment or transfer in
violation of this Section 14.7 will be void ab initio and
of no force or effect.

 

14.8         Counterparts.  This Agreement
may be executed in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.  Signatures provided by
facsimile transmission shall be deemed to be original signatures.

 

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

 

14.10       Severability.  If any
one or more of the provisions of this Agreement is held to be invalid or
unenforceable by any court of competent jurisdiction from which no appeal can
be or is taken, the provision shall be considered severed from this Agreement
and shall not serve to invalidate any remaining provisions hereof.  The Parties shall make a good faith effort to
replace any invalid or unenforceable provision with a valid and enforceable one
such that the objectives contemplated by the Parties when entering this Agreement
may be realized.

 

14.11       Headings.  The
headings for each article and section in this Agreement have been inserted for
convenience of reference only and are not intended to limit or expand on the
meaning of the language contained in the particular article or section.

 

14.12       No Waiver.  Any delay
in enforcing a Party’s rights under this Agreement or any waiver as to a
particular default or other matter shall not constitute a waiver of such Party’s
rights to the future enforcement of its rights under this Agreement, excepting
only as to an express written and signed waiver as to a particular matter for a
particular period of time.

 

26

 

[Signature Page Follows]

 

27

 

IN
WITNESS WHEREOF, the Parties have executed this License and Commercialization
Agreement in duplicate originals by their proper officers as of the Effective
Date.

 

 

	
  INTERNATIONAL
  FLAVORS & FRAGRANCES INC. 

  	
   

  	
  REDPOINT
  BIO CORPORATION 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Hernan Vaisman

  	
   

  	
  By:

  	
  /s/
  R. Raymond Salemme

  
	
   

  	
   

  	
   

  
	
  Name:  Hernan
  Vaisman

  	
   

  	
  Name:
   F. Raymond Salemme

  
	
   

  	
   

  	
   

  
	
  Title:  Flavors
  President

  	
   

  	
  Title:
   Chief Executive Officer

  
					

 

Signature Page to License and Commercialization Agreement

 

 

SCHEDULE 1.1.30

 

Redpoint
Patents

 

	
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