Document:

Manufacturing and Supply Agreement

 Exhibit 10.17 
  

	 	***	CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT (INDICATED BY ASTERISKS) HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A
REQUEST FOR CONFIDENTIAL TREATMENT UNDER 17 C.F.R. SECTIONS 200.80(B)(4), 200.83 AND 230.406. 

  
 MANUFACTURING AND 
 SUPPLY AGREEMENT 
  
 THIS MANUFACTURING AND SUPPLY
AGREEMENT is entered into effective as of June 30, 2002 (“Effective Date”), by and between ENHANCED DERM TECHNOLOGIES, INC., a
Delaware corporation (“EDT”) and SKINMEDICA, INC., a California corporation (“SM”). EDT and SM are each referred to as a “Party” to this
Agreement, and collectively as the “Parties.” 
  
 BACKGROUND 
  

	A.	SM desires to use EDT’s facilities, resources and expertise to manufacture the Product, as defined below. 

  

	B.	EDT desires to act as developer and contract manufacturer of the Product in accordance with the terms and conditions set forth in this Agreement. 

  

	C.	EDT desires to grant to SM an exclusive license to market and sell the Product for the purpose of the treatment of diseases in the Field in the Territory, as both terms are defined
below. 

  
 NOW, THEREFORE, in consideration of these premises and
the mutual covenants set forth below, EDT and SM agree as follows: 
  
 AGREEMENT 
  
 ARTICLE 1

 DEFINITIONS 
  
 For the purposes of this Agreement, the following capitalized terms shall have the following meanings: 
  
 “Acceptance Notice” shall have the meaning set forth in Section 14.1
of this Agreement. 
  
 “Affiliate” means any
corporation or other business entity controlled by, controlling or under common control with a Party hereto. For this purpose “control” shall mean direct or indirect beneficial ownership of fifty percent (50%) or more of the voting stock,
or a fifty percent (50%) or more interest in the income of, such corporation or other business entity. 
  
 “Arbitrator” shall have the meaning set forth in Section 15.2 of this Agreement. 
  
 “Certificate of Analysis” means a summary of the quality control testing, as described in the Product Specifications, performed by the Contract
Manufacturer for Finished Product supplied under this Agreement. 

 “cGMP” means current Good Manufacturing Practices of the U.S. Food and Drug Administration, as may be
amended from time to time. 
  
 “Claim” shall have the meaning set
forth in Section 15.2 of this Agreement. 
  
 “Commercially
Reasonable Efforts” means the effort by EDT or SM to deploy, in light of prevailing circumstances and taking into account obligations and commitments to third parties, sufficient resources, capital equipment, material and labor as might
reasonably be expected to achieve in an appropriate time-scale, the benefits which are anticipated to accrue to EDT and SM from the commercial exploitation of the Products, and if the Commercially Reasonable Efforts are to be directed to a specific
goal, then that goal. 
  
 “Confidential Information” shall have
the meaning set forth in Section 8.2.1 of this Agreement. 
  
 “Contract Manufacturer” shall mean DPT Laboratories, Ltd. or such other manufacturer of the Product selected by EDT and approved by SM. 
  

	“DelPouch	Product” shall have the meaning set forth in Section 14.1 of this Agreement. 

  
 “Effective Date” shall have the meaning set forth in the preamble to this Agreement. 
  
 “FDA” means the U.S. Food and Drug Administration. 
  
 “Field” means the treatment of pigmentation disorders. 
  
 “Finished Product” shall mean the Product together with all Labeling,
branding, trade dress and packaging set forth in the Product Specifications. 
  
 “Initial Term” shall have the meaning set forth in Section 11.1 of this Agreement. 
  
 “Know-How” means unpatented technical and other information, including without limitation, ideas, concepts, expertise, designs, inventions, discoveries,
data, formulae, specifications, procedures for experiments, patent and legal data or descriptions, marketing, sales and manufacturing data, tests and other protocols and techniques, which is necessary or useful to make, have made, use, have used,
offer for sale, sell and import the Product in the Field in the Territory. 
  
 “Labeling” means the primary container label, secondary packaging, package insert, shelf pack and shipper label specific to a Finished Product manufactured in accordance with the Product Specifications. 

 
 “Losses” shall have the meaning set forth in Article 12 of this
Agreement. 
  

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 “Manufacturing Standards” means the specifications for manufacturing, packaging, labeling and storing
the Products set forth in the Product Specifications, the master batch record, cGMPs, “material safety data sheets,” and all other applicable U.S. federal and state laws and regulations. 
  
 “Minimum Purchase Requirements” shall have the meaning set forth in
Section 3.4.1 of this Agreement. 
  

	“Offer	Notice” shall have the meaning set forth in Section 14.1 of this Agreement. 

  
 “Party” and “Parties” shall have the meanings set forth in the preamble to this Agreement. 
  
 “Patents” means all patents and patent applications in which EDT has rights
covering the Product and the Field, and any divisions, provisionals, renewals, continuations, continuations-in-part, extensions or substitutions thereof, including those patents set forth on Schedule I. 
  
 “Placebo” means a Product adjusted to be formulated without the active
ingredient. 
  
 “Product” means the product described on
Exhibit A to this Agreement, as it may be amended from time to time, and which is incorporated by this reference as though fully set forth in this paragraph. 
  
 “Product Specifications” means the specifications agreed to by both Parties for the manufacture of any Product and attached
hereto as Exhibit C. 
  
 “Regulatory Authority” means the
FDA or any equivalent or additional governmental or regulatory agencies having authority over EDT, EDT’s facilities, or the Products. 
  
 “Samples” means the Product size intended for distribution without charge to medical professionals.  
  
 “SM Improvements” shall have the meaning set forth in Section 4.4 of
this Agreement. 
  
 “Term” shall mean the Initial Term and any
extensions or renewals of the Initial Term in accordance with Section 11.1 of this Agreement. 
  
 “Territory” means the United States of America, including its territories, commonwealths and possessions. 
  
 “Unique Materials” shall have the meaning set forth in Section 3.12 of this Agreement. 
  
 ARTICLE 2 
 MANUFACTURE 
  

	2.1	 Exclusive Supply of Products. EDT shall supply, or cause to be supplied, and SM shall purchase all of SM’s Minimum Purchase Requirements of Finished
Product, including 

  

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Samples, for use in the Field in the Territory on the terms, and subject to the conditions, of this Agreement. EDT agrees that, during the Term of this
Agreement, SM shall have the exclusive right to purchase the Product from EDT and its Affiliates for resale in the Field and the Territory until such time as SM fails to satisfy the Minimum Purchase Requirements specified in Section 3.4.1
below and forfeits its exclusive right to purchase the Product in accordance with Section 3.4.3 below. 

  

	2.2	General Responsibilities. EDT will be responsible *** for all scale-up, validation, stability, formulation, Finished Product testing, and fill and finish work related to the
manufacture of the Product. 

  

	2.3	Conformance to Specifications. During the Term of this Agreement, and subject to the terms and conditions of this Agreement, EDT shall cause Contract Manufacturer to
formulate, fill and package the Product in accordance with the Product Specifications and Labeling requirements of SM. The Product shall conform to the Product Specifications. 

  

	2.4	Labeling. 

  

	 	2.4.1	EDT will label and package, or cause to be labeled and packaged, the Product in finished form (i.e., Finished Product), pursuant to a firm purchase order accepted by EDT as
described in Section 3.7, provided, however, that SM shall provide all specifications and artwork for packaging and trade dress for the Labeling and, and shall be responsible for the accuracy and final approval of Labeling before
manufacture. 

  

	 	2.4.2	SM shall determine the trademarks and trade names owned or licensed by SM to be used in connection with the Product and which trademarks and trade names will appear on the labels,
labeling, and any promotional materials for the Products. SM shall advise EDT as to the trademarks and trade names SM has selected for the Product. EDT shall use these trademarks and trade names and no other trademarks and trade names on the labels
and labeling for the Product. EDT shall have no right to use said trademarks and trade names other than in connection with its manufacturing and packaging Products for sale to SM under this Agreement. Upon expiration or termination of this
Agreement, EDT shall not use any of these trademarks or trade names, whether or not said trademarks or trade names have been registered with the U.S. Patent and Trademark Office. SM shall have the right to change trademarks and trade names and will
reimburse EDT for any costs incurred for labels or labeling bearing a trademark or trade name that SM has determined it no longer wants to use. 

  

	2.5	Raw Materials. EDT and/or Contract Manufacturer shall have the sole responsibility to source all raw materials used in the manufacture of the Product.

  

	2.6	Batch Testing; Certificate of Analysis. EDT shall test, or cause to be tested, in accordance with the Product Specifications, each batch of Product manufactured pursuant to
this Agreement before delivery to SM. Prior to each shipment of Product, EDT shall 

  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

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provide, or cause to be provided, to SM a Certificate of Analysis in customary form attesting to the quality of each batch contained within the shipment,
including review and approval by the appropriate quality control unit of all batch production and control records. EDT shall maintain or cause to be maintained and provide SM with such batch records and documentation, including information relating
to the manufacturing, packaging, labeling, and quality control testing and analysis for each lot of Finished Product produced hereunder as may be required by the FDA and under all applicable federal, state and local laws and regulations.

  

	2.7	Good Manufacturing Practices. EDT shall ensure that Contract Manufacturer and any other contractors/affiliates shall manufacture, store and prepare all Product and related
raw materials for shipping in accordance with the cGMPs, in a facility to be agreed upon by EDT and SM. EDT may not change manufacturing of the Product to an alternate facility without first obtaining SM’s written approval.

  

	2.8	Inspections. EDT authorizes SM to make reasonable inspections at Contract Manufacturer’s plant on the same terms as are available to EDT under its agreement with
Contract Manufacturer in order for SM to satisfy itself that the Contract Manufacturer manufactures and documents the Product according to current cGMPs. In furtherance of, and not limited by, the foregoing, SM shall use its Commercially Reasonable
Efforts to cause Contract Manufacturer to permit SM, at any time during the Term of this Agreement, upon reasonable prior notice and during reasonable business hours, to inspect the facility where the Product has been or is being manufactured or
stored, or the raw materials to be incorporated into the Products have been or are being manufactured or stored. The provisions of this Section 2.8 are subject to the confidentiality provisions of Article 8. SM shall be responsible for
its costs of travel and accommodation for such inspections. 

  

	2.9	Changes to Specifications. 

  

	 	2.9.1	The Product Specifications or manufacturing process shall not be supplemented, modified or amended in any respect without the prior written agreement of the Parties. If SM requests
a change to a Product Specification, including the manufacturing process, and EDT agrees that such change is feasible, such change shall be incorporated within the Product Specification pursuant to a written amendment to this Agreement which shall
specify the change and resulting increase in price agreed to by each of the Parties. 

  

	 	2.9.2	EDT may provide additional services in conjunction with the manufacture of the Products, such as additional formulation, process development or stability testing, at the request of
SM and pursuant to SM’s purchase order. 

  

	2.10	Placebos. If required for clinical trial work in the future, EDT shall also supply all of SM’s needs for Placebos, on terms to be agreed upon at that time.

  

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 ARTICLE 3 
 PLANNING AND SUPPLY 
  

	3.1	Supply of Product. EDT will produce, or cause to be produced, Finished Product to meet the mutually agreed upon forecasts, subject to the provisions of this Article 3.
EDT shall have the sole responsibility, financially and otherwise, for manufacturing the Product, either directly or through Contract Manufacturer or one or more Affiliates of EDT, receiving and processing orders and shipping the Finished Product to
SM. EDT shall bear all costs of the foregoing activities, including without limitation ***. EDT may utilize contractors to carry out its obligations hereunder, including Affiliates of EDT, only with the prior written consent of SM (provided that SM
is deemed to have hereby consented to the appointment of the initial Contract Manufacturer). EDT shall ensure, but cannot guarantee, that sufficient stock of the Product will be available in its inventory, or set aside by Contract Manufacturer, to
promptly fill orders from the trade based on the rolling non-binding forecasts provided by SM pursuant to Section 3.5. 

  

	3.2	Production. EDT will keep SM informed of all scheduled production activity for the Products. 

  

	3.3	Initial Supply of Product and Samples. EDT shall make available and SM shall purchase for commercial sale an initial supply of *** units of Product no later than ***;
provided however, that if the expiration date on Product is less than twenty (20) months, the initial supply required to be purchased by SM shall be *** units. The expiration dating shall be calculated as of the date that Product is
manufactured. For the avoidance of any doubt, the definition of “available” in this Section 3.3 shall mean that the initial supply of Product must be released from quarantine and ready for shipping by ***. 

 

	3.4	Minimum Purchase Requirements. 

  

	 	3.4.1	SM agrees to purchase a minimum of *** units of the Product per twelve (12) month period commencing with the first purchase of Product hereunder (the “Minimum Purchase
Requirements”). Subject to Section 11.2, any failure of SM to deliver firm purchases orders meeting the Minimum Purchase Requirements shall not be deemed to be a breach of this Agreement and shall result only in the loss by SM of its
exclusive right to purchase Product from EDT as set forth in Section 3.4.3 below.  

  

	 	3.4.2	If the FDA removes (or requires the removal) of the Product from the market, the Parties shall negotiate in good faith new minimum quantities. 

  

	 	3.4.3	If SM fails to purchase the Minimum Purchase Requirement in any given twelve (12) month period, EDT shall notify SM that it has failed to comply with this Section 3.4. If
within the *** following such notice, SM fails to order sufficient quantities of Product to bring it into compliance with Section 3.4.1, 

  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

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then SM shall be deemed to have forfeited its exclusive right to purchase the Product hereunder and EDT may proceed to sell the Product to third parties in
the Territory. 

  

	3.5	Forecasts. SM shall provide an initial production forecast for 2002 by July 1, 2002. Thereafter SM shall provide a twelve (12) month rolling production forecast every three
(3) months. Forecasts shall be submitted in the format set out as Exhibit D. Forecasts shall include the amounts of each Product and Samples to be manufactured and supplied by EDT and the expected timing for the delivery of each
shipment during the forecast period. 

  

	3.6	Purchase Orders. SM will place written purchase orders directly or through its designated representatives with EDT at least *** prior to requested shipment date, including
the following details: number of units, requested shipping date, shipping instructions and SM’s order reference number including the price calculated according to this Agreement. Each Purchase Order issued pursuant to this Agreement shall be
governed by the terms and conditions of this Agreement. 

  

	3.7	Acceptance of Purchase Order by EDT. EDT shall promptly acknowledge its receipt of purchase orders and inform SM of the anticipated dates of manufacture and delivery of each
Product presentation to SM. EDT shall respond in writing as to its acceptance of each firm purchase order within *** of receipt of such order In each twelve (12) month period commencing after December 20, 2002, EDT must accept each purchase order
from SM until such time as EDT has accepted purchase orders representing the Minimum Purchase Requirements in such period. All purchase orders which are accepted by EDT (or required to be accepted by EDT pursuant to this Section 3.7) shall be deemed
binding on both of the parties. 

  

	3.8	Shipment; Delays. EDT shall ship the Product to SM or the location designated by SM by the delivery date specified in the accepted purchase order. 

 

	3.9	Change Orders. The time of delivery and quantities specified in a purchase order accepted by EDT pursuant to Section 3.7 above shall be binding upon the Parties and
may not be changed or canceled. 

  

	3.10	Increased Demand. EDT will use Commercially Reasonable Efforts to accommodate SM’s requests for units in excess of those forecasted pursuant to Section 3.5;
provided, however, that EDT shall not be in breach of this Agreement if EDT, despite its Commercially Reasonable Efforts, is unable to supply quantities of Product to SM in excess of *** of the amount forecast for that year pursuant to
Section 3.5. 

  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

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	3.11	Shipment; Inspection; Rejection 

  

	 	3.11.1	Shipment of Product. EDT shall ship, or cause to be shipped, at SM’s expense, the Product to SM or such destination(s) as SM may designate in writing. Product will be
shipped FOB SM’s designated delivery location, and all risk of loss or damage therein shall pass to SM when each such order of the Product is delivered to SM’s designated facility. Title to the Product supplied to SM by EDT pursuant to an
applicable purchase order shall remain in EDT until delivery to the SM’s designated facility, at which time title shall pass to the SM and SM shall assume all risk of loss or damage. All invoices and other shipping documents shall be sent via
first class mail or by fax to SM’s address for notices under this Agreement. 

  

	 	3.11.2	Non-Conforming Product. SM may reject any batch of Product that does not conform to the Manufacturing Standards, subject to the terms of this Section. Within *** after
SM’s receipt of Product and batch documents, SM shall inspect the Product and notify EDT whether it will accept or reject the Product. No inspection under this Section shall relieve EDT of its obligations and warranties under this Agreement. If
SM rejects all or any part of any shipment of Product, the procedures to be followed are: 

  

	 	(a)	SM shall submit to EDT in writing any claim that Product does not conform with the Specifications or Manufacturing Standards (including conformance to cGMPs), accompanied by a
report of SM’s analysis (which analysis shall be conducted in good faith) and a sample of the Product at issue, explaining in reasonable detail the basis on which the allegedly nonconforming Product does not meet the Specifications or
Manufacturing Standards. Until any dispute concerning nonconformance is resolved pursuant to (b) (ii) below, ***. Only those tests listed in the Specifications may be used to demonstrate nonconformance of Product from the
Specifications. 

  

	 	(b)	EDT shall conduct its own analysis of the Sample in good faith within *** after the receipt by EDT of the report and Sample from SM, and provide the results to SM.

  

	 	(i)	If after EDT’s own analysis of the Sample EDT agrees with the claim of nonconformity, SM shall promptly inform EDT if SM wishes to have EDT replace the nonconforming Product
with conforming Product. If SM wishes to receive such replacement Product, EDT shall provide such replacement as soon as reasonably practicable thereafter, in which case SM shall be obligated to pay only for such replacement Product. SM shall not be
obligated to pay for the nonconforming Product, and EDT shall: 

  

	 	(A)	credit SM for the amount paid by SM to EDT for the nonconforming Product if SM has already paid for such nonconforming Product or 

  

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	 	(B)	cancel its invoice to SM for such nonconforming Product if SM has not yet paid for such nonconforming Product, and SM shall not be obligated to pay such canceled invoiced amount.

  

	 	(ii)	If, after its own analysis, EDT does not agree with the claim of nonconformity or determines that SM is responsible for the nonconformity, such Product shall be tested for
conformance with the applicable Specifications or Manufacturing Standards by an independent third party testing laboratory mutually acceptable to both parties. The independent analysis shall be binding on both Parties solely for the purpose of
determining whether such Product may be rightfully rejected. 

  

	 	(c)	After a final determination that the Product shipment is nonconforming, and if EDT is responsible for the nonconformity, SM shall return or destroy it at EDT’s request and cost
in the most cost effective and environmentally safe and appropriate manner available, consistent with federal, state and local laws and regulations. 

  

	 	3.11.3	Notwithstanding the other provisions of this Section 3.11, SM shall have no right to reject any Product that fails to conform with the Manufacturing Standards if the
nonconformance is attributable to (a) events outside of EDT’s control that occurred after delivery to SM’s designated facility, or (b) processes, procedures or Product components specified by SM in the Specifications, provided that
EDT followed or used such processes, procedures and Product components substantially in accordance with the Specifications and cGMPs. 

  

	3.12	Unique Materials. SM shall reimburse EDT for *** of “Unique Materials” (i.e., artwork, printed materials, labels, and cartons) purchased by EDT
expressly to meet its performance obligations under this Agreement in reliance upon a firm Purchase Order accepted pursuant to Section 3.7 and which later are made obsolete, or to the extent that such Unique Materials remain on hand at the
expiration or termination of this Agreement as provided under Article 11 unless terminated (i) by SM for breach by EDT or (ii) by EDT pursuant to Section 11.5. For purposes of this Section 3.12, material is obsolete if it cannot
be incorporated into the Product due to changes mandated by a Regulatory Authority, changes directed by SM, or SM-mandated cancellation or postponement. EDT may invoice SM for *** of Unique Materials after they are made obsolete. EDT’s invoices
shall identify the material in question and shall be accompanied by a statement of the cause of such obsolescence and a certification that EDT has disposed of such materials in accordance with the terms of this Agreement. 

 

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

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	3.13	Insurance. EDT and SM shall at their own expense obtain and maintain workers’ compensation and comprehensive general liability insurance with respect to performance
under this Agreement, in the amount of ***. 

  
 ARTICLE 4 
 PROMOTION & PRODUCT DEVELOPMENT

  

	4.1	Promotional Materials. SM shall create and develop at SM’s own expense, promotional materials relating to the Product for distribution to independent third parties. SM
will establish the copy platform for all promotional materials and develop tactical programs. 

  

	4.2	Training Materials. SM shall bear the expenses associated with training its sales force. SM shall develop programs to monitor, test and otherwise ensure that the SM’s
sales force is sufficiently knowledgeable about the Product and other information contained in SM’s training materials. 

  

	4.3	Clinical Studies. EDT shall provide SM with full access to all data generated by EDT on the Product, including clinical, regulatory and marketing data. In addition, SM, at
its expense, shall have the right to conduct pre-clinical or clinical studies with the Product for regulatory and commercial purposes. SM will own all data and results from such studies which have been paid for in full by SM; provided, however, that
EDT shall have the right to access such data/results for the purpose of making external presentations, with SM’s prior written consent. 

  

	4.4	Product Improvements. Product improvements, including but not limited to formulations improvements, identified, initiated or made by SM (“SM Improvements”)
shall be the property of SM. SM Improvements may not be used by EDT or any of its Affiliates without the prior written consent of SM, except with Products sold to SM hereunder. SM Improvements will be incorporated in the Product, covered under this
Agreement only by mutual and written agreement by both EDT and SM. 

  
 ARTICLE 5 
 PRICE AND PAYMENT
TERMS 
  

	5.1	Development Fee. SM shall pay EDT *** upon execution of this Agreement. SM shall pay EDT an additional *** prior to June 30, 2002. 

  

	5.2	Price for Products. SM shall pay EDT for Products the amounts for each Product and for each size or formulation set forth in Exhibit B to this Agreement, which Exhibit
may be amended from time to time by the mutual written agreement of the Parties. Prices for Products may be increased by EDT, not more than once each year, in order to reflect increases in *** for the relevant period. 

  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  
  

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	5.3	Invoices. EDT shall submit to SM an invoice with each shipment of Product. SM shall pay each invoice within *** of the date of each accurate invoice. SM shall not be
obligated to pay for any non-conforming shipment of Product. 

  
 ARTICLE 6 
 WARRANTIES 
  

	6.1	Quality. To facilitate quality control inspections by the Parties, EDT shall identify each Product shipment with a vendor lot number that is traceable to raw materials and/or
components used to manufacture such Product. 

  

	6.2	Representations and Warranties. 

  

	 	6.2.1	Product. EDT warrants that Product delivered to SM pursuant to this Agreement shall, at the time of delivery: 

  

	 	(a)	have been manufactured, filled, packaged and stored in accordance with all applicable laws, rules, regulations or requirements, including without limitation all FDA regulations;

  

	 	(b)	have been manufactured, filled, packaged and stored in accordance with, and will conform to, the Product Specifications and Manufacturing Standards; 

  

	 	(c)	will be free from defects in material, manufacturing and workmanship when delivered to SM’s designated facility; 

  

	 	(d)	will not have been adulterated or misbranded within the meaning of the Food, Drug and Cosmetic Act or be an article which may not, under the provisions of Sections 404 and 505 of
the Food, Drug and Cosmetic Act, be introduced into interstate commerce; 

  

	 	(e)	does not infringe upon the rights of any third party, including without limitation rights under (i) U.S. Patent 5,932,612 or (ii) any other patents that directly pertain to the
Product, and, in each case, any continuations or divisions of U.S. Patent 5,932,612 or such other patents; 

  

	 	(f)	have a *** from the date of manufacture. 

  

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 With respect to the representation in clause (f) above, EDT agrees to cause the Product to be delivered
to SM reasonably promptly after the manufacture of the applicable Product batch. 
  

	 	6.2.2	Licensing. EDT represents and warrants that it has obtained and will maintain on a current basis and will comply with all licenses, permits and approvals of applicable
governmental agencies as may be required to manufacture, test and store the Product pursuant to this Agreement and perform its other obligations under this Agreement. EDT shall be responsible for obtaining and maintaining licenses and permits for
manufacture, testing and storage of the Product and ensuring that the facilities used in the manufacture of the Product meet cGMPs in all respects. 

  

	 	6.2.3	Compliance with Laws. EDT represents and warrants that it shall comply in all respects with all federal, state, local and foreign laws, regulations and other requirements
applicable to the manufacture, testing and storage of the Product and the performance of EDT’s obligations under this Agreement. EDT shall have sole responsibility for adopting and enforcing safety procedures for the handling and manufacture of
the Product at its facilities and the proper handling and proper disposal of waste relating to the Product. 

  

	 	6.2.4	Binding Effect. Each Party hereby represents and warrants that this Agreement is a legal and valid obligation binding upon it and is enforceable in accordance with its terms,
except that the enforcement of the rights and remedies created hereby is subject to bankruptcy, insolvency, reorganization and similar laws of general application affecting the rights and remedies of creditors and that the availability of the remedy
of specific performance or of injunctive relief is subject to the discretion of the court before which any proceeding therefor may be brought. The execution, delivery and performance of this 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 may be bound, nor violate any law or regulation of any court, governmental body or administrative or other agency having authority over it.

  

	6.3	Limitations. 

  

	 	6.3.1	Limitations on Warranty. The warranties furnished in Section 6.2.1 shall not apply to defects caused by accident or willful damage, abuse, misuse, neglect, improper
testing, handling, storage or use after delivery by EDT or the common carrier of the Product in question to SM’s designated facility. 

  

	 	6.3.2	 No Implied Representations, Warranties or Conditions. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT, NEITHER EDT NOR SM MAKES ANY REPRESENTATIONS
OR WARRANTIES AND THERE ARE NO CONDITIONS, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE, WITH RESPECT TO PRODUCT SUPPLIED UNDER THIS 

  

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AGREEMENT, INCLUDING, WITHOUT LIMITATION, ANY REPRESENTATIONS, WARRANTIES OR CONDITIONS WITH RESPECT TO NONINFRINGEMENT, MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE OF SUCH PRODUCT, OR ARISING FROM A COURSE OF DEALING OR USAGE OF TRADE PRACTICE. 

  

	 	6.3.3	Limitation of Liability. EXCEPT FOR ANY LOSS, LIABILITY, DAMAGE OR OBLIGATION ARISING OUT OF OR RELATING TO THE DISCLOSURE OF CONFIDENTIAL INFORMATION PURSUANT TO ARTICLE
8 OR AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, IN NO EVENT SHALL EITHER PARTY HAVE ANY LIABILITY TO THE OTHER PARTY OR ANY OTHER THIRD PARTY FOR ANY LOST OPPORTUNITY, COSTS OF PROCUREMENT OF SUBSTITUTE GOODS OR SERVICES, OR FOR ANY
INDIRECT, INCIDENTAL, CONSEQUENTIAL, PUNITIVE OR SPECIAL DAMAGES ARISING OUT OF THIS AGREEMENT, UNDER ANY CAUSE OF ACTION OR THEORY OF LIABILITY (INCLUDING NEGLIGENCE), AND WHETHER OR NOT SUCH PARTY TO THIS AGREEMENT HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGE. THESE LIMITATIONS SHALL APPLY NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY. 

  
 ARTICLE 7 
 TECHNOLOGY TRANSFER 
  

	7.1	If for any reason EDT is unable to manufacture Product or provide sufficient quantity of Product to meet SM’s Minimum Purchase Requirements under this Agreement, after advance
written notice to EDT from SM and an opportunity to cure not to exceed an additional ***, SM shall have the right to manufacture, or have manufactured by any substitute manufacturer, the Product, in addition to its other rights and privileges under
this Agreement. In such event, EDT shall assist SM in qualifying a second source for the active ingredients in Product (excluding microsponge), providing technical assistance and documentation as necessary, including such manufacturing
technology and know-how so as to permit another entity to manufacture such active ingredients, and EDT agrees to cooperate with SM to facilitate any technology transfer (excluding microsponge) required in furtherance of the foregoing. SM’s
Minimum Purchase Requirements, and payment obligations to EDT pursuant to this Agreement, shall be temporarily suspended until EDT or the Contract Manufacturer can resume its manufacturing obligations or the expiration of any substitute
manufacturing or supply agreement entered into by SM with the substitute manufacturer 

  

	7.2	EDT shall provide SM with data on the chemical and physical properties, toxicity, and handling, storing, and shipping information for any materials supplied to SM by EDT and any
other information available to EDT that is necessary for the safe conduct of the manufacturing of the Product by SM or the substitute manufacturer. EDT shall supply SM with pertinent information regarding health or safety hazards to workers relating
to materials supplied to SM by EDT. EDT shall update all of such information provided to SM as such information becomes available to EDT. 

  

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	7.3	In the event of any transfer of manufacturing responsibilities pursuant to this Article 7, EDT shall make available to SM, and SM shall purchase, SM’s minimum
requirements of microsponge components. The Parties shall negotiate in good faith with respect to the appropriate price for such microsponge components, and, in any event, EDT shall offer such microsponge components to SM on terms no less favorable
than the price attributable to the microsponge components included in Product previously supplied pursuant to this Agreement. 

  

	7.4	At such time as SM shall have the right to manufacture, or have manufactured, the Product in accordance with this Article 7, EDT shall be deemed to have granted to SM a
license, under the Patents and Know-How (and any improvement in or modification thereof) to make, have made, use, have used, offer for sale, sell and import the Product for the Field in the Territory. Such license shall ***, other than payments for
microsponge components in accordance with Section 7.3 above. 

  
 ARTICLE 8 
 CONFIDENTIALITY 
  

	8.1	Public Relations and Announcements. Neither Party shall make any representations concerning the other without the prior consent from the other Party. Except for such
disclosure as is required by applicable law and/or stock exchange regulation, neither Party shall make any announcement, news release, public statement, publication or presentation relating to the existence of this Agreement or the arrangements
referred to in this Agreement without the other Party’s prior written consent, which consent will not be unreasonably withheld. The Parties agree to coordinate the initial announcement and/or press release relating to this Agreement.
Notwithstanding the foregoing, each Party consents to references to it in reports or documents or other disclosures sent to stockholders or filed with or submitted to any governmental authority or stock exchange. The Parties agree that once approval
for disclosure of information has been obtained in accordance with the provisions of this Section 8.1, the Party that requested such approval shall be entitled to use such information without any obligation to seek further approval.

  

	8.2	Confidentiality. 

  

	 	8.2.1	Confidential Information. The Parties acknowledge that by reason of their relationship to each other under this Agreement, each will have access to certain information
and materials concerning the other’s business, plans, trade secrets, customers (including, but not limited to, customer lists), technology, and/or products that is confidential and of substantial value to that Party, which value would be
impaired if such information were disclosed to Third Parties (“Confidential Information”). Each Party agrees that it will not use in any way other than expressly authorized or contemplated under this Agreement, nor

  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 14 

	 	 
disclose to any third party, any such Confidential Information revealed to it by the other Party (except that Confidential Information may be disclosed, as
required for the purposes of this Agreement, to any Regulatory Authority, an Affiliate, assignee, distributor, consultant or third party contractor or research and development organization under similar written obligations of non-disclosure and
non-use), and will take every reasonable precaution to protect the confidentiality of such information and with no less restrictive precautions than it takes to protect its own confidential information. If Confidential Information is required to be
disclosed in response to a valid order by a court, Regulatory Authority or other government body of competent jurisdiction, or if otherwise required to be disclosed by law, or if necessary to establish the rights of either Party under this
Agreement, the receiving Party shall use Commercially Reasonable Efforts to provide the disclosing Party with advance notice of such required disclosure to give the disclosing Party sufficient time to seek a protective order or other protective
measures, if any are available, for such Confidential Information. 

  

	 	8.2.2	Exceptions. For purposes of this Agreement, information shall be deemed Confidential Information if such information, by its nature or due to the context within which
it is disclosed, is obviously intended by the disclosing Party to be kept confidential even if not identified as such in writing or with legends or other markings. Upon request by either Party, the other Party will advise whether or not it considers
any particular information or materials to be Confidential Information. Confidential Information does not include information, technical data or know-how that: 

  

	 	(a)	is or becomes publicly available through no fault of the receiving Party or its individual employees, agents or members amounting to a breach of this Agreement;

  

	 	(b)	is lawfully obtained on a non-confidential basis by the receiving Party from a third party who is not obligated to retain such information in confidence; 

 

	 	(c)	the receiving Party can demonstrate, by competent evidence, was known to it or any of its Affiliates from a source other than the disclosing Party or any of its Affiliates prior to
the disclosure under this Agreement; 

  

	 	(d)	the receiving Party can demonstrate by its written records is independently developed by employees of the receiving Party or an Affiliate of the receiving Party, which employees
were neither privy to nor had access to the Confidential Information and which is developed without use in any way of the Confidential Information; 

  

	 	(e)	 must be disclosed to governmental agencies, provided that: (A) this exception shall only apply to disclosure to such agencies, and not to any other person or
entity; and (B) the disclosing Party shall (1) provide the 

  

 15 

 
other Party with prompt notice (including copies of all written requests or demands) of any proposed disclosure to any governmental agency, with an
explanation of the Confidential Information of the other Party to be disclosed; and (2) cooperate in any lawful effort by the other Party to prevent, limit or restrict disclosure of its Confidential Information to such government agency. 

 
 In addition, in the event EDT is unable to manufacture Product or
provide sufficient quantity of Product and the provisions of Article 7 above permit SM to obtain a substitute manufacturer, SM may disclose Confidential Information to such substitute manufacturer to facilitate the manufacture of the Product
(except microsponge) in accordance with Article 7; provided that the substitute manufacturer enters into similar written obligations of non-disclosure and non-use as set forth in this Article 8. 
  

	8.3	Remedy. If either Party breaches any of its obligations with respect to this Article 8, or if such a breach is likely to occur, the other Party shall be
entitled to seek equitable relief, including specific performance or an injunction, in addition to any other rights or remedies, including money damages, provided by law, without posting a bond. 

  

	8.4	Return of Confidential Information. Within ten (10) days following the termination of any agreement between the Parties with respect to the subject matter the receiving Party
agrees to promptly return all tangible items relating to the Confidential Information, including all written material, photographs, models, compounds, compositions and the like made available or supplied by the disclosing Party to receiving Party,
and all copies thereof, upon the request of the disclosing Party, except such records as may be required to be kept for FDA or other government regulatory compliance. Recipient further agrees to identify those persons to whom the Confidential
Information that is the subject of this Agreement was disclosed upon request of the disclosing Party. 

  
 ARTICLE 9 
 ASSIGNMENT 
  

	9.1	Assignment. Neither Party shall have the right or authority to assign the Agreement or any portion of the Agreement, to sublet or subcontract in whole or in part, or
otherwise delegate its performance under this Agreement, except as contemplated hereunder or with the other Party’s prior written consent. Notwithstanding the foregoing, nothing in this Agreement shall prohibit EDT from assigning this Agreement
to any Affiliate of EDT that may from time to time own or operate the facility at Lafayette, Louisiana. No such assignment shall relieve EDT of primary liability for the performance of its obligations under this Agreement. 

 

 16 

 ARTICLE 10 
 FORCE MAJEURE 
  

	10.1	Force Majeure. Neither Party shall be considered in default of performance of its obligations under this Agreement, except any obligation under this Agreement to make
payments when due, to the extent that performance of such obligations is delayed by contingencies or causes beyond the reasonable control and not caused by the negligence or willful misconduct of such Party, including but not limited to strike,
fire, flood, earthquake, windstorm, governmental acts or orders or restrictions, or force majeure, to the extent that the failure to perform is beyond the reasonable control of the nonperforming Party, if the Party affected shall give prompt
written notice of any such cause to the other Party. The Party giving such notice shall thereupon be excused from such of its obligations under this Agreement for the period of time that it is so disabled, but the Agreement shall otherwise remain in
full force and effect. 

  
 ARTICLE
11 
 TERM AND TERMINATION 
  

	11.1	Term. This Agreement shall expire ten (10) years after the Effective Date (the “Initial Term”). At the end of the Initial Term, this Agreement shall
automatically renew for successive one (1) year periods under the same terms and conditions set forth under this Agreement (or such other terms agreed in writing by the Parties) until terminated in writing in accordance with the provisions of this
Agreement. 

  

	11.2	Termination for Material Breach. Either Party may terminate this Agreement upon written notice if the other Party has breached any of its material obligations under this
Agreement, and such breach has not been cured within *** after written notice of the breach. Additionally, EDT may terminate this Agreement, at its sole option, if SM fails to meet the Minimum Purchase Requirement in *** periods.

  

	11.3	Termination upon Insolvency. Either Party may, in addition to any other remedies available to it by law or in equity, terminate this Agreement immediately by written notice
to the other Party upon (i) the filing by the other Party of a voluntary petition in bankruptcy or seeking reorganization, liquidation, dissolution, winding-up, arrangement, composition or readjustment of its debts or any other relief under any
bankruptcy, insolvency, reorganization or other similar act or law of any jurisdiction now or hereafter in effect, (ii) the filing against such other Party of an involuntary petition in bankruptcy which is not dismissed within sixty (60) days, (iii)
the appointment of a receiver or trustee of any of such other Party’s property if such appointment is not vacated within sixty (60) days, (iv) the adjudication of such other Party as insolvent, or (v) the assignment of such other Party’s
property for the benefit of its creditors. 

  

	11.4	Termination for Force Majeure. Either Party may terminate this agreement upon thirty (30) days prior written notice in the event of the other Party’s inability to
substantially perform its obligations under this Agreement for more than one hundred eighty (180) days due to an event of force majeure as described in Article 10. 

  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 17 

	11.5	Termination without Cause. SM may terminate this Agreement upon *** written notice to EDT. EDT may terminate this Agreement after the expiration of the Initial Term upon ***
written notice to SM. 

  

	11.6	Accrued Liabilities. The termination of this Agreement for any reason shall not discharge either Party’s liability for obligations incurred under this Agreement and
amounts unpaid at the time of such termination. SM shall be liable to pay EDT for any Product, work in progress and materials purchased by EDT to fulfill its obligations under firm purchase orders under this Agreement, provided however that
EDT shall take all commercially reasonable steps to mitigate its damages under such circumstances. 

  

	11.7	Return and Disposition of Property. Upon the termination of this Agreement for any reason, each Party shall return to the other Party or its designee all of such other
Party’s property, including, but not limited to, all proprietary information in its possession. To the extent required by law or to comply with such Party’s continuing obligations under this Agreement, each Party may keep a single copy of
tangible property belonging to the other Party. EDT shall dispose of all bulk active ingredients, raw materials, containers, and Labeling not necessary to complete work in progress at SM’ expense in accordance with SM’ instructions.

  
 ARTICLE 12 
 INDEMNIFICATION 
  

	12.1	Indemnification by EDT. 

  

	 	12.1.1	EDT shall indemnify SM, its Affiliates and their respective directors, officers, employees and agents, and defend and save each of them harmless, from and against any and all suits,
losses, actions, demands, investigations, claims, damages, liabilities, costs and expenses (including, without limitation, reasonable attorneys’ fees and expenses) incurred by or rendered against any of them for personal injury, sickness,
disease or death or other damages (collectively, “Losses”) brought by third parties arising from or occurring as a result of: 

  

	 	(a)	a nonconformity of Product with the warranties under Sections 6.1 and 6.2 except for any damages attributable to the negligence of SM, its employees or agents;

  

	 	(b)	EDT’s failure to comply with the Product Specifications; 

  

	 	(c)	any willful act or omission or negligence of EDT or its employees, agents or other contractors in the manufacturing and testing of the Product; 

  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 18 

	 	(d)	any breach (or alleged breach) by EDT of its representations, warranties, or obligations under this Agreement; or 

  

	 	(e)	the manufacture or the storage of the Product prior to the delivery of Product to SM’s designated facility by EDT or its Affiliates; 

  
 all except to the extent caused by the negligence or willful misconduct of
SM or its officers, agents, employees, Affiliates, sublicensees or customers. 
  

	 	12.1.2	EDT shall indemnify, defend and hold harmless SM, its Affiliates and their respective directors, officers, employees and agents, and defend and save each of them harmless, from and
against any and all Losses incurred by or rendered against any of them related to any charge of infringement by a third party for the use, marketing or sale of any Product, including specifically with respect to United States Patent 5,932,612 and
any continuations and divisions thereof; except that such indemnity shall not apply to any marketing claims by SM that are materially inconsistent with those made by EDT prior to the Effective Date. 

  

	12.2	Indemnification by SM. SM shall indemnify EDT, its Affiliates and their respective directors, officers, employees and agents, and defend and save each of them
harmless, from and against any and all Losses brought by third parties arising from or occurring as a result of: 

  

	 	(a)	the use, sale or other distribution of the Product; 

  

	 	(b)	any willful act or omission or negligence of SM or its employees, agents or other contractors 

  

	 	(c)	any breach (or alleged breach) by SM of its representations, warranties, or obligations under this Agreement; or 

  

	 	(d)	the storage of Product after its delivery to the SM’s designated facility; 

  
 all except to the extent caused by the negligence or willful misconduct of EDT or its officers, agents, employees,
Affiliates, sublicensees or customers or the breach of any covenant, representation, warranty or agreement hereunder. 
  

	12.3	Process. If either Party expects to seek indemnification from the other pursuant to the provisions of this Article 12, it shall promptly give notice to the
indemnifying Party of any such Claim. The indemnifying Party shall have the right to control the defense of such Claim and the indemnified Party shall cooperate with the indemnifying Party in the defense of such Claim. No settlement or compromise of
any Claim shall be binding on a Party hereto without its prior written consent. 

  

 19 

 ARTICLE 13 
 AUDIT RIGHTS; INSPECTIONS 
  

	13.1	Inspections. SM, upon its own discretion and at its own cost and expense, is entitled during ordinary business hours and at dates acceptable to EDT to inspect or to have
inspected, EDT’s plant and procedures used for manufacture and storage of the Products as well as the books and records referred to in Section 13.2 below. 

  

	13.2	Books and Records. EDT agrees to maintain and cause its Affiliates to maintain complete and accurate books and records of account so as to enable SM to verify amounts due and
payable under this Agreement. In particular, EDT shall preserve and maintain all such records and accounts required for audit for a period of *** years after the calendar quarter for which the record applies. 

  

	13.3	Communications with Government Agencies. SM shall have the sole right and responsibility and shall bear all costs related to communications with any government
agencies to satisfy their requirements regarding the authorization and/or continued authorization to market the Product in commercial quantities in the Territory. EDT shall promptly notify SM of any inquiry or other communication that it receives
from the FDA concerning the Product. If required, SM shall be primarily responsible for all communications with the FDA (and state equivalent agencies) concerning the Product, including but not limited to reporting adverse events and responding to
any inquiries concerning advertising, detailing or promotional materials. EDT, however, shall be able to communicate with the any such governmental agency regarding the Product if: 

  

	 	(a)	such communication is necessary to comply with the terms of this Agreement or the requirements of any law, governmental order or regulation; or 

  

	 	(b)	EDT, if practical, made a request of such agency to communicate with SM instead, and such agency refused such request; provided, however, that before making any communication under
this Section 13.4, EDT shall, if practical, give SM notice as soon as possible of EDT’s intention to make such communications, and SM shall, if practical, be permitted to accompany EDT, take part in any such communications and receive
copies of all such communications. 

  

	13.4	Government Inspection. EDT agrees to advise SM by telephone and facsimile immediately of any proposed or announced visit or inspection, and as soon as possible but in any
case within *** of any unannounced visit or inspection, by any Regulatory Authority of any facilities owned by EDT in the performance of its obligations under this Agreement. EDT shall provide SM with a reasonable description of each such visit or
inspection promptly (but in no event later than five (5) calendar days) thereafter, and with copies of any letters, reports or other documents (including Form 483’s) issued by any such authorities that relate to the Products, or such
facilities, processes or procedures. SM may review EDT’s responses to any such reports and communications, and if practicable, and, insofar as timely received, SM’ reasonable views and requests shall be taken into account prior to
submission of such reports and communications to the relevant Regulatory Authority. 

  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 20 

	13.5	Notification and Recall. If any Regulatory Authority issues or requests a recall or takes similar action in connection with the Product, or if either Party determines
that an event, incident or circumstance has occurred which may result in the need for a recall or market withdrawal, the Party notified of or wishing to call such recall or similar action shall, within ***, advise the other Party of notification or
its determination by telephone or facsimile, after which the Parties shall promptly discuss and work together to effect an appropriate course of action; provided, however, that either Party may initiate a recall or market withdrawal
thereafter if it deems such action necessary or appropriate. SM shall be responsible for notification to FDA and compliance with applicable laws in conducting such recall. 

  

	13.6	Recall Expense. If a recall results from the breach of a Party’s warranties or obligations under this Agreement, the breaching Party shall bear the full expense
of both Parties incurred in any such recall. Such expenses of recall shall include, without limitation, the expenses of notification and destruction or return of the recalled Product and the sum paid for the recalled Product. If, however, a recall
is partially caused by SM’s actions or omissions and partially caused by EDT’s actions or omissions, then each Party shall be responsible for its proportionate share of the recall expenses based on its proportionate share of causation.

  
 ARTICLE 14 
 DELPOUCH PRODUCT 
  

	14.1	Right to Product in DelPouch Form. EDT hereby grants to SM the right to purchase the Product in DelPouch form (the “DelPouch Product”) from EDT on an
exclusive basis in the Field in the Territory prior to EDT’s offer of the DelPouch Product to any third party. In furtherance of the foregoing, EDT shall use Commercially Reasonable Efforts to offer the DelPouch Product as soon as reasonably
practicable and shall provide prompt written notice (the “Offer Notice”) to SM specifying the terms on which the DelPouch is available. SM may elect to exercise its right of first refusal hereunder by providing an affirmative notice
(the “Acceptance Notice”) to EDT within *** of the receipt of the Offer Notice. In such event, the Parties shall negotiate in good faith the definitive terms and agreements providing for the manufacture, purchase and supply of the
DelPouch Product. EDT agrees that SM shall not be required to pay *** with respect to the DelPouch Product and that the fees payable by SM pursuant to Section 5.1 above shall be deemed in full satisfaction of *** that EDT would otherwise
charge third parties with respect to the DelPouch Product. 

  

	14.2	Sale of DelPouch Product to Other Parties. In the event (i) SM does not provide an Acceptance Notice to EDT within such *** period or (ii) the Parties fail to agree on the
definitive terms and agreements for the manufacture, purchase and supply of 

  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 21 

	 	 
the DelPouch Product within *** of EDT’s receipt of the Acceptance Notice from SM, EDT shall have the right to offer the DelPouch Product to any other
third party on no more favorable terms than those offered to SM in the Offer Notice or, if applicable, the draft of the definitive agreements last offered by EDT to SM. 

  

	14.3	Certification of Terms. In the event that EDT enters into any definitive agreement with respect to DelPouch Product with a third party in accordance with the foregoing, it
shall provide SM with a certificate signed by an officer of EDT setting forth the material commercial terms of the definitive agreement and certifying that EDT has complied with the provisions of this Article 14.

  
 ARTICLE 15 
 DISPUTES 
  

	15.1	Governing Law. This Agreement shall be governed, controlled, interpreted and defined by and under the laws of the State of California and the United States without
regard to that body of law known as conflicts of law; provided that issues relating to the validity and enforceability of patents shall be governed by the laws of the jurisdiction under which such patent was granted. 

 

	15.2	Arbitration. Any claim, dispute, or controversy of whatever nature arising out of or relating to this Agreement, including, without limitation, any action or claim based on
tort, contract, or statute or concerning the interpretation, effect, termination, validity, performance and/or breach of this Agreement (“Claim”), shall be resolved by final and binding arbitration before a single arbitrator
(“Arbitrator”) who is knowledgeable in the subject matter at issue in the dispute. The Arbitrator will be selected by mutual agreement of the parties. The arbitration shall be held in Los Angeles County, California. Arbitration of
Claims between the parties shall be conducted in accordance with Sections 1282 through 1288 of the California Code of Civil Procedure. The Arbitrator shall, within 15 calendar days after the conclusion of the arbitration hearing, issue a written
award and statement of decision describing the essential findings and conclusions on which the award is based, including the calculation of any damages awarded. The Arbitrator shall be authorized to award compensatory damages, but shall NOT be
authorized (i) to award non-economic damages, such as for emotional distress, pain and suffering or loss of consortium, (ii) to award punitive damages, or (iii) to reform, modify or materially change this Agreement or any other agreements
contemplated hereunder; provided, however, that the damage limitations described in parts (i) and (ii) of this sentence will not apply if such damages are statutorily imposed. The Arbitrator also shall be authorized to grant any temporary,
preliminary or permanent equitable remedy or relief he or she deems just and equitable and within the scope of this Agreement, including, without limitation, an injunction or order for specific performance. Each Party shall bear its own
attorney’s fees, costs, and disbursements arising out of the arbitration, and shall pay an equal share of the fees and costs of the Arbitrator; provided, however, the Arbitrator shall be authorized to determine whether a Party is the
prevailing Party, and if so, to award to that prevailing Party reimbursement for its reasonable attorneys’ 

  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 22 

 
fees, costs and disbursements (including, for example, expert witness fees and expenses, photocopy charges, travel expenses, etc.), and/or the fees and costs
of the Arbitrator. Each Party shall fully perform and satisfy the arbitration award within 15 days of the service of the award. By agreeing to this binding arbitration provision, the parties understand that they are waiving certain rights and
protections which may otherwise be available if a Claim between the parties were determined by litigation in court, including, without limitation, the right to seek or obtain certain types of damages precluded by this provision, the right to a jury
trial, certain rights of appeal, and a right to invoke formal rules of procedure and evidence. 
  
 Notwithstanding the foregoing, either Party shall have the right to pursue an action in a court of competent jurisdiction to obtain injunctive or other
equitable remedy, in order to preserve the status quo during the resolution of any dispute under this provision. 
  
 ARTICLE 16 
 NOTICES 
  

	16.1	Notices. Any notice required or permitted by this Agreement shall be in writing and shall be sent by prepaid registered or certified mail, return receipt requested; by
facsimile; by internationally recognized courier; or by personal delivery, in each case addressed to the other Party at the address below or at such other address for which such Party gives notice under this Agreement. 

  
 If to SM, at: 
  
 SkinMedica, Inc. 
 2380 Camino Vida Roble, Suite C 
 Carlsbad,
CA 92009 
 Attn: Rex Bright, President and Chief Executive Officer 
  
 If to EDT, at: 
  
 Enhanced Derm Technologies, Inc. 
 123
Saginaw Drive 
 Redwood City, CA 94063 
 Attn: David O’Hara 
  
 Such notice shall be deemed to have been
given when delivered or, if delivery is not accomplished by some fault of the addressee, when tendered. Either Party may change its address for notice by delivering a written notice of the new address in accordance with this Article 16.

  

 23 

 ARTICLE 17 
 ADDITIONAL PROVISIONS 
  

	17.1	No Agency; Independent Contractor. Each Party is and shall be considered to be an independent contractor of the other Party. Neither Party shall be the legal agent of the
other for any purpose whatsoever and neither Party has any right or authority to make or underwrite any promise, warranty or representation, to execute any contract or otherwise to assume any obligation or responsibility in the name of or on behalf
of the other Party. Neither Party shall be bound by or liable to any third persons for any act or for any obligation or debt incurred by the other toward such third party, except to the extent specifically agreed to in writing by the Party so to be
bound. 

  

	17.2	Headings. Article and section headings contained in this Agreement are included for convenience of reference only and shall not affect in any way the meaning or
interpretation of this Agreement. 

  

	17.3	Partial Invalidity. If any provision of this Agreement is held to be invalid, illegal, or unenforceable by a court of competent jurisdiction, then: (a) such provision will be
deemed amended to conform to applicable laws of such jurisdiction so as to be valid and enforceable, or, if it cannot be so amended without materially altering the intention of the parties, it will be stricken; (b) the validity, legality and
enforceability of such provision will not in any way be affected or impaired thereby in any other jurisdiction; and (c) the remaining provisions of this Agreement will remain in full force and effect. 

  

	17.4	Survival. The covenants and agreements set forth in Articles 7, 8, 12 and 15 shall survive any termination or expiration of this Agreement and remain in full
force and effect regardless of the cause of termination. 

  

	17.5	Entire Agreement. This Agreement, including the attached Exhibits, constitutes the entire agreement of the Parties with respect to the subject matter, and supersedes all
prior or contemporaneous understandings or agreements, whether written or oral, between SM and EDT with respect to such subject matter. In particular, (a) this Agreement specifically supercedes and replaces the Mutual Confidential Disclosure
Agreement dated July 2, 2001 and the Hydroquinone/Retinol Cream Term Sheet dated July 30, 2001 in their entirety, and (b) in the event of conflict between this Agreement and the terms and conditions of any purchase order or other form generated in
performance of this Agreement, then the terms and conditions of this Agreement shall control, and (c) in the event of conflict between this Agreement and the Quality Agreement (as it may be amended from time to time), the terms of this Agreement
shall govern all aspects of the relationship between the Parties except that the Quality Agreement shall govern with respect to quality matters. 

  

	17.6	 Waivers. No waiver of any term or condition of this Agreement shall be valid or binding on either Party unless agreed in writing by the Party to be charged.
The failure of either Party to enforce at any time, or for any period of time, any provision of this Agreement, or the failure to require at any time performance by the other Party of any provision of 

  

 24 

 
this Agreement, shall in no way be construed to be a present or future waiver of such provisions or of the right of such Party thereafter to enforce that
provision or other provisions of this Agreement. 
  

	17.7	Restrictions; Ability to Subcontract. Insofar as EDT anticipates using contract laboratories for any activity contemplated by this Agreement, EDT shall notify SM when use of
such contract laboratories becomes necessary. EDT may not use any such contract laboratories without the prior written consent of SM. EDT shall be responsible for assuring that any contract laboratories comply with the terms of this Agreement and
applicable laws and regulations. 

  

	17.8	Amendment. No amendment or modification of this Agreement shall be valid or binding upon the Parties unless made in writing and signed by the duly authorized representatives
of both Parties. 

  

	17.9	Conflicting Terms and Conditions. All sales under this Agreement shall be subject to the provisions of this Agreement (including, without limitation, the
Specifications) and shall not be subject to the terms and conditions contained on any purchase order of SM or confirmation of EDT, except insofar as any such purchase order or confirmation establishes: 

  

	 	(a)	the quantity and form of any Product ordered; 

  

	 	(b)	the shipment date; 

  

	 	(c)	the shipment routes and destinations; or 

  

	 	(d)	the carrier. 

  

	17.10	Binding Effect and Assignment. Each Party agrees that its rights and obligations under this Agreement may not be transferred or assigned directly or indirectly, except as
follows: (a) either Party may transfer or assign this Agreement to an Affiliate of such Party which agrees in writing to undertake the obligations under this Agreement, (b) either Party may transfer or assign this Agreement in connection with the
sale of all or substantially all of the assigning Party’s related business, and (c) either Party may transfer or assign this Agreement to a non-Affiliate Third Party with the prior written consent of the other Party, which consent shall not be
unreasonably withheld. Subject to the foregoing, this Agreement shall be binding upon and inure to, the benefit of the Parties, their successors and assigns. Any attempted assignment contrary to the provisions of this Section 17.10 shall be
deemed ineffective, and either Party shall have the right to terminate this Agreement, with the effect described in Section 11.2. 

  

	17.11	Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the
same agreement. 

  

 25 

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

							
	SKINMEDICA, INC.	 	ENHANCED DERM TECHNOLOGIES, INC.
	(“SM”)	 	(“EDT”)
				
	By:	 	 /s/ Rex Bright

	 	By:	 	 /s/ David O’Hara

	Name:	 	Rex Bright	 	Name:	 	David O’Hara
	Title:	 	President and Chief Executive Officer	 	Title:	 	 

  

 26License and Supply Agreement

 Exhibit 10.18 
  

	 	***	CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT (INDICATED BY ASTERISKS) HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A
REQUEST FOR CONFIDENTIAL TREATMENT UNDER 17 C.F.R. SECTIONS 200.80(B)(4), 200.83 AND 230.406. 

  
 LICENSE AND SUPPLY AGREEMENT 
  
 This Agreement dated this 31st day of March, 2003, by and between Cardinal Health P.R. 409 B.V. having its principal offices at Rd 925 Km 6.1, Bo. Junquito, Humacao PR 00791 (hereafter called “Cardinal
Health”), and SkinMedica, Inc. (hereafter called “Purchaser”), having its principal offices at 5909 Sea Lion Place, Suite H, Carlsbad, CA 92008. 
  
 BACKGROUND 
  
 A. Cardinal Health specializes in manufacture, packaging and related services for the pharmaceutical and cosmeceutical industries and has certain
technical and commercial information and know-how relating thereto. 
  
 B. Purchaser is a Delaware corporation engaged in the business of marketing dermatological products. 
  
 C. Purchaser desires to engage Cardinal Health to manufacture and supply certain of Purchaser’s products. 
  
 D. Cardinal Health is the owner of certain proprietary patented packaging
technology commonly referred to as the DelPouch, which can be used in the unit-dose packaging of topical pharmaceutical and cosmeceutical products as well as certain proprietary delivery technology commonly referred to as Microsponge. 
  
 E. Purchaser desires to acquire from Cardinal Health, and Cardinal Health
desires to grant to Purchaser, an exclusive right to purchase certain Products as set forth herein using the aforesaid proprietary patented technologies upon the terms and conditions set forth herein. 
  
 TERMS 
  
 In consideration of the mutual promises made by the parties hereto and for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, intending to be legally bound, the parties hereto agree as follows: 
  
 1. DEFINITIONS 
  
 The following terms as used in this Agreement shall have the meanings set forth in this Article unless the context clearly indicates to the contrary:

  
 (a) “Affiliate(s)” with respect to Cardinal
Health, means Cardinal Health 400, Inc. (Sterile); Cardinal Health 402, Inc. (Development); Cardinal Health 403, Inc. (Oral); Cardinal Health 404, Inc. (Oral); Cardinal Health 405, Inc. (Development); Cardinal Health 407, Inc. and its subsidiaries
(Packaging); Cardinal Health 409, Inc. and its subsidiaries (Oral); Cardinal Health P.R. 409 B.V. (Sterile); Cardinal Health 410, Inc. (Sterile); Cardinal Health 411, Inc. (Commercialization); and any other subsidiary of Cardinal Health, Inc. as may
be designated by Cardinal Health, Inc. With respect to Purchaser, “Affiliate” means any corporation, firm, partnership or other entity which controls, is controlled by or is under common control with a party. For purposes of this
definition, “Control” shall mean the ownership of at least fifty percent (50%) of the voting share capital of such entity or any other comparable equity or ownership interest. 

 (b) “Agency” shall mean any governmental regulatory authority involved in regulating any
aspect of the development, Manufacturing, market approval, sale, distribution or use of the Product in the Territory. 
  
 (c) “Benzoyl Peroxide Products” shall mean collectively the trade and sample products to be Manufactured under this Agreement in three
(3) concentrations of benzoyl peroxide packaged both in a tube and DelPouch as requested by Purchaser in accordance with the terms and conditions of this Agreement, as described more completely on Attachment 2.  
  
 (d) “Calendar Quarter” shall mean each three (3) month
calendar period ending on the last day of March, June, September, or December of a given year. 
  
 (e) “Cardinal Health Materials” means all Cardinal Health Confidential Information, the Cardinal Health Patents, other intellectual property and developments (including all know-how, inventions,
designs, concepts, improvements, technical information, manuals, instructions or specifications), owned, licensed or used by Cardinal Health for drug delivery, or in developing or Manufacturing of Products and the packaging equipment, processes or
methods of Manufacturing, or any improvements to any of the foregoing, including any container, pouch, vial, ampoule or other form of container developed by Cardinal Health. 
  
 (f) “Cardinal Health Patent(s)” means the Patent(s) set forth in Attachment 1. 
  
 (g) “Certificate of Analysis” means a summary of the quality
control testing, as described in the Specifications, performed by the Cardinal Health for Products supplied under this Agreement. 
  
 (h) “cGMP” means current Good Manufacturing Practices of the U.S. Food and Drug Administration, as may be amended from time to time.

  
 (i) “Contract Year” means each twelve (12)
month period during the Term which begins on the Effective Date or anniversary of the Effective Date. 
  
 (j) “Delivery Date” shall mean the date set forth in the relevant Purchase Order on which Cardinal Health must supply Purchaser with
Products pursuant to Section 6(c). 
  
 (k)
“DelPouch” means certain proprietary patented packaging technology owned by Cardinal Health and described in U.S. Patent No. 6,007,264. 
  
 (l) “Effective Date” shall mean the date set forth on page 1 of this Agreement. 
  
 (m) “EpiQuin Product” shall mean the trade and sample
products to be Manufactured under this Agreement containing EpiQuin and packaged in a DelPouch in accordance with the terms and conditions of this Agreement, as described more completely on Attachment 2. 
  
 (n) “Facility” shall mean Cardinal Health’s facility at
Road 925 Km. 6.1 Bo. Junquito, Humacao, PR 00791 or facility at State Road #3 Km. 82.2 Humacao, P.R. 00791 or such other facility as agreed by the parties. 
  

 -2- 

 (o) “Force Majeure” shall mean any of the following events or conditions, provided that
such event or condition did not exist as of the date of execution of this Agreement, was not reasonably foreseeable as of such date and is not reasonably within the control of either party and prevents as a whole or in material part, the performance
by a party of its obligations hereunder: acts of state, governmental or regulatory action, orders, legislation, regulations, restrictions, priorities or rationing, riots, disturbance, war (declared or undeclared), terrorism, strikes, lockouts,
slowdowns, prolonged shortage of energy supplies, interruption of transportation, embargo (inability to procure or shortage of supply materials, equipment or production facilities), delay of subcontractors or vendors, acts of God, fire, earthquake,
flood, hurricane, typhoon, explosion and accident. 
  
 (p)
“Manufacture/Manufactured/Manufacturing” shall mean the compounding, filling, packaging and testing of the Products as provided in this Agreement, the Development Plan (as defined in Section 2, below), applicable master batch
records and the Specifications, including the development, scale-up, validation, stability, formulation, finished product testing. 
  
 (q) “Microsponge” means certain proprietary patented technology owned or licensed by Cardinal Health and described in U.S. Patent Nos.
5,145,675 and 4,690,825. 
  
 (r) “Patent(s)”
shall mean (i) valid United States patents, reexaminations, reissues, renewals, extensions, term restorations, divisionals, continuations and continuations in part thereof, and foreign counterparts thereof, and (ii) pending applications for the
United States and foreign patents and foreign counterparts thereof. “Patent” also includes a Supplementary Certificate of Protection of a member state of the European Community and any other similar protective rights in any other
country. 
  
 (s) “Product(s)” shall mean each of
or any of the products set forth on Attachment 2 Manufactured pursuant to this Agreement and the Specifications which (i) in the absence of this Agreement, the use, sale or distribution of which would result in the infringement of one or more claims
in the Cardinal Health Patents; or (ii) utilize Cardinal Health Materials. 
  
 (t) “Purchase Order” shall mean a written document issued by Purchaser to Cardinal Health in accordance with Section 6(c) hereof, authorizing Cardinal Health’s performance of Manufacturing
and other related services pursuant to the terms of this Agreement. 
  
 (u) “Purchaser’s Materials” shall mean all Purchaser Confidential Information, intellectual property and developments owned, developed or provided by Purchaser, including, without limitation, Patents, patent
applications, know-how, inventions, designs, concepts, improvements, technical information, trademarks or trade names relating to such materials. 
  
 (v) “Raw Materials” means all raw materials, supplies, components and packaging necessary to manufacture the Product in accordance with
the Specifications. 
  
 (w) “Scope of
Work” shall mean the responsibilities of Cardinal Health and Purchaser as set forth in Attachment 4. 
  
 (x) “Specifications” shall mean the specifications and quality control testing for each Product mutually agreed upon by the parties
promptly after the completion of the formulation work in the Development Phase (as defined in Section 5(a)) for such Product. The Specifications may be amended or modified only upon the written agreement of both parties. 
  

 -3- 

 (y) “Territory” shall mean the United States, its territories, commonwealths and
possessions. 
  
 (z) “Tube Agreement” shall mean
the Manufacturing and Supply Agreement between Enhanced Derm Technologies, Inc. and SkinMedica dated June 15, 2002. 
  
 2. DEVELOPMENT, SUPPLY, AND GRANT OF LICENSE 
  
 (a) Development Plan. Within *** following the execution of this Agreement, the parties shall execute a development plan for each Product
(“Development Plan”). The Development Plan shall set forth the responsibilities of the parties covering the activities and timing for the formulation and process development studies, package development and filling studies, pilot
scale compounding and filling studies, pre-validation compounding and filling studies, and validation and stability testing to support (i) transfer of the finalized EpiQuin formulation to Puerto Rico, (ii) transfer of the finalized Benzoyl Peroxide
formulation to Puerto Rico, and (iii) finalization of the DelPouch packaging. In the event of a conflict between the terms of this Agreement and the Development Plan, this Agreement shall control. 
  
 (b) *** 
  
 (c) Supply. Cardinal Health shall supply, and Purchaser shall purchase and pay for the Products, subject to the terms
and conditions of this Agreement, including the Scope of Work. Subject to the terms of Section 5(d), Cardinal Health agrees that Purchaser shall have the following exclusive purchase rights during the Term of the Agreement: 
  
 (i) Purchaser shall have the exclusive right to purchase from Cardinal
Health the EpiQuin Product (or any other product that contains hydroquinone as an active ingredient) in the DelPouch, but solely for use in the field of pigmentation disorders in the Territory, and solely to the extent they are available by
prescription, but not including any such product in a DelPouch that is sold to a consumer without a prescription; and 
  
 (ii) Purchaser shall have the exclusive right to purchase from Cardinal Health the Benzoyl Peroxide Products (or any other product that contains benzoyl
peroxide as the sole active ingredient) in the DelPouch for use in the Territory to the extent they are available by prescription, but not including any benzoyl peroxide product in a DelPouch that is sold to a consumer without a prescription.

  
 (iii) Purchaser shall have the exclusive right to purchase
from Cardinal Health the Benzoyl Peroxide Products as formulated with Microsponge in a tube for use in the Territory to the extent they are available by prescription, but not including any benzoyl peroxide product in a DelPouch that is sold to a
consumer without a prescription, provided, however, that Cardinal Health shall be entitled to continue supplying two current customers (and their successors or assigns) of Cardinal 
  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 -4- 

 
Health affiliates, who are currently purchasing benzoyl peroxide Microsponge entrapment from Cardinal Health affiliates. Cardinal Health and its Affiliates
agree not to supply benzoyl peroxide Microsponge entrapment, where benzoyl peroxide is the sole active ingredient, or the Microsponge to any third party (“Third Party Purchaser”) other than the two current customers unless the Third Party
Purchaser agrees in writing not to market, use, or distribute such material, or supply it to others to market, use, or distribute in a prescription product in the Territory where benzoyl peroxide is the sole active ingredient. 
  
 For purposes of clarity, Cardinal Health agrees that Cardinal Health and its
Affiliates shall not supply the Products, directly or indirectly, to any third party, including to its Affiliates, except (i) as set forth in subsection 2(c)(iii), or (ii) to the extent such Products are sold outside of the Territory, or (iii) to
the extent such Products are available without a prescription, or (iv) in the case of the Benzoyl Peroxide Products, to the extent such Products contain another active ingredient in addition to benzoyl peroxide, or (v) in the case of the EpiQuin
Products, to the extent such Products have an indication outside the field of treatment of pigmentation disorders. 
  
 (d) To the extent not prohibited by law, Purchaser shall not sell or distribute any Product to customers outside of the Territory or to any party whom
Purchaser knows, or has reason to believe, may export a Product outside the Territory. Purchaser shall obtain a representation and warranty from third party customers purchasing the Product from SkinMedica that such customers shall use, sell or
distribute the Products solely in the Territory. Purchaser shall take all reasonable actions within its legal rights and powers to cause such third parties to cease such exportation. 
  
 (g) Purchaser shall promote, market, and sell the Products only for use in the Territory. Purchaser shall use commercially
reasonable efforts and make reasonable expenditures to market and promote sales of the Products for use in the Territory. Purchaser’s good faith efforts and expenditures will be at least comparable to Purchaser’s efforts and expenditures
for other Purchaser products. Purchaser shall maintain a qualified sales organization sufficient to cover the Territory as accepted by industry standards, and Purchaser shall ensure that it gives proper coverage to the Products throughout the
Territory on a regular basis. During the term of this Agreement, Purchaser shall not, without Cardinal Health’s prior written consent, directly or indirectly, manufacture, promote or sell any product containing benzoyl peroxide or EpiQuin in
the concentrations identified in Attachment 2 other than those Products to be manufactured under this Agreement and the Tube Agreement. 
  
 (h) Trademark. 
  

	 	(i)	During the term of this Agreement, Cardinal Health grants to Purchaser a non-exclusive, royalty free license (without a right to sublicense) for the use of the trademarks identified
in Attachment 3 attached hereto (each, a “Trademark”) in connection with the Products and Purchaser agrees that the Trademark shall appear on the Products in a manner as generally depicted in Attachment 3 and subject to review and
approval by Cardinal Health. The Trademarks shall be used only in connection with, and subject to, the terms of this Agreement and only on the Products. Purchaser is further authorized to use, in connection with the foregoing, the Trademarks in
Product related marketing material including the use of the Trademarks in publicity, advertising, signs, product brochures, cartons and other forms of advertising (“Marketing Material”) subject to the terms and conditions of this
Agreement. 

  

 -5- 

	 	(ii)	Purchaser acknowledges the ownership of the Trademarks by Cardinal Health, agrees that it will do nothing inconsistent with such ownership, and agrees that all use of the Trademarks
by Purchaser and all good will developed from such use shall inure to the benefit of and be on behalf of Cardinal Health. Purchaser agrees to maintain the integrity of the Trademarks, use the Trademarks in accordance with good customary trademark
practice, and avoid taking any action that would in any manner impair or detract from the value of the Trademarks or the goodwill and reputation of Cardinal Health. Purchaser shall not use the Trademarks other than as strictly provided for herein.

  

	 	(iii)	Purchaser shall cooperate with Cardinal Health in facilitating Cardinal Health’s control of the use of the Trademarks, including complying with the conditions set forth from
time-to-time by Cardinal Health with respect to the style, appearance and manner of use of the Trademarks. Purchaser shall, if requested by Cardinal Health, place a notice on the Products and/or Marketing Material to identify the licensed use and
the proprietary rights of Cardinal Health. Purchaser shall, prior to any application of a Trademark to any Product or use in Marketing Material, provide to Cardinal Health a sample of such proposed use for review and written approval. The proposed
use of a Trademark shall be deemed approved unless Cardinal Health provides Purchaser with a written objection to the proposed use within seven (7) days of receipt of the sample. Marketing Material review and approval may include, without
limitation, content, style, appearance, composition, timing and media. 

  

	 	(iv)	The trademark license shall terminate concurrently with the exclusive rights to purchase Product as set forth in Section 2 of this Agreement. 

  
 3. RAW MATERIALS AND ARTWORK 
  
 (a) Raw Material. Cardinal Health shall be responsible for procuring,
inspecting and releasing adequate Raw Materials to Manufacture the Products. If Customer insists on a specific supplier to be used for a Raw Material, Customer shall be responsible for the timeliness of supply, quantity of supply and quality of
supply of such Raw Materials. If Cardinal Health provides reasonable documentation indicating that the cost of any such Raw Material is greater than Cardinal Health’s costs for such Raw Material of equal quality from other vendors, Cardinal
Health shall add the difference between Cardinal Health’s cost of the Raw Material and Customer’s mandated supplier’s cost to the Price of the Product. Customer will be responsible for all direct costs associated with qualification of
a new supplier of a Raw Material not previously qualified by Cardinal Health. 
  
 (b) Artwork. Purchaser shall provide approved specifications for labeling and packaging and approved artwork, trade dress, advertising and packaging information (collectively “Artwork”) to be
used by Cardinal Health to Manufacture the Product or approve such items in writing prior to procurement of Raw Materials. Artwork shall be considered a part of the Specifications. 
  

 -6- 

 (c) Reimbursement for Materials. Cardinal Health shall use reasonable commercial efforts to
maintain appropriate quantity of Raw Materials to meet the Firm Commitment. In the event of (i) a Specification change for any reason; or (ii) expiration or termination of this Agreement for any reason, Customer shall bear the cost of any unused Raw
Materials. 
  
 4. SHIPPING AND PAYMENT 
  
 (a) Shipping. Subject to the following provisions, all Product will
be delivered F.O.B. the Facility. The common carrier shall be selected by Purchaser and title and risk of loss of the Product shall pass to Purchaser upon delivery by Cardinal Health. Purchaser shall insure the Product in transit. 
  
 (b) Payment. Cardinal Health shall invoice Purchaser ***; provided,
however, that if Purchaser requests that Cardinal Health delay delivery beyond the delivery date specified in Purchaser’s Purchase Order, Cardinal Health shall invoice Purchaser on ***. Purchaser shall make full payment of each invoice to
Cardinal Health, at the address specified on the invoice, no later than *** from the date of receipt of such invoice. If Purchaser has not made payment in full by the expiration of such *** period, Cardinal Health may, at its option elect to: (i)
charge a late payment fee on such unpaid amount equal to *** per month of such unpaid amount; or (ii) suspend any further deliveries hereunder until such invoice is paid in full. 
  
 (c) Bill and Hold. If Purchaser fails to take delivery on any scheduled Delivery Date, Purchaser shall be invoiced on
the first day of each month for reasonable administration and storage costs. For each such lot of undelivered Product, Purchaser agrees that: (i) Purchaser has made a fixed commitment to purchase such Product, (ii) risk of ownership for such Product
passes to Purchaser, (iii) such Product shall be on a bill and hold basis for legitimate business purposes, (iv) if no delivery date is determined at the time of billing, Cardinal Health shall have the right to ship the Product to Purchaser within
four months after billing, and (v) Purchaser will be responsible for any decrease in market value of such Product that relates to factors and circumstances outside of Cardinal Health’s control. Within *** following a written request from
Cardinal Health, Purchaser shall provide Cardinal Health with a letter confirming items (i) through (v) of this Section for each batch of undelivered Product. 
  

(d) Advance Payment. If at any time, in Cardinal Health’s reasonable determination, Purchaser’s credit is materially impaired,
Cardinal Health shall have the right to require payment in advance before making any further shipment of the Product. If Purchaser shall fail, within a reasonable time, to make such payment in advance, or if Purchaser shall fail to make payment when
due, Cardinal Health shall have the right, at its option, to suspend any further deliveries hereunder until such default is corrected, without thereby releasing Purchaser from its obligations under this Agreement. 
  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 -7- 

 5. DEVELOPMENT FEES, PRICING, AND MINIMUM VOLUMES 
  
 (a) Development Fees. Purchaser has previously paid Cardinal Health
the development fee for the EpiQuin Products under the Tube Agreement. Purchaser shall pay Cardinal Health a prototype development fee of *** for the Benzoyl Peroxide Products upon execution of this Agreement. Purchaser shall pay *** of the
prototype development fee for Benzoyl Peroxide Products on the Effective Date and the remaining *** upon completion of the development of three prototype formulations for the Benzoyl Peroxide Products. Cardinal Health agrees to use commercially
reasonable efforts to complete development of the three prototype formulations by June 30, 2003. 
  
 (b) Product Price. Purchaser shall pay to Cardinal Health the price for Manufacturing and supplying the Product, as set forth in Attachment 5
attached hereto (“Price”). Any tax (other than Cardinal Health’s income or franchise taxes), however denominated and measured, imposed upon the Product or upon its Manufacture, production, packaging, storage, inventory, sale,
distribution, transportation, delivery, use or consumption shall be paid by Purchaser. 
  
 (c) Price Adjustments. The Price is subject to adjustment *** per Contract Year, effective on each anniversary date of this Agreement, upon *** written notice from Cardinal Health to Purchaser in an amount up
to ***. In addition to the foregoing, Cardinal Health shall be entitled to pass through the actual amount of all price increases for Raw Materials beyond the *** that are reasonably documented by Cardinal Health to Purchaser. Upon request, Cardinal
Health shall provide reasonable supporting documentation for such increases. 
  
 (d) Minimum Requirement. 
  
 (i) Purchaser shall purchase the minimum volume of *** units of EpiQuin Product (“Minimum EpiQuin Requirement”) during each twelve (12) month period, the first of which shall begin upon first acceptance of a shipment of an
EpiQuin Product by Purchaser. A unit is a single DelPouch sample or single use trade size. One (1) trade size tube equals sixty (60) units of EpiQuin Product. The parties further agree that Purchaser’s purchase of EpiQuin Products from Enhanced
Derm Technologies, Inc. (“EDT”) under the Tube Agreement shall count towards the Minimum EpiQuin Requirement. If Purchaser does not submit purchase orders to Cardinal Health with delivery dates sufficient to meet such Minimum
EpiQuin Requirement during each applicable *** period, at least *** prior to end of such *** period, Cardinal Health shall provide Purchaser a written notice of its failure to satisfy the Minimum EpiQuin Requirement. If Purchaser does not respond to
such written notice within *** and ***, Cardinal Health may convert the exclusive purchase rights granted by Cardinal Health to Purchaser for the EpiQuin Products under Section 2(c)(i) to non-exclusive purchase rights for the EpiQuin Products.
 
  
 (ii) Purchaser shall purchase the minimum
volume of *** units of the Benzoyl Peroxide Products in DelPouch (“Minimum BPO DelPouch Requirement”) and 
  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 -8- 

 
*** of Benzoyl Peroxide Products (“Minimum BPO Tube Requirement”) during each *** period, the first *** period to begin upon first
acceptance of a shipment of a Benzoyl Peroxide Product by Purchaser. A unit is a single DelPouch sample or single use trade size. If Purchaser does not submit purchase orders to Cardinal Health with delivery dates sufficient to purchase the Minimum
BPO DelPouch Requirement or the Minimum BPO Tube Requirement during each applicable *** period, at least *** prior to end of such *** period, Cardinal Health shall provide Purchaser a written notice of its failure to satisfy such requirements and
the parties shall have the following options: 
  
 (a) If (i)
Purchaser submits purchase orders to Cardinal Health with delivery dates sufficient to purchase *** units of Benzoyl Peroxide Products in DelPouch, and (ii) Purchaser does not pay to Cardinal Health the difference between the total amount Purchaser
would have paid to Cardinal Health if Purchaser had purchased *** units of Benzoyl Peroxide Product in DelPouch and the sum of all purchases of Benzoyl Peroxide Product in DelPouch from Cardinal Health during such *** period, then Cardinal Health
may convert the exclusive purchase rights granted by Cardinal Health to Purchaser for the Benzoyl Peroxide Products under Section 2(c)(ii) to non-exclusive purchase rights for the Benzoyl Peroxide Products. 
  
 (b) If (i) Purchaser submits purchase orders to Cardinal Health with
delivery dates sufficient to purchase less than *** of Benzoyl Peroxide Products in DelPouch, and (ii) Purchaser does not pay to Cardinal Health the difference between the total amount Purchaser would have paid to Cardinal Health if Purchaser had
purchased *** units of Benzoyl Peroxide Product in DelPouch and the sum of all purchases of Benzoyl Peroxide Product in DelPouch from Cardinal Health during such *** period, then Cardinal Health shall have the right to terminate the exclusive
purchase rights in Section 2(c)(ii) and terminate its supply to Purchaser of the Benzoyl Peroxide Products in a DelPouch. 
  
 (c) If (i) Purchaser submits purchase orders to Cardinal Health with delivery dates sufficient to purchase *** units of Benzoyl Peroxide Products in a
tube, and (ii) Purchaser does not pay to Cardinal Health the difference between the total amount Purchaser would have paid to Cardinal Health if Purchaser had purchased *** units of Benzoyl Peroxide Product in a tube and the sum of all purchases of
Benzoyl Peroxide Product in a tube from Cardinal Health during such *** period, then Cardinal Health may convert the exclusive purchase rights granted by Cardinal Health to Purchaser for the Benzoyl Peroxide Products in a tube under Section
2(c)(iii) to non-exclusive purchase rights for the Benzoyl Peroxide Products. 
  
 6. FORECAST, PURCHASE AND SUPPLY 
  
 (a)
Purchase and Supply. During the Term of this Agreement and subject to subsection (d) of this Section 6, Purchaser shall purchase and Cardinal Health shall supply such quantities of Product as shall be set forth on Purchase Orders issued by
Purchaser to Cardinal Health under this Agreement. Cardinal Health agrees to use commercially reasonable efforts to accept all Purchase Orders submitted by Purchaser for the purchase of the Products. 
  
 (b) Forecasts. Within ten (10) days after the Effective Date, and
thereafter on the first day of each calendar month during the term of this Agreement, Purchaser will provide Cardinal Health with a written twelve (12) month rolling forecast (commencing with the 
  

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 -9- 

 
immediately following month) of the quantity of Product which Purchaser expects to require from Cardinal Health during each of the next twelve (12) months
(“Forecast”). The first *** of the rolling Forecast shall be firm and binding upon Purchaser (“Firm Commitment”). Further, with regards to the next *** of the rolling Forecast, Purchaser agrees to submit
Purchase Orders for at least *** of such rolling Forecast, and Cardinal Health agrees to accept all Purchase Orders up to *** of such rolling Forecast. Cardinal Health shall use commercially reasonable efforts to accept all Purchase Orders submitted
by Purchaser in excess of the *** of such rolling Forecast. The following *** of the rolling Forecast shall constitute non-binding good faith estimates. Purchaser’s Forecast shall include (i) the required Delivery Date for the binding portion
of the Forecast, (ii) the quantity of Product to be delivered and (iii) the lot numbers to be applied to such Product. 
  
 (c) Purchase Order. Purchaser shall submit Purchase Orders for the Firm Commitment portion of the Forecast at least *** prior to the requested
Delivery Date. Within *** of receipt of a Purchase Order, Cardinal Health shall notify Purchaser in writing whether Cardinal Health has accepted such Delivery Dates or if not, shall, specify alternate Delivery Dates. Cardinal Health shall make
reasonable commercial efforts to accept the requested Delivery Date. 
  
 (d) Orders Greater than Forecast. Cardinal Health shall use its commercially reasonable efforts within its existing capacity to supply the quantity of Product ordered as set forth on the relevant Purchase Order, regardless of the
quantity forecast by Purchaser subject to the capacity limitations of Cardinal Health’s Manufacturing equipment and the Facility. 
  
 (e) Amendment of Purchase Orders. Cardinal Health will use commercially reasonable efforts to accommodate a request by Purchaser to amend a
Purchase Order to increase or decrease the quantity of Product to be delivered, provided, however, that the foregoing shall not affect or diminish Purchaser’s liability under the Firm Commitment portion of the Forecast or the Minimum
Requirement. In the event such amendment causes an increase in Cardinal Health’s cost to perform the Manufacturing, the Price shall be increased to reflect such increased cost. Cardinal Health shall notify Purchaser of such cost increase
promptly after Cardinal Health’s receipt from Purchaser of the amended Purchase Order, and the increase in such prices shall be effective for the first lot of Product Manufactured after the implementation date of such amendment. 
  
 (f) Terms of Agreement Govern. No modification or amendment to this
Agreement shall be effected by or result from the receipt, acceptance, signing or acknowledgement of any party’s purchase orders, Cardinal Health quotations, invoices, shipping documents or other business forms containing terms or conditions in
addition to or different from the terms and conditions set forth in this Agreement, and the terms of this Agreement shall supersede any provision in any Purchase Order, Specification or other document that is in addition to or inconsistent with the
terms of this Agreement. 
  

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 -10- 

 7. SPECIFICATION CHANGES 
  
 The Product Specifications and the manufacturing process agreed to by the parties shall not be supplemented, modified or
amended in any respect without the prior written agreement of the Parties. If either party requests a change to the Product Specifications, including the Manufacturing process, and the other party agrees with such change, the parties shall agree in
writing to the exact changes, as well as any change in Price associated with such change. 
  
 8. COMPLIANCE WITH AGENCY REGULATIONS 
  
 The parties agree to comply in all material respects with all laws and regulations of any Agency. Cardinal Health has and shall maintain all necessary or required registrations, permits, licenses and authorizations to
Manufacture the Products at the Facility. Purchaser shall obtain and maintain all registrations, permits, licenses and authorizations from all Agencies necessary or required for the sale, distribution, shipping, marketing, use or entering into
commerce of any Product. Further, to the extent Purchaser must obtain any permits or licenses necessary to Manufacture the Products at the Facility, Purchaser shall obtain and maintain all such registrations, permits, licenses and authorizations and
Cardinal Health agrees to provide Purchaser all reasonable assistance required to obtain or maintain such registrations, permits, licenses, and authorizations. 
  

9. FACILITY 
  
 (a) Manufacturing/Manufacturing. Cardinal Health hereby agrees to perform the Manufacturing at its Facility and shall not subcontract any portion
of the Manufacture to any other location without the prior written consent of Purchaser. 
  
 (b) Compliance with Laws. Cardinal Health will comply, in all respects, with all local applicable laws, rules and regulations relating to the services to be provided by Cardinal Health under this Agreement.
Cardinal Health shall also be responsible for adopting and enforcing safety procedures for the handling and Manufacture of the Product at the Facility and the proper handling and disposal of any waste relating to the Product. 
  
 (c) Agency Inspection and Communications. Cardinal Health hereby
agrees to advise Purchaser promptly of (i) any proposed or unannounced inspection of the Product or Manufacturing process or procedures by any Agency and will, to the extent practicable, permit Purchaser to be present during any such inspection, and
(ii) any other communication it receives from an Agency relating to any of the Products. If Purchaser is not present during such an inspection, Cardinal Health shall promptly provide a report of the results of the inspection to Purchaser.

  
 (d) Purchaser Technical Representative. During the term
of this Agreement, Purchaser shall have the right to have one or more technical representatives present in the area of the Facility where the Manufacturing is being conducted (or at another mutually agreeable time) to (i) review the Manufacturing;
(ii) review any relevant records in connection with such Manufacturing and assess its compliance with cGMP and the Specifications; and (iii) discuss any related issues with Cardinal Health’s management personnel. Purchaser’s technical
representatives, when on-site (including during any inspection conducted pursuant to Section 9(c)), shall comply with Cardinal Health’s rules and regulations. Purchaser shall indemnify and hold Cardinal Health and its Affiliates harmless from
all liability, including claims for workers’ compensation, resulting from the presence of Purchaser’s technical representatives at the Facility. 
  

 -11- 

 (e) Audit. Purchaser shall have the right during normal business hours, and upon at least ***
written notice to Cardinal Health, to inspect and audit in a reasonable manner those portions of the Facility in which Manufacturing is conducted in order to ensure Cardinal Health’s compliance with its obligations under this Agreement.
Purchaser and its authorized representatives will have the right to conduct *** quality compliance audit. Additional audits shall only be permitted upon agreement of both parties. 
  
 (f) Product Information. Purchaser, at its expense, shall furnish Cardinal Health with all available health, safety
and environmental information in its possession necessary for the Manufacture of the Product by Cardinal Health hereunder, including without limitation, material safety data sheets. 
  
 10. QUALITY OF MANUFACTURING 
  
 (a) Sampling and Testing of Products. Cardinal Health is responsible for all sampling and testing of the Products to assure that the Products are
in conformity in all respects with the Specifications. Prior to each shipment of Product, Cardinal Health shall provide Purchaser a Certificate of Analysis in customary form attesting to the quality of each batch contained within the shipment,
including review and approval by the appropriate quality unit of all batch production and control records. Purchaser, upon receipt of Products from Cardinal Health, shall have *** to inspect such Products. Any Product that is not rejected by
Purchaser within *** of receipt of the Products from Cardinal Health shall be deemed to have been accepted by Purchaser. In the event Purchaser believes that the Products do not conform in all material respects to the Specifications, Purchaser shall
send to Cardinal Health, via overnight delivery service or certified mail, return receipt requested, within *** of discovery of the defect, a notice of rejection along with samples of the rejected Products. Products that Cardinal Health agrees are
defective or non-conforming will be replaced by Cardinal Health in accordance with Section 10(b). If Cardinal Health does not agree with Purchaser’s determination that the Products fail to meet the Specifications in all material respects, the
rejected Products shall be submitted to a mutually acceptable third party testing laboratory, which shall determine whether such Products conform in all material respects to the Specifications. The parties agree that such testing laboratory’s
determination shall be final and the costs of such testing will be paid by the non-prevailing party. 
  
 (b) Replacement of Defective Products. Subject to subsection (a), Cardinal Health shall replace, at its sole expense, all Product that does not
conform to the Specifications with conforming Product. THE OBLIGATION OF CARDINAL HEALTH TO REPLACE DEFECTIVE PRODUCT AS PROVIDED IN THIS SECTION 10 SHALL BE PURCHASER’S EXCLUSIVE REMEDY UNDER THIS AGREEMENT AND IS IN LIEU OF ANY OTHER
WARRANTY, EXPRESS OR IMPLIED. 
  
 (c) Recalls. In the event
Cardinal Health believes a recall, field alert, Product withdrawal or field correction may be necessary for any Product provided under this Agreement, Cardinal Health shall immediately notify Customer in writing. Cardinal Health will not act to
initiate a recall, field alert, Product withdrawal or field correction without the express prior written approval of Customer, unless otherwise required by Applicable Laws. In the event Customer believes a recall, field alert, Product withdrawal or
field correction may be necessary for any 
  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 -12- 

 
Product provided under this Agreement, Customer shall immediately notify Cardinal Health in writing and Cardinal Health shall provide all necessary
cooperation and assistance to Customer. The cost of any recall, field alert, Product withdrawal or field correction shall be borne by Cardinal Health solely to the extent such recall, field alert, or Product withdrawal or field correction is a
result of Cardinal Health’s breach of its obligations under this Agreement or Applicable Laws or its negligence or willful misconduct; otherwise, Purchaser shall bear the cost of such recall, field alert, Product withdrawal or field correction.
For purposes hereof, such cost shall be limited to reasonable, actual and documented administrative costs incurred by Customer for such recall, withdrawal or correction. Defective Product shall be replaced in accordance with the terms and conditions
set forth in Section 10(b). 
  
 (d) Quality Agreement.
Within three (3) months following the execution of this Agreement, the parties shall execute a quality agreement (“Quality Agreement”). The Quality Agreement shall in no way determine liability or financial responsibility of the
parties for the responsibilities set forth therein. In the event of a conflict between the terms of this Agreement and the Quality Agreement, this Agreement shall control. 
  
 11. MANUFACTURING REPRESENTATIONS AND WARRANTIES 
  
 Cardinal Health represents and warrants that, at the time of delivery, (i) the Products supplied to Purchaser and the
Manufacturing provided hereunder shall comply in all respects with the Specifications, cGMPs, and applicable laws, rules and regulations within each Territory, (ii) the Product shall not be adulterated or misbranded within the meaning of the Food
Drug and Cosmetic Act (“Act”) or be an article which may not, under the provisions of Sections 404 and 405 of the Act be introduced into interstate commerce, (iii) the Products are labeled and packaged in accordance with
Purchaser’s Specifications for labeling and packaging, (iv) the Products shall have a *** from the date of manufacture, and ***. THE WARRANTY SET FORTH IN THIS SECTION 11 IS IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY
WARRANTY OF MERCHANTABILITY AND ANY WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE. EXCEPT FOR THE WARRANTIES EXPRESSED IN THIS SECTION 11, CARDINAL HEALTH MAKES NO OTHER WARRANTY, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THE MANUFACTURE OF THE
PRODUCTS. 
  
 12. GENERAL REPRESENTATIONS AND WARRANTIES 

 
 (a) Existence and Power. Each Party hereby represents and warrants
to the other Party that such Party (i) is duly organized, validly existing and in good standing under the laws of the state in which it is organized, (ii) has the power and authority and the legal right to own and operate its property and assets,
and to carry on its business as it is now being conducted, and (iii) is in compliance with all requirements of applicable law, except to the extent that any noncompliance would not materially adversely affect such party’s ability to perform its
obligations under the Agreement. 
  
 (b) Authorization and
Enforcement of Obligations. Each Party hereby represents and warrants to the other Party that such Party (i) has the power and authority and the legal right to enter into the Agreement and to perform its obligations hereunder and (ii) has taken
all necessary action on its part to authorize the execution and delivery of the Agreement and the performance of its obligations hereunder. The Agreement has been duly executed and delivered on behalf of such Party, and constitutes a legal, valid,
binding obligation, enforceable against such Party in accordance with its terms. 
  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 -13- 

 (c) No Consents. Each Party hereby represents and warrants to the other Party that all necessary
consents, approvals and authorizations of all Agencies and other persons required to be obtained by such Party in connection with the Agreement have been obtained. 
  
 (d) No Conflict. Each Party hereby represents and warrants to the other Party that the execution and delivery of the
Agreement and the performance of such party’s obligations hereunder and thereunder (i) do not conflict with or violate any requirement of applicable laws or regulations or any material contractual obligation of such Party and (ii) do not
materially conflict with, or constitute a material default or require any consent under, any material contractual obligation of such Party. 
  
 (e) Legal Authority For Sale of Product. Purchaser has (or will have, prior to delivery to Purchaser) obtained all permits, licenses or
authorizations from any applicable Agency necessary or required for the sale, marketing or entering into commerce of any Product. 
  
 (f) Ownership of Intellectual Property. Cardinal Health represents and warrants that it owns all rights, title, and interest in the Cardinal Health
Patents and related know-how and the Cardinal Health Materials, free of any liens and encumbrances. 
  
 13. INTELLECTUAL PROPERTY 
  
 (a) Ownership of Intellectual Property. 
  

	 	(i)	All Cardinal Health Materials, including without limitation, all improvements, developments, derivatives or modifications to the Cardinal Health Materials shall be owned exclusively
by Cardinal Health. 

  

	 	(ii)	All Purchaser Materials, including, without limitation, all improvements, developments, derivatives or modifications to the Purchaser Materials and Purchaser Confidential
Information shall be owned exclusively by Purchaser. 

  
 (b) Trademarks. Each Party acknowledges the validity of the title of the other Party to any and all trademarks that may be used in conjunction with such other party’s performance of its obligations hereunder. No right, title or
interest in and to such trademarks is granted by this Agreement other than the trademark license granted in Section 2(d) herein, and each party agrees not to use the other party’s trademarks other than in conjunction with such party’s
performance of its obligations hereunder. 
  
 14. INTELLECTUAL PROPERTY
ENFORCEMENT 
  
 (a) Notification of Infringement.
Each party shall promptly notify the other of any material infringement of, or attack upon, any Cardinal Health Patent or Trademark by a third party or parties, as soon as the notifying party learns of such infringement, and shall provide the other
party with any available evidence of such infringement or attack. 
  

 -14- 

 (b) Third Party Claims. Cardinal Health agrees to defend or settle any claim of infringement made
by others alleging that Cardinal Health’s Manufacture of the Products infringes any third party’s intellectual property rights. Cardinal Health shall keep Purchaser fully informed of the progress of such proceedings. Any such action shall
be at Cardinal Health’s expense. 
  
 (c) Enforcement.
Cardinal Health shall have the right, but not the obligation, to institute, prosecute and control at its own expense any action or proceeding with respect to infringement of any Cardinal Health Patents covering the manufacturing, use, importation,
sale or offer for sale of the Products by counsel of its own choice. Cardinal Health shall have the sole right to control such action and any damages or other monetary awards recovered pursuant to this Section 14 shall be for the account of Cardinal
Health. 
  
 15. CONFIDENTIALITY 
  
 (a) Confidentiality. Cardinal Health and Purchaser agree to keep
secret and confidential any and all information (“Confidential Information”) either disclosed hereunder or through any prior disclosure and not to disclose such Confidential Information to any person or entity, except (i) to
employees, Affiliates, agents or representatives of each party having a need to know the information in order to fulfill such party’s obligations hereunder; or (ii) as required by an applicable Agency. The parties shall use the Confidential
Information solely for the purpose of carrying out the obligations contained in the Agreement. The obligations imposed by this Section shall not apply to any Confidential Information: 
  

	 	(i)	which at the time of disclosure is in the public domain; 

  

	 	(ii)	which, after disclosure, becomes part of the public domain by publication or otherwise, through no fault of the receiving party; 

  

	 	(iii)	which at the time of disclosure is already in the receiving party’s possession, except through prior disclosure by Cardinal Health, Purchaser or an Affiliate of either of them,
and such possession can be properly documented by the receiving party in its written records, and was not made available to the receiving party by any person or party owing an obligation of confidentiality to the disclosing party;

  

	 	(iv)	which is rightfully made available to the receiving party from sources independent of the disclosing party; 

  

	 	(v)	which is required to be disclosed in the course of litigation or other legal or administrative proceedings; or 

  

	 	(vi)	which is required to be disclosed by law; 

  
 provided that in all cases the party receiving the Confidential Information shall, to the extent permitted, give the other party prompt notice of the pending disclosure
and shall cooperate in such other party’s attempts, at such other party’s sole expense, to seek an order maintaining the confidentiality of the Confidential Information. 
  

 -15- 

 (b) Term. The obligation of confidentiality and nonuse set forth in this Section 15 shall survive
for a period of five (5) years beyond the termination or expiration of this Agreement. 
  
 (c) Ownership of Confidential Information. Confidential Information shall remain the exclusive property of the disclosing party. In no event shall either party’s Confidential Information, technology,
know-how, intellectual property (or rights thereto) become the property of the other party. 
  
 16. TERM AND TERMINATION 
  
 (a) Term. The term of this Agreement, unless sooner terminated as provided below, shall begin on the Effective Date and shall continue to the tenth (10th) anniversary of the Effective Date. The Agreement may be renewed thereafter upon the mutual written agreement of the parties. 
  
 (b) Immediate Termination. Either party shall have the right to
immediately terminate this Agreement if (i) the other party files a petition in bankruptcy, or enters into an agreement with its creditors, or applies for or consents to the appointment of a receiver or trustee, or makes an assignment for the
benefit of creditors, or suffers or permits the entry of an order adjudicating it to be bankrupt or insolvent and such order is not discharged within ***; (ii) if either party materially breaches any of the provisions of this Agreement, and such
breach is not cured within *** after the giving of written notice, the party claiming the breach shall have the right to terminate this Agreement; or (iii) if any required license, permit or certificate required of the other party is not approved
and/or issued, or is revoked, by any applicable Agency; provided that such other party may no longer appeal such decision or reapply or otherwise pursue such permit, license or certificate. 
  
 (c) Duties Upon Termination. In the event of termination, Cardinal
Health shall promptly return (i) all Raw Materials paid for by Purchaser and (ii) any other Product or material being stored for Purchaser, to Purchaser at Purchaser’s expense. Cardinal Health shall have no obligation to return the foregoing
until all outstanding invoices sent by Cardinal Health to Purchaser have been paid in full. Purchaser shall also be required to pay, at the applicable price set forth in the relevant Purchase Order for completed but not yet shipped Products,
Products in process and Products shipped but not yet invoiced. Purchaser shall specify the location in the continental United States to which delivery, at Purchaser’s expense, of the foregoing is to be made. Confidential Information exchanged
between Purchaser and Cardinal Health shall be promptly returned upon any expiration or termination of the Agreement. 
  
 (d) License Termination. In the event of expiration of this Agreement or termination of this Agreement for any reason, the licenses granted
hereunder by Cardinal Health to Purchaser shall terminate, and shall revert to Cardinal Health, and Purchaser shall not thereafter make any use whatsoever of the Cardinal Health Trademarks. In the event of such termination of the licenses hereunder,
Cardinal Health shall, however, grant Purchaser sufficient time to sell off its existing inventory of the Products, provided that Purchaser shall continue to pay any Royalty payable thereon as provided in this Agreement. Purchaser shall promptly
return or provide to Cardinal Health all Confidential Information of Cardinal Health. 
  
 (e) Continuing Obligations. The rights and obligations of each of the parties hereto under any provision of this Agreement, which, by its terms, is intended to survive beyond the term of this Agreement, shall
continue notwithstanding the expiration or termination of this Agreement for any reason. 
  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 -16- 

 17. FORCE MAJEURE 
  

If either party shall be delayed in making any delivery in whole or in part, by reason of Force Majeure, such delay shall be excused during the
continuance of and to the extent of such Force Majeure; provided that if, as a consequence of any such Force Majeure, the total demands for Cardinal Health’s products or services cannot be supplied by Cardinal Health, Cardinal Health may, at
its option, allocate its available supply among Purchaser and its other Purchasers on such basis as Cardinal Health reasonably deems fair and practicable, without liability for any failure to perform this Agreement. Cardinal Health shall promptly
notify Purchaser of the termination of such event. Delivery shall be made and taken as soon as reasonably possible after the removal of such cause, and the time for performance of this Agreement shall be extended for a period equal to the duration
of such cause, provided that if such delay exceeds one hundred twenty (120) days, either party may terminate this Agreement, subject to the duties set forth in Section 16(c). 
  
 18. TECHNOLOGY TRANSFER 
  
 (a) Upon the completion of Development Phase for each Product, Cardinal Health shall assist Purchaser in qualifying a second source selected by Purchaser
(“Substitute Manufacturer”) to manufacture such Products in a tube presentation for Purchaser, providing technical assistance and documentation as necessary, at Purchaser’s expense. Such assistance shall include such
manufacturing technology and know-how so as to permit the Substitute Manufacturer to Manufacture such Product in the tube presentation. Cardinal Health agrees to cooperate with Purchaser to facilitate any technology transfer to the Substitute
Manufacturer required in furtherance of the foregoing. The Substitute Manufacturer shall be used to produce a Product for sale only in the circumstances as set forth in Section 18(b) below. For purposes of clarity, Cardinal Health shall not be
required to transfer technology related to the DelPouch or Microsponge, except to the extent necessary to fill Microsponge entrapped with active and inactive ingredients into a tube. Prior to such transfer, the Substitute Manufacturer shall be
required to sign a confidentiality and non-use agreement at least as restrictive as that set forth in Section 15 of this Agreement. 
  
 (b) If for any reason Cardinal Health is unable to supply any Product to Purchaser or provide sufficient quantity of Product to meet Purchaser’s
Minimum Purchase Requirements under this Agreement, after advance written notice to Cardinal Health from Purchaser and an opportunity to cure not to exceed an additional ***, Purchaser shall have the right to manufacture, or have manufactured by the
Substitute Manufacturer, the Product in a tube presentation, provided that such right shall not include the right to manufacture the Microsponge or DelPouch. Purchaser’s Minimum Purchase Requirements, and payment obligations to Cardinal Health
pursuant to this Agreement, shall be temporarily suspended until Cardinal Health can resume its manufacturing obligations or the expiration of any substitute manufacturing or supply agreement entered into by Purchaser with the substitute
manufacturer. Notwithstanding the foregoing, Cardinal Health shall have no obligation to transfer DelPouch packaging components, equipment or related technology to any third party. 
  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 -17- 

 (c) Cardinal Health shall provide Purchaser with data on the chemical and physical properties, toxicity,
and handling, storing, and shipping information for any materials supplied to Purchaser by Cardinal Health and any other information available to Cardinal Health that is necessary for the safe conduct of the manufacturing of the applicable Product
by Purchaser or the Substitute Manufacturer. Cardinal Health shall supply Purchaser with pertinent information regarding health or safety hazards to workers relating to materials supplied to Purchaser by Cardinal Health. Cardinal Health shall update
all of such information provided to Purchaser as such information becomes available to Cardinal Health. 
  
 (d) In the event of any transfer of manufacturing responsibilities pursuant to this Article 18, Cardinal Health shall make available to Purchaser, and
Purchaser shall purchase, Purchaser’s minimum requirements of Microsponge components entrapped with the appropriate active and inactive ingredients, as the case may be. The Parties shall negotiate in good faith with respect to the appropriate
price for such Microsponge components, and, in any event, Cardinal Health shall offer such Microsponge components to Purchaser on terms no less favorable than the price attributable to the Microsponge components included in Product previously
supplied pursuant to this Agreement. Cardinal Health shall have no obligations with respect to sale of DelPouch components, equipment or related technology. 
  
 (e) At such time as Purchaser shall have the right to manufacture, or have manufactured, any Product in accordance with this Article 18, Cardinal Health
shall be deemed to have granted to Purchaser a license under all of Cardinal Health’s patents and related know-how (and any improvement or modification thereof) to make, have made, use, have used, offer for sale, and import such Product in the
Territory, but only for such period of time that Cardinal Health is unable to supply the Products in accordance with the terms of this Agreement, and (i) with respect to the EpiQuin Products, only for use in the field of pigmentation disorders, and
only to the extent such Product is available by prescription, and (ii) with respect to the Benzoyl Peroxide Products, only to the extent such Product is available by prescription. Such license shall bear no royalties, other than payments for
Microsponge components in accordance with Section 18(d) above. 
  
 19. INDEMNIFICATION 
  
 (a)
Indemnification by Purchaser. Purchaser agrees to defend, indemnify and hold Cardinal Health, its Affiliates, and their respective agents, employees, officers, directors and representatives harmless from and against any and all costs,
expenses, liabilities, claims, damages, demands, actions, judgments, losses and fees, including attorneys’ fees and costs (“Liability”) arising from any third party claim that is the result of: (1) the marketing, shipping,
sale, distribution, possession or use of any Product, (2) any breach of this Agreement by Purchaser, including, without limitation, any representation or warranty contained herein, (3) the negligence or willful misconduct of Purchaser, or (4) any
claim of infringement or alleged infringement of any third party rights as a result of the marketing, shipping, sale, distribution or use of any Product; provided, however, that Purchaser shall have no indemnity obligation to the extent that any
such Liability is due to the negligence or willful misconduct of Cardinal Health, its Affiliates, and their respective agents, employees, officers, directors and representatives. 
  
 (b) Indemnification by Cardinal Health. Cardinal Health agrees to defend, indemnify and hold Purchaser, its
Affiliates and their respective agents, employees, officers, directors and representatives harmless from and against any and all Liability arising from any third party claim that is the result of: (1) any breach of this Agreement by Cardinal Health,
including, without 

  

 -18- 

 
limitation, any representation or warranty contained herein, (2) the negligence or willful misconduct of Cardinal Health, or (3) any claim of infringement or
alleged infringement of any third party rights as a result of the Manufacture of the Product; provided, however, that Purchaser shall have no indemnity obligation to the extent that any such Liability is due to the negligence or willful misconduct
of Purchaser, its Affiliates, and their respective agents, employees, officers, directors and representatives. 
  
 (c) Procedure for Indemnification. Upon receiving notice of any claim for liability under this provision, the indemnified party shall promptly
notify the indemnifying party in writing; provided, however, that failure to give notice shall not limit or otherwise reduce the indemnification provided for in this Agreement. The indemnified party shall use commercially reasonable efforts to
mitigate the effects of such claim and shall reasonably cooperate with the indemnifying party in the defense of such claim. The indemnifying party may, in its sole discretion and at its sole cost, assume and conduct the legal defense of the
indemnified party in any suit that could result in claims under this provision, which such conduct shall include the authority to settle any such claim. 
  
 20. LIMITATION OF LIABILITY 
  
 (a) IN NO EVENT SHALL CARDINAL HEALTH’S TOTAL LIABILITY UNDER THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION ANY OF CARDINAL HEALTH’S INDEMNITY
OR OTHER FINANCIAL OBLIGATIONS UNDER SECTION 19 OR ANY OTHER PROVISION OF THIS AGREEMENT, EXCEED THE TOTAL FEES PAID BY PURCHASER TO CARDINAL HEALTH FOR THE PACKAGING OF THE PRODUCT WHICH WAS INVOLVED IN CAUSING ANY CLAIMS, DAMAGES, LOSSES, COSTS OR
EXPENSES. 
  
 (b) IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY
SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL LOSSES, DAMAGES, COSTS OR EXPENSES OF ANY NATURE WHATSOEVER, INCLUDING WITHOUT LIMITATION, LOSS OF REVENUES, PROFITS, DATA OR USE, WHETHER IN CONTRACT OR TORT OR BASED ON A WARRANTY, EVEN IF THE OTHER
PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. 
  
 21.
INSURANCE 
  
 (a) During the Term, Cardinal Health
will obtain and maintain comprehensive general liability insurance (including broad form general liability, completed operations and product liability, personal injury liability, blanket contractual liability and broad form property damage
liability) with limits of not less than *** combined single limit for bodily injury and property damage liability per occurrence and annual aggregate. During the Term, Cardinal Health will obtain and maintain worker’s compensation insurance as
required under applicable law and employer’s liability insurance with a limit of not less than ***. With respect to all insurance coverage required under this Section 21(a): 
  

	 	(i)	Cardinal Health will furnish Purchaser with certificates of insurance evidencing at least the required coverage as soon as practicable after the Effective Date and each anniversary
of the Effective Date during the Term); and 

  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 -19- 

	 	(ii)	Cardinal Health will endeavor to have such policy include provisions for at least thirty (30) business days prior written notice of any materials change or cancellation (whether for
non-payment or otherwise). 

  
 (b) Purchaser.
During the Term, Purchaser will obtain and maintain comprehensive general liability insurance (including broad form general liability, completed operations and products liability, personal injury liability, blanket contractual liability and broad
form property damage liability) with limits of not less than *** combined single limit for bodily injury and property damage liability per occurrence and annual aggregate, containing a cross liability or severability of interests clause. During the
Term, Purchaser will obtain and maintain worker’s compensation insurance as required under applicable law and employer’s liability insurance with a limit of not less than ***. With respect to such insurance coverage required under this
Section 21(b): 
  

	 	(i)	Purchaser will furnish Cardinal Health with certificates of insurance evidencing at least the required coverage as soon as practicable after the Effective Date and each anniversary
of the Effective Date during the Term; and 

  

	 	(ii)	Purchaser will endeavor to have such policy include provisions for at least thirty (30) business days prior written notice of any materials change or cancellation (whether for
non-payment or otherwise); 

  

	 	(iii)	the comprehensive general liability policy shall name Cardinal Health as an additional insured and this provision shall be evidenced on the above referenced certificate of insurance
being provided to Cardinal Health. 

  
 22. NOTICES

  
 Notices or other communications required or permitted by
this Agreement shall be given in writing, and shall be deemed to have been given when deposited in the United States mail, return receipt requested and postage prepaid, or on the day following delivery of such notice to a major overnight delivery
service. All notices shall be addressed to the parties as follows: 
  
 To Cardinal Health: 
  
 Cardinal Health, STG Puerto Rico 
 Bo. Junquito 
 Road 925 Km. 6.1Humacao, Puerto Rico 00791 
 Attn: VP/GM 
 Fax: 787-852-7920 
  

	***	Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 

  

 -20- 

 with copy to: 
  
 Cardinal Health, Inc. 
 7000 Cardinal Place 
 Dublin, OH 43017 
 Attn: General Counsel, Cardinal Health Pharmaceutical 
             Technologies & Services 
 Fax: 614-757-5051 
  
 To Purchaser: 
  
 SkinMedica, Inc. 
 5909 Sea Lion Place, Suite H 
 Carlsbad, CA 92008 
 Attn: President 
 Fax: (760) 448-3601 
  
 with copy to:

  
 Latham & Watkins LLP 
 12636 High Bluff Drive, Suite 300 
 San Diego, CA 92130 
 Attn: Scott N. Wolfe 
 Fax: 858-523-5450 
  
 23. CHOICE OF LAW/VENUE 
  
 The laws of the State of Delaware shall govern any dispute arising out of or under this Agreement, notwithstanding the conflict of laws principles of the
State of Delaware. 
  
 24. ASSIGNMENT 
  
 This Agreement shall not be assigned by either party, except with the
written consent of the other party; provided, however that either party may assign this Agreement to any of its Affiliates or to the Purchaser of all or substantially all of its assets, or to its successor entity or acquirer in the
event of a merger, consolidation or change in control of such party without the consent, written or otherwise, of the other party. 
  

 -21- 

 25. ARBITRATION 
  

If a dispute, controversy or disagreement (“Dispute”) arises between the parties in connection with this Agreement, then the Dispute
shall be presented to the respective presidents of Cardinal Health and Purchaser for their consideration and resolution. If the presidents cannot reach a resolution of the Dispute, then such Dispute shall be resolved by binding Alternative Dispute
Resolution (ADR) in accordance with the then existing commercial arbitration rules of The CPR Institute for Dispute Resolution (“CPR”), 366 Madison Avenue, New York, NY 10017. Arbitration shall be conducted in New York, NY. 

  
 26. RELATIONSHIP OF THE PARTIES 
  
 Nothing contained in this Agreement shall create a joint venture or
partnership between the parties. Cardinal Health shall be an independent contractor in performing its obligations. Neither party shall be liable for any of the debts or obligations of the other and neither party shall have any authority or right to
act for or incur any liability of any kind, express or implied, on the name of or on behalf of the other party. 
  
 27. PUBLICITY 
  
 Neither party will make any press release or other public disclosure regarding this Agreement or the transactions contemplated hereby without the other
party’s express prior written consent, except as required under applicable law or by any governmental agency, in which case the party required to make the press release or public disclosure shall use commercially reasonable efforts to obtain
the approval of the other party as to the form, nature and extent of the press release or public disclosure prior to issuing the press release or making the public disclosure. 
  
 28. MISCELLANEOUS 
  
 (a) Entire Agreement. This Agreement and all Purchase Orders, Purchase Order notifications, Cardinal Health quotations, and Specifications issued
pursuant to this Agreement, constitutes the entire agreement between the parties pertaining to the subject matter hereof and supersedes all prior agreements, understandings, negotiations and discussions, whether oral or written, of the parties, and
there are no warranties, representations or other agreements between the parties except as specifically set forth herein. 
  
 (b) Counterparts, Signatures by Facsimile. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be one and
the same Agreement. Any facsimile signature of any party hereto shall constitute a legal, valid and binding execution hereof by such party. 
  
 (c) Setoff. Without limiting Cardinal Health’s rights under law or in equity, Cardinal Health and its Affiliates, parent or related entities,
collectively or individually, may exercise a right of set-off against any and all amounts due to Cardinal Health from Purchaser. For purposes of this Section 28(c), Cardinal Health, its Affiliates, parent or related entities shall be deemed to be a
single creditor. 
  

 -22- 

 (d) Titles. The headings appearing at the beginning of the numbered Articles and at the beginning
of paragraphs have been inserted for convenience only and do not constitute any part of this Agreement. 
  
 (e) Modifications. No changes, modifications or waivers of any provision of this Agreement shall be binding unless in writing and signed by a duly
authorized representative of each party. 
  
 (f)
Severability. In the event that any provision of this Agreement shall be determined to be illegal or unenforceable, that provision will be limited or eliminated to the minimum extent necessary so that this Agreement shall otherwise remain in
full force and effect and enforceable. 
  
 (g) Waiver. The
failure on the part of any party to exercise or enforce any rights conferred upon it hereunder shall not be deemed to be a waiver of any such rights nor operate to bar the exercise or enforcement thereof at any time or times thereafter. 

 
 (h) No Strict Construction. The language used in this Agreement
will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any party. 
  

IN WITNESS WHEREOF, Purchaser and Cardinal Health have executed this Agreement on the date first set forth above. 
  

							
	SkinMedica, Inc.	 	Cardinal Health P.R. 409 B.V.
				
	 By:
	 	 /s/ Rex Bright

	 	 By:
	 	 /s/ John Lowmy

	 Name:
	 	 Rex Bright
	 	 Name:
	 	 John Lowmy

	 Title:
	 	 President and CEO
	 	 Title:
	 	 President, O.T.

	 Date:
	 	 March 31, 2003
	 	 Date:
	 	 March 31, 2003

  

 -23-

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